What do you guys make of Krugman's casual dismissal of the New Deal in his 2/15 column?

[EmilyAnne]

He said, "if you want to see what it really takes to boot the economy out of a debt trap, look at the large public works program, otherwise known as World War II, that ended the Great Depression."

After all of the disparaging of FDR and the New Deal that has been coming non-stop from the Republicans, why would Krugman make such a statement without any clarification in this column OR in any others that I have seen?

What do you guys think?

[BlooInBloo]

1. Links are wonderful things.

[EmilyAnne]

2. Oops. Here is the link. It was titled "Weekend At Bernie's."

http://www.nytimes.com/2009/02/16/opinion/16krugman.html

[Cassandra]

3. He was talking about the size...

of the effort of WWII vs. the New Deal. For those who think this recovery bill is too large.

[EmilyAnne]

6. I assumed that is what he meant. Just an inference from his other articles calling for a

recovery bill that triples the spending. It just that it seems many Republicans are seizing on this one line as a concession that "the New Deal didn't work." Definitely in the comments section. They seem to be rejoicing.

[rvablue]

15. The Republicants are seizing on this as they like to twist and conflate facts to suit

their twisted smear campaigns.

Won't be the last time.

[Cleita]

4. He's right and he has been right pretty much up until now. Obama's

financial advisors are old retreads from Clinton's White House and some of their decisions are unraveling, so we can't blame it all on the Bush administration. I want Obama to start reading less Lincoln and more FDR. Lincoln's wisdom was needed in different times from this. FDR's is needed today.

[phantom power]

5. I can elaborate a little bit...

One of the things that Krugman has pointed out previously is that the New Deal was not a very large portion of GDP. In a sense, it did not fully meet the recommendations of Keynesian economics.

WWII was, among other things, a govt spending program that was much larger than the new deal, and put more people back to work. The GOP will tell you that the lesson we should learn from this is war is good for the economy. The real lesson is that govt spending is a good way to get out of a deflationary trap. You don't have to spend on war, in fact it would be far better to spend on infrastructure.

[EmilyAnne]

7. But the freepers see the "failure" of the New Deal as proof the Keynesian economics won't work.

What is it about war in and of itself that would magically repair the economy? Of course, waging war is a form of massive government spending. I don't understand how the Repubs don't make a connection. They just see war as a magic cure?

So why hasn't the massive government spending in Iraq and Afghanistan worked? Because we are employing private defense contractors? Because its a different kind of war? Today we don't need people working at shipyards and gun factories like we did in WWII. We already built up our arsenal.

I believe you are right in your explanation, I'm just pretty clueless about these things.

[phantom power]

12. I'm no expert either, but I can give you a couple differences.

For one thing, when we started the Iraq war, we weren't in a deflationary trap. So govt spending was arguably not necessary. Also, BushCo and the GOP combined massive govt spending with massive tax cuts. So what they accomplished was to add several trillion dollars to our national debt. All things being equal, that's a bad thing. Put those two things together, and you have govt spending on deficit that did not serve to correct a deflation trap, because there was none.

And, as you say, we came into Iraq with a huge military. When we started WWII, we had very little military. That was *before* the rise of the military industrial complex. So a huge physical build-out was required. Ironically, we probably should have spent more to offset the Iraq expenditure, but again the GOP was obsessed with tax cuts, and also "proving" that the war really didn't cost anything, so they spent less than they should. Hence, our military is currently in bad shape. Overused and under-supported.

Ideologically the GOP just does not believe in govt, except for punitive things like jails and war. Force projection, essentially. They will go to any lengths to discredit examples of govt succeeding at social projects or economic management. They do not want to know.

[OHdem10]

14. What about Social Security has failed???? nothing , nothing

nothing.

One of the most successful New Deal Programs yet.

Please make a concerted effort to refute people who say the New Deal
Failed. This is a GOP Talking Point they have used for years.
The GOP hated FDR so much, they could not even repeat his name,
referring to him as "That Man In The White House."
No Republican voted for it and the GOP Party has been and
continue to do everything in their power to end it.

Unfortunately we have Democrats in the House and Senate who are
almost as bad.

[EmilyAnne]

17. That's pretty much my point and why I put the word failure in quotes. Believe me, being the

granddaughter and great granddaughter of rural Texas ranchers who lost almost everything during the Dust Bowl, FDR made them lifelong Democrats. I grew up hearing the stories of starving cows that the government bought and then killed so my grandfather wouldn't lose everything. FDR's programs also allowed them to have access to a doctor who saved the life of my Uncle Gene after his two baby sisters died of dehydration.

I am pretty sure that I missed the point of Krugman's column which is why I was asking about it here.

[rvablue]

13. Thanks Phantom Power for your rational and earnest analysis. We need more of it around here

when it comes to Krugman.

[Spike89]

8. I didn't get that at all from the column

Krugman has been consistently calling for something much bigger than even the largest plans being floated. He doesn't say the New Deal concept doesn't (didn't) work, just that you almost can't throw too much stimulus at the problem. This is very different from the Republican viewpoint that basically says any spending is bad.

[rvablue]

11. And, Spike89, you would be closer to the truth with your assessment...Krugman was on KO

last night and said that RWers spewing this anti-FDR and anti-New Deal BS are totally full of BS.

[HiFructosePronSyrup]

9. I think Hillary's gas tax holiday is what really ended the Great Depression.

:crazy:

[rvablue]

10. I assume you didn't watch Keith last night. He had Krugman on and they both agreed

that when Republicans say that FDR didn't end the GD they are full of shit.

So, he's not disparaging FDR or the New Deal, he was making a comparison on what money was spent on.

[EmilyAnne]

16. No, I didn't see that. Thanks rvablue. n/t

[Still Sensible]

18. If WWII finally ended the great depression

and Krugman points to that--apparently not to disparage FDR's New Deal but to point out, I presume, that the level of spending in WWII was finally enough stimulus--how does what is going on right now compare as a percentage of GDP? And is that the right comparison to use?

I mean we have one and a half wars--obviously not the universal effort WWII required--and we've got a $700 billion TARP, plus the now $787 billion stimulus just signed, plus another $1 trillion-plus TARP II and mortgage saving effort coming up. I certainly expect some of what was negotiated out of the Recovery Act to passed as separate bills and I suggest we'll absolutely have to at least double the infrastructure spending.

[EmilyAnne]

20. I hope we do at least double the infrastructure spending. It seems that, aside from the financial

mess we are in, we must also tend to our infrastructure quickly because basic maintenance was neglected under Bush II.

[damntexdem]

19. The New Deal went a long way to counteracting the Depression.

But it didn't end it -- and the belt-tightening in 1937 deepened it a bit. It was finally WWII that pulled the U.S. all of the way out of the Depression. Krugman's point is right on: a bit of stimulus (even nearly 800 billion of it), especially if followed too soon by budget balancing, won't get the job done.

[JHB]

21. I think you need to read more of his columns...

He's visited this topic often lately, and his main point is that the only problem with the New Deal is that it wasn't Big Enough.

Why would he make such a statement? maybe he's talked about it so often lately he forgets to keep adding every caveat and proviso every single time.