Krugman: the trillion dollar boondoggle stimulus was not BIG enough, so let’s spend a few hundred billion on a WPA jobs program for the low skilled, but under no circumstances should you cut taxes…

Utterly backwards. The boondoggle spendulus failed (EPIC FAIL!), so they want to dilute hundreds of billions more by pouring it through government’s oh so inefficient hands again. I think it is intellectually dishonest of Krugman to suggest if the stimulus were only BIGGER it would have done more to stimulate job creation., No matter how BIG they make it, the pockets of those who do NOT create jobs would be filled that much bigger we would STILL not have created jobs. Where did all that money go? The way it was STRUCTURED not the AMOUNT was the problem. The proof is that 2/3 of it are unspent and they have already GIVEN UP on getting any jobs from it.

If they would simply stop the overregulation and taxation and do something like a PAYROLL TAX CUT that goes DIRECTLY to WORKERS with no government mishandling, we would be doing much much better..but the academics and govt lackeys would prefer ANYTHING over giving us back OUR OWN MONEY to spend OUR OWN WAY.

Krugman is among those invited to Thursday’s jobs summit on Mount Obama so we can expect more of this kind of thing from their jobs bill. More state bailouts thereby allowing the states to continue to avoid the real job of CUTTING SPENDING and STATE GOVERNMENT PAYROLLS AND BENEFITS which is where all the bleeding is happening across the country on state balance sheets….

Krugman:

(…) So our best hope now is for a somewhat cheaper program that generates more jobs for the buck. Such a program should shy away from measures, like general tax cuts, that at best lead only indirectly to job creation, with many possible disconnects along the way. Instead, it should consist of measures that more or less directly save or add jobs.

One such measure would be another round of aid to beleaguered state and local governments, which have seen their tax receipts plunge and which, unlike the federal government, can’t borrow to cover a temporary shortfall. More aid would help avoid both a drastic worsening of public services (especially education) and the elimination of hundreds of thousands of jobs.

Meanwhile, the federal government could provide jobs by … providing jobs. It’s time for at least a small-scale version of the New Deal’s Works Progress Administration, one that would offer relatively low-paying (but much better than nothing) public-service employment. There would be accusations that the government was creating make-work jobs, but the W.P.A. left many solid achievements in its wake. And the key point is that direct public employment can create a lot of jobs at relatively low cost. In a proposal to be released today, the Economic Policy Institute, a progressive think tank, argues that spending $40 billion a year for three years on public-service employment would create a million jobs, which sounds about right.

Finally, we can offer businesses direct incentives for employment. It’s probably too late for a job-conserving program, like the highly successful subsidy Germany offered to employers who maintained their work forces. But employers could be encouraged to add workers as the economy expands. The Economic Policy Institute proposes a tax credit for employers who increase their payrolls, which is certainly worth trying.

All of this would cost money, probably several hundred billion dollars, and raise the budget deficit in the short run. But this has to be weighed against the high cost of inaction in the face of a social and economic emergency….

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November 30, 2009. Tags: , , , , , , , , , . Economy, Finance, Obama Administration, Politics, Taxes, Unemployment Statistics, Wall St.

3 Comments

  1. W replied:

    Krugman was exactly right. The stimulus was too small. It saved the economy, but did not push it into a healthy recovery. Exactly as he predicted at the time.

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    • ginaswo replied:

      I think if it had been correctly distributed the first time it would have done the job, had housing been addressed.
      Paul is losing credibility rapidly, under Dubyah he didnt like deficits, now no deficit is too big
      no meaningful infrastructure or job creation resulted from the 800 b we spent and now there is no political will for more

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  2. Reactions to Palin Joining Fox News – Backbenchmedia Finance Economics Politics Popular Culture «Backbench Media replied:

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