June 30, 2013
Krugman
changes direction
Paul Krugman has long been
known as an economist who advocates increasing government borrowing
and spending for such things as infrastructure in order to stimulate
our weak economy and create jobs. I have disagreed with him for a
couple of reasons: first, because he and others of his ilk usually
qualify calls for additional borrowing and spending by stating,
"until the economy recovers". To which I always reply...and
what if it doesn't? And, second, because I do not trust those in
government who will have control over how the newly borrowed money to
spend it wisely. Their past actions predict their future behavior
quite clearly.
Of course, if additional
borrowing and spending were actually used for things like the
infrastructure rebuild, it would add some jobs in the short term. Our
nation's problems worsen in the longer term if the jobs created don't
last beyond the rebuild, and don't generate sufficient tax revenues
to repay their costs. The greater likelihood is we would only end up
deeper in debt than we are today. That would leave future generations
in even worse shape, with remaining poor job prospects, and higher
levels of debt burdens. And, after all, why do we need better roads
and bridges if we can't afford gas for our autos? Truthfully,, I'm
not actually opposed to investing in infrastructure. I am opposed to
additional borrowing and would much prefer funding come from
reductions in wasteful spending instead.
Now I see in his June 14,
2013 article in the New York Times, "Sympathy for the Luddites",
the esteemed columnist finally acknowledges our weak job creation
might be more permanent than he earlier thought. He cites recent
information showing workers in developed countries globally, both
unskilled and skilled, are being increasingly replaced by technology
and outsourcing. He says it has now become apparent previous calls
for more education as the solution will not likely solve the
increasing shortfall of jobs.
In his article he did not
discuss where he now stands on his previous calls for additional
deficit spending. However, it seems illogical for him to continue to
support more borrowing and spending for short-term job creation,
which in his own view cannot be sustained in our increasingly
automated society. I would like to hear his current views on this
topic.
In this new article,
Krugman calls for creating bigger public safety nets to assure all
citizens have a minimum level of income and health care in order to
assure the survival of our middle class. He goes on to say all of
this will require tax revenues from profits and investments to pay
the bills. I find it interesting he and others like him always want
to turn to higher taxes or more borrowing for every newly identified
need. Sort of sounds a lot like a guy named Marx??
Professor Krugman: Why
don't you demand our leaders immediately face the reality you
describe and begin by first looking under every government rock for
wasteful spending? Why don't you call for reduced military spending?
Why don't you demand our President approve every possible action to
allow our nation's vast oil and gas reserves be tapped in order to
create both jobs and tax revenues?
Truthfully, if we don't do
all of these things...we won't have any choice except to create a
massive welfare state in order to provide for the needs of a growing
number of our needy citizens. And, we'll only be able to sustain the
required levels of spending for these things until we run out of
taxpayer's money and credit.
When an increasing jobless
future predictably collides with the shortfall of taxes needed to
fund entitlements for the baby boomers' retirement years...it will
not be a pretty picture!
I am glad the good
professor finally sees a future in which human labor of all types is
less needed. Now we have to show him a better path out of the hole
folks who think like him have placed our nation in today.
Drill and transport baby,
drill and transport! It's either that or keep increasing taxes and
borrowing to pay for more and more welfare funding until we reach the
end of the American dream.
These are my opinions.
What do you think?
Mike Tower
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