Paul Krugman is an economist and a pundit, and he wants to convince people of certain economic realities, like the wisdom of increased deficit spending in the short-term to improve our budgetary situation in the long-term. It’s hard to sell people on the idea that the best way to lower the budget deficit is to make it bigger. There are many people in our media who are eagerly undermining that idea for purely political reasons, and there are many more who simply don’t understand it. So, it’s important for Krugman to repeat his call for more stimulus, and to repeat it again and again. It’s important for other economists, pundits, politicians, organizers, and bloggers to join him in this chorus. But what’s not helpful is to harp on the fact that the administration didn’t fight sufficiently for an adequate stimulus in the first place. Who cares? How does that help now?
We can argue all day about what was passable at the time. Let’s look at how David Obey describes that time:
The problem for Obama, he wasn’t as lucky as Roosevelt, because when Obama took over we were still in the middle of a free fall. So his Treasury people came in and his other economic people came in and said “Hey, we need a package of $1.4 trillion.” We started sending suggestions down to OMB waiting for a call back. After two and a half weeks, we started getting feedback. We put together a package that by then the target had been trimmed to $1.2 trillion. And then [White House Chief of Staff] Rahm Emanuel said to me, “Geez, do you really think we can afford to come in with a package that big, isn’t it going to scare people?” I said, “Rahm, you will need that shock value so that people understand just how serious this problem is.” They wanted to hold it to less than $1 trillion. Then [Pennsylvania Senator Arlen] Specter and the two crown princesses from Maine [Sens. Olympia Snowe and Susan Collins] took it down to less than $800 billion. Spread over two and a half years, that’s a hell of a lot of money, but spread over two and a half years in an economy this large, it doesn’t have a lot of fiscal power.
So, while Obey places some blame on the White House political shop for being skittish about the price tag, he also notes that then-Republican Arlen Specter and the two Maine senators were forcing the price tag down as a condition of their support. Even with the lower price, Specter was immediately forced out of the Republican Party when he was courageous enough to do the right thing and support the stimulus package. I think a fair assessment of Rahm Emanuel’s position at the time has to take into account the need for 60 votes and the pressure the moderate Republicans were facing to vote ‘no’ on anything, let alone something in the $1.4 trillion range. He was telling Obey that he couldn’t sell a package that big and Obey was telling Rahm that a smaller package would be insufficient. That’s a classic Catch-22, and the administration didn’t have a magic solution for solving that conundrum.
We can add into the mix the whole debate about what percentage of the stimulus would be in the form of tax cuts. That was also an issue held hostage by the “two crown princesses of Maine.” I don’t think David Obey was wrong and I don’t think Emanuel was wrong, although I agree that a stronger argument could have been made on the merits of a larger stimulus. But that is all so yesterday. Why does Krugman have to muddy his message with constant I-told-you-so bitching?
He says that politics don’t matter for electoral outcomes, policies don’t matter, accomplishments don’t matter, only economic conditions matter. He overstates his case. I could just as easily argue that the only thing that matters is the height of the candidates, since the taller man almost always wins presidential elections. The truth is that policies do matter and accomplishments matter, but only if people know about them and hear about them in a positive light. If the beneficiaries of those policies spend all their energy complaining about their inadequacy, who is going to be proud of and support what’s been accomplished? By all means, advocate sane economic policies and make the case for politicians who are seeking remedies for our economic woes. But do it in a positive way.
If liberals are no fun, who will want to be one? Who will want to vote for one?