Back in my college days, I had a friend who I would debate various topics with on those late night study sessions in the study lounge. He use to drive me crazy because he would always take the opposite position and would never yield, compromise, or even acknowledge any of my points. No matter what evidence I provided he would refuse to accept it. These debates wouldn’t go anywhere because of his stubbornness but he enjoyed them. He would walk around for a few days with a smugness believing he bested me. That’s how it seems Congressional Republicans are acting over the proposed stimulus plan.
The GOP has always been factually challenged but is always a good read when someone points it out in a high profile publication like the New York Times.
Paul Krugman, professor of economics and international affairs at Princeton University and who won the 2008 Nobel Memorial Prize in Economic Sciences, demolishes the current GOP talking points against the proposed stimulus plan. Let me stress. Paul Krugman is an expert in economics. It his job.
In his January 26th column he states:
As the debate over President Obama’s economic stimulus plan gets under way, one thing is certain: many of the plan’s opponents aren’t arguing in good faith. Conservatives really, really don’t want to see a second New Deal, and they certainly don’t want to see government activism vindicated. So they are reaching for any stick they can find with which to beat proposals for increased government spending.
Bad Faith Economics
He then went through the talking points and shreds them:
John Boehner, the House minority leader, calling the plan to “spend hundreds of millions of dollars on contraceptives” is simply a cheap shot and easily dismissed. The fact is the proposal is an expansion in the number of states that can use Medicaid money, with a federal match, to help low-income women prevent unwanted pregnancies, which would save the states $400 million.
The Obama plan will cost $275,000 per job created? Nope. Closer to $100,000 and lower if you take into account the tax income from those new jobs.
It’s always better to cut taxes than to increase government spending because taxpayers should decide how to spend their money? Krugman notes that a large percentage of any tax cut would be saved so spending on things like infrastructure will get more bang for the bucks. Increased tax revenue and increased spending in the private sector by the people with those created jobs will amplify the results. As an aside, the last tax cut Bush gave, when all of us got $600 or more in a check only created an infinitesimal ripple in the economy.
We should favor monetary policy over fiscal policy? Nope. Because interest rates are effectively zero right now. There are no more monetary tricks to pull out.
Krugman closes with a even more true fact facing the GOP. Obama won the election. The public has spoken.
We need better roads, bridges that don’t fall down, and school buildings that don’t make students sick. The LAST thing we need is a tax cut.