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Why Paul Krugman has Ideological Blindness on Debt

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The National Debt Clock, around April 15th, 2010

Talking heads of all stripes never can resist cherry-picking data points that show we should be very scared of an impending economic doomsday... if we don't do what they tell us we need to do. Take a look at the overall macro level, though, and you see an economy in the midst of a steady recovery.

It isn't recovering as fast as we would like it to, but as government jobs are being trimmed around the country, the private sector is creating more and more jobs. These new jobs lead to more spending (that isn't borrowed or from government benefits - which also largely comes from debt), and this sutainable growth in income leads to more sustainable demand - the real source of more jobs.

Despite the economic direction trending up, especially in the last few months, partisan zealots like liberal economist Paul Krugman say things like "key economic indicators suggest that the recovery may be sputtering", and says that the recovery we've had isn't much of one. Even if you ignore the fact that he's been singing this tune for a long time, his partisan blindness is illustrated nicely by his insistance that skyrocketing debt doesn't matter - pulling an absurdly appropriate bit of political gamesmanship from the Dick Cheney school of hackery.

He isn't even above naked lies, in claiming, in a recent piece in his column at the New York Times, that those who are trying to drum up support for balancing the budget are against any tax increases to get there. This is easily debunked when you look at proposals from several think tanks that have joined in on that debate, as well as the Fiscal Commission's recommendations, and politicians from both sides of the aisle. He knows this.

He also lies when he says he has no idea where fiscal hawks are getting the two-year mark where they think our debt problems will get significantly worse if we don't act. He knows credit rating agencies are looking at our lack of action on debt and deficit issues and are signalling it is more and more likely that they will lower our national credit rating.

A review of our credit rating will happen within those two years, and lets be honest here. If all of the work being done by a few brave politicians towards changing fiscal course ends up failing, our nation deserves to see its credit rating fall. If a business or individual saw its income drop, and its debt grow geometrically, over a sustained period of time, what do you think that would do to their rating?

Should this happen, the spiral of our debt becomes significantly more threatening, given that our debt will grow even faster than it is growing now, pushing social welfare program spending that liberals claim to staunchly support out of the budget.

It really is sad to see such intelligent man made into such a cartoon by ideological blindness. Krugman is brilliant, but when you put a partisan agenda in his hands, he's just another spin doctor, using whatever voodoo math he can come up with to support his ideologically predetermined position. He's even been caught arguing against economic points he made in the past when he wasn't so involved in political arguments.

We're lucky that there are folks, like the Gang of Six in the Senate, who are putting their necks on the line to try and avert a fiscal disaster with our national debt. If they fail, it will partially be because of people like Krugman fool them into thinking it isn't a problem we need to worry about.

Solomon Kleinsmith is a nonprofit worker, serial social entrepreneur and strident centrist independent blogger from Omaha, Nebraska. His website, Rise of the Center, is the fastest growing blog targeting centrist independents and moderates. He is currently collaborating with other centrist independent and moderate bloggers on a news aggregation and social networking site, and is always looking for ways to help the independent groundswell as more and more people become disaffected with the two major parties