Paul Krugman, a New York Times columnist and professor of economics and international affairs at Princeton University, spoke in front of a packed Memorial Union Theater crowd Monday night to promote his new book “The Great Unraveling” and voice his increasing concern for current United States economic affairs.
“Something very funny is going on here,” Krugman said. “I think we are headed for some kind of crisis moment, and the easiest place to see that is economics.”
Krugman chose the 2003 Bush tax cuts as an example of the current administration’s shortcomings and an indication that the current system is functioning inappropriately. Krugman said the tax cuts, “which were passed just a few months after the aircraft carrier landing,” were irresponsible and should not have been passed in wartime because “wars…sort of cost money.”
Krugman also said the proposal to cut taxes distorted the average American’s gain from the tax cuts, and politically motivated Republican promises that the tax cuts were lies, as they are currently lobbying to extend the cuts indefinitely. He said the tax cuts are unrealistic, especially considering the current federal deficit and projections about its immensity in upcoming years.
“Serious budget experts giggle about the projections [made in the 2003 tax cut proposals],” Krugman said. “The allowance they made for future occupation of Iraq was, of course, zero.”
Krugman said the current taxes make about 25 percent too little revenue to pay for important federal programs and reduce the deficit, and offered several possible outcomes of the current state of affairs.
“[The government] is going to have a Wile E. Coyote moment; we are going to take a few steps off of a cliff and realize there is nothing left to support us,” Krugman said, noting that his cartoon reference would appear in Tuesday’s column.
Krugman said the government could either cut fifty percent of government spending and retain the current tax cuts, recall the cuts and increase taxes to break even, or ignore the problem until the deficit gets out of control and forces action.
“I miss Ronald Reagan,” Krugman said. “I miss Richard Nixon.”
Reagan, who also introduced a tax cut in the 1980s, did not deny the legitimacy of claims that his tax cuts were inappropriate and repealed the cuts, Krugman said, and Nixon was “serious about governing the country.”
He said the Republicans in power, including congressional majority leaders in addition to the president and his affiliates, are a radical rather than conservative coalition. The coalition has seized control of the government and radically changed foreign and domestic policy in the United States that has lasted for more than 50 years, Krugman said, including policy such as Franklin D. Roosevelt’s New Deal to fund social welfare programs.
“We could very easily turn this increasingly scary situation around,” Krugman said. “My hope that out of all of this will arise a new FDR.”
Krugman also criticized the United States’ mass media and journalists’ reluctance to put their careers on the line in the name of critical reporting. Krugman added that most media is too even-handed, and networks like Fox News promote inaccurate and biased views.
“Many reporters risk their lives in the war zone, but none are willing to risk their careers at home,” Krugman opined.
Krugman also said he thinks the public hears little about the economic situation because people would find it hard to believe that the political situation today is radical.
“The Great Unraveling,” Krugman’s new book published by W.W. Norton and Company in September, is one of many books published by the author. The book explores similar topics and is mainly a collection of Krugman’s published columns.
