Paul Krugman's Meltdown

Firing Paul Krugman


By Jay B Gaskill, Attorney at Law

Paul Krugman was a shrill partisan liberal voice even before his accomplishments as an economist were recognized by the Nobel committee.  But this election cycle has brought out a new level of hyper-partisanship.  I believe that we are seeing the meltdown of a columnist who is squandering the last shreds of his political credibility in an intemperate and misleading attack on the political center.  In this writer’s opinion, Krugman has crossed the same line that a now-fired NBC News producer crossed in the Trayvon Martin case.

“NBC has launched an internal probe after running an edited version of the 911 call from George Zimmerman — the man who shot and killed Trayvon Martin — that made Zimmerman sound racist.

‘We have launched an internal investigation into the editorial process surrounding this particular story,’ the network said in a statement to the Washington Post on Monday.

NBC’s ‘Today” show ran the edited audio of George Zimmerman’s phone call to a police dispatcher in which Zimmerman says: ‘This guy looks like he’s up to no good … he looks black.’

“But the audio recording in its entirety reveals that Zimmerman did not volunteer the information that Martin was black. Instead, Zimmerman was answering a question from a police dispatcher about the race of the ‘suspicious person’ whom Zimmerman was speaking about.”
Read more:

NEW YORK — NBC News has fired a producer for editing a recording of George Zimmerman’s call to police the night he shot Trayvon Martin, a person with direct knowledge of the matter said Saturday.

The person was not authorized to talk about the situation publicly and spoke on the condition of anonymity. The identity of the producer was not disclosed.

Deception was punished.  Hold that thought.


Enter the New York Times’ pet economist, Paul Krugman whose 2008 Nobel Prize was awarded for his analysis of international trade patterns.  Based on his increasingly partisan columns in the Times, one could be forgiven for assuming his award was for achievements in left wing political polemic -given his hagiographic status among the liberal intelligentsia. But the award was clearly not a Pulitzer for journalism – because the writing and journalistic standards are higher.

In the parlance, Paul Krugman is losing it.  I sense that he has concluded that Barack Obama is probably going to be defeated in November.  He is despondent and angry.  As a result, his rhetorical style has reverted from ordinary partisan to frustrated diatribe.

Here’s a taste of the latest Op Ed that has exposed Krugman’s as someone who has lost his balance.

The Gullible Center


Published: April 8, 2012

[Speaking of Congressman Paul Ryan]

“He’s a garden-variety modern G.O.P. extremist, an Ayn Rand devotee who believes that the answer to all problems is to cut taxes on the rich and slash benefits for the poor and middle class.

“No, what’s interesting is the cult that has grown up around Mr. Ryan — and in particular the way self-proclaimed centrists elevated him into an icon of fiscal responsibility, and even now can’t seem to let go of their fantasy.

“Mr. Ryan insists that despite these tax cuts his proposal is “revenue neutral,” that he would make up for the lost revenue by closing loopholes. But he has refused to specify a single loophole he would close. And if we assess the proposal without his secret (and probably nonexistent) plan to raise revenue, it turns out to involve running bigger deficits than we would run under the Obama administration’s proposals.”

Congressman Paul Ryan in his own words

“A tax code should be fair, competitive and simple, and the US tax code fails on all three counts.  Here are common-sense ideas we’ve advanced before…ideas that have bipartisan support.

“First, we have to make our tax code fair.

“It’s full of deductions, credits and special carve-outs – otherwise known as “loopholes” – that let politically-connected companies avoid paying taxes. Every dollar that businesses spend lobbying for a better tax deal, is a dollar they’re not spending on making a better product.

And, since every dollar hidden in a loophole doesn’t get taxed – politicians make up for this lost revenue by increasing overall tax rates. So we need to close these loopholes.

“But if we just close loopholes, then our federal corporate tax rate is 35 percent, which is really high.

Add in state and local taxes, the rate climbs to 39.2 percent – the second highest tax rate among developed countries.

“On top of sending almost 40 cents out of every dollar earned, straight to the government, businesses pay investment taxes, payroll taxes, and a handful of other taxes our government makes job creators pay.

“In the 21st century global economy – and when American families need jobs – this approach just doesn’t make any sense.

“We need to make our tax code competitive.

“The budget we passed in the House of Representatives calls for closing the loopholes and lowering the rates.

The President’s bipartisan Fiscal Commission proposed something similar.

“Its plan would reduce the corporate tax rate to as low as 26 percent, and to lower the top individual rate that many small businesses pay to as low as 23 percent.

“So if we lower tax rates, does that mean the wealthy pay less in taxes? Not if we do it by closing loopholes. Because the people who use most of the loopholes are those in the top tax brackets. For all the money that’s parked in these tax loopholes, all that money’s taxed at zero. Take away the tax loophole; lower everybody’s tax rates – that money’s now taxed. But its taxed at a fair more simple, more competitive way so the small business men and women who are out there striving and competing have a better tax rate so they can compete in this global economy.

“Third, let’s make the tax code simple.

“All together, individuals and businesses spend over six billion hours and 160 billion dollars, every year, just trying to understand and comply with the tax code.

“Let’s simplify the code, not just by closing loopholes, but also by decreasing the number of different tax brackets taxpayers fall in.

“Fewer brackets, along with lower individual rates, will make the tax code less complicated, and let more people keep more of the money they earn.

“There’s a reason this approach has attracted bipartisan support: It’s Fair, It’s Competitive, and It’s Simple.

“America’s been knocked down before. We’ve had tough recessions before, and we know that the secret to growing jobs and prosperity in America are through the ingenuity and the hard work of our businesses – of our small businesses, of our large businesses, of job creators. We don’t want a tax system that rewards people for coming to Washington and getting special favors. We want a tax system that rewards Americans for hard work, risk taking, entrepreneurship , investment and innovation. These are the kinds of things that have made America great in the past. And these are the kinds of ideas the kind we’re going to need if want to grow our economy in the future and compete in the 21st century global economy.’

From Paul Ryan’s September 14, 2011 Speech


“Mr. Ryan wants two simple tax rates: 25 percent for higher incomes and 10 percent for lower incomes. He wants to abolish the alternative minimum, which has hit an ever-growing number of middle-class taxpayers, especially in high-tax states like New York and California. He wants the results to be revenue-neutral.

‘But there’s no getting around the fact that a 25 percent rate on the top earners would nearly double Mr. Romney’s effective rate and more than double it for the 101 of the top 400 taxpayers who pay less than 10 percent, assuming the loopholes are indeed closed. (The White House calculation that the Ryan plan would result in a tax cut for the wealthy assumes they won’t be.) A top rate of 25 percent may sound like a cut from current higher rates, but so few wealthy taxpayers pay the top rate that it would be a significant increase for many of them.

“I caught up with Mr. Ryan this week as he was on his way to a vote on the House floor.

“’All I’m saying is, let’s have a fair, simple and competitive system. Let’s get beyond the rhetoric of class division,” Mr. Ryan told me. “The fact is that nearly all the loopholes and tax shelters benefit the top bracket taxpayers. For every dollar you park in a tax shelter, that dollar is taxed at zero. You take away the shelters, and we can have a lower rate for everybody. It’s really that simple. As for fairness, under the current system you can have two people living next door to each other with the same income paying a dramatically different tax rate. There’s something fundamentally wrong with that and we’ve got to fix it.’

“Of course, one man’s loophole or shelter is another’s beneficial social policy. Just what those policies should be, and which of the current tax breaks would have to be sacrificed to pay for them, remains to be decided.

“But Mr. Ryan said he believed everything should be on the table, even some of the Republicans’ most cherished tax breaks.”

‘”What we need is to get the country behind the principle first, which is to lower rates by broadening the tax base, then proceed to do it,” he said. “We need hearings in the light of day, with no back-room dealings. If we can’t afford certain policies, or if we can’t afford to retain certain tax breaks, then let’s have an open debate about it. But let’s do first things first. You can’t go out there with a detailed formula until there’s a consensus that we need to broaden the base and reduce rates.”’


Published: March 23, 2012


Paul Ryan has gone farther with more political courage and in more detail than any other federal elected official including the President in addressing the catastrophic imbalance between spending and revenue- using hard numbers and concrete proposals.  He has gone well beyond the administration’s timid and unrealistic rhetoric. He is a player is the sense that sideliners like Paul Krugman are not.

As Krugman attacks Ryan as an extremist and the political center as unintelligent dupes, we would be well to remember the behavior of the incumbent president.

How soon we forget that Mr. Obama fled from the recommendations of his own deficit commission, the report of which ironically was called “The Moment of Truth”:

“The Moment of Truth” (65 p.) is a landmark report issued by the National Commission on Fiscal Responsibility and Reform in December 2010.  Co-chaired by former Clinton WH chief of Erskine Bowles & former Wyoming GOP Senator Alan Simpson, the report is a rare instance of a commission producing a document that addresses urgent and growing national public policy problems in a serious, credible way.

Sadly, the report–an assessment of its provisions follows–has been ignored by President Obama, who convened the panel in the first place.  Notably, as reported by Politico, the nation’s governors are disgusted with the spectacle in Washington.  The states have seen creative activity as never before, ranging from very liberal to very conservative, while Washington is mired in stasis.

The New York Times

WASHINGTON — President Obama was backstage at an auditorium at George Washington University last April preparing to give a major speech, when William M. Daley, then his chief of staff, spied an unexpected guest in the audience: Representative Paul D. Ryan, the Republican chairman of the House Budget Committee, whose budget plan Mr. Obama was about to shred.

“Try to tell the president!” Mr. Daley directed an aide.

It was too late to deliver a warning. Mr. Obama went on stage and outlined his proposal to reduce deficits — but not before he flayed the Ryan plan, saying its deep tax cuts and deeper spending reductions would harm students, seniors, the disabled and the nation.

“It’s not going to happen as long as I’m president,” Mr. Obama vowed.


U.S. President Barack Obama’s new budget is no Valentine’s Day love note to deficit hawks. The blueprint ignores the cost-cutting ideas of the president’s own deficit panel and will add $2.7 trillion in new debt over the next two years. It’s an economic and political bet that invites a fight with congressional Republicans.

The budget would cut cumulative projected deficits by $1.1 trillion over the next decade. That’s a bit more than 10 percent of the debt likely to be added during that span, according to Congressional Budget Office forecasts. Some two-thirds of the reduction would be achieved by spending cuts — including a five-year freeze on some domestic spending — and one-third by higher taxes.

Those proportions may not be so far away from what Obama’s deficit commission proposed in December.  But the scale of debt reduction falls way short. The budget also skips the panel’s recommendations for reforming Social Security and Medicare spending, the biggest drivers of long-term deficits.


“In early 2011, Barack Obama received a report from the Simpson-Bowles deficit commission he himself launched that outlined a series of significant cuts and new taxes that would have at least lowered the rate at which the country added to its debt.  Obama ignored the report completely and instead proposed a budget with nearly $1.5 trillion in deficit spending, with no serious attempts to cut spending.  It was so embarrassing that Republicans had to force the Democrat-controlled Senate in May 2011 to bring it up for a vote, where it failed unanimously, 0-97.

“This is the second year in a row that Obama’s budget couldn’t win a single Democratic vote in Congress.  In parliamentary systems, that would be a vote of no confidence and the party would be looking for new leadership.”



Paul Krugman’s attack on Paul Ryan (and on any “centrists” silly enough to take Congressman Ryan seriously) was disingenuous and misleading…I believe by calculated omission.

It was deceptive in the same way as was the redacted 911 call by the shooting suspect Zimmerman.

The Ryan smear column, like so many other recent Paul Krugman columns, betrays a hint of delusional thinking:  Paul Krugman apparently actually thinks that he occupies the political center. Compared to most mainstream elected leaders (other than Mr. Obama), Krugman’s political positions are very left of center, and in some instances are outliers.

In January for example, Paul Krugman wrote that – “nations with stable, responsible governments — that is, governments that are willing to impose modestly higher taxes when the situation warrants it — have historically been able to live with much higher levels of debt than today’s conventional wisdom would lead you to believe. Britain, in particular, has had debt exceeding 100 percent of G.D.P. for 81 of the last 170 years.” []

Surely Paul Krugman was not implying that, under the Obama deficit/debt load, we should emulate Post WWII England. But he was.  Yet most of those glorious 81 years when England was “able to live with much higher levels of debt than today’s conventional wisdom would lead you to believe” were spent in grinding economic stagnation.

Omitting a discussion of England’s dire economic condition while mired in debt was more than an oversight.  That glaring omission made Krugman’s startling claim about the harmless UK sovereign debt every bit as misleading as was the redacted Zimmerman 911 recording.

Krugman did not bother to note or report that England was a ruin following the war, deep in sovereign debt; that rationing was in place throughout the 1950’s; that the English “recovery” during the 1960’s foundered on a fuel crisis and high interest rates, until the economy was rescued by the North sea oil discovery.

Make a note – oil revenues kept England’s sovereign creditors at bay.

And make another note:  Paul Krugman’s misleading smear of Paul Ryan was of a piece with NBC’s early, biased and misleading reporting on the Trayvon Martin case.  In that instance a producer was actually fired in order to protect NBC News’ credibility.  Will the New York Times have the integrity to fire Paul Krugman?


Copyright © 2012 by Jay B Gaskill, Attorney at Law

First published on The Policy Think Site {}and linked blogs.

As always, forwards, links and quotations with attribution are welcome and encouraged.  For everything else, please contact the author via e-mail {}

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