On page A27 of today’s New York Times, Paul Krugman is at it again. Spending trillions of dollars we don’t actually have is what saved us from disaster, but we need to spend more! More! More!
Krugman has written the same thing so many times, he apparently doesn’t need to bother with facts, just assertions. In yesterday’s Wall Street Journal, Robert Barro and Charles Redlick did bother with facts, which happens to lead them to the exact opposite conclusion.
But that isn’t the ugly part. The ugly part is that, if you turn just one page in today’s NYT, you get a peek into the future that Krugman, the Obama Administration, and much of the Congress apparently want for America.
On page B1 of the NYT, there is an article on China surpassing Japan economically. This is happening much faster than the Japanese expected because the Japanese economy has been so weak. It is, in fact, smaller than it was 15 years ago. The average Japanese was richer than the average American 20 years ago but is now 25% poorer.
And why is that? The *second* NYT piece points to Japan’s “crushing national debt” and “huge public works projects.” These came directly from Japan’s response to its early 1990’s financial crisis – spend billions they didn’t have. When that didn’t work so well, they kept on spending. Sound familiar? We are heading down Japan’s road and Krugman’s worried that we just might stop and turn toward prosperity.
Most important, this road will leave us poorer, just as it did Japan. As a bonus, there’s China. If you’re concerned about the PRC passing us by, consider how they caught Japan so quickly. President Obama and Speaker Pelosi are presently doing their level best to ensure that China catches the U.S. as fast as possible, just the way it caught Japan.