Spending freeze signals Obama is trying to give Krugman an aneurysm
Oh boy, here we go. Late last night, news of Obama’s proposed non-military discretionary spending freeze was shooting around the Liberal Internet, but Paul Krugman — who has been at a full-throated yell to avoid the mistakes of 1937, namely an ill-timed spending freeze – had yet to weigh in. Krugman has been warning for months now that premature worrying about the deficit is unnecessary, and the worst thing for the economy would be to slow down government spending before we are actually out of this crisis.
Well, this morning Paul gave us his two cents.
A spending freeze? That’s the brilliant response of the Obama team to their first serious political setback?
It’s appalling on every level.
Yikes. He continues:
And it’s a betrayal of everything Obama’s supporters thought they were working for. Just like that, Obama has embraced and validated the Republican world-view — and more specifically, he has embraced the policy ideas of the man he defeated in 2008. A correspondent writes, “I feel like an idiot for supporting this guy.”
Reactions through the Liberal Internet have echoed this level of despair. Nate Silver, at 538, writes:
First reactions aren’t always the best ones, but my first reaction to tonight’s news is that it’s a mistake on par with John McCain’s “suspending my campaign” gaffe.
Andrew Leonard, who writes the econo-blog over at Salon, gets historical:
If ever there was a time to pull out the old Karl Marx chestnut, “History repeats itself, first as tragedy, second as farce,” that moment is now. Prominent members of Obama’s own administration have warned against repeating the errors of 1937, namely, Franklin Roosevelt’s decision to cut spending and balance the budget too quickly, thus strangling a nascent recovery from the Great Depression. But with the U.S. economy far from healthy, the president has decided, once again, to bow to the political winds and make the deficit priority number one.
[Obama is] aiming for what you might call a “cut and invest” strategy—slashing certain programs and boosting others. And I think anyone who looks at it would have to admit that there is, in fact, a lot of discretionary spending on programs of little value.
For more responses from the blogosphere, check here. We’ll see if Obama’s State of the Union — which I’ll be live blogging here — clarifies which programs he’s proposing to cut.
It’s worth remembering that “defense” spending in the United States, which will not be affected, accounts for approximately 42% of military spending worldwide.