November 15, 2010

Krugman Watch 11/15: The Austerity-Mongering is On


“What’s going on here? I don’t think you can resort to class war arguments.”
I would have that be seen as the defining quote of Krugman’s career. True, there’s competition from the likes of “In Praise of Cheap Labor”, but I think this best sums up Krugman’s role as corporate liberal astroturfer. He epitomizes the historical mission of system liberals: When the going gets tough for the criminal elites, and there’s some risk of their facing real resistance, their first choice is to bring in the liberals as consultants, agents of misdirection, astroturfers. (The second choice is fascism, if the liberals fail.)
To come in and say things like, “I don’t think you can resort to class war arguments.”
I called my shot on Krugman a long time ago, in posts like Schizoid Krugman and Krugman Watch on Sarajevo Day. I said he didn’t really oppose the Austerity offensive in principle, but only questioned its tactical tempo, and perhaps the vehicles being proposed. He thought they were jumping the gun.
I said then and I still say that in the end he’ll support the gutting of Social Security. You just watch.
Now we’re starting to see Krugman’s maneuver in that direction. Before I get to his current advocacy of death panels and regressive taxation, let’s first go over today’s column. It’s a typical batch of Thugman nonsense and lies, and I don’t normally bother, but since we’re already here…..

On Wednesday David Axelrod, President Obama’s top political adviser, appeared to signal that the White House was ready to cave on tax cuts — to give in to Republican demands that tax cuts be extended for the wealthy as well as the middle class. “We have to deal with the world as we find it,” he declared…..

But the bitter irony goes deeper than that: the main reason Mr. Obama finds himself in this situation is that two years ago he was not, in fact, prepared to deal with the world as he was going to find it. And it seems as if he still isn’t.

Krugman correctly calls out Axelrod’s crackpot pragmatism. Let’s be clear about what pragmatism really is, as opposed to Orwellian “pragmatism”.
If you have the nominal power to push through your agenda, but you unilaterally scale down your goals because of the merely political resistance of the enemy, and perhaps the disapproval of the MSM, you’re already a coward. Then there’s the fact that the historical record proves that the enemy won’t credit any of your concessions, but instead will treat your self-diminished position as the outrageous primal extreme.
If, under those conditions, you still seek appeasement and compromise, then cowardice has escalated into morbid stupidity. No rational, modestly self-respecting person under those conditions would do anything other than use his power to ram through his entire agenda, knowing that there will be no political reward for doing anything less. Not to mention that there may very well be a tremendous reward for aggressively doing it all, that you’d galvanize your base and compel the respect and even admiration of many who hadn’t previously supported you.
What really happens, assuming the alleged “progressives” are really at all progressive in intent, is that if their only options are to either give up their goals or to force their way through to their goals, but in such a way that they’d have to endure being shrieked at by their enemies to the right, that’s too much for them to endure. That’s the elemental cravenness which goes into defining the progressive “character”. And out of that, by way of self-justification, arises the rationally absurd crackpot “pragmatism”, which is the least pragmatic course of action from the point of view of reality.
All of that assumes that the “progressive” is somewhat sincere in his own mind. Of course that’s seldom the case with system elites, who are for the most part conscious criminals who use crackpot pragmatism in an Orwellian way, to pseudo-justify their liberal lies and help astroturf the well-meaning but cowardly base.

In retrospect, the roots of current Democratic despond go all the way back to the way Mr. Obama ran for president. Again and again, he defined America’s problem as one of process, not substance — we were in trouble not because we had been governed by people with the wrong ideas, but because partisan divisions and politics as usual had prevented men and women of good will from coming together to solve our problems. And he promised to transcend those partisan divisions.

Crackpot pragmatism is a good complement for the liberal “process” mentality. They both serve the parallel goals of camouflaging liberal corporatism and psychologically consoling the feckless rank and file, keeping them in the fold. Obama knew what he was doing during the campaign.
Of course, here we see the core Krugman lie: He pretends Obama is one of the feckless, rather than one of the criminals.
But the fact is that Obama is a perfect example of those who rule with “the wrong ideas”. That is, a criminal. (It’s also a core part of Krugman’s project to represent all elite criminals, even the Republicans, as merely misguided or crazy. After all, “I don’t think you can resort to class-warfare arguments.”)
The fact is that Thugman himself is one of those who rule with criminal ideas. For the prime example, he supports the Bailout. While opposing the Bailout isn’t sufficient to signify that one has the right ideas, it is necessary. (He was also Hack #1 pied piping for the health racket bailout and austerity bill.) 
With that, we reach his call for death panels and regressive taxes:

So, what I said is that the eventual resolution of the deficit problem both will and should rely on “death panels and sales taxes”. What I meant is that

(a) health care costs will have to be controlled, which will surely require having Medicare and Medicaid decide what they’re willing to pay for — not really death panels, of course, but consideration of medical effectiveness and, at some point, how much we’re willing to spend for extreme care

(b) we’ll need more revenue — several percent of GDP — which might most plausibly come from a value-added tax

…But medical costs must be controlled somehow, or nothing works. And is a modest VAT really so much more implausible than ending the mortgage interest deduction?

1. What deficit problem? Why is Krugman suddenly echoing Republican talking points? Very interesting…
There’s certainly no deficit problem which can’t be helped most of all by ending the Krugman-supported bailout and restituting all the trillions stolen in the Krugman-supported looting binge.
2. Is there any fiscal problem at all? The solution is obvious:
Total Austerity for the Criminals, Not One Cent More from the People.
But of course, that would have to mean acknowledging the class war being waged upon us, and Krugman has decreed that we can’t resort to that. But that conveniently forestalls all the right ideas and leaves in place only “the wrong ideas”. The same bad ideas Krugman is always claiming to deplore through his crocodile tears.
3. As I’ve written before, no matter how good something like a VAT sounds in the good civic wonk textbooks, we know for a fact that under kleptocracy ALL government revenue represents nothing but wealth redistribution from the productive people to the corporate criminals. The same would be true of a VAT.
So when Krugman whips out the wonkery and calls for the good civics playbook, all he’s doing is advocating class war robbery by other means. Why does he recite conservative talking points and advocate a regressive tax on the same web page where he pretends to deplore the extension of the Bush tax cuts? That juxtaposition is no accident. It indicates that he supports regressive taxation as the primary revenue stream going forward, once profligate borrowing becomes impossible. (His incessant China-bashing is meanwhile meant to provide a scapegoat for the soon-to-come collapse of the dollar.)
4. Meanwhile the great advocate of the bailout for the “insurance” rackets is now echoing the NYT party line, that the only allowable path to cutting health care costs is to cut services for the non-rich. This is austerity with a vengeance. This criminal now regrets that he was so impolitic as to crack a joke about death panels (remember how under Bush he said we should revile anyone who laughs at our impoverishment and misery? so how should we regard your death panel joke, scumbag?), but the idea remains the same: In order to maintain the ability of the insurance racketeers to extract enough to remain luxuriantly “profitable”, the health care system will have to crush the people.
That’s the health racket bailout Krugman always consciously supported before, and that’s the bailout and austerity assault he supports now.
So Krugman now indicates that he sees the limits of the Bailout on the horizon, and that in order for the finance sector to maintain its extractions, it will need to move to more direct robbery methods. In a word, “austerity”.
Thugman is on schedule. He’s “waffling” (i.e. insidiously maneuvering) with regard to austerity itself, via the masked austerity of the regressive VAT which he advocates in the same breath that he sighs over the foregone conclusion of the extension of tax cuts for the super-rich. And he’s doing the same when he joins his home NYT in pushing for austerity via the health racket bailout when he attempts misdirection toward the provider side. The real goal, of course, is to force people to buy worthless “insurance policies” while those policies don’t actually pay for care. That’s the death panel Krugman advocates here.
What’s going on here? I think it’s clear to any honest, moral human being that we must resort to class war arguments. Paul Krugman is a class war criminal. That’s why every step of the way, from day one of the Obama administration, he has systematically advocated bailouts and austerity, while seeking to obfuscate the class war reality. As I said above, that’s the historical mission of system liberals. Krugman has been one of the best at his pernicious job, which makes him in reality and morality one of the worst.


  1. It’s always nice to see Krugman’s base nature exposed, and you do it well. Gonzo Lira has recently done a fine job- though some minions take exception- of exposing the shittiness that is
    The Krug.

    Comment by Edwardo — November 15, 2010 @ 11:05 am

    • The NYT is really launching the Big Push on deficit terrorism. Did you see that stupid “deficit reduction game” where all the choices are skewed in a pro-bankster way, and how cleverly it obscures the big question – why would deficit reduction be a priority at all under these economic circumstances?

      Compared to that, Krugman’s still a relative slacker, and he better watch out or Leonhardt’s gonna take his top dog spot*. That must be why he’s easing himself into this propaganda in blog posts, while the columns are still beating the dead horse of “Obama means well, so why is he so weak?”

      [*I certainly don’t mean that Krugman needs to go along with this for the sake of his job. He has enough clout that he can do whatever he wants, even if not at the NYT.

      No, he’s doing exactly what he wants as per his neoliberal corporatist ideology.]

      You say Krugman has minions? How pathetic is that? If I wanted to be a minion, I’d find somebody cooler than that to follow.

      Comment by Russ — November 15, 2010 @ 12:07 pm

  2. The death panel comments will come back to haunt him. They may end up finishing his career.

    Comment by purple — November 15, 2010 @ 12:17 pm

    • Wouldn’t it be poetic justice if after all his warnings about Republican craziness and all of his being the good Democratic and NYT soldier, he ended up getting ACORNed over something like that? (But unlike ACORN, he’d have it coming. That’s why the NYT so viciously hated ACORN.)

      But it doesn’t look like anyone cares much, unless I’ve been missing it.

      Comment by Russ — November 15, 2010 @ 4:00 pm

  3. Russ,

    Although I really like your site, and what you say most of the time, you are over-reaching yourself here. Krugman is not perfect, and neither are you. sometimes you write stuff that makes so much sense, and sometimes you just seem to be picking on someone to pick on somebody.

    Obama and the neoliberalism, I buy that. Krugman is a neoliberalist who is part of some overarching conspiracy, with what he has done and written, I don’t buy that. 90% of what Krugman says has been very condemning of the deficit crowd, almost as stridently as you have been at times. He has to write to deadlines, and I have read some of his books.

    I agree with you that this is class warfare, but there may be reasons for Krugman not to say that right now, and then again, maybe he had a bad day, and screwed up a little.

    I like you and what you write, but come back to earth a little. Our world is not as black and white as you paint it, (although the banksters and corporations have become a criminal class warfare waging bunch of jerks, that is greed, not exactly a new phenomena), and is instead lighter and darker shades of gray.

    We have to have some of these guys not be painted as pure black because they made a comment you did not like.

    Just saying!!

    Comment by kcbill13 — November 16, 2010 @ 2:22 am

    • Kcbill, this is a little more than a stray comment, both on Krugman’s part and on mine.

      By what logic do you agree that Obama’s alleged good intentions are a sham, but not Krugman’s?

      Do you have a counterargument? I didn’t come on here just now shouting “Krugman’s a jerk, and his beard looks stupid!” I’ve made a sustained argument for longer than a year, a dozen posts or so, providing copious links as evidence. Several of those earlier posts are linked above. So whatever you think of my general argument (which you don’t say), we’re most definitely not talking about a “bad day” here, not from the point of view of my contention.

      I did see one person who basically admitted that he gives Krugman a pass out of gratitude for the fact that in the darkest days of Bush Krugman was the only establishment voice forcefully opposing him. Is that what this is all about?

      What reason could Krugman have “not to say that right now”? There’s no personal reason – he’s set for life financially, and ensconced in tenure at Princeton. The most he’d risk by telling the truth would be losing his NYT gig, which wouldn’t have to matter. A truth-telling Krugman.com or whatever could be exactly the kind of high-profile independent media we need.

      So if he means well, the way you say, why isn’t he actively seeking to do that? You cryptically refer to “reasons”. The same 11-dimensional chess explanation you agree is a scam in Obama’s case.

      (And in all of this I don’t even have time to go back to the true, primal Thugman of the 90s, the globalization arch-cadre who wrote manifestoes “in praise of low wages” and in celebration of factory farms.)

      Krugman retains a high prestige and apparent influence among what’s supposedly “enlightened opinion”. He used that clout to help astroturf that opinion mass in favor of the health racket bailout. That’s the number one example of why I think it’s important to recognize him for what he is.

      As for the bigger picture, of course greed isn’t new. What is new is that with Peak Oil, we’ve reached the end of the great wealth accumulation of the Industrial Revolution. All the growth mechanisms must end one way or another, with greater or lesser travail.

      What’s happening today is that greed and power want to make a virtue of necessity, seize upon this transformation to accumulate all the wealth which fossil fuels empowered the people to produce over the last 300 years, and use that seizure to maintain as much of their wealth and power as possible as we economically return to history’s normal level.

      It’s simply the most spectacular project of disaster capitalism.

      It’s no “conspiracy theory”. The elites knew about Peak Oil since Hubbert first broached the topic in the 50s. They at first disparaged it, but when the US peaked on schedule in 1970, that was the big wake-up call.

      In direct response the whole neoliberal strategy and tactics were formulated, and the history of the last forty years has been the history of the end of the Oil Age and the playing out of the neoliberal game plan.

      We’re now at the crossroads, and what we the people do over the next decade will likely decide our fate – restored feudalism, serfdom, and slavery, or true democracy as the basis for the most prosperous post-oil economy.

      So while the motivations of the players – greed, in the elites’ case; the dream of freedom and self-determination, in the case of humanity – are age-old, the stakes have never been so high.

      Comment by Russ — November 16, 2010 @ 3:09 am

  4. Russ,

    Sorry I missed the earlier posts, and did not mean to impugn your theory on Krugman, but I considered you were being a bit harsh, and I only started following you about four or five months ago.

    And I have to admit that I like Krugman, and have read his “Conscience of a Liberal” book, and his “Return of Depression Economics and the Crisis of 2008” which I am not certain you have read. I found his story of the rise of the “movement conservatives” to be quite convincing, and I do find his explanations of how the “movement conservatives” basically took the repukes inot a win at any cost mentality that has had the Democrats bringing knives to gunfights ever since.

    I like his discussions of the economic foundations laid out through regulations by FDR leading to the longest sustained boom for the lower and middle classes to have been an interesting discussion of what regulations and proper tax structures can do to help the middle and lower classes. From my readings of both of those books, he seemed to take a very strong stand for the middle and lower classes. And I also give him a break because of his standing up to bu$hCo), and I agree that Krugman does need the money all that much either.

    I’m basically an expat old fart from Kansas City, Missouri who currently lives in Melbourne, Australia, and have for 22 years. I came here as a sales agent, and after Bush, found my business partners in the US did not need me anymore (gosh, its simple to just do all sales and support over the net, we don’t need direct representation anymore. So after a few shit jobs, I found the corporate world did not consider me employable anymore.

    So I went back to school and am just about 3/4 way through a Masters of Commerce degree, and admit that growing up a Midwest boy left me a little naive, and as a properly propagandized young man, I joined the Air Force in the early 1970’s, that’s how stupid I was as a young man.

    But since I have been studying, a whole new world has opened up for me, and I am trying to understand where I fit in this brave new world.

    I find your writing a bit ballsy, but I kind of like your blog, and find that you have some good arguments that make sense to me. I also read Naomi Klein’s No Logo, and The Shock Doctrine, so what you say about the corporates and wealthy elites are doing seems in line with what I think, and that the banksters are criminal cannot be argued with. We have had the Magna Carta out there for a long time, and the breaking of the rule of law by my government disgusts me just like the torture did.

    I see a lots of reasons to be mad, careful, cautious, and vigilent. I realise we have complete corporate takeover of our government, and have never been an Obamabot, kinda wanted Hillary, but what difference does it make when we vote and nothing changes at all, I kind of think we are closer to an oligarchy, maybe a kleptocracy like you say.

    But to lay so much blame on Krugman still seems a bit harsh. What you see as his betrayal I see as how an economist thinks, and that rubs elbows with so many jerks that sometimes some of the BS rubs off at times. But he has been a strong defender of the lower and middle classes in his recent books, and although I have heard he was brash when he was young, I would find it difficult to believe he was FOR the rich elites and corporate takeover of government.

    When I said maybe there were reasons that he did not use the term class warfare, I was not referring to multi dimensional chess. I was referring to the fact that the term is incendiary, and often meant to provoke. That he chooses not to utilise the terms you want him toes not make him on the wrong side here. I do think we have much greater enemies to fight than Paul Krugman

    I agree with William Black, from the UMKC, that we need to throw the banksters who have and still are committing fraud into jail, and agree with Stiglitz that not only that we should look back and jail the financial fraudsters, but that until we do , we will not be able to get out of this financial mess. I think we should prosecute the war criminals on torture and preemptive wars.

    But I am also not seeing us even in battle on these fronts. It seems that you are right about the corporate takeover of America, and many of the topics you discuss make sense to me, and I believe the rent seeking conservatives around the world are more tied together than ever before, and that they would love to see people like me as cheap exploitable labour forever. But America is in a world of hurt, and you have so much good knowledge to write in this blog, that I think attacking people who are not leading the neoliberal fight is not the best use of your time. You effect people like me more when you explain and teach, rather than get in to ad hominem attacks, go positive Russ, you have good skills as a writer, and your message will go on to greater effect when you educate.

    Comment by kcbill13 — November 16, 2010 @ 8:23 am

  5. Russ,

    Made a few spelling mistakes, sorry, but I think you get my general drift.

    I don’t believe Krugman needs the money.

    I read your goals, and love the first six. I diverge a little bit there, but mainly on perspective. You blame peak oil, which I do not consider is the only way to describe what is happening in our world.

    I think that Americans have been being manipulated since the repukes were co-opted by corporate crooks, and I think the democrats like Rahmbo and Obama are just republicans who lied about the way they really felt and ran as democrats.

    But as I said, I like your blog, but I think you are wrong about Krugman.

    Comment by kcbill13 — November 16, 2010 @ 9:01 am

    • Thanks, kcbill. We can disagree about Krugman.

      I’ll just ask one more question: Since you agree strongly with Bill Black, then doesn’t it bother you that Black is evidently an unperson as far as Krugman is concerned? (The Corrente blog runs a periodic “Why won’t Krugman mention Bill Black” series. It’s up to something like over a dozen installments by now.) And the very words “crime” and “fraud” are disallowed?

      That’s the kind of evidence I consider damning.

      Thanks for the advice on the positive. That’s where I’ve been headed. I’m largely finished with the counterattacks on the corporate liberals and the likes of Krugman. The reason I came out of retirement here was the occasion of what I see as a Krugman shift on austerity. I was especially offended by the death panel crack.

      Did you see my post on negativity and positivity?


      Comment by Russ — November 16, 2010 @ 9:35 am

  6. I’ll take a look at it.

    I just want to see the banksters get their just deserts. I think it would be fair if they got burned for all of the fraudulent loans they made. I also like Glenzilla a lot. See Corrente some times, but school is in crunch time right now, and I have two 4500 word papers due in next two weeks, so life is a grindstone at the moment.

    Comment by kcbill13 — November 17, 2010 @ 6:13 am

    • Yes, burned. On the loans, at least. 🙂

      Have fun with those papers. By now I’d say to myself, “It’s two long blog posts”. (And they would be.)

      Comment by Russ — November 17, 2010 @ 6:52 am

  7. […] trotting out the same lie, this time as part of the austerity-lite initiative exemplified by his own death panel proposal and the Rivlin/Domenici counterproposal to Obama’s Star Chamber plan. The goal here is to […]

    Pingback by Krugman: Austerity-Lite « Volatility — November 18, 2010 @ 5:29 am

  8. […] who want to politically shield these interests. Then we have globalization ideologues like Paul “It’s not class warfare” Krugman who are ardent to absolve all direct criminal actors of blame. So in desperation he […]

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