The Phantom Menace By PAUL KRUGMAN

[Better Believe It]

Op-Ed Columnist
The Phantom Menace
By PAUL KRUGMAN
November 22, 2009

A funny thing happened on the way to a new New Deal. A year ago, the only thing we had to fear was fear itself; today, the reigning doctrine in Washington appears to be “Be afraid. Be very afraid.”

In December 2008 Lawrence Summers, soon to become the administration’s highest-ranking economist, called for decisive action. “Many experts,” he warned, “believe that unemployment could reach 10 percent by the end of next year.” In the face of that prospect, he continued, “doing too little poses a greater threat than doing too much.”

Ten months later unemployment reached 10.2 percent, suggesting that despite his warning the administration hadn’t done enough to create jobs. You might have expected, then, a determination to do more.

But in a recent interview with Fox News, the president sounded diffident and nervous about his economic policy. He spoke vaguely about possible tax incentives for job creation. But “it is important though to recognize,” he went on, “that if we keep on adding to the debt, even in the midst of this recovery, that at some point, people could lose confidence in the U.S. economy in a way that could actually lead to a double-dip recession.”

What? Huh?

Mr. Summers was right the first time: in the face of the greatest economic catastrophe since the Great Depression, it’s much riskier to do too little than it is to do too much. It’s sad, and unfortunate, that the administration appears to have lost sight of that truth.

Read the full article at:

http://www.nytimes.com/2009/11/23/opinion/23krugman.html?adxnnl=1&hpw=&adxnnlx=1258999265-8IcMxZwdPbiQRbv7XrHG9g

[Bolo Boffin]

1. I think he's more worried about the election cycle and the deficit's effect on the Democratic hold

on Congress. But the Congress critters are listening to the Wall Street lobbyists as well. So it's only a matter of degree.

[optimator]

2. which is why Craig is resigning

every decision is being won by Rahm and conservatives within the Administration.

[paulk]

3. Wall Street owns Obama

http://www.opensecrets.org/pres08/contrib.php?cycle=2008&cid=N00009638

That's been clear from the start.

We can only hope that at some point he starts listening to someone other than the folks who filled his campaign coffers...

High unemployment is going to destroy his Presidency. I'm not sure he understands that.