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As for the economy, Krugman tries to pin the current deficit mess on Bush. Krugman states that by the first quarter of 2009 - with “only a trickle” of Obama’s stimulus funds “flowing” – the deficit had already reached “almost 9 percent of G.D.P.” Aside from ignoring the fact that the TARP bailout, which Obama had supported as a Senator and extended as President, was mainly responsible for the large jump in the deficit, Krugman omits completely what followed once Obama’s economic policies did kick in.
According to U.S. government figures, the entire actual fiscal year 2009 deficit as percentage of GDP was 9.91 and the projected percentage for fiscal year 2010 under Obama is 10.64.
President Obama’s budget would add $4.9 trillion in public debt from the beginning of 2010 through 2016.
Krugman also leaves out of his narrative the critical Democratic Congressional policies propping up the sub-prime market that helped bring about the financial collapse in the first place and which Obama’s financial reform package does nothing to address. I am talking, of course, about Fannie Mae and Freddie Mac. These quasi-government agencies followed a disastrous course to encourage non-creditworthy mortgage loans by purchasing many of them to spur even more loans. They continue to sop up taxpayer money with little if any real accountability. Krugman omits to mention that Bush tried to deal with this problem while in office. Obama is ignoring it.
As for the overall economy, Krugman omits to mention that when George W. Bush left office – in the midst of the “economic catastrophe” as Krugman puts it – unemployment stood at 7.6%. After nearly 18 months of Obama’s stimulus spending, unemployment now stands at 9.5%, with many more discouraged people not counted because they stopped looking for a full-time job.
Krugman also says that during the Bush administration’s first two and half years in office, there was “declining employment.” He omits to mention that we were on the cusp of an economic downturn when Bush took office and that our economy then endured the catastrophe of 9/11, which had alot to do with the economic instability that Bush’s tax cuts corrected.
Krugman is not intellectually honest in his defense of Obama’s reckless spending and failed economic policies, while falsifying significant parts of Bush’s record. But we will continue to watch him and correct his distortions.
