Krugman: “Let’s Not Make a Deal”

Paul Krugman is advising President Obama to end the G.O.P.’s hostage-taking strategy by refusing to be intimidated by the “fiscal cliff.”

Mr. Obama should hang tough, declaring himself willing, if necessary, to hold his ground even at the cost of letting his opponents inflict damage on a still-shaky economy. And this is definitely no time to negotiate a “grand bargain” on the budget that snatches defeat from the jaws of victory.

[…]

Both the Bush-era tax cuts and the Obama administration’s payroll tax cut are set to expire, even as automatic spending cuts in defense and elsewhere kick in thanks to the deal struck after the 2011 confrontation over the debt ceiling. And the looming combination of tax increases and spending cuts looks easily large enough to push America back into recession.

… Mr. Obama has to be willing to let it happen if necessary.

[…]

So what should he do? Just say no, and go over the cliff if necessary.

It’s worth pointing out that the fiscal cliff isn’t really a cliff. It’s not like the debt-ceiling confrontation, where terrible things might well have happened right away if the deadline had been missed. This time, nothing very bad will happen to the economy if agreement isn’t reached until a few weeks or even a few months into 2013. So there’s time to bargain.

Krugman suggests that President Obama is in a stronger position now than ever to deal with G.O.P. blackmail.

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Comments

3 Responses to “Krugman: “Let’s Not Make a Deal””
  1. Paul says:

    The next Congress will contain 40 more Republicans than the people actually voted for. If they’re going to continue to be a bunch of babies, Obama needs to give them a time out.

    And if they ever hold the country’s economy and reputation hostage again by refusing to unconditionally raise the debt ceiling, the president needs to stop treating them as anything but a grave threat to the country’s welfare and use his Constitutional authority to raise it himself. (http://www.nytimes.com/2011/07/22/opinion/22posner.html).

  2. depelton says:

    Thanks Paul.

    I agree!

    I like that idea of a timeout. Maybe make them sit in the corner facing the wall. Or, go to their rooms!

  3. RickD says:

    For four years Obama failed to confront the partisan voting pattern of the GOP in our Legislature. Whether in the majority or the minority in Congress Republicans have voted for what was best for their party and not for the nation.
    Why then, in the face of such obvious tactics, did we hear nothing from the Democratic Party or its leader who happened to have the “bully pulpit” of the White House to send his message to all Americans?

    My own opinion is that Obama and his party answer to the same large donors as does the GOP, and to speak truth to politics might dry up those large campaign donations. We have already read comments from McConnell and Boehner echoing the same failed mantra that cost them the election. This would indicate that we the people will see the next four years emulate the last.

    Until and unless the electorate comes to the conclusion that we are not represented by our elected leaders, but are run by the money from large corporations and their CEO’s and turns to third party politics as a way to lessen said influence we will see little to no progress.

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