Mehdi Hasan

Mehdi Hasan’s polemical take on politics, economics and foreign affairs

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Krugman: Labour is "weak" in its opposition to cuts

The Nobel economist is scathing in his criticism of the two Eds.

By Mehdi Hasan Published 30 May 2012 16:19

Paul Krugman said Labour was "weak". Source: Getty Images

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Tags: Budget Deficit Ed Miliband Ed Balls Paul Krugman

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66 comments

Wed, 2012-05-30 22:44 — mbrecker (not verified)

The big contradiciton. Krugman will write a book that publically states, yes we really are in a Depression. Not the "greatest economic downturn since the Great Depression". Yet, he won't admit that no amount of stimulus will ever be enough to pay off the global toxic debt. Why?

Wiping off the debt would mean nationalizing the banks. This would mean the Evil Word Socialism (at least it's evil to many in the States. Yet, many of these same people have no clue what that really means).
No corporate MSM outlet would touch him for an interview.
The NYT would reprimand him, and he could lose his column for pissing off their advertisers. The Times also reprimanded Chris Hedges for telling the truth about Afghanistan and Iraq.
He would no longer be a "hot" economic name like Roubini, Reich, Stiglitz, Wolfe or others.

As for Brown and other politicians, they'll just continue to write books that basically say, you're not going to blame me for this. What good does that do?

Wed, 2012-05-30 22:41 — Steve AM (not verified)

The problem with The Labour Party is that it is always weak or quiet about talking what it really wants to do and to speak about it successes. The party allows itself to be crowded out by noise by the Tories and right wing media who always shout the loudest with what they want to do and what they believe they have achieved, whilst denouncing anything Labour want or does.

Sun, 2012-06-03 07:45 — rain (not verified)

“The problem with The Labour Party is that it is always weak or quiet about talking what it really wants to do and to speak about it successes” Labour entered office with 4 million claiming one kind of state benefit or another. Labour left office with 4 million claiming one kind of state benefit or another. Despite Labour's best intentions and 5 billion spent on relieving relative poverty, millions remained in relative poverty. Labour pumped billions into our state education system only to see standards fall. Labour’s ethical foreign policy was anything but ethical. Labour forgot that the art of diplomacy is to avoid wars; not start them. It now seems that almost every one of the Labour’s sacred cows is being slaughtered on the altar of common sense. From climate change to big government from welfare dependency to multiculturalism but many inside Labour party remain arrogant and talk of success dismissing any challenge or warning about the possible negative implications of their world view, every passing day provides further evidence of the folly of Labour’s policy agenda and the falsehoods it is built upon.

Thu, 2012-05-31 15:32 — Hu Ru (not verified)

All you say is true, but you forgot to add one important issue......that basically people in Britain associate Socialism with taxation, and they don't want to pay any more ........even some of those with lower household incomes who could benefit from a progressive redistribution are satisfied with the status quo, thereby having some bogyman group to feel superior to. The statistical majority are just too mean spirited - Tories in other words.
I wish it weren't so, but there you go.

Thu, 2012-05-31 16:45 — Paul Mn (not verified)

Not sure that follows. Ordinary workers have ended up being taxed far too much because they have to subsidise the rich who don't pay anything like the same rate. That is a sort of socialism too... for the rich! A geniunely social democratic setup could easily reduce taxes on the vast majority right now.

Wed, 2012-05-30 20:59 — niww

http://dv.gd/oej

Wed, 2012-05-30 20:36 — UKUncut Sheffield (not verified)

"Where is the really effective intellectual opposition coming from?’, it seems to be think-tank people and journalists. The opposition is Martin Wolf [of the Financial Times], Jonathan Portes [of the National Institute for Economic and Social Research], Simon Wren-Lewis [of Oxford University], David Blanchflower [of the New Statesman] and me.”

Thanks Krugman.

Thanks for leaving out the thousands of people who have formed UKUncut who are taking real opposition and argument against austerity, taking the fight for economic justice to the streets, to our fellow public more effectively than any think tank, journalist, professor or politician has yet to do.

Wed, 2012-05-30 20:36 — UKUncut Sheffield (not verified)

Thanks Krugman.

Thu, 2012-05-31 22:14 — George Hallam (not verified)

"Thanks Krugman.

Thanks for leaving out the thousands of people who have formed UKUncut who are taking real opposition and argument against austerity, taking the fight for economic justice to the streets,"

Thanks UKUncut Thanks for leaving out Lewisham People Before Profit

Thu, 2012-05-31 22:14 — George Hallam (not verified)

"Thanks Krugman.

Thanks for leaving out the thousands of people who have formed UKUncut who are taking real opposition and argument against austerity, taking the fight for economic justice to the streets,"

Thanks UKUncut Thanks for leaving out Lewisham People Before Profit

Thu, 2012-05-31 22:14 — George Hallam (not verified)

"Thanks Krugman.

Thanks for leaving out the thousands of people who have formed UKUncut who are taking real opposition and argument against austerity, taking the fight for economic justice to the streets,"

Thanks UKUncut Thanks for leaving out Lewisham People Before Profit

Wed, 2012-05-30 19:24 — John Cheese (not verified)

Can't believe Krugman got it right about the Euro being a bad idea- hey I guess a dead clock is correct twice a day... He continues to argue the obama policy is successful as the US trounces along in our 4 year economic ditch. I can see November from my porch!

Wed, 2012-05-30 18:58 — moaning minnie (not verified)

I have listened to various interviews with Paul Krugman. He talks such sense and is absolutely spot on with the timidity of the Labour Party who still even under the leadership of EM are afraid to do bold policy initaitives. I say PK should run for President. OBama is beginning to sound more and more like a has been

Wed, 2012-05-30 17:25 — Jacob Richardson (not verified)

Krugman is absolutely correct. Despite the narrative of the ruling parties, ideological austerity and deficit reduction are not intrinsic (and as increasing borrowing and inflation has shown, they are often often opposed). There is an alternative to reduce structural and budget deficits, consequentially caused by the ruling elite's financial crisis, that does not entail the dismantling and tearing apart of the social fabric. Deficit denier? Advocacy to end the yearly £95 billion cost of tax evasion and avoidance schemes, and £123 billion subsidy of the banking system. And the introduction of a Tobin Tax, and reversal of disastrous and inefficient privatisation in the public sector, to mention only a portion of ideas for an anti-austerity manifesto, would rather make Miliband and Balls the deficit eliminators. And more importantly, the social democratic opposition to the Cameron government's abject and unspeakable injustices.

Wed, 2012-05-30 16:49 — Shinsei67

" they have been trying to find the right balance between opposing the coalition’s austerity measures in the short run and supporting deficit reduction and cuts in the long run."

A perfectly sensible approach to take.

Krugman's ideas to borrow substantially more is just as misguided as Greek style austerity.

Krugman's policies haven't been a great success in the US. Obama's stimulus has had substantially less impact than Krugman forecast two years ago. Similarly his mates like Blanchflower have also been proven to be wrong on their dire predictions of UK unemployment increasing by many 100s of thousands.

Borrowing and spending more (when one is already borrowing 8%+ of GDP) is the wrong remedy for an economy hit by a deleveraging banking sector.