North America 4 December 2010 The problem with Obama The economist and <em>New York Times</em> columnist Paul Krugman’s damning verdict. Sign UpGet the New Statesman's Morning Call email. Sign-up The Nobel Prize-winning economist Paul Krugman, one of America's leading liberal commentators, used his New York Times column yesterday to issue a devastating crititique of Barack Obama in the wake of the president's decision, on Monday, to introduce a pay freeze for federal government workers across the United States. The Princeton professor describes the move as "a (literally) cheap trick . . . slashing federal spending at a time when the economy is depressed is exactly the wrong thing to do". But it is his analysis of the politics, not the economics, of the issue that stands out in his column. Krugman writes: Mr Obama's pay ploy might, just might, have been justified if he had used the announcement of a freeze as an occasion to take a strong stand against Republican demands – to declare that at a time when deficits are an important issue, tax breaks for the wealthiest aren't acceptable. But he didn't. Instead, he apparently intended the pay freeze announcement as a peace gesture to Republicans the day before a bipartisan summit. At that meeting, Mr Obama, who has faced two years of complete scorched-earth opposition, declared that he had failed to reach out sufficiently to his implacable enemies. He did not, as far as anyone knows, wear a sign on his back saying "Kick me", although he might as well have. There were no comparable gestures from the other side. Instead, Senate Republicans declared that none of the rest of the legislation on the table – legislation that includes such things as a strategic arms treaty that's vital to national security – would be acted on until the tax-cut issue was resolved, presumably on their terms. It's hard to escape the impression that Republicans have taken Mr Obama's measure – that they're calling his bluff in the belief that he can be counted on to fold. And it's also hard to escape the impression that they're right. To be fair, Krugman was never a big supporter of Obama; he backed Hillary Clinton in the Democratic primaries in 2008. But it's difficult to disagree with his stinging conclusion: Whatever is going on inside the White House, from the outside it looks like moral collapse – a complete failure of purpose and loss of direction. › Student occupiers call on NUS president to stand down Mehdi Hasan is a contributing writer for the New Statesman and the co-author of Ed: The Milibands and the Making of a Labour Leader. He was the New Statesman's senior editor (politics) from 2009-12. Subscribe To stay on top of global affairs and enjoy even more international coverage subscribe for just £1 per month!