Dave Carpenter: Krugman mired in past; wrong on Greece

Re “Greece tips over the brink” (Opinion, June 30): Far be it from me to disagree with the “great” Paul Krugman, but someone has to. Paul Krugman is all for socialist big government. He implies that it is OK to tax and spend and dig a big hole of debt because, in the long run, it will all come back in revenues. Wrong, so wrong!

Remember the Reagan years and his “Star Wars?” Well, Ronald Reagan tripled our national debt with his pet military project on the assumption that spending would come back. It would “stimulate” more spending, like ripples in a pond, and would return full circle in revenues. It did not.

It’s all based on the Keynesian “multiplier effect,” that spending and debt is good balance because it “stimulates” demand. This theory is obsolete. An honest multiplier is about 1-to-1. In other words, you can’t get something from nothing; you can’t just print money to create wealth; and you can’t expect to throw trillions away on wars and boondoggles and still hope to stay above water. It will not come back in revenues, and Greece, contrary to Krugman’s view, will not prosper if it continues its profligate ways.

This story was originally published July 7, 2015 at 6:16 PM with the headline "Dave Carpenter: Krugman mired in past; wrong on Greece."