Krugman is correct but he's not right! He is brilliant on economics, naive on GOVERNANCE!

[jeff47]

67. They could have called it "a good start"

as I said.

Let's look at what happened, now that people have leaked the events:
Their advisers ran the math, figured out they needed something like $1.2-1.5T in stimulus. Terrified of the enormous number, Volker said $800B would be enough. Then that got cut by the Republicans to $400B of stimulus, and $400B of tax cuts.

So we've got a combination of advisers lying to Obama, but even without that, they knew they only got 1/2 of what they asked for. To turn around and call it "perfect" was dumb. Team Obama knew they needed another $400B, and the people with expertise knew they needed about another $1T.

This is the entirety of Krugman's complaint: The Obama administration knew the stimulus was too small, and pretending it was "just right" opens the door wide for "stimulus didn't work - you said it was perfect yet the economy still sucks". If we instead imagine the stimulus bill advertised as "a good start", then whether or not Obama could get more politically, he was not in the position of having to pretend a stimulus that was too small was going to fix the entire economy.

Remember that I stated that the federal agencies were preparing for a second round of stimulus. And in fact Obama wanted one, but guess what happened?

What happened is they believed the Obama administration. They were the ones saying the stimulus bill was sufficient. To later come back for more is not politically feasible, regardless of the blue dogs and Republicans.

with the help of a complicit Corporate Media, the Republican lies convinced Americans that the stimulus failed

And the Obama administration. Again, they called it perfect. If it was perfect, and the economy hadn't turned around, then stimulus won't work.