Krugman outlines progressive agenda for Obama

by: JC

Fri Jan 16, 2009 at 12:37:18 PM MST

Dear Mr. President:

Like FDR three-quarters of a century ago, you're taking charge at a moment when all the old certainties have vanished, all the conventional wisdom been proved wrong. We're not living in a world you or anyone else expected to see. Many presidents have to deal with crises, but very few have been forced to deal from Day One with a crisis on the scale America now faces.

So, what should you do?

Krugman goes on to illustrate in detail the challenges facing our country: economic, health care; labor and the middle class; and truth & reconciliation. He also lays out a progressive framework for Obama to look at. But most importantly, he presents his arguments in a fashion that allows lawmakers, policy wonks, bloggers and the general citizenry to pick up on the intricacies of his thoughts and inform their daily understanding of where this country needs to go.

How bad is the economic outlook? Worse than almost anyone imagined...

If things continue on their current trajectory, Mr. President, we will soon be facing a great national catastrophe. And it's your job - a job no other president has had to do since World War II - to head off that catastrophe...

This time, however, the transmission mechanism [the Fed] is broken... There's no realistic prospect that the Fed can pull the economy out of its nose dive.

So it's up to you.

He then proceeds into illustrating his approach to rescuing the economy:

If banks need federal funds to survive, provide them - but demand that the banks do their part by lending those funds out to the rest of the economy...

You have to be really bold in your job-creation plans...

You probably have to spend $800 billion a year to achieve a full economic recovery...

As much as possible, you should spend on things of lasting value, things that, like roads and bridges, will make us a richer nation...

Aid to the distressed - enhanced unemployment insurance, food stamps, health-insurance subsidies - is both the fair thing to do and a desirable part of your short-term economic plan...

The tax break for working families you outlined in your campaign plan looks... reasonable.

He then moves on to crisis management, which he translates into helping the middle class regain the position it had in society following WWII.

The biggest, most important legacy you can leave to the nation will be to give us, finally, what every other advanced nation already has: guaranteed health care for all our citizens.

His arguments for why health care reform, and a move to universal health care during dire economic times, is essential to the success of the recovery, is must-read for any who try to defend health care reform from attacks by naysayers:

Universal health care... should be your biggest priority after rescuing the economy. Providing coverage for all Americans can be for your administration what Social Security was for the New Deal... (it made America a middle-class society.)

He then moves on to labor and wages:

Under FDR, America went through what labor historians call the Great Compression, a dramatic rise in wages for ordinary workers that greatly reduced income inequality. Before the Great Compression, America was a society of rich and poor; afterward it was a society in which most people, rightly, considered themselves middle class. It may be hard to match that achievement today, but you can, at least, move the country in the right direction...

You won't be able to oversee a tripling of union membership anytime soon. But you can do a lot to enhance workers' rights. One is to start laying the groundwork to pass the Employee Free Choice Act.

After recognizing that environmental concerns like cap & trade may not be on the front burner, "By all means, put as much environmentally friendly investment as possible - such as spending to enhance energy efficiency - into the initial recovery plan," and glossing over foreign policy, "wind down the war in Iraq - which is, by the way, costing about as much each year as the insurance subsidies we need to implement universal health care," he moves on to truth and reconciliation:

I'm an economist, but I'm also an American citizen - and like many citizens, I spent the past eight years watching in horror as the Bush administration betrayed the nation's ideals. And I don't believe we can put those terrible years behind us unless we have a full accounting of what really happened...

[We need] something like the Truth and Reconciliation Commission that helped South Africa come to terms with what happened under apartheid. We need to know how America ended up fighting a war to eliminate nonexistent weapons, how torture became a routine instrument of U.S. policy, how the Justice Department became an instrument of political persecution, how brazen corruption flourished not only in Iraq, but throughout Congress and the administration. We know that these evils were not, whatever the apologists say, the result of honest error or a few bad apples: The White House created a climate in which abuse became commonplace, and in many cases probably took the lead in instigating these abuses. But it's not enough to leave this reality in the realm of things "everybody knows" - because soon enough they'll be denied or forgotten, and the cycle of abuse will begin again. The whole sordid tale needs to be brought out into the sunlight.

Much, much more in the whole article. I would place Krugman's synthesis of the enormity of the challenges facing the Obama administration and the rest of the country, and his solutions, at the top of every progressive's reading list. And to catch a phrase from Krugman, we all must stand up and: "ignore the naysayers."