Liberal economist and veteran New York Times economist Paul Krugman was a frequent source of wisdom during the Great Recession of the late 2000s and 2010s. Now, in 2020, the U.S. finds itself confronting a major health crisis that is also a major economic crisis: coronavirus, which is forcing a wide range of brick-and-mortar businesses to close their doors. And Krugman, in his column, offers three economic tips for coping with the deadly pandemic: (1) “focus on hardship” rather than GDP, (2) “stop worrying about incentives to work,” and (3) “don’t trust Trump.”
Over the years in his column, Krugman has repeatedly stressed a core principle of New Deal/Great Society economics: helping those in need benefits the economy on the whole. Krugman asserts that helping those who inevitably suffer great “hardship” because of coronavirus is sound economic policy.
“What policy can do is reduce the hardship facing those who are temporarily out of work,” Krugman advises. “That means that we need to spend much more on programs like paid sick leave, unemployment benefits, food stamps and Medicaid that aid Americans in distress — who need far more help than they’ll get from an across-the-board cash drop. This spending would also provide stimulus, but that’s a secondary concern.”
Krugman doesn’t actually use the word “bootstraps” in his column. But with #2, he is essentially making a New Deal/Great Society type of argument and saying that it is ridiculous to expect those who are economically devastated by coronavirus to simply pull themselves up by the bootstraps.
“The usual suspects are already objecting that helping Americans in need reduces their incentive to work,” Krugman observes. “That’s a lousy argument even in good times, but it’s absurd in the face of a pandemic. And state governments that have been trying, with encouragement from the Trump administration, to reduce public assistance by imposing work requirements should suspend all such requirements immediately.”
With #3, Krugman is especially biting in his commentary — arguing that because Trump was painfully slow to acknowledge the severity of coronavirus, he simply cannot be trusted.
“The U.S. response to the threat has been catastrophically slow and inadequate,” Krugman asserts. “And the buck stops with Trump, who minimized the threat and discouraged action until just a few days ago.”
Krugman goes on to explain, “Over the past few days, state TV — I mean Fox News — and right-wing pundits have abruptly pivoted from dismissing COVID-19 as a liberal hoax to demanding an end to all criticism of the president in a time of national emergency. This should come as no surprise. But this is where the history of the Trump pandemic — all those wasted weeks when we did nothing because Donald Trump didn’t want to hear anything that might hurt him politically — becomes relevant. It shows that even when American lives are at risk, this administration’s policy is all about Trump, about what he thinks will make him look good. Never mind the national interest.”
Krugman stresses that when “Congress allocates money” for economic stimulus because of coronavirus, Trump shouldn’t have “any discretion over how the money is spent.”
“While it may be necessary to provide funds for some business bailouts,” Krugman notes, “Congress must specify the rules for who gets those funds and under what conditions. Otherwise, you know what will happen: Trump will abuse any discretion to reward his friends and punish his enemies. That’s just who he is.”
The economist wraps up his column by lamenting that during a devastating global pandemic, the United States has a president who is woefully unfit for the job.
“Dealing with the coronavirus would be hard in the best of circumstances,” Krugman writes. “It will be especially hard when we know that we can’t trust either the judgment or the motives of the man who should be leading the response. But you go into a pandemic with the president you have, not the president you wish you had.”