Krugman: 'Now is not the time to get rid of those public deficits'

In order to avoid a full-on depression, the U.S. government needs to ignore the size of the deficit and start spending to stimulate the economy, Nobel Prize-winning economist Paul Krugman tells us.

"Somebody has to spend more than their income, and, for the time being, that has to be the government," says Krugman.

But what about the deficit, that so many people are concerned about? After all, Krugman was something of a deficit hawk during the Bush administration.

He notes two things: One is that the deficit spending under Bush was totally wasteful, and that that should have been time to pay down debts. But he also says he's learned from watching the US and Japan that it's much harder for a country to have a debt crisis than he previously appreciated.

"My thinking has evolved," says Krugman. "If you haven't updated your views in the face of new experiences, you're not doing your job."

The fact that the US has its own currency makes a big difference, as evidenced by the crisis in Europe, where the countries without their own currencies are getting into so much trouble.

He still thinks a debt crisis is theoretically possible, but the evidence of the last several years shows it's much harder than he realized.

Watch the video, uploaded by Business Insider on July 12.