Loading ...Paul- “You Ignorant Slut”
To borrow a line from the old Saturday Nite Live show for my title. Paul Krugman is such an ignorant jackass. What he doesn’t realize is that he is actually correct about comparing suspending the payroll tax is like Trump endorsing use of hydroxychloroquine, BECAUSE they both actually work! We know about the medicine and any moron except this “Nobel” economist knows that if you tax something less you get more of it and if you tax something more you get less of it. Removing the payroll tax helps both employers cash flow and ability to stay in business and employees take home more of their pay so they spend and save more.
Paul Krugman: Trump’s payroll tax cut is ‘the hydroxychloroquine of economic policy’
Published: Aug. 10, 2020 at 11:20 a.m. ET
The economist said he’s ‘extremely worried about a greater recession coming from it’
Economist Paul Krugman calls payroll tax cuts a “quack remedy.”
President Trump’s bold move to bypass Congress by signing his own executive order and memorandums for coronavirus relief over the weekend drew plenty of strong reactions from both Democrats and Republicans.
His actions to defer payroll taxes and replace the expired supplemental $600 unemployment benefit with a plan that would pay up to $400, in particular, drew questions about their effectiveness, and whether the president has the right to overwrite the legislative branch of U.S. government.
Nobel Prize-winning economist and New York Times columnist Paul Krugman is among the most vocal critics, calling payroll tax cuts “the hydroxychloroquine of economic policy” in both a CNN interview and on his official Twitter TWTR, +1.37% account on Sunday.
His dig harks back to the fervid belief by some during the pandemic, including the president, that the malaria drug would be a silver bullet against COVID-19. That has not proven to be the case.
Krugman said that payroll tax cuts are a “known bad idea” on CNN, adding, “Even Senate Republicans basically said, ‘Let’s forget about that. That’s a really stupid idea,’” during deliberations for a new relief package.
Indeed, Republican Sen. Ben Sasse of Nebraska called the executive order “unconstitutional slop” in a statement on Sunday. “President Obama did not have the power to unilaterally rewrite immigration law with DACA and President Trump does not have the power to unilaterally rewrite the payroll tax law,” he said.
Top Democratic senators Nancy Pelosi and Chuck Schumer also piled on, releasing a statement calling the president’s actions “unworkable, weak and narrow.”
But Trump supporters such as Senate Majority Leader Mitch McConnell (R-Ky.) praised the executive decision. “Struggling Americans need action now,” McConnell said in a statement on Saturday. “Since Democrats have sabotaged backroom talks with absurd demands that would not help working people, I support President Trump exploring his options to get unemployment benefits and other relief to the people who need them the most.”
Read more:Trump extends unemployment benefits, defers payroll tax
In a Twitter thread, Krugman wrote that payroll taxes help fund Social Security and Medicare, and so cutting them would “undermine the finances of programs that are absolutely crucial to the lives of older Americans.”
“It’s a known quack remedy that everybody who knows anything has said is useless and dangerous, including Republicans.”
What’s more, he said that combining a payroll tax cut with a new and more complicated unemployment benefits program, especially after many people struggled to claim their benefits from the first Cares Act package, could have “dangerous side effects.”
“I’m extremely worried about a greater recession coming from it,” said Krugman.
I agree with you Chartsmaster
Nobel Prize …for what ?
Isn’t this the guy who promotes Deficit spending and MMT ?
Two thumbs up!
BTW Obama also got the Nobel Peace prize…. ah remind me what for?
If you are interested, payroll taxes fund social security and medicare. That is their purpose (and yes congress has raided that money for other stuff). If you want to cut social security benefits and medicare for everyone over 65, this is a good way to go about it.
But actually, this is just a moratorium on payroll taxes. Unless Congress approves it, everyone will have to pay back these taxes in the near future. It is pretty much a bad idea all around.
Congress will approve it after the election.
Do you see another way to save struggling American Businesses and Employees with this gridlock in congress ?
The payroll tax to support Social Security and Medicare is a nice narrative and talking point but as you correctly pointed out Kemmrich, it was raided decades ago. General tax revenue has been used and will continue to be needed to support those programs. Trump and everyone else knows this, he is the only one willing to touch the “third rail”. Now we can eliminate the payroll tax on everyone and just incorporate those amounts into the regular tax system. If those programs were properly run from the beginning it would be another story but now we can move on from this political shell game that has existed for decades.
Remember how SNL and everyone made so much fun of Al Gore’s “lockbox” comment (concerning ss/medicare revenues). It was funny then. Not so much now.
That’s a difficult question, fully. Eliminating payroll taxes is a 1+ trillion dollar hit to the revenue side. If you added 1 trillion to the spending side and kept the payroll taxes in place there would be a zero net sum effect. If the republicans would just add 1 trillion to their offer, they would meet the democrats in the middle and congress could move on. Hopefully covid will continue to ebb down and we will be done with it (before a vaccine comes out!). In either case you are still talking about an additional $1 trillion deficit item. There are no good solutions at this point in time.
It’s all funny money now and the FED keeps printing. This is the perfect time to overhaul the entire system, after the election.
The system will not be overhauled until we get a collapse of it. One should prepare for this.