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Paul Krugman: A Smart Man Paid To Say Stupid Things

By John Spritzler

15 June, 2013

Paul Krugman is a Nobel Memorial Prize winning economist and also happens to be a smart man. In today's NYT Krugman has an Opinion piece titled, "Sympathy for the Luddites," in which he carefully explains that, "highly educated workers are as likely as less educated workers to find themselves displaced and devalued [by new technologies], and pushing for more education may create as many problems as it solves."

Unlike Robert Reich, who as recently as this year was still speciously asserting that "A strategy designed to increase jobs and wages…would focus on raising the productivity of all Americans through better education—including early-childhood education and near-free higher education," Krugman--being a smart man--tells the truth: "Education, then, is no longer the answer to rising inequality, if it ever was (which I doubt)."

But as smart as Krugman may be, his pay, not to mention his prestigious platform at the New York Times, comes with a string, or rather a steel cable, attached; the deal is, "Say all the smart things you want, in order to maintain your credibility with other smart people, but don't you dare talk about a realistic solution to things like unemployment and economic inequality, because that would entail Thinking about Revolution."

This is why Krugman gives the following as his "solution" to the growing inequality and unemployment in the United States:

"So what is the answer? If the picture I’ve drawn is at all right, the only way we could have anything resembling a middle-class society — a society in which ordinary citizens have a reasonable assurance of maintaining a decent life as long as they work hard and play by the rules — would be by having a strong social safety net, one that guarantees not just health care but a minimum income, too. And with an ever-rising share of income going to capital rather than labor, that safety net would have to be paid for to an important extent via taxes on profits and/or investment income."

Krugman's solution is like the solution that the mice came up with to solve the problem of the cat that was eating them, in the famous Aesop story:

The Mice once called a meeting to decide on a plan to free themselves of their enemy, the Cat. At least they wished to find some way of knowing when she was coming, so they might have time to run away. Indeed, something had to be done, for they lived in such constant fear of her claws that they hardly dared stir from their dens by night or day.

Many plans were discussed, but none of them was thought good enough. At last a very young Mouse got up and said:

"I have a plan that seems very simple, but I know it will be successful. All we have to do is to hang a bell about the Cat's neck. When we hear the bell ringing we will know immediately that our enemy is coming."

All the Mice were much surprised that they had not thought of such a plan before. But in the midst of the rejoicing over their good fortune, an old Mouse arose and said:

"I will say that the plan of the young Mouse is very good. But let me ask one question: Who will bell the Cat?"

It is one thing to say that something should be done, but quite a different matter to do it.

Who will bell the cat, indeed, Mr. Krugman?

Krugman ends his Opinion piece with:

"I can already hear conservatives shouting about the evils of 'redistribution.' But what, exactly, would they propose instead?"

This is the kind of language the plutocracy allows, language that presumes "responsible" (meaning non--revolutionary) methods only must be used to forward one's agenda. Thus Krugman implies that the task is to persuade conservative politicians to "see the light." Krugman also honors his side of the deal with the ruling class by focusing on "conservatives" as the obstacle to his "solution," thereby implying that liberal politicians are sympathetic to the "solution" and would implement it if only they could get support from the conservatives. The reality--that we need a revolution to solve the problems that the plutocracy creates--is totally excluded from Krugman's language.

It's not as if the United States were a real democracy, in which ordinary people can just enter a ballot booth and "bell the cat" that way, is it, Mr. Krugman? Krugman writes as if all it takes to "bell the cat" is for Americans to decide they'd rather dump all of the laws and policies of both the government and private corporations that have been causing economic inequality and insecurity to grow dramatically for many decades, and vote in "representatives" to carry out their wishes. If this were the case we'd have had "Medicare for All" (a.k.a. single payer) health insurance for everybody long ago, without being forced to pay huge premiums to big profit-taking insurance company middlemen who only cause our health care costs to be more per person than in other nations, wouldn't we, Mr. Krugman? After all, this is what Americans have been saying they want, in the ballot booth and to opinion pollsters, for decades.

As a smart man like Mr. Krugman probably knows full well, a plutocracy rules the United States, and it has no intention of making the United States a "middle-class society — a society in which ordinary citizens have a reasonable assurance of maintaining a decent life as long as they work hard and play by the rules." The last time the plutocracy toyed with that idea just a little bit, the period from FDR's New Deal to LBJ's War on Poverty, it was out of fear of a revolution happening if they didn't do it, and aside from preventing a revolution it was a disaster from the point of view of the plutocracy. Americans came to have rising expectations and many of them felt economically secure enough to think about fighting to make America a more equal and democratic society. All hell broke out, as anybody who lived through or has read about the radical upheavals of the "1960s" knows.

How profoundly the 1960's affected the thinking of elite leadership can be seen in the writing of Samuel P. Huntington, Professor of Government and Director of the Center For International Affairs at Harvard University, and co-author of The Crisis of Democracy: Report on the Governability of Democracies to the Trilateral Commission written in 1975. [1] Huntington's Report noted that, "The essence of the democratic surge of the 1960s was a general challenge to existing systems of authority, public and private,"[2] marked by a "sharp increase in political consciousness, political participation, and commitment to egalitarian and democratic values." [3] What especially frightened the elite was the fact that, as Huntington wrote, "In recent years, the operations of the democratic process do indeed appear to have generated a breakdown of traditional means of social control, a de-legitimation of political and other forms of authority... The late sixties have been a major turning point."[4] The Report concluded: "Al Smith once remarked that 'the only cure for the evils of democracy is more democracy.' Our analysis suggests that applying that cure at the present time could well be adding fuel to the flames. Instead, some of the problems of governance in the United States stem from an excess of democracy... Needed, instead, is a greater degree of moderation of democracy." [5]

Corporate leaders abandoned the old method of social control embodied in the New Deal and the Great Society and began relying instead on a fundamentally different, "get tough," strategy designed to strengthen corporate power over people by making them less secure. This new strategy motivates corporate leaders' new enthusiasm for the "discipline" of the free market, which they use to justify not only market-driven health care but downsizing and attacks on the social safety net.

The people who actually control the United States today--the plutocracy--are not going to usher in the "middle class society" with its "strong social safety net" that Krugman whimsically suggests would solve the problem unless, as was the case in the 1930s, they feared revolution if they didn't shift from a strategy of the "stick" and go to that of the "carrot." Thus, in May of 1935, FDR told an emissary of William Randolf Hearst, "I want to save our system, the capitalistic system; to save it is to give some heed to world thought of today. I want to equalize the distribution of wealth." [6] And what exactly was the "world thought" that so motivated (frightened, to be exact) FDR? It was the thought of revolution that had spread across the entire United States. Here is just one little indication (of many like it in reference to all regions of the United States) of the very real threat of revolution: The Los Angeles Times commented on the huge 1934 West Coast strike of longshoremen as follows:

"The situation in San Francisco is not correctly described by the phrase, 'general strike.' What is actually in progress there is an insurrection, a Communist-inspired and led revolt against organized government. There is but one thing to be done--put down the revolt with any force necessary." [7]

FDR's National Recovery Administration chief, General Hugh S. Johnson, went to San Francisco and declared the general strike a "menace to the government" and a "civil war." And Senator Hiram Johnson, California's "elder statesman" declared, "Here is revolution not only in the making but with the initial actualities."[7]

The credible threat of revolution forced the plutocracy to buy time with the "carrot" strategy initiated by FDR's New Deal. But the plutocracy never intended to create, never mind maintain, the "middle class society" of Mr. Krugman's dream. Since the mid 1970's the plutocracy has been implementing policies that increase the insecurity of working people and increase economic inequality. Why do they do this? They do it in part to prevent rising expectations leading to another radical upheaval like the 1960s, and in part simply to enrich themselves as the expense of the working class--what they always do as much as they think they can get away with without provoking a revolution.

The only thing that will make the plutocracy shift again, if only temporarily, to the "carrot" strategy of social control (which is, essentially, what Mr. Krugman is dreaming of as his "solution") is a credible threat of revolution; and the only thing that can create a truly decent egalitarian and genuinely democratic society is a successful revolution to remove the plutocracy from power, entirely. To believe otherwise, as Mr. Krugman pretends to believe in his Opinion piece (because the terms of his employment require it), is as stupid as to believe that the cat would bell itself!

Mr. Krugman used the Luddites of 18th century England to make a point in his Opinion piece. The Luddites were part of an anti-capitalist tradition that included the 17th century Diggers, who explicitly aimed for a free and equal society based on mutual aid, in which "The earth [would be] a Common Treasure House for all." We need to create a world based on their vision, and to start Thinking about Revolution.

John Spritzler is editor of www.NewDemocracyWorld.org

1. Crozier, Michael J., Huntington, Samuel P., Watanuki, Joji, "The Crisis of Democracy: Report on the Governability of Democracies to the Trilateral Commission," New York University Press, New York, 1975, p 3629. Crozier, p 74

3. Crozier, p 106

4. Crozier, p 8

5. Crozier, p 113

6. Arthur M. Schlesinger, Jr., The Age of Roosevelt, Vol. III, The Politics of Upheaval, Houghton Mifflin Company, Boston, 1960, p. 325.

7. cited in Strike!, by Jeremy Brecher, South End Press, Boston, 1997, p. 174







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