Obama Calls Out Krugman
Ezra Klein at American Prospect has already commented on some footage that I just saw on CNN.
Paul Krugman marshalled his critique of Obamaâ€™s stimulus plan from his blog onto the op-ed page of todayâ€™s New York Times. A front-page story in the same newspaper suggests that Democratic legislators have been reading Krugman. Obama responded by throwing down the gauntletÂ for people in general, and Krugman specifically, to put forward better stimulus ideas.
As Klein notes, Krugman has already been pretty clear about his constructive proposal: a larger stimulus package with proportionally more new spending and fewer tax cuts. In another post, Klein outlines a more specific proposal from theÂ man who gave the PEFâ€™s inaugural Galbraith lecture: hiking Social Security benefits and cutting Social Security premiums.
Klein (correctly) argues that Social Security premiums are regressive because they apply only to the first $102,000 of income. By comparison, Canada Pension Plan premiums applyÂ only toÂ the first $46,000 of income, which makes them much more regressive.
I would put far more emphasis on improving benefits than on cutting premiums. But if we are going to have tax cuts, we should indeed aim to cut regressive taxes.
UPDATE (Jan. 11): Another specific suggestion for Obama