Krugman Gone Wild

Paul Krugman went a little bit crazy earlier in the week after reading the following excerpt from a Bloomberg article:

"President Barack Obama said he doesn’t “begrudge” the $17 million bonus awarded to JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon or the $9 million issued to Goldman Sachs Group Inc. CEO Lloyd Blankfein, noting that some athletes take home more pay.

Krugman responds:

"Oh. My. God.

First of all, to my knowledge, irresponsible behavior by baseball players hasn’t brought the world economy to the brink of collapse and cost millions of innocent Americans their jobs and/or houses. . . . . .

The point is that these bank executives are not free agents who are earning big bucks in fair competition; they run companies that are essentially wards of the state. There’s good reason to feel outraged at the growing appearance that we’re running a system of lemon socialism, in which losses are public but gains are private. And at the very least, you would think that Obama would understand the importance of acknowledging public anger over what’s happening.

But no. If the Bloomberg story is to be believed, Obama thinks his key to electoral success is to trumpet 'the influence corporate leaders have had on his economic policies.'

We’re doomed."

Generally, I'm a Krugman fan, but this threw me way off base. "We're doomed?" You can't be serious Paul. I've complained in the past, (privately and amongst friends) about right wing media outlets and congressmen misrepresenting actual facts, but I expected better from Dr. Krugman. Bonuses paid to Wall Street executives did not cost American families their homes, they did not bring the world economy to the brink of collapse. This rhetoric from the left side is just as bad as the rhetoric from the right side.

Why should Obama care about a combined $26 million in bonuses paid out to a couple of Wall Street's more successful executives? Goldman paid back all of their TARP money long ago, and likely didn't even need their original $10 billion as they had $40 billion in cash at the time of the crisis. JP Morgan was responsible for a substantial privatized bail out of Washington Mutual, which had it gone under, would have actually cost Americans their jobs and homes. I suppose his implied argument has something to do with allowing the "culture of Wall Street," to perpetuate itself, and I agree to some extent. We need substantial financial reform, but regulating bonuses from the top down will have little to zero effect on the problem. Obama is hardly "trumpeting corporate influence," he's just being reasonable.

Usually Krugman is thoughtful in his articles and blog posts. Usually he tries to throw out ideas to promote healthy discussion that lead to solving problems. But in this case, he oversimplified an extremely complex issue in an attempt to get a reaction from people. Well, here's my reaction. I don't like it Paul. Your readers aren't the ultra-right conservative base. You can't go Fox news on us and not get called on it. That's my two-cents.