Senator Bunning’s Universe

From the New York Times, my favorite Nobel Prize winning economist Paul Krugman on the disconnect between Republicans and reality:

Today, Democrats and Republicans live in different universes, both intellectually and morally.

Take the question of helping the unemployed in the middle of a deep slump. What Democrats believe is what textbook economics says: that when the economy is deeply depressed, extending unemployment benefits not only helps those in need, it also reduces unemployment. That’s because the economy’s problem right now is lack of sufficient demand, and cash-strapped unemployed workers are likely to spend their benefits. In fact, the Congressional Budget Office says that aid to the unemployed is one of the most effective forms of economic stimulus, as measured by jobs created per dollar of outlay.

But that’s not how Republicans see it. Here’s what Senator Jon Kyl of Arizona, the second-ranking Republican in the Senate, had to say when defending Mr. Bunning’s position (although not joining his blockade): unemployment relief “doesn’t create new jobs. In fact, if anything, continuing to pay people unemployment compensation is a disincentive for them to seek new work.”

And

More important, however, what are the implications of this total divergence in views?

The answer, of course, is that bipartisanship is now a foolish dream. How can the parties agree on policy when they have utterly different visions of how the economy works, when one party feels for the unemployed, while the other weeps over affluent victims of the “death tax”?

More here.

My take is a bit more nuanced than Krugman's: the Democrats, who don't seem to fully understand just how bad consumer demand is getting, are also detached from reality; it's just that their universe has, at least, some resemblance to reality, while the Republicans' universe has none.

Indeed, it is now obvious, for instance, that right-wing fueled deregulation mania in Washington these last thirty years is what caused the Wall Street meltdown that, by and large, created the massive recession which we are now enduring. Nonetheless, Republicans cry "Socialism!" in the face of Democratic efforts to unravel the twisted knot that financial deregulation created. That is, they continue to understand economics the way they always have, as though nothing had happened to destroy the foundational assumptions on which their understanding is based. Republicans, and conservatives in general, are no longer rational.

I mean, neither are the Democrats, but at least they're not frothing at the mouth.

Democrats should pound away at this, sending the message in as many ways they can imagine, that "the loyal opposition" is batshit crazy. Of course, they won't do that; they've had the opportunity for months now, since it became clear just how bad the financial sector had become, but they haven't taken it. I have very little reason to believe that they will, either. Because, you know, they're crazy, too.

At any rate, it does now appear that the Democrats are starting to understand that they can't work with conservative lunatics. Maybe they'll finally accomplish something.

$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$