Nobel Prize-winning economist Paul Krugman has been a frequent critic of President-elect Obama. During the primary season, he faulted Obama for saying there is a Social Security “crisis,” refusing to adopt a mandate in his health care proposals, and not fighting enough on “partisan issues.” In fact, today in his New York Times column, Krugman expresses skepticism at the effectiveness of Obama’s stimulus plan, in particular his tax cuts for businesses:
But right now we seem to be facing two major economic gaps: the gap between the economy’s potential and its likely performance, and the gap between Mr. Obama’s stern economic rhetoric and his somewhat disappointing economic plan.
Today in his press conference, a reporter questioned Obama about Krugman’s criticisms. Obama said that he is open to the economist’s ideas: “If Paul Krugman has a good idea, in terms of how to spend money efficiently and effectively to jump-start the economy, then we’re going to do it.” Watch it:
Last month, Krugman told radio host Bill Press that he is “in communications” with the Obama team.
CHIP REID: Thank you, Mr. President-Elect. I’d like to follow up on that. Larry Summers, as he said, is up on the Hill now, and we’re told he’s getting an earful from some Democrats who say this plan just isn’t big enough. And I know you resisted putting a number on it, but your staff has talked about a high end of $800 billion or something like that. They say if that’s true, and 40 percent of it is tax cuts that don’t have the bang for the buck, that spending has, it’s not big enough. Paul Krugman today said it falls far short for what you’re going to need to put America back to work. How do you respond to those critics?
OBAMA: Look, there’s some people who have said that it’s not big enough, there are others who say it’s too big. Well, the — as I said before, Democrats or Republicans, we welcome good ideas. And so the challenge for all of us, I think, is to identify good ideas, good spending plans, that deliver on my commitment to create or save 3 million jobs. I want this to work. This is not an intellectual exercise, and there is no pride of authorship. If members of Congress have good ideas, if they can identify a project for me that will create jobs in an efficient way, that does not hamper our ability to — over the long term — get control of our deficit, that is good for the economy, then I’m going to accept it.
If Paul Krugman has a good idea, in terms of how to spend money efficiently and effectively to jump-start the economy, then we’re going to do it. If somebody has an idea for a tax cut that is better than a tax cut we’ve proposed, we will embrace it. So, you know, one of the things that I think I’m trying to communicate in this process is for everybody to get past the habit that sometimes occurs in Washington of whose idea is it, what ideological corner does it come from. Just show me. If you can show me that something is going to work, I will welcome it.