Krugman: “The deficit doesn’t matter”

Well, apparently there is at least one thing that former Vice President Dick Cheney and Nobel Prize winning economist (and unofficial White House adviser) Paul Krugman have in common. They both feel the same way about deficits – they don’t matter.

On yesterday’s This Week with George Stephanopoulos, Krugman made what sounded like an off-hand remark, one that almost didn’t even seem worth saying as it was so obvious to everyone in the room (except maybe George Will).

From the ABC transript:

Important political fact, which is that whatever you would do with the deficit, the public won’t notice. In 1996, a majority of Republicans thought that the deficit had increased under Clinton, even though we had in fact been on an incredible run. So no, I mean, the deficit doesn’t matter. The economy matters. And that’s why somehow or other, Obama has got to get jobs being created.

Yes, I know. The national debt is now over $12 trillion, not the $11.5 trillion as depicted above. No one really seems to care – $11 trillion, $12 trillion, $20 trillion?

It’s only money.

Tim Iacono is a retired software engineer and writes the financial blog “The Mess That Greenspan Made” which chronicles the many and varied after-effects of the Greenspan term at the Federal Reserve. Tim is also the founder of the investment website “Iacono Research” that provides weekly updates to subscribers on the economy, natural resources, and financial markets.

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