Nobel Laureate Paul Krugman, a proponent of the left and Ron Paul, a right leaning Congressman have one thing in common, they both believe that the debt ceiling deal offers nothing but false promises for the American public.
The Obama-Boehner-Reid plan is meant to cut $2.1 trillion in the deficit by 2012 with first tranche cuts of $917 billion however according to Ron Paul, there are actually no cuts at all in the plan, he says the “cuts” are not to amounts already being spent but to “projected spending increases” which is basically like saying “we’ll cut money we ‘might’ spend one day.”
According to Ron Paul:
“The ‘cuts’ being discussed are illusory, and are not cuts from current amounts being spent, but cuts in projected spending increases,” while he adds “the truth is that Washington is about to pass “a bigger budget than ever” despite heavy rhetoric.”
He goes on to explain what is actually happening, noting:
[The debt ceiling deal] is akin to a family “saving” $100,000 in expenses by deciding not to buy a Lamborghini, and instead getting a fully loaded Mercedes, when really their budget dictates that they need to stick with their perfectly serviceable Honda.
Paul Krugman on the other hand called the deal a “disaster” when speaking with the New York Times.
According to Krugman:
“Pay no attention to those who invoke the confidence fairy, claiming that tough action on the budget will reassure businesses and consumers, leading them to spend more. It doesn’t work that way, a fact confirmed by many studies of the historical record,” while adding that because historic low interest rates “spending cuts now will do little to reduce future interest costs.”
Krugman also offered his own analogy in response to Ron Paul’s own:
So those demanding spending cuts now are like medieval doctors who treated the sick by bleeding them, and thereby made them even sicker.
The left hates the plan, the right hates the plan and it gets approval, seems like U.S. “politics as usual” to me.