The Hijacked Crisis is another gem from Paul Krugman.

I have picked the following quote because it is a subject I have harped on.

What would a real response to our problems involve? First of all, it would involve more, not less, government spending for the time being — with mass unemployment and incredibly low borrowing costs, we should be rebuilding our schools, our roads, our water systems and more.

In a call to Senator Scott Brown’s office quite a while ago, I made this same point.  I also made this point in a previous blog post in, Mugged by the Moralizers. I’ll quote what I said there.

The American Society of Civil Engineers in its 2009 Report Card for America’s Infrastructure estimates that we need to spend $2.2 trillion dollars over the next 5 years repairing our infrastructure just to prevent it from failing. If we know we need to spend this money at some point in the future, when would be the best time to spend it? I claim that now is the best time.  When private spending is underperforming, there is no better time for public spending. There is little competition for the borrowing capacity.  The infrastructure use is at the lowest ebb that it is going to be (not that it is low, but relatively it is). There is idle labor, equipment, and raw materials, so construction prices are low. There is little risk of inflation because there is so much idle capacity in the system

It is much better to do the work now than wait until the economy booms.  Borrowing will be expensive then as the private sector is competing for loans as they are borrowing to increase capacity.  Workers will be scarce and therefore expensive. Raw materials will be costlier. Adding government spending to private spending at that time will stoke the fires of inflation.

Why would we pass up such a golden opportunity to do work that we know has to get done?