Paul Krugman, being interviewed by the Liberal Oasis. [*] Shrill and partisan, as usual:
The huge budget surpluses of the Clinton Administration had a lot to do with the stock market bubble. They were not really a lasting achievement. The gradual return to a balanced budget was a real achievement. But that move into surplus was the stock bubble.
Was the improvement of economic performance real? Yes. The stock market got ahead of the real economy. But the improvement of economic performance was real. That doesn’t necessarily mean it was Clinton’s achievement, but it was real.
Most of the improvement in the budget, but not that last couple hundred billion dollars, was a real achievement.
[The Bush] tax cuts were justified on the basis of the surplus that wasn’t real.
If you ask, “who was it that bought into the illusions of the dot-com bubble?” It wasn’t Clinton. It was Bush.
I hadn’t thought about it quite that way, but it’s obviously right once you hear it.