It doesn't have to be like this. No external dynamic is keeping unemployment at more than 8 percent and consigning a generation of young workers to an economy in which risk is plentiful and opportunities scarce. It is only a failure of political will -- and an almost universal embrace of conservative voodoo economics - that is keeping us mired in this dark economic moment.
Here's one question from the interview:
JH: I find it frustrating that there is such a concerted effort to create this alternative reality where Keynesian economics has failed and giving tax cuts to the wealthy will create jobs. It's a parallel universe.
Krugman responds, in part, that "Political polarization and income inequality march hand in hand. There's every reason to believe that relationship is not an accident:"
What happens is when the wealthy are very wealthy they can in effect buy political support. The way that's worked in practice in the United States is that the Republican party moves with the interests of the super elite. Not the 1 percent, but the .01 percent. So the extraordinary explosion in incomes of the .01 percent relative to everybody else has pulled the Republican party far to the right to the point where there is no center. The center did not hold, it dissolved and turned into a chasm. That's not because Democrats moved to the left, because they didn't; they moved right. It's because the Republicans moved off into the Gamma quadrant. That is at the root of our political paralysis right now.
When asked about the "austerity madness," Krugman replies that "we are moving back towards sanity:"
Whether it'll be time enough to avoid catastrophe I don't know. I think hammering on these points and pointing to the evidence does seem to work, which is why I published the book. It's in the hope we can get the debate to move a little bit further in the direction of doing the right thing.