Paul Krugman wrote in his New York Times column on February 7, 2009, that the package to stimulate the American economy, proposed by the Obama administration, was too small and too focused on ineffective tax cuts. The tax cuts were included to appease the more conservative members of the Congress. To make things worse the Congress has now shaved off a good portion of the proposed spending, "much of it among the most effective and most needed parts of the plan", wrote Krugman. Furthermore the Congress has increased the tax cuts. Krugman concluded: "This is really, really bad".

Seemingly things have not changed a lot in Washington. When the Republicans won the White House in 2000, the economy was healthy and the Federal Government had a surplus. Some economists even worried about the effects on the financial markets if the federal government would cease to issue long term treasury bills. Now the U.S. economy is in its worst shape in living memory and could possibly even implode. The federal government's indebtedness is at a record level and much, much more is needed (Vice President Cheney once said that President Reagan had thought us that debt does not matter). Wall Street is effectively, if not formally, owned by the U.S. government. A nationalization as a result of compassionate conservatism! In spite of all this, the Republican Party does not seem to think that there is a need to rethink its policies.

The financial crisis has spread all over the world. The United States has been the engine that has pulled many countries out of miserable poverty, most notably China and India. Now they are more on they own. Countries like Venezuela, Iran and Russia became self-confident, arrogant and anti-American because American consumerism, which they so despise, made their only true export item, oil, valuable and their own governments popular.

The big loser in the economic crisis could however become the West in general, and the Western way of life, which is built on human rights, personal liberty and democracy. The West needs a strong America, which presupposes a healthy and dynamic American economy. One can only hope President Obama succeeds in restoring America's status. He is certainly the right man for the job, for which only the American electorate can be thanked, but the challenges are enormous. The Republican Party should by now realize that the campaign is over, and take a deep look into the mirror.

Olli Raade, Editor

February 8, 2009

Video: Senator Ben Nelson defends the cuts to the stimulus package (February 10, 2009):