Paul Krugman’s “Solution” to the U.S. Deficit: Death Panels and VAT
By David J. Theroux • Monday November 15, 2010 10:22 AM PDT • 19 Comments
In a roundtable discussion on the U.S. National Commission on Fiscal Responsibility and Reform (“Deficit Reduction Commission”), Nobel Prize laureate and hyper-Keynesian economist Paul Krugman came clean on his view on ABC’s “This Week with Christiane Amanpour,” regarding how to reduce the gigantic federal deficit that he has been so supportive in seeing created: death panels and a national Value Added Tax (VAT). Krugman has been among the leading figures in attacking Sarah Palin’s warnings that Obamacare, without the use of free-market pricing, would necessarily include “death panels” to ration medical treatments for the seriously ill and aged. Neglecting to propose any cuts in spending or taxes, Krugman stated the following:
Some years down the pike, we’re going to get the real solution, which is going to be a combination of death panels and sales taxes. It’s going to be that we’re actually going to take Medicare under control, and we’re going to have to get some additional revenue, probably from a VAT. But it’s not going to happen now.
The Obama healthcare plan passed by Congress in 2010 includes government-run healthcare committees with sweeping powers, including the power to engage in competitive pricing and cost analysis, a system Britain uses that has led to rationing of medical care for the elderly.
Later Krugman, in realizing that his remarks would be met with outrage, tried to cover his trail on his blog for the New York Times, “The Conscience of a Liberal,” but in the process, has only dug himself in even deeper:
I said something deliberately provocative on This Week, so I think I’d better clarify what I meant (which I did on the show, but it can’t hurt to say it again.)
So, what I said is that the eventual resolution of the deficit problem both will and should rely on “death panels and sales taxes”. What I meant is that
(a) health care costs will have to be controlled, which will surely require having Medicare and Medicaid decide what they’re willing to pay for—not really death panels, of course, but consideration of medical effectiveness and, at some point, how much we’re willing to spend for extreme care
(b) we’ll need more revenue—several percent of GDP—which might most plausibly come from a value-added tax
And if we do those two things, we’re most of the way toward a sustainable budget.
By the way, I’ve said this before.
Now, you may declare that this is politically impossible. But medical costs must be controlled somehow, or nothing works. And is a modest VAT really so much more implausible than ending the mortgage interest deduction?
So that’s my plan. And I believe that some day—maybe in the first Chelsea Clinton administration—it will actually happen.
Tags: Bailouts, Budget and Tax Policy, Corporatism, Culture, Economics, Employment, Fascism, Free Market, Government subsidies, Healthcare, Morality, Nanny State, Nationalization, Politics, Power, Price control, Regulation, Socialism, Taxation, The State, Transparency, Utilitarianism, Video 
It’s amazing that Palin (no, I’m not a fan) was excoriated for bringing up death panels. Now Krugman himself admits it, even though the name is somewhat distasteful.
Speedmaster | Nov 15, 2010 | Reply
Let me guess. When those plans are eventually implimented and do nothing to improve the quality or the supply of health-care, Krugman will complain that his advice was not taken far enough as always.
DW | Nov 15, 2010 | Reply
Krugman sold his soul to the left in the 1990s and now prostitutes his Nobel Prize prestige in support of ludicrous economic and political recommendations. He doesn’t appear senile or demented, so I conclude that he deliberately spreads known falsehoods to support the cause of bigger, more powerful, and more intrusive government. He is yet another false economist who has been seduced by government power and spurns the free market.
Dr. T | Nov 15, 2010 | Reply
Is there a video of this? Surely it’s something critics of Krugman could share with others about the true end to his proposed policy prescriptions.
Ryan Szabo | Nov 15, 2010 | Reply
I don’t think there’s a kind way of putting it, so I’ll just write it: Paul Krugman is a cancer on society. That anyone would give this cretin the time of day speaks volumes.
Someday soon, our dear Nobel Laureate will be an old fart fighting to extend his life. In a just world, he’ll be subject to the “solutions” he’s offering us.
Steve Hogan | Nov 15, 2010 | Reply
No Steve, those “Solutions” are never for those proposing them, just we, the unwashed masses. Mr. Krugman will never face a death pannel because he will likely always be “well connected.” you and I however need to plan for our retirement in some other country if we intend to live through old age (or have plenty of gold and silver coins with which to bribe doctors working off the grid).
joe4liberty | Nov 16, 2010 | Reply
Small point, but it’s ABC’s This Week, not CNN.
john | Nov 17, 2010 | Reply
John, Duly noted and corrected. Thank you.
David Theroux | Nov 17, 2010 | Reply
He’s disgusting.
Peter Shalen | Nov 17, 2010 | Reply
Obamacare will not, I repeat, not lead to so called Death Panels. Obamacare will merely require Cost Control Boards charged with deciding who gets care and who doesn’t.
Tim | Nov 21, 2010 | Reply
We don’t want the death panels. Obama said he would not have the death panels in his health care bill. Now I don’t think the government should tell us when to die and I hope won’t. Thanks.
joanne | Dec 28, 2010 | Reply