WASHINGTON — House Democrats will ask the wealthiest Americans to help pay for overhauling the health care system with a $550 billion income tax increase, the chairman of the tax-writing Ways and Means Committee said Friday.

Predictably...Republicans — and some Democrats — have treated any bad news as evidence of failure, rather than as a reason to make the policy stronger. ...I was afraid this would happen. ...But they should also be prepared to add to the stimulus now that it’s clear that the first round wasn’t big enough.

It was disturbing when President Obama walked back Mr. Biden’s admission that the administration “misread” the economy, declaring that “there’s nothing we would have done differently.” There was a whiff of the Bush infallibility complex in that remark, a hint that the current administration might share some of its predecessor’s inability to admit mistakes. And that’s an attitude neither Mr. Obama nor the country can afford.

I have always wondered how smart, very smart, people can say such obliviously idiotic things. My conclusion is that they are nuts. Infallibility, for Krugman, must be a synonym for irony.

"Normally, then, we expect policy makers to respond to bad job numbers with a combination of patience and resolve. They should give existing policies time to work, but they should also consider making those policies stronger."

Nowhere does he consider the possibility that the policy itself may be incorrect!

What's this talk about a "second" stimulus? Krugman refers to "the first round". Wasn't the first stimulus during the Bush administration? How many stimuli have there been so far?

The next item is one of my favorites. A common observation by people who like the blog is that lots of it could have been written today. Well, here's a review in the 1930 Journal ... of an 1830 book ... about events in 1720 ... and it still could have been written today!...

Washington Irving's book “The Great Mississipi Bubble” republished by Random House. "The story was written about a hundred years ago and the actual event occurred more than two hundred years ago, but the narrative ... will interest many who witnessed the recent debacle of stock prices." A couple of quotes from the book: The boom - "Every now and then the world is visited by one of those delusive seasons when the 'credit system,' as it is called, expands to full luxuriance; the broad way to certain and sudden wealth lies plain and open ... "; The bust - "a panic succeeds, and the whole superstructure built upon credit and reared by speculation crumbles to the ground, leaving scarce a wreck behind."

The global market has stimulated first and foremost, on the part of rich countries, a search for areas in which to outsource production at low cost with a view to reducing the prices of many goods, increasing purchasing power and thus accelerating the rate of development in terms of greater availability of consumer goods for the domestic market. Consequently, the market has prompted new forms of competition between States as they seek to attract foreign businesses to set up production centres, by means of a variety of instruments, including favourable fiscal regimes and deregulation of the labour market. These processes have led to a downsizing of social security systems as the price to be paid for seeking greater competitive advantage in the global market, with consequent grave danger for the rights of workers, for fundamental human rights and for the solidarity associated with the traditional forms of the social State. Systems of social security can lose the capacity to carry out their task, both in emerging countries and in those that were among the earliest to develop, as well as in poor countries. Here budgetary policies, with cuts in social spending often made under pressure from international financial institutions, can leave citizens powerless in the face of old and new risks; such powerlessness is increased by the lack of effective protection on the part of workers' associations. Through the combination of social and economic change, trade union organizations experience greater difficulty in carrying out their task of representing the interests of workers, partly because Governments, for reasons of economic utility, often limit the freedom or the negotiating capacity of labour unions. Hence traditional networks of solidarity have more and more obstacles to overcome.

To fairly divide the climate change fight between rich and poor, a new study suggests basing targets for emission cuts on the number of wealthy people, who are also the biggest greenhouse gas emitters, in a country.

Gotta love the "expert quote."

Is this a limousine-and-yacht tax on the rich? Not necessarily, [study author] Chakravarty said, but he did not rule it out: "We are not by any means proposing that. If some country finds a way of doing that, it's great."

"You're distributing the task of doing something about emissions reduction based on the proportion of the population in the country that's actually doing the most damage," said Shoibal Chakravarty of the Princeton Environment Institute, one of the study's authors.

While sitting on the sunny shores of Lake Huron this weekend, I almost choked on my Makers Mark when I read Krugman's column from Friday. He closed with this gem:

"So here’s my message to the president: You need to get both your economic team and your political people working on additional stimulus, now. Because if you don’t, you’ll soon be facing your own personal 1937."

But, according to Politico.com, in December of last year:

When master economist, columnist, and plain ole intellectual (so few left these days) Paul Krugman was asked this morning [on Bill Press's radio show] about whether or not he was "in communications" with the Obama administration regarding the economy, he declared: "Yes... I am.. And that's all I care to talk about."

While I'm prepared to acknowledge that the currently enacted pork filled stimulus may not have been a Krugman design, doesn't the above quote lead one to believe that he at least had a hand in it, and would therefore be part of the Obama economic team he seems to think was inadequate the first time around?

How does he think that he can wag his finger at the President with one hand, while patting his back with the other?

And, for someone so interested in history, why didn't Krugman discuss the Smoot Hawley tariff?

If it wasn't for the fine Habana Cohiba, he may have ruined my vacation!

Mr. Biden, in an interview with ABC News's "This Week," said the 9.5% jobless rate is "much too high" and acknowledged that the administration didn't anticipate the severity of the economic problems. "There was a misreading of just how bad an economy we inherited," he said in the interview, which aired Sunday. He and other White House officials say the administration relied on consensus economic figures in January when they were developing the stimulus package.

"A second stimulus should be the one they should have done the first time, something that is relatively fast and thoughtful," said Phillip Swagel, a professor at Georgetown University's McDonough School of Business. Mr. Swagel, a former Treasury assistant secretary for economic policy under President George W. Bush, said a more-effective package could include more assistance to struggling state and local governments and personal tax cuts.