Krugman to Henry Paulson

Mr Paulson, are you ready to sell your soul and sacrifice all of your credibility?
That is the question Paul Krugman asks.
The promises:

No doubt you received assurances that like Robert Rubin, but unlike your predecessors in this administration, you'll get to be a real Treasury secretary. And you probably believe that those assurances can be trusted, if only because the Bush people currently need you a lot more than you need them.

The reality:

So what are you being asked to do that will undermine your credibility? Right now, I'd guess, you're being pressed to support the administration's illusions about how the economy is doing.

Americans are very unhappy with the state of the economy. According to Gallup, only 4 percent of the public considers the economy "excellent," and only 25 percent considers it "good." And there's good reason for this unhappiness. Although profits and C.E.O. compensation have soared, most workers are significantly worse off than they were a year ago.

The official line, however, is that it's a great economy, but that Americans for some reason aren't hearing the good news (just like they aren't hearing the good news from Iraq). Mr. Bush - who, by the way, isn't the affable guy you may have thought you met - doesn't seem as if he realizes that the economy isn't all that good; in his public appearances he seems peeved that he isn't getting credit for a great economy. And he expects you to explain to working Americans that the trouble they're having paying their bills is just a figment of their imagination.

Moreover, if past experience is any guide, you won't be pressured just to spin on the administration's behalf, you'll be pressured to lie.

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