Paul Krugman explains why we can't settle for stabilizing the economy, and says unless there's a bigger economic stimulus package, high unemployment is here to stay for a long, long time:

The effects of the stimulus will build over time — it’s still likely to create or save a total of around three million jobs — but its peak impact on the growth of G.D.P. (as opposed to its level) is already behind us. Solid growth will continue only if private spending takes up the baton as the effect of the stimulus fades. And so far there’s no sign that this is happening.

So the government needs to do much more. Unfortunately, the political prospects for further action aren’t good.

What I keep hearing from Washington is one of two arguments: either (1) the stimulus has failed, unemployment is still rising, so we shouldn’t do any more, or (2) the stimulus has succeeded, G.D.P. is growing, so we don’t need to do any more. The truth, which is that the stimulus was too little of a good thing — that it helped, but it wasn’t big enough — seems to be too complicated for an era of sound-bite politics.

But can we afford to do more? We can’t afford not to.

High unemployment doesn’t just punish the economy today; it punishes the future, too. In the face of a depressed economy, businesses have slashed investment spending — both spending on plant and equipment and “intangible” investments in such things as product development and worker training. This will hurt the economy’s potential for years to come.

Deficit hawks like to complain that today’s young people will end up having to pay higher taxes to service the debt we’re running up right now. But anyone who really cared about the prospects of young Americans would be pushing for much more job creation, since the burden of high unemployment falls disproportionately on young workers — and those who enter the work force in years of high unemployment suffer permanent career damage, never catching up with those who graduated in better times.

Even the claim that we’ll have to pay for stimulus spending now with higher taxes later is mostly wrong. Spending more on recovery will lead to a stronger economy, both now and in the future — and a stronger economy means more government revenue. Stimulus spending probably doesn’t pay for itself, but its true cost, even in a narrow fiscal sense, is only a fraction of the headline number.

O.K., I know I’m being impractical: major economic programs can’t pass Congress without the support of relatively conservative Democrats, and these Democrats have been telling reporters that they have lost their appetite for stimulus.

But I hope their stomachs start rumbling soon. We now know that stimulus works, but we aren’t doing nearly enough of it. For the sake of today’s unemployed, and for the sake of the nation’s future, we need to do much more.

From NOW on PBS--Power Struggle. More available here.

This is what I hate having to explain to my relatives and friends abroad in Europe about politics in the US. We know that global warming is a fact. We know that our actions, if they didn't cause global warming, definitely exacerbate it. We know that we must reduce our dependency on oil, for both ecological and political/strategic reasons. And yet, what we are able to do is hampered so predictably by the Republican party:

Here we go again. James Inhofe, the most prominent climate change denier in the United States Senate, has concocted a new and innovative strategy to thwart the Clean Energy Jobs and American Power Act. To wit, he and his Republican colleagues on the Environment and Public Works Committee have worked up a plan to simply not show up for next week’s markup:

But Boxer cannot hold the markup unless at least two Republicans show up, and EPW ranking member James Inhofe (R-Okla.) signaled that he has unanimous support among the panel’s minority members to boycott the session until they get more data on the legislation from U.S. EPA and the Congressional Budget Office.

Inhofe said he will wait for Boxer to file an official notice of the markup — expected today — before responding with his own declaration of the GOP’s markup strategy.

“As soon as we find out what her announcement is and what she wants to do, we’ll have our response,” Inhofe told E&E last night. “We’ll have our unanimous expression ready.”

Sadly, this is a continuation of the GOP’s longstanding strategy of delaying clean energy legislation:

• As Chairman Markey shepherded his American Clean Energy and Security Act through the House Energy and Commerce Committee, Republicans employed multiple parliamentary tricks to — as Politico put it — “nitpick the bill into legislative oblivion.” Brian Beutler called these nefarious stall tactics, and noted that Democrats responded by hiring a speed reader.
• Last year during the debate over the Climate Security Act, Minority Leader Mitch McConnell demanded that the entire 491 page bill be read on the floor of the United States Senate. A strategy memo was leaked at the time detailing the Republican strategy for delaying the bill as much as humanly possible.

While this Republican obstructionism is not necessarily surprising, it is especially egregious this time. Here are a few things about this episode that struck me:

1. Despite the fact that Senator Inhofe has been working to orchestrate this obstruction for a week now, Republicans are pretending the effort is being led by the two moderate Republicans on the committee. Politico handled the stenography.

The Politco, acting as a mouthpiece for the Republican Party? Say it isn't so!

Can you imagine how much further we'd get in this country if we didn't have so many idiots in office?

I can draw only one of two conclusions: Either the Obama administration's economic advisers and their Congressional enablers are as dumb as a box of hammers and completely oblivious to the history of the first Great Depression, or they do know and are gambling with the nation's economy anyway - because they're afraid the Republicans might draw blood in the next election cycle:

WASHINGTON — Faced with anxiety in financial markets about the huge federal deficit and the potential for it to become an electoral liability for Democrats, the White House and Congressional leaders are weighing options for narrowing the gap, including a bipartisan commission that could force tax increases and spending cuts.

But even the idea of a panel to bridge the partisan divide has run into partisan objections. Many Democrats, including in the White House, are loath to cede such far-reaching decisions to a commission and doubt Republicans’ willingness to compromise. And most Republicans remain adamantly opposed to tax increases, leaving the prospects for any bipartisan approach limited at best.

The proponents, however, are pressing for a Senate vote this month. “If we have the same process and the same people, we are going to get the same results,” said Senator Evan Bayh, Democrat of Indiana, who recently met with Mr. Obama to discuss the idea. “The Democratic Party wants to spend more than we can afford, the Republican Party tends to want to cut taxes more than we can afford. So we are stuck.”

And of course, the grandstanding Mr. Bayh is the man who loves to agree with the Republicans.

Concerns about the deficit are building even as the White House and Congress continue to add to it with tax cuts and spending to stimulate a still-fragile economy. Yet those one-time costs do not trouble most economists and market analysts.

The main driver of long-term deficits is the chasm between the benefit programs Medicare and Medicaid, which are growing faster than the economy, and federal tax collections, which are at one of their lowest levels in many decades relative to the size of the economy.

Mr. Obama’s budget director, Peter R. Orszag, now at work on the president’s next budget, due in February for the 2011 fiscal year, declined to comment about a bipartisan commission and instead promised that the coming budget would propose additional ways to reduce the deficit beyond next year, when the economy is fully recovered.

Paul Krugman referred us to this just the other day:

Matt Yglesias makes a good point:

A lot of politicians and political operatives in DC are very impressed by polling that shows people concerned about the budget deficit. I think it would be really politically insane for people to take that too literally. If congress makes the deficit even bigger in a way that helps spur recovery, then come election day people will notice the recovery and be happy. If, by contrast, the labor market is still a disaster then people will be pissed off. It’s true that they might say they’re pissed off at the deficit, but the underlying source of anger is the objective bad conditions.

But the political argument against focusing on the deficit is even stronger than he realizes — because there are very good odds that even if Obama exhibited iron fiscal discipline, voters wouldn’t notice. There’s a remarkable, depressing paper by Achen and Bartels that includes an analysis of voter views of the deficit in 1996 — by which time the huge deficit that Bill Clinton inherited had been drastically reduced.

Here’s what voters thought they knew... Yep: after one of the biggest moves toward budget balance in history, a majority of Republicans, and a plurality of all voters, believed that deficits had increased.

Not to put too fine a point on it: if Obama succeeded in reducing the deficit, would Fox News or the Washington Times report it?

The truth is that the truth about budgets plays almost no role in real politics. Right now, Meg Whitman is campaigning for Governor of California on the claim that state spending has exploded over the last decade — when the fact is that it has fallen drastically in real per capita terms. Will she pay a price for this? Probably not.

So if I were a politician, I’d focus on providing real improvements in peoples’ lives, rather than seeking deficit reductions the public won’t even hear about.

Not to mention that in 1937, when FDR, under pressure from the Blue Dogs of his time, cut taxes and spending, it deepened and prolonged the Depression by driving unemployment back into double digits - and led to a major defeat in the 1938 mid-terms for the Democrats.

Via Paul Rosenberg at Open Left:

According to leading "education researchers" (sub required), the draft guidelines that the Obama administration has published for federal economic-stimulus money and Title I aid for schools "have no credible basis in research."

The researchers point to two regulatory priorities in particular that are lacking in research evidence: evaluating teachers based on students' standardized test scores and promoting the growth of charter schools.

"One theory of action seems to be that holding teachers more accountable for the gain in their students' test scores will induce them to become better teachers," writes Duke University's Helen Ladd. "At this point, I am not aware of any credible evidence in support of that proposition."

And research on the performance of charter schools has shown that their track record is "highly variable."

The article points out that the Bush administration was famous for insisting that schools adhere to policies and programs that were based on "scientific research" while it promoted an agenda that had nothing "scientific" about it.

Now, the Obama administration is insisting that schools make decisions based on "data that shows what works," while it pursues mandates that have no data to support them.

What's the difference?

The difference is, the investors who run these new charter schools will be donating to Democrats! Next question?

Paul comments:

Due to the Great Recession, state and local governments are suffering massive cut-backs, and since education spending is generally their largest single budget item, schools are getting hit especially hard. This need not have been the case if Obama had either (a) asked for a $1.3 trillion stimulus, the size that many economists said was needed back in early 2009, or (b) altered the mix of tax cuts vs. spending through the states. And the blow could certainly have been softened if he had opposed the Snowe/Collins/Nelson/Scrouge "compromise" that cut something like $50 billion in school funding from the stimulus, rather than hailing those piggy-bank robbers for their "leadership." Whether or not it was all planned from the beginning, what's eventually shaped up out of this is that there's a small package of stimulus funds available for states and schools that jump through the federal education reform hoops--the exact nature of which is still being determined, although states that lift restrictions on charter schools will go to the head of the line.

It's really hard to see this as anything other than a Shock Doctrine-style deal, since it's a way to force cash-starved states and schools to change education policy and practice, regardless of what they might normally and democratically choose to do. And not only that--because the funds are limited, they could make the changes, and still not get a dime for doing so.

Yes, but we're much more inspired now and that will change everything.

Remember during the stimulus debate, when the Republicans told us birth control funds didn't have a damned thing to do with the economy - and the Democrats, as usual, knuckled under to them?

The Guttmacher Institute has just released a report on the impact of the recession on family planning, and the results are predictable - at least, if you're a normal (i.e. non-wingnut) person. Via Salon:

This summer, researchers surveyed 947 women between the ages of 18 and 34 with household incomes of less than $75,000. They found that women are preoccupied by worry about money, medical costs and childcare. Most of the women hope to get pregnant later on or have decided against having kids because of these tough times -- and that's even more common among women who are less well-off than they were a year ago. A total of 64 percent agreed with the statement, "With the economy the way it is, I can’t afford to have a baby right now."

These findings are all rather intuitive, but what this actually means for pregnancy prevention is less straightforward. A total of 29 percent say they are "more careful" than before about using contraception every time they have sex. There is a flip-side to that, though: Eight percent of women are using birth control less regularly as a means of saving money and, among women in financial decline, that number rises to 12 percent. Things are even sketchier among women on the pill: 18% are popping hormones irregularly to save some cash -- either by missing pills, filling their prescription late, taking at least one month off or picking up fewer packs at a time. That number balloons to 25 percent when it comes to the category of worse-off women.

Overall, 23 percent are having a tougher time than a year ago covering the cost of birth control and -- again, say it with me now -- that number is higher among women whose finances have dwindled. The upshot: Those who are least capable of affording the cost of a child are putting themselves at the greatest risk for an unplanned pregnancy. Women also report avoiding appointments with their gynecologists in the last year -- especially those who have recently lost their health insurance.

From an emailer:

This is Democrat Alan Grayson asking Chairman Ben Bernanke where the Federal Reserve sent $500,000,000,000 last year. And Chairman Bernanke doesn't know. He says it went to foreign central banks, but beyond that, he has no idea what those banks did with the money.

Whatever, it's only a half a trillion.

It would be nice to know where our money is going one would think. And with these "beyond Monopoly money" figures that went out to the world---why isn't there any form of accountability? I'll take a page from Bernanke's playbook. I don't know.

It was inevitable Obama's numbers would drop, and although Ohio is typically a bellwether state, it remains to be seen whether this is a trend. (Download complete poll here.)

The fact that the most high-profile administration efforts went to save banks instead of homeowners probably didn't help. People all over the country are barely hanging on, and it will take something like a successful health care plan - or another stimulus package - to win back their confidence:

July 7 (Bloomberg) -- A new poll found that President Barack Obama’s approval rating has dropped by 13 percentage points from two months ago in Ohio, traditionally a critical swing state in presidential elections.

The survey by Quinnipiac University released today showed 49 percent of Ohio voters approved of Obama’s job performance, down from 62 percent in a May 6 poll. The disapproval figure for Obama in the new poll was 44 percent, up from 31 percent in the May survey.

The pollsters termed Obama’s ratings “lackluster” in a release, and said the numbers were his lowest marks “in any national or statewide Quinnipiac University poll since he was inaugurated.”

The White House announced late today that Vice President Joe Biden will travel to Cincinnati on July 9, where he will tout progress being made by the $787 billion economic stimulus Measure passed in February.

“The economy in Ohio is as bad as anywhere in America,” said Peter Brown, assistant director of the Quinnipiac University Polling Institute. The poll numbers “indicate that for the first time voters have decided that President Barack Obama bears some responsibility for their problems.”

Maybe this is why Obama economic adviser Laura Tyson said this yesterday:

"We should be planning on a contingency basis for a second round of stimulus. ... The stimulus is performing close to expectations but not in timing." Reuters: "Addressing a seminar in Singapore, Tyson said she felt the first round of stimulus aimed to prop up the economy had been slightly smaller than she would have liked and that a possible second round should be directed at infrastructure investment."

Also, Biden will head to Ohio Thursday to talk up the stimulus plan.

The same people who insisted the first stimulus package was plenty (remember that famous "bipartisan" compromise?) and that the economists who said otherwise (Paul Krugman, Nouriel Roubini, etc.) were overreacting now quietly agree: It really wasn't enough. It wasn't enough, and now it will be even more politically difficult fr Obama to go back and ask for more - just as Krugman warned.

Despite signs that the recession gripping the nation's economy may be easing, the unemployment rate is projected to continue rising for another year before topping out in double digits, a prospect that threatens to slow growth, increase poverty and further complicate the Obama administration's message of optimism about the economic outlook.

The likelihood of severe unemployment extending into the 2010 midterm elections and beyond poses a significant political hurdle to President Obama and congressional Democrats, who are already under fire for what critics label profligate spending. Continuing high unemployment rates would undercut the fundamental argument behind much of that spending: the promise that it will create new jobs and improve the prospects of working Americans, which Obama has called the ultimate measure of a healthy economy.

"Our hope would be to actually create some jobs this year," Obama said in an interview with The Washington Post in the days before taking office.

Obama has defended his economic approach -- which includes the $787 billion economic stimulus plan and record investments in health care, alternative energy, education and job training -- as necessary to stabilize the shaky economy and point the way to job growth.

So far, the White House has counseled patience even as the political debate surrounding its economic policies grows more urgent. Officials point out that job growth will not come until robust economic expansion takes hold, which they expect will happen as stimulus funding works its way through the economy. Still, the flagging job market is likely to stir calls for further stimulus efforts as polls show voters growing increasingly wary of federal spending in the wake of a costly series of financial- and auto-industry bailouts and amid current efforts to expand health-care coverage to the uninsured, which is estimated to cost at least $1 trillion over the next decade.

With many forecasters projecting unemployment to remain above 10 percent next year and not return to pre-recession levels of roughly 5 percent for years after that, Obama is likely to be confronted with defending the effectiveness of his economic policies as the nation endures its worst employment situation in a generation.

Analysts say the high levels of joblessness would be accompanied by increases in child poverty, strained government budgets, and black and Latino unemployment rates approaching 20 percent.

"I find it unfathomable that people are not horrified about what is going to happen," said Lawrence Mishel, president of the Economic Policy Institute. "I regard all this talk about how the recession is maybe going to end, all the talk about deficits and inflation, to be the equivalent of telling Americans, 'You are just going to have to tough it out.' But we're looking at persistent unemployment that is going to be extraordinarily damaging to many communities. There is a ton of pain in the pipeline."

The final federal benefits extension, the one that's the end of the line? They make you prove you're looking for work and require you to accept any job they find that pays as much as your unemployment check.

You know, as if it's your fault you're unemployed during a major recession and you're just too lazy to look.

I guess that was part of the "bipartisan" solution. You'd think they'd be smart enough to figure out that if they're funding a third benefits extension, duh! It's because there aren't any jobs. On the other hand, you get to brag to the voters back home how you're making those bums pay - and in addition, you get the sheer fun of kicking people when they're down. So there's that, too!

Wacky wingnut Sen. Jim "Your Conservative Voice in the Senate" DeMint (R-SC) is trying to raise a stink about this. Are people being put to work with the stimulus money? If yes, then shut your piehole, Jim:

WASHINGTON — President Obama and congressional Democrats have defended the $787 billion stimulus package against accusations of pork-barrel spending by saying the bill did not direct money to projects requested by members of Congress.

Still, that hasn't stopped lawmakers from working behind the scenes to try to influence how the money is spent, according to agency records.

Dozens of members of Congress from both parties have called, written or e-mailed agencies urging them to fund projects in their districts or states.

So freakin' what? As Barney Frank points out, isn't that their job?

Among the projects supported by members of Congress that have been funded: $116 million for a federal courthouse in Austin; $35 million to $60 million for toxic waste cleanups in Massachusetts and Colorado; and $5 million for the removal of pine trees killed by bark beetles in Colorado, records show.

Ten of 27 departments and agencies receiving stimulus money have released records of contacts by lawmakers under Freedom of Information Act requests USA TODAY filed in April. Those records detailed 53 letters, phone calls and e-mails recommending projects from 60 members from February through the end of May. Thirteen of those lawmakers voted against the stimulus package.

Seems to me that's the real story. Why doesn't USA Today list the lawmakers who voted against the stimulus but are still trying to grab the dough? Could it be because of their party affiliation, perhaps?

Budget watchdogs worry that political pressure from members of Congress could threaten the impartiality of agency decisions.

"This is really subverting the intent of the legislation, when members call an agency and say, 'Fund my project,' " says Thomas Schatz of the non-partisan Citizens Against Government Waste. "Especially if it's an appropriations committee member that's in charge of the agency's budget, it's likely the agency will accede to that request."

Oh, let's talk about Citizens Against Government Waste, shall we? A right-wing group funded by the usual suspects - the Olin Foundation, the Bradley Foundation - and Big Biz, like the tobacco lobby and Microsoft. Coincidentally, one of their biggest campaigns was against... open source software, that well-known threat to humanity. They also lobbied Congress on behalf of the tobacco industry. Hmm.

Lawmakers say they are just doing their jobs.

"One of the dumbest things I've ever heard is the notion that members of Congress should have no say on how government money is spent," said Rep. Barney Frank, D-Mass., who successfully petitioned the Environmental Protection Agency to use stimulus money to speed cleanup of a polluted harbor.

Congress enacted rules two years ago requiring lawmakers to disclose their requests for funding of projects inserted into annual spending bills and to certify that the projects would not directly benefit themselves or close relatives. The stimulus bill, however, contained no specific projects — known as earmarks — prompting lawmakers to seek other ways to direct spending.

Horrors! A bill gets passed that doesn't specify how it's spent - and Congress tries to lobby on behalf of projects! The sky is falling!

Sounds like a lazy reporter got a press release from Citizens Against Government Waste, is how it sounds to me. But what do I know?

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Ever notice how the wingnuts all clutch their pearls and collapse on the fainting couches whenever President Obama talks about the miserable failure that has been conservative rule?

Of course, they really don't want to own up to this failure, because otherwise their fading movement will collapse altogether. But the harsh fact is that we can't solve the problems, and prevent their repeat, without understanding the nature of the mistakes that caused them.

Obama gets this, of course. So today in his speech on the economy, he tackled it head on:

It is simply not sustainable to have a 21st-century financial system that is governed by 20th-century rules and regulations that allowed the recklessness of a few to threaten the entire economy. It is not sustainable to have an economy where in one year, 40 percent of our corporate profits came from a financial sector that was based on inflated home prices, maxed-out credit cards, over-leveraged banks and overvalued assets. It's not sustainable to have an economy where the incomes of the top 1 percent has skyrocketed while the typical working household has seen their incomes decline by nearly $2,000. That's just not a sustainable model for long-term prosperity.

For even as too many were out there chasing ever-bigger bonuses and short-term profits over the last decade, we continued to neglect the long-term threats to our prosperity: the crushing burden that the rising cost of health care is placing on families and businesses; the failure of our education system to prepare our workers for a new age; the progress that other nations are making on clean energy industries and technologies while we -- we remain addicted to foreign oil; the growing debt that we're passing on to our children. Even after we emerge from the current recession, these challenges will still represent major obstacles that stand in the way of our success in the 21st century. So we've got a lot of work to do.

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Larry Summers' address before the Economic Club in Washington D.C. on Thursday was interrupted by two members of Code Pink who jumped on stage with a banner, yelling derogatory comments.

Both Larry Summers (L), the Director of President Obama's National Economic Council and David Rubenstein, Economic Club of Washington President and Co-Founder and Managing Director of The Carlyle Group, seemed to take the disruption in stride. When asked by Rubinstein if he ever regretted taking the job Summers replied "There are moments that are more pleasant and some that are less pleasant. ... Honestly, I felt honored to be asked by the president to help at this moment."

Just about all the Village teevee bobbleheads -- especially the Foxheads -- have been trying to find ways to shuffle the blame for the economic disaster now upon us onto the man Americans hired to fix the problem: Barack Obama.

It seemed like everywhere you turned a couple of weeks ago, we were hearing about the "Obama Bear Market." Mind you, they were positively gleeful about it; after all, they know their own future success hinges on Barack Obama's failure. And it worked for a little while: the mau-mauing over Obama's recovery plan certainly didn't help the market.

But now that we're at over 8,000 again? Crickets. That's all we hear.

So now they're crying "socialism" -- or is it "fascism"? -- and hysterically warning against One World Government. I think we can all see the direction this is heading, and it's not a healthy one.

The public sees it too: A Washington Post poll reveals some unpleasant truths for the right-wing pundits who pat themselves on the backs for keeping the flock of True Believers who plump up their ratings, these masters of the media who wield the power to alter public opinion.

Because it ain't working anymore. The rest of the world is gradually abandoning them:

Media Matters has more:

The Washington Post/ABC News poll, released on March 31, asked respondents who they thought "deserve[d]" the most "blame" for "the country's economic situation." Results for who deserved a "great deal" or "good amount" of blame are as follows:

* 80 percent said banks and other financial institutions

* 80 percent said large business corporations

* 72 percent said consumers

* 70 percent said the Bush administration

* 26 percent said the Obama administration

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Well, if it wasn't already obvious, it should be plain by now that the whole flirtation with Judd Gregg wouldn't have worked out at all for the Obama administration. Because he just can't suppress his inner Republican, especially when he gets on national teevee shows like CNN's State of the Union with John King on Sunday:

"The practical implications of this is bankruptcy for the United States,” Gregg said of the Obama’s administration’s recently released budget blueprint. “There’s no other way around it. If we maintain the proposals that are in this budget over the ten-year period that this budget covers, this country will go bankrupt. People will not buy our debt, our dollar will become devalued. It is a very severe situation.”

Gregg, known as one of the keenest fiscal minds on Capitol Hill, also told CNN Chief National Correspondent John King that he thought it was “almost unconscionable” for the White House to continue with its planned course on fiscal matters with unprecedented actual and projected budget deficits in the coming years.

“It is as if you were flying an airplane and the gas light came on and it said ‘you have 15 minutes of gas left’ and the pilot said ‘we’re not going to worry about that, we’re going to fly for another two hours.’ Well, the plane crashes and our country will crash and we’ll pass on to our kids a country that’s not affordable.”

A clever quote (he's used it previously), but cleverness doesn't make for good economics. Obama's recovery plan has always been clearly a gamble of a different sort -- he's essentially betting that the stimulus package will create enough economic activity to overcome the deficits. In a simple airplane analogy, he's betting that they can create enough fuel to get the plane over the rough stretch -- which in the world of aviation, of course, doesn't work. But economics isn't exactly avionics. And Gregg knows that -- but hey, why not trot out the Republican talking points anyway?

Earlier in the segment, Gregg complained that the Congress was going after the AIG bonuses irrationally, with torches and pitchforks. But then he turned around and offered up this bit of hysteria too, certain to turn up on Glenn Beck's show Monday as proof of Obama's "socialism" taking us straight to Helena Handbasket. Yeah, that was helpful.

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David Shuster invited Rep. Jim Clyburn on to his morning MSNBC broadcast to talk about Mark Sanford's latest bizarre twist in his attempts to defend his refusal to take federal stimulus money for his state:

Sanford told reporters in South Carolina that he still intends to turn down millions in stimulus cash, despite the likelihood of his state legislature accepting the cash -- and criticism by House Majority Whip Jim Clyburn (D-SC) that rejecting any payments would disproportionately harm African American residents.

"What you're doing is buying into the notion that if we just print some more money that we don't have, send it to different states - we'll create jobs... If that's the case why isn't Zimbabwe a rich place?"..."why isn't Zimbabwe just an incredibly prosperous place. Cause they're printing money they don't have and sending it around to their different - I don't know the towns in Zimbabwe but that same logic is being applied there with little effect."

Clyburn largely elaborated on the point he made originally:

"Sounds like he's playing the race card," Clyburn said. "[W]hy would he compare this country to Zimbabwe? Is he comparing this president to Mugabe? What is this about? It's very strange to me."

... "I'm sure he would not say that, but how did he get to Zimbabwe? What took the man to Zimbabwe? Someone should ask him if that's really the best comparison. ... How can he compare this country's situation to Zimbabwe?"

Underscoring the fact that Sanford's refusal of federal dollars will disproportionately affect black people was the latest from ThinkProgress:

Yesterday, ThinkProgress reported that Gov. Mark Sanford’s (R-SC) decision to reject $700 million of stimulus funds could result in the firing of up to 7,500 teachers across the state, more than $500 million of which was slated to fill in the massive education budget deficit. Last night, CNN’s Jessica Yellin visited Ty’Sheoma Bethea, the South Carolina student who pleaded with Congress to save her crumbling school. Sanford’s decision, Yellin pointed out, means Bethea’s school will remain in disrepair.

Matt Yglesias writes:

Not only is this comparison really offensive to people living in Zimbabwe and struggling with a horrible situation, far worse than the misery Sanford is trying to inflict on the population of South Carolina by refusing to extend unemployment benefits, but the ignorance on display here is really appalling. Sanford’s like a guy standing next to a burning building worrying that it might rain tomorrow. There’s no inflation right now in the United States. None whatsoever. It’s actually a big problem, because it means that our standard macroeconomic stabilization tool—federal reserve open market operations—doesn’t work. Serious inflation would be bad, of course, and Zimbabwe-style hyperinflation would be ruinous, but some increase in inflation would be helpful. It would serve as a real cut in interest rates and help to spur growth. And long before inflation reached problem levels, the Fed could increase nominal rates to head the problem off. Sanford’s just out to sea on this.

Sure looks like Krugman was right when he said the stimulus package was too small. And the diddling around with the banking bailout isn't helping, either:

The nation is losing jobs so quickly that the government, racing to deal with the crisis, is having trouble keeping up.

The U.S. unemployment rate last month leapt half a percentage point, to 8.1 percent, the highest level since 1983, according to data released yesterday. The stunning pace of job losses raises the possibility that, perhaps as early as this summer, one in 10 Americans will be out of a job even though they are actively looking for work. It also means that the government faces even more pressure to take further action to stabilize the economy and the financial system.

President Obama, speaking in Columbus, Ohio, to police cadets whose jobs were saved with money from the $787 billion stimulus package, called the new unemployment figures "astounding."

"We have a responsibility to act," he said, "and that's what I intend to do."

Analysts increasingly view the administration's actions so far as insufficient given the scope of the problem. The stimulus package was designed to "save or create" 3.5 million jobs, according to the administration. But the nation has already lost 4.4 million jobs since the start of the recession. Many banks and other financial institutions, whose health is critical to the economy, are teetering, and the Treasury Department has yet to finalize the details of its plans to remove from their balance sheets the toxic assets dragging them down.

"It's premature to say we need another stimulus, but the economy is performing much worse than when [the law] was signed, and the odds are increasing that we'll need a bigger policy response," said Mark Zandi of Moody's Economy.com, who has advised Democratic lawmakers. "What we've learned is policy has been a step behind this whole downturn. It's important to get a step ahead."

The International Monetary Fund yesterday urged governments worldwide to consider additional fiscal stimulus, noting that the public sector must help prevent a collapse of confidence.