Textbook Economics

clipped from justoneminute.typepad.com "What Democrats believe," he says "is what textbook economics says": But that's not how Republicans see it. Here's what Senator Jon Kyl of Arizona, the second-ranking Republican in the Senate, had to say when defending Mr. Bunning's position (although not joining his blockade): unemployment relief "doesn't create new jobs. In fact, if anything, continuing to pay people unemployment compensation is a disincentive for them to seek new work." Krugman scoffs: "To me, that's a bizarre point of view--but then, I don't live in Mr. Kyl's universe." What does textbook economics have to say about this question? Here is a passage from a textbook called "Macroeconomics": Public policy designed to help workers who lose their jobs can lead to structural unemployment as an unintended side effect. So it turns out that what Krugman calls Sen. Kyl's "bizarre point of view" is, in fact, textbook economics. The authors of that textbook are Paul Krugman and Robin Wells. Pretty funny.