Paul Krugman’s Monday column laments the fact that . . .

Washington, it seems, is still ruled by Reaganism — by an ideology that says government intervention is always bad, and leaving the private sector to its own devices is always good.

And the devastation wrought by Reaganism is everywhere. From an unconcionable maldistribution of wealth . . .

Remember how lower taxes on high incomes and deregulation that unleashed the “magic of the marketplace” were supposed to lead to dramatically better outcomes for everyone? Well, it didn’t happen.

To be sure, the wealthy benefited enormously: the real incomes of the top .01 percent of Americans rose sevenfold between 1980 and 2007. But the real income of the median family rose only 22 percent, less than a third its growth over the previous 27 years.

. . . to the financial collapse last year:

And then there’s the small matter of the worst recession since the 1930s.

There’s a lot to be said about the financial disaster of the last two years, but the short version is simple: politicians in the thrall of Reaganite ideology dismantled the New Deal regulations that had prevented banking crises for half a century, believing that financial markets could take care of themselves. The effect was to make the financial system vulnerable to a 1930s-style crisis — and the crisis came.

Krugman notes the same ideology still distorts the debate over the public health insurance option:

The debate over the public option has, as I said, been depressing in its inanity. Opponents of the option — not just Republicans, but Democrats like Senator Kent Conrad and Senator Ben Nelson — have offered no coherent arguments against it. Mr. Nelson has warned ominously that if the option were available, Americans would choose it over private insurance — which he treats as a self-evidently bad thing, rather than as what should happen if the government plan was, in fact, better than what private insurers offer.


Krugman thinks Obama contributed to this by praising Reagan during the campaign. But I think it’s much more than that.

During the campaign, I appreciated the fact that Obama often stood up for the principle that government needed to intervene in the economy to forward the public interest and redirect the economy. His first budget is premised on that belief. But now he seems afraid to make that argument.

Now he’s saying that if the public plan really were a "government takeover" of health care, he’d be scared of that too. What is he talking about? Is he telling us that the VA health system is something to fear? That Medicare and Medicaid and SCHIP are all mistakes? Why is he discrediting the foundations of these popular, successful programs?

I realize he’s trying to distinguish the limited public option proposals from a ridiculous rightwing caricature, but it is not helpful to hear the President reenforcing the harmful framing of government-supported health programs. He knows the indispensable element of reforms is to expand government intervention in the insurance and health care industries. He also knows that all of the far more successful, and less costly universal health programs in other nations all rely on even greater government involvement than Congress is yet considering.

President Obama has said the insurance industry’s behavior warrants substantial government regulation and a competitive check to keep them honest. We don’t need another Reagan telling us otherwise.