Krugman has decried that we live in a dark ages of macro-economics. He's right: basic counter-cyclical policy has been forgotten, and he is correct in attacking the hausterity community. Sadly, he's also part of the dark ages of macro-economics, when he refuses to put the other half of the equation in place. The government, in a down turn, borrows money to restructure the economy. This was the other part of the New Deal: to spread demand vertically and horizontally, and create an economy that could unlock economic energy. For those misty eyed about the new deal, don't worry, this generation will give you a chance to do it again.