It gets old Paul, and you need to have your degree revoked.

Nobel Prize-winning economist Paul Krugman suggested Federal Reserve policy makers led by Ben S. Bernanke are “reckless” for refusing to pursue higher inflation, which he said could lower U.S. unemployment.

“The reckless thing is to allow mass unemployment to continue,” Krugman, a Princeton University professor, said on Bloomberg Television’s “Street Smart” yesterday. “We have had a massive failure of our political system that has come to accept that 8 percent unemployment is the new normal and there is nothing that can be done,” Krugman said. “We’re in a low-key version of the Great Depression.”

....

“Inflation is theft,” said Paul, a Republican presidential candidate who said he will stay in the race until his party’s convention in August. “You’re stealing value from people who save money. It really destroys an important feature of the economy -- and that is saving.”

Ron Paul has it half right.  The problem is that he hasn't (and I don't know why he won't) go after the debasement committed by private banking interests at the behest of government.

Here is the reality of inflation in the money supply (including credit) and income change over the last 30 years:

Rebased to (1) be an income growth (or loss) figure by (1) subtracting one from the other and (2) removing purely-financial product credit growth (which some will argue never makes it into the real economy and thus shouldn't count -- and makes the numbers look better than the raw figures suggest) you get this:

We hear laments of the middle class being hollowed out.  It's true.

Barack Obama campaigned four years ago assailing President George W. Bush for wage losses suffered by the middle class. More than three years into Obama’s own presidency, those declines have only deepened.

The rebound from the worst recession since the 1930s has generated relatively few of the moderately skilled jobs that once supported the middle class, tightening the financial squeeze on many Americans, even those who are employed.

The problem is found in that chart above.  Obama hasn't done anything about it because playing "fan money from your hand" can't do anything more than provide a temporary salve for the problem.  To actually address it you have to put a stop to the offshoring abuses and stop the credit inflation game -- a game that Obama has refused to allow to collapse on its own, which was it was beginning to do when he took office.

Here's the ugly: Had Obama done so the nominal wage growth you see in the top chart would have, by now, begun even with the credit collapse and the middle class would actually be on the mend with real improvement!

But he didn't.  Instead he decided to "throw money from the train" that we don't have by borrowing more and more money.  All this does is create more and more credit money, which is inflation! 

Those who "receive" these government handouts may think they're getting something for nothing but in fact they're having their earnings power and prosperity destroyed.

There's no solution to an economic bubble caused by loose credit that can be found without deflating the excess credit that has infested in the system.

It's the math folks.

Here's the interview for those who want to watch...... be warned, it will permanently deplete your IQ by 15 points.

http://www.youtube.com/watch?v=jEmKIRqz9AI&feature=player_embedded