Federal ReservePaul Krugman

China, Germany, and the Republican Party are all trying to bully the Federal Reserve into calling off its job-creation efforts. Krugman says their motives are suspect. He calls the three the Axis of Depression. China and Germany don’t want the dollar to fall because it would make US goods more competitive, and a smaller US deficit would then cause them to run a deficit. Republicans’ reasons are odd and incoherent since the Fed is following the policies of none other than Milton Friedman. Krugman says Republicans are afraid that if the Fed succeeds and helps the economy, it would foul their election chances in 2012.

Krugman is a New York Times columnist.

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