that was a terrible article!
every single econonomist (including Krugman) would agree that debt accumualtion is bad for long term growth. THe only thing that emerged last week was debate about whether or not there is a a sharp inflection point on HOW BAD debt is at teh 90% threshold. apparently there isnt... the "debt is bad" line still has an upward slope (more debt is bad) it just doesn't suddenly get a lot steeper at 90%.
what krugman and others argued is that in times of economic crisis the adverse effects of debt are secondary to the more pressing adverse affects of the recession itself .... and also that a governmetn in free fall accumualtes debt no matter how austere they try to be, as teh economy crashes.... so your choice in 2008 really was... accumulate debt to try to soften the recession, or let the recession crash the economy AND THEN accumlulate alot of debt AFTER the economy is in ashes.
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