Nobel Prize-winning economist and New York Times columnist Paul Krugman argues in his new editorial that U.S. economic policy over the last five years has been “an astonishing, horrifying failure.” Krugman, a long-time critic of the Obama Administration’s stimulus efforts, writes that the U.S. government should have spent three times the amount of money it did to get the economy back on its feet:

“…if the U.S. government had actually been able and willing to do what textbook macroeconomics says it should have done — namely, make a big enough push for job creation to offset the effects of the financial crunch and the housing bust, postponing fiscal austerity and tax increases until the private sector was ready to take up the slack…we would be a richer nation, with a brighter future — not a nation where millions of discouraged Americans have probably dropped permanently out of the labor force, where millions of young Americans have probably seen their lifetime career prospects permanently damaged, where cuts in public investment have inflicted long-term damage on our infrastructure and our educational system.”

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Notable economists such as Joseph Stiglitz and James Galbraith denounced the $787 billion American Recovery and Reinvestment Act of 2009 as too small and ineffective. The stimulus package did help the U.S. economy escape the depression-like conditions that Europe suffered, but millions of Americans still cannot find work and economic growth remains sluggish five years after the Lehman Brothers bankruptcy brought the global economy to its knees. As Krugman points out, just 59% of American adults are employed, down from 63% in 2008.

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The Daily Ticker’s Aaron Task and Henry Blodget both agree that the government’s stimulus efforts have returned the financial system to functionality. But neither one would defend Krugman’s case for a significantly larger spending program.

“Krugman is going a little too far,” notes Task. “We’re not Greece.”

Watch the video above to see Task and Blodget take on the stimulus debate.

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