#126: They just refuse to believe that higher taxes will be good for them...

KRUGMAN TRUTH SQUAD

Paul Krugman's world is crumbling and he is not taking it well. On the eve of primary season and with a presidential general election just a year away, look at what he has to deal with:

1. The eight (or is it nine) Democrats seeking the presidential nomination are all running against the "worst economy since Herbert Hoover" and all want to raise taxes on the wealthy.

2. Meanwhile, back in the real world, the economy is anything but Hooveresque. As we keep saying over and over, it is gathering strength now and there will be a spate of good economic reports in the coming weeks. The markets have certainly noticed. The Dow Industrials are closing in on 10,000 again and some of the broader indexes, such as the Wilshire 2000, are already in historic high ground.

3. People have the crazy notion that when the wealthy do well, they do well too. They just refuse to believe that higher taxes on anyone will be good for them.

[The Truth Squad is a group of economists who have long marveled at the writings of Paul Krugman. The Squad Reports are synopses of their discussions. ]