Krugman: No Correlation Between Regulations and Job Creation

Van Susteren tells Krugman to go and actually talk to small business owners


Columnist Paul Krugman took exception to Greta Van Susteren’s claim Sunday on “This Week” that government regulations were strangling small businesses, saying the numbers told a different story.

When Van Susteren encouraged him later on to talk to small businesses and would see that a rough economy was preventing them from hiring more people, Krugman said during cross-talk that’s not what they would say.

GRETA VAN SUSTEREN: You talk about Main Street, we’re strangling small businesses. I mean, no one is paying much attention to these small businesses. The regulations that are strangling them, some are laughable and silly, but they have a profound impact on the job creators, those who are making jobs. They can’t afford to hire people.

PAUL KRUGMAN: There has been a ton of work on this. What’s holding small business back is not regulations, it’s the fact that they don’t have sales.

VAN SUSTEREN: It’s not all, it’s some of it.

KRUGMAN: It’s not. There’s no correlation, looking across, which parts of the economy do small businesses complain about regulations, which don’t they. There’s no correlation between that and actual job creation.

Host George Stephanopoulos asked Krugman if he saw Obamacare creating a negative impact on firms with more than 50 people, who would cut to 49 or less in order to pay less.

Van Susteren encouraged Krugman to get out and talk to small businesses rather than just looking at numbers.

“A lot of them are struggling with this,” she said. “They don’t understand a lot of things that are happening in Washington. They’re very cautious because they see a dismal economy out there.”

“If you actually talked to them, that’s not what they’d say,” Krugman replied.