Has White House Fallen for “Confidence” Argument?

Paul Krugman thinks it’s possible:

I was on Good Morning America this not-so-good morning, doing what I could. But I was struck by something that George Stephanopoulos said: he claimed to have been speaking to an administration official who asserted that what we need to get businesses investing is for business to know that the government has stopped — presumably, that means no new spending, no new regulation, whatever.

GS is a careful guy, so this must be true. And it’s shocking — not that people are saying this, but that someone inside the administration is saying it.

It’s garbage, of course: businesses are refusing to invest because they don’t see enough demand for their products. And administration economists know that it’s garbage. But obviously some people in the WH — I’m guessing a political person, but who knows — have bought the right-wing line hook, line, and sinker.