Paul Krugman does not expect much from Republicans but it bothers him that reputable reporters, like Bob Woodward, are given a platform to make comments on the economy that mimic those made by GOP politicians. Woodward's comments on national TV reflect the confidence fairy hypothesis that Romney used in his unsuccessful campaign. He argued that businesses have trillions of dollars that they are not investing because they lack confidence in government fiscal policies. In other words, government fiscal policies, rather than a lack of demand for their products, is constraining business investment. Apparently, this is the assumption that one must make in Washington, or the assumption that one must make to get a guest appearance on national TV, in order be consistent with other "serious people".
It is not surprising the confidence fairy is alive and well among serious people. I have many friends, who are not arch conservatives, who believe in the confidence fairy. If one is a regular view of CNBC, which is very popular with many serious people, there is a constant stream of commentary that put the blame on government policies for the slow recovery. The commentary is also less concerned about unemployment and the ability of indebted consumers to stimulate demand than it is about projected budget deficits in 2040.
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