On the Democratic side, it's somewhat disappointing that Barack Obama, whose campaign has understandably made a point of contrasting his early opposition to the Iraq war with Hillary Clinton's initial support, has tried to score a twofer by suggesting that the war, in addition to all its other costs, is responsible for our economic troubles.
The war is indeed a grotesque waste of resources, which will place huge long-run burdens on the American public. But it's just wrong to blame the war for our current economic mess: in the short run, wartime spending actually stimulates the economy. Remember, the lowest unemployment rate America has experienced over the last half-century came at the height of the Vietnam War.
Krugman would be right on this, if it was during the Vietnam war. He seems to forget that we now have this new "global economy". Most of our bullets are made in Israel, and now we got our planes being made in Europe. War doesn't benefit our economy the same way it used to. Basically we have outsourced the "benefits of war" to other nations.