Paul Krugman writes:What will be most interesting is working out how to go forward....My view is that we are not now bound by golden fetters--that by and large we know what to do and how to do it to keep the world economy out of a depression. But, I would say, there are three groups of people who are trying to handcuff us with today's equivalents of the golden fetters that constrained economic policy and made the Great Depression so great. Each group is doing so for its own reasons:
What E&T show is that circa 1930 key decision-makers had spent so many years equating adherence to gold not just with prosperity, but with morality, decency, civilization itself, that they couldn’t even contemplate breaking with that orthodoxy — even in the face of total catastrophe....[ cf Are We Handcuffed by Golden Fetters? ]
3. Out of justice: avoiding depression requires supporting asset prices--which means that for many financiers the wages of overspeculation will be not bankruptcy but fortunes. People rebel against the fact that in a financial crisis the banking sector has got the rest of us by the plums, and that there is no effective way to make sure they get their justice without creating prolonged mass unemployment for the rest of us.
Of the other two points he listed, Ignorance in the Chicago School, is ultimately Ironic, since the ignorance is a failure to actually read, amongst other players, Milton Friedman. The other point, is the malevolence of congresional GOP members, and their Echo Chamber, who are hoping that by just saying NO, that this will get them the win in 2010 or 2012.
What is going to be REALLY fun of course, is what IF we pass laws to criminalize repeating these follies?
Would there be a will within congress to keep a rememberance for why those laws were written? Or would we just repeat the Glass-Steagall Act written under the Jack Boot Of Repressive Godless Communist Hooverites bent upon the destruction of our white christian america...
What? you mean it wasn't Hoover's Fault that the Glass-Steagal Act was not passed on his watch?
But isn't he the democrat who caused the depression by not clapping his hands to keep tinkerbelle alive?
What if americans had to actually live with their actual history?