General Discussion
In reply to the discussion: Krugman: Recession ‘gratuitous’ because if Congress created jobs program it ‘would all be over’ [View all]NoOneMan
(4,795 posts)I don't think things are the same as the 1930s, due to biophysical limits. Energy consumption per dollar of GDP has been dropping consistently for decades on end. It cost more and more to do usable work than it ever has in the past, meaning our economy is approaching an abstract point of diminishing returns due to energy costs. How long can you ignore this and pump blood into a zombie economy?
Krugman's approach might keep the behemoth stumbling along a bit longer (emitting more CO2 into the atmosphere), but fall it must eventually. Collapse is especially inevitable when everyone approaches these changing times with paradigms that may no longer be applicable.
Neoclassical economics wants to pretend the real world doesn't exist for as long as it possibly can.