End This Depression Now!
It is an honor and a pleasure to have Paul Krugman at the Lake this afternoon for a conversation on End This Depression Now! Dedicated “To the unemployed, who deserve better,” the book is a condemnation of the policies and mind-set that have produced the worst economic depression since the 1930s. And unlike the Great Depression, which contemporaries did not understand, we know what to do; the current depression is entirely self-inflicted. The broken homes and ruined lives are not attributable to acts of God or the inscrutable logic of the market, but are the direct consequence of public decisions that have amplified the inherent risk of private credit by deregulating financial operations and the attempt to balance the budget when aggregate private demand is collapsing. The central message is that none of this suffering is necessary, and none of it is justified.
Paul Krugman: End This Depression Now!
This is a passionate book. Beyond the wonkery (very limited) it meets the obligation to tell the truth. Part of that truth is the simple macroeconomics of aggregate demand; in the short run it is the truth that counts most, because lack of demand is wrecking the lives of millions of people. The deeper truths about politics and the nihilism of contemporary mainstream macroeconomics are more disturbing. They go to the heart of what we are becoming as a people and (to be parochial) as economists. Paul has peered into the abyss; it isn’t pretty. There are a lot of things that are wrong with our economic organization. This book argues for doing first things first. The first thing is to get people back to work in productive jobs. This can be done immediately. The impossible takes longer.
On the principle that pictures are worth thousands of words, I have copied several graphs from the book plus one from elementary macroeconomics to provide reference points for discussion.