The question no one dares ask
To paraphrase Richard Nixon, "We're all Keynesians again."
Well, not you and me. But certainly among the Very Serious People who allegedly think Deep Thoughts about this credit crisis thing.
I got to musing about this when I read the news that Team Bush is contemplating "a roughly $40 billion proposal to help forestall foreclosures," according to the Wall Street Journal.
True, $40 billion is chump change compared to a $150 billion stimulus last spring, a $300 billion housing bill last summer, and a $700 billion bailout this fall. But still, non-Keynesian that I am, I asked, "Where the hell is the money going to come from?"
But hardly anyone asks that kind of question now. Even Nouriel Roubini calls for a Keynesian solution. A real kick in the teeth coming just days after uber-Keynesian Paul Krugman won the Nobel Prize for economics.
Like Nixon, even the "conservatives" are Keynesians again. They rally around John McCain, who's proposed a foreclosure-prevention program five times the size that of Team Bush. And they have the termerity to justify it by saying Barack Obama will bring about the onset of "socialism."
As I wrote a few weeks ago, before the fall of Lehman set off the most recent series of devastating dominoes, it's time to hunker down — reduce debt, keep the gas tank at least half-full, etc. And if you're out of debt, here's something else to give serious consideration.