December 14th, 2008


post-industrial economy and unemployment

Things that suggest trouble ahead:
5. The fact that our economy is post-industrial, and traditional Keynesian economics does not take that into account. I still cannot picture unemployed investment bankers joining road-repair crews.
The worst of all possible worlds would be every country following our protectionist lead. The auto bailout is, if you think about it, the modern equivalent of the Smoot-Hawley tariff. If other countries retaliate by protecting their own precious domestic industries, that is the equivalent of a trade war.

"The Economic Outlook", by Arnold Kling