I'm not a good enough economist to assess Yglesias's argument. It strikes me as obvious that we will need much more government action to prevent a depression. That action must come from the federal government, because states are usually not allowed to carry debt. The federal government is currently controlled by a wannabe mob boss with the attention span of a 3 year old on a sugar binge and a host of anti-government ideologues.
Thinking of this moment in the economy as a crisis in demand is all well and good, but what we are really looking at is more like a natural disaster - except it's hitting the whole country and not just one part of it. What happens when the disaster ends? Yglesias makes the point that we shouldn't wait for that to happen, but mobilize people to do Covid-19 related work. That seems sound.
What happens, though, if we get a good handle on this with a new treatment and we can get back to "normal" at some point in the fall? How do we bail out people behind on mortgage and rent? How do we prop up small businesses as well as large corporations?
What's more, how do we insure that we don't get a repeat of 2009, where the Republican Party absolutely refused to lift a finger to help Americans, because to do so would help a Democratic president?
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