I hope you like science, because guess what? Economically we are in the middle of a huge set of experiments in America. You may not think of them as experiments but they are – in the sense that actions were taken and results most certainly followed. Last week I talked about how we're in unknown territories, so consider this metaphor another way of looking at our situation.
* The US tried less financial regulation. We learned that was pretty bloody bad.
* We're finding out what happens when a large quantity of people looking for work have to take 6 months on average to find a job.
* We're finding out just how long you can extend unemployment benefits for people.
* We learned what happened when you tie together a lot of different European countries with one currency.
* We're finding out how welfare and social systems can stretch.
* We're finding out . . .
Well you can fill in any number of blanks.
We've been subjected to all sorts of economic theories over the years, great efforts, plenty of papers, and of course various political and economic policies. As the world grows smaller and more complex, as the changes speed up because of technology and globalization, we've basically tried a whole lot to keep the economic ball in the air.
So now, in the Great Recession, we're primed to learn an awful lot about the things our economics and politicians and the like have been writing about, theorizing about, lying about, and the like.
What frustrates me is that we may not learn from all of this. That we'll have people resort to ideology and deception and hiding to save their egos and bank accounts as opposed to learn.
But the experiments have been done. These are no-going back experiments.
Learning or not is the question. The willingness to learn is.
– Steven Savage