The 20 Percent Solution

Following on this from yesterday, Robert Reich has published a second post, "Are We Heading For Another Great Depression (Part Two)." He thinks "the chances of a Depression are no higher (and not much lower) than twenty percent."

"Why not higher?" he asks. Mostly, he suggests, because the people in charge are smarter than they used to be.

[O]ur monetary authorities know how and when to pump more money into the economy; our Congress and White House know how and when to stimulate with fiscal policy; and the US economy is more integrated with the rest of the world... .

Poppycock. We may well avoid a depression, even a Great one, but it won't be because authorities are smarter than they used to be. As George Orwell famously observed in a 1945 essay, "Each generation imagines itself to be more intelligent than the one that went before it, and wiser than the one that comes after it."