This is a lecture that Paul Krugman gave at MIT recently — The Economic Meltdown: What Have We Learned, if Anything? Krugman tried to explain how we got here AND why it seems so hard to wrap our minds around strong policy to fix it. In many ways, he thinks that we never really learned the lessons of the Great Depression, including that for all of the risk that bankers put us in, the greatest risk may just be a government policy apparatus that will be happier with a political fix rather than a systemic one.
“What actually seems to be happening is that by avoiding real disaster, we also managed to avoid confronting our own intellectual failings. … It’s as if it were still 2007: we’ve gone back to it. People are espousing the same positions, the same rhetoric about private sector dynamism and the evils of big government. The same denunciations of Keynesian economics are right back in vogue. ”
This video is about an hour long, so get your wine or cognac or single malt before settling in to watch: