Ken Rogoff: Infrastructure spending, if it were well-spent, that's great. I'm all for that. I'd borrow for that, assuming we're not paying Boston Big Dig kind of prices for the infrastructure.from Krugman calls for space aliens to fix U.S. economy?
Fareed Zakaria: But even if you were, wouldn't John Maynard Keynes say that if you could employ people to dig a ditch and then fill it up again, that's fine, they're being productively employed, they'll pay taxes, so maybe Boston's Big Dig was just fine after all.
Paul Krugman: Think about World War II, right? That was actually negative social product spending, and yet it brought us out.
If we discovered that space aliens were planning to attack and we needed a massive buildup to counter the space alien threat and really inflation and budget deficits took secondary place to that, this slump would be over in 18 months. And then if we discovered, oops, we made a mistake, there aren't any aliens, we'd be better –
Ken Rogoff: And we need Orson Welles, is what you're saying.
These guys know that what we need to do to survive is to reinstate Glass-Steagall, dump Obama (who on Monday was taking a page from Calvin "do nothing" Coolidge's script), take back QE1 and QE2, and start work on NAWAPA. Rogoff's comments, I assume, are about as close to the truth as he was allowed to get in a public forum. Krugman was hinting at the need for warfare-scale program to reindustrialize and produce infrastructure.