There’s a famous passage in Schumpeter’s writings during the Great Depression, in which he lays out the extreme liquidationist position, arguing not just against the use of fiscal policy to fight unemployment but even against monetary policy, lest it get in the way of the “work of depressions”. That passage has been held up by many people as an example of the wrong-headedness that prevailed at the time. Here it is:
But here we are, in 2010 — and something very much like that position is being forcefully advocated by Wolfgang Schauble, the government of China, Narayanan Kocherlakota, and Sarah Palin.
Awesome.