Natural Disasters and Why Keynes Was Wrong.

In Commentary on March 16, 2011 by CQCA

“If the [tsunami] were to fill [the tide] with [boats, cars, houses, etc.], [sink] them at suitable depths in [the sea] which [is] then filled up to the surface with town rubbish, and leave it to private enterprise on well-tried principles of laissez-faire to [rebuild the damaged areas] up again (the right to do so being obtained, of course, by tendering for leases of the note-bearing territory), there need be no more unemployment and, with the help of the repercussions, the real income of the community, and its capital wealth also, would probably become a good deal greater than it actually is. It would, indeed, be more sensible to build houses and the like; but if there are political and practical difficulties in the way of this, the above would be better than nothing.” —John Maynard Kaynes in The General Theory of Employment, Interest, and Money. 1936. Page 129.

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