Genealogy of a crisis

The crisis had numerous causes, amongst others irrationally high consumer debt and regulation that relied on liberal ideology instead of sane policies, which permitted malfeasance by banks and investors. When the bubble burst a collapse of the banking system caused a severe economic depression lasting for a decade, after which the economy limped on until a world war finally helped it to its feet. No, this is not a science fiction future, just history. But - as the metaphysical Hegel noted - history has a tendency to repeat itself, and - as the materialist Marx added - first as tragedy, then as farce. I can not help myself to find all economical deliberations somewhat farcical, especially their compulsive immersion in means, ends not being seen anywhere on the horizon. When you have a crashed car that was going way too fast into a tight corner on a wet road with a drunk driver behind the wheel, you can certainly find a group of economists arguing whether he should have braked or accelerated, pulled the wheel to this or that side, but the obvious "don't drink and drive" is nothing short of unimaginable. Milton Friedman's analysis of the great depression is just such a virtuoso account of the minutiae of a financial crash - the question why a gang of lunatic investors was let loose to wreak havoc is not asked, and can not be lest the economy should be seen as a political problem in need of regulation (god forbid!). Knowing nothing of economics it is surely pure naivete that makes me believe the Marxist idea that a basic mismatch of consumption and production, the need to artificially create consumption (even by giving consumers loans they will never be able to repay) to match the needs of production is what causes the periodic crises of capitalism. That actually the functioning of Say's law is the problem. Even more naive probably is the idea that regulation of markets (risky loans to consumers and trickstery in financial markets) might be a way to prevent such breakdowns.