It’s incredibly easy for a modern economy to have the equivalent of a gold rush. Indeed, the recovery from the Great Recession of 2008 was fuelled in part by such a reaction- Central banks can now create money through Quantitative Easing, and increase the supply of money that way. Indeed, Ben Bernanke has postulated that in extreme cases, the economy could be restarted by creating new money and distributing it directly to the public.
(Economic history side note- The UK effectively ran a helicopter money programme during the aftermath of the 2008 recession, in the form of PPI refunds, where £50bn in compensation was paid to people who had been mis-sold expensive insurance by their banks. It’s difficult to see how effective it was, due to the government at the time doing their best to counteract the effect entirely by slashing welfare and public spending at the same time.)
As I have said before, QE is not the optimal way to do this:
If you have a “stuck” economy (as if your economic motor has magneto trouble), as the world economy will be after we come out the other side of the pandemic, then the best way to get it started again is to put the idle forces of production directly to work, creating things that are very much needed,but which the hand of the market in its glorious invisibility, has failed to provide.
The obvious candidate for such an effort today, would be all the infrastructure improvements required to shift the global economy onto a low-carbon path. Insulating a nation’s worth of homes to increase energy efficiency, building the metro systems and high speed rail that will allow people to get out of their fuel-guzzling cars. Building all the renewable power that will allow us to run all of this without burning megatons of coal. That would take a massive investment and huge amounts of resources, but if they happen to be sitting idle anyway, then great, let’s get to work
In short, the Green New Deal:
