Yes. Space Aliens.
Brilliant! Why didn’t I think of that? All we need is a space alien attack, and suddenly we’re saved! The competition for survival will give the entire human race the incentive it needs to regain productivity, spurring the economy into recovery.
Of course, we could just restore the competitive free market and achieve the same incentives with less destruction and unnecessary waste…but that’s just BORING. Why do something that makes sense when we can fight a TOTALLY AWESOME WAR AGAINST SPACE ALIENS???
And maybe those space aliens will break a few windows while they’re at it.
But seriously, how can Krugman even be considered an economist? Any introductory course in economics will teach about the Broken Window Fallacy. Perhaps he should take such a course so he can learn about his own field.