In his Sept. 30 New York Times article, "The Fear Economy," MIT economist Paul Krugman warned that the American public should be prepared for a possible deflationary spiral comparable to the Great Depression of the 1930s and Japan's milder but chronic depression of the 1990s. A major depression could certainly result from the psychological fear triggered by the present terror. So Krugman tried to assure the American public that the collapse of the twin WTC towers should be less devastating to the economy in monetary terms than has been any of "America's recent natural disasters" -- such as severe hurricanes or earthquakes.
He is right. Even in terms of human casualties the present body counts, while in thousands, are not really so high relative to other avoidable causes of death. For example, the annual death toll from smoking in the United States alone amounts to about an awesome 400,000, including 53,000 dying from passive smoking, according to the New England Journal of Medicine.
If an economic depression is imminent, if it is indeed related to the public psychology, and if because of this the public feels a need to "escape," then we have a better proposition. While Krugman's "unorthodox remedies" seem to include letting the Bank of Japan print and disperse money, our own heretical proposal is to revamp the contemporary prohibition on drugs. It may sound far-fetched, but it could succeed in "killing two birds with one stone" or perhaps even no stone at all.