This crisis will prove to be an historic “teaching moment” for economists and the politicians who distrust them. We will learn, for example, that Modern Monetary Theory is right, that the fiscal authorities and central bank, working together as “monetary sovereign,” can print as much money as is needed to keep the wheels spinning, because inflation is the only constraint, and with no one spending on luxuries, there is no inflation in sight.

We will learn how money moves through the economic goose as we try to figure out where to put the subsidies. Politicians will want subsidies to go directly to voters, not because it makes any economic sense, but because voters don’t trust or understand any other system. If the government gives me food stamps and pays my landlord or mortgagee and other creditors on my behalf, the system will running, whether or not I get a check. But we won’t do that, and the result is likely to be some serious losses as not enough debts get paid.

My greatest fear in systemic terms is that government will provide too little relief for “rich” debtors, with the result that recovery will stall for lack of demand. I am particularly concerned about the debts of the guy who was making a few hundred thousand a year and carrying a $10,000 nut on his $2,000,000 house. We cannot simply say that these people should lose their homes and move somewhere cheaper. There is no place cheaper; someone who makes way less is already living there and receiving a subsidy to stay there.

The highly-paid worker does not need a lifestyle maintenance payment, but if his McMansion mortgage and BMW lease aren’t paid, his bank, which employs less well-off people, will come up short (sell the repo to whom?) and will default on its loans and/or deposits, causing the FDIC to step in. And when the restaurant that employs the people who refused to rescue the rich guy reopens, he won’t be able to afford to eat there. Like it or not, there aren’t enough jobs to go around selling necessities. Some people must earn their living selling luxuries, and those people need prosperous clients.

I can already hear the bleats about how I care more about rich people than poor people. I wonder how many times I will have to say that a gazillion poor people earn their livings selling luxuries to rich people, that if we bankrupt luxury buyers, it’s the poor man’s golden goose that gets cooked. (Cue the “blah, blah trickle down” bullshit. We will screw ourselves if it feels good enough.)

I am pessimistic because I do not believe we are smart enough to see the second order impact of our resentments, and because we are likely to have a Democrat landslide in November. As a never-Trumper, I would ordinarily welcome that result, but, if it results in bank failures because liberals hate banks and their best customers, it won’t be so good an outcome.