So, S&P downgrades the USAAA. The last store of value for financial investors has become fluid, relative, uncertain. Could this be a watershed in economic ideology?
If value cannot be safely stored in money, will holders of money turn to the ‘real economy’ for lasting security? Will they begin again to assess the use-value of products and services? To look for the right balance between basics and luxuries, between consumer goods and capital goods, between local production and imports? To see value in full employment and in social cohesion? But also, to look beyond employment numbers, to what employees actually produce? To rediscover thrift, but also to consider how savings are invested in ‘real’ assets?
Is it time to revive input-output economics? Whatever happened to David Ricardo and to Wassily Leontief?