The Iz and the Uns
Once upon a time there was a kingdom called Employvia. Two classes of people lived in the kingdom, the Iz and the Un. The Iz were the preferred and more respected class. They had much greater access to the many riches of the kingdom and thus could consume more goods and services.
Almost every Un wanted to become an Iz. Under normal conditions 95% of the people were Iz and 5% were Uns. People moved from one class to the other due to personal or situational factors in the everyday life of Employvia. In good times it wasn’t difficult for an Un to become an Iz. An Un still had do exert some effort to become an Iz, but the transition period was relatively short. Under these conditions the great majority of the people were happy and the kingdom thrived.
Then one day it was discovered that some greedy men had been manipulating the kingdom’s resources for their own gain. This caused a great panic among the people. This panic resulted in terrible conditions in Employvia. Many people involuntarily went from being an Iz to an Un. Worse yet, no matter how hard the new Uns tried to turn back into Iz, the great majority remained Uns. And so the number of Uns continued to grow.
This situation alarmed the people so much that they demanded action by the king to increase the number of Iz. So the great King "O" (not much of a stretch) waved the royal stimulus wand that was supposed to magically transform the Uns into Iz (even less of a stretch). But alas, this did not work. Iz continued to become Uns.
The fear and panic had caused another problem. Many Iz were afraid they might become Uns. They knew of many family, friends and neighboring cubicle dwellers who once were very successful Iz who had suddenly been turned into Uns. Because of this fear, they started behaving more like Uns than Iz. They started to consume less goods and services. Ironically this change in behavior resulted in even more people becoming Uns.
Now the king and his royal advisors must restore confidence in Employvia so that the Iz return to acting like Iz. This will result in more Uns becoming Iz and as the number of Iz grows, it will provide even more opportunities for Uns to become Iz.
Recovery or Healing
While we all talk about an economic "recovery", it will resemble more of a healing. It is similar to an athlete who suffers a serious hamstring injury. The injury is a traumatic event with much pain and suffering. Immediately after the injury it is difficult and painful to even walk. You can take medication to reduce the pain, but there is little you can do to accelerate the healing process, it just takes time. At some point you can walk again without pain. But athletes need to run, not just walk.
There is a psychological barrier that needs to be overcome in the transition from walking to running. The leg feels different than before and the pain from the injury is still very fresh in your memory. But you jog, and then you trot, and one day you run again. And that is a great day. Our economy has been injured. It will take time to heal, but someday we will run again.