Paul Krugman: A Whiff of Stagflation (April 2005): “Suppose that the housing bubble bursts… [that] could easily turn our mild case of stagflation into something much more serious….

…How do we get out of this bind? As the old joke goes, I wouldn’t start from here. We should have spent the years of cheap oil encouraging conservation; we should have spent the years of modest growth in medical costs reforming our health care system. Oh, and we’d have a wider range of policy options if the budget weren’t so deeply in deficit. So if any of these things does come to pass, we’ll just have to see how well an administration in which political operatives make all economic policy decisions, and the Treasury secretary is only a salesman, handles crises.