Ozone regulations: Smashing windows, getting fresh air

MY COLLEAGUE writes that the decision to drop the EPA's new ozone regulations, while unfortunate in environmental terms, might be reasonable given the economic situation. And that's certainly the way I would instinctively have looked at it: as a trade-off between environmental goods and economic costs. But Paul Krugman makes a fascinating argument that under current circumstances, this perspective is completely wrongheaded:

As some of us keep trying to point out, the United States is in a liquidity trap: private spending is inadequate to achieve full employment, and with short-term interest rates close to zero, conventional monetary policy is exhausted.

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