Paul Krugman Says the Iran War Could Be the Last Straw for the US Economy
Business Insider • • nation
Key Points:
- Economist Paul Krugman warns that the escalating Iran war could severely impact the US economy, potentially accelerating its decline amid existing stresses such as tariffs and restrictive immigration policies.
- Krugman highlights the prolonged conflict's potential to keep the Strait of Hormuz closed, sustaining high oil prices and exacerbating economic strain.
- He expresses concern over persistent market uncertainty due to the Trump administration's lack of a clear plan or timeline for resolving the war.
- Krugman also points to risks from AI-related job losses and financial instability reminiscent of pre-2008 shadow banking issues as compounding economic threats.
- Overall, Krugman describes the war as an unplanned crisis adding massive uncertainty, increasing the likelihood of a US recession alongside
