Economist Paul Krugman, who won a Nobel Prize for his work on developing the New Trade Theory, has a fresh one in the works: the U.S. government should fake an alien invasion to stimulate the economy.
The idea of a government faking such a world-changing event is one that's been thoroughly explored by science fiction. An apt example going 'round the net right now is the plot hatched by Ozymandias in Watchmen, where he faked an alien menace (with plenty of real casualties) to bring about world peace.
In reality we've actually come pretty close to doing exactly what Krugman proposes — the War of the Worlds radio drama that caused such a panic in 1938 would have been a decent start, at least. Krugman is just talking casually, of course, but it sounds about as good as anything else being proposed.
Here's the plan according to Krugman:
Think about World War II — that was actually negative social product spending and yet it brought us out... If we discovered that space aliens were planning to attack and we needed a massive build-up to counter the space alien threat, and inflation and budget deficits took secondary place to that, this slump would be over in 18 months. And then if we discovered, "whoops, we made a mistake," we'd [still] be better... There was a Twilight Zone episode like this, in which scientists fake an alien threat in order to achieve world peace. Well, this time we need it to get some fiscal stimulus.
We're not sure what Twilight Zone episode that was, but it does sound quite a bit like "The Architects of Fear" from Outer Limits. (Not that they're really two different shows, anyway, right?)
See Krugman geek out in the video below.