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Cheerleaders for massive, police-state lockdowns invariably justify their taste for authoritarianism by pious moralising. “It’s all about saving lives,” they self-righteously intone. “If it saves just one life, it’s worth it.”
This is a hollow argument even on its own merits: the panic-mongers don’t, for instance, shut down the highway system every time there’s a fatal crash. The “save lives” mob are liars.
Worse, they’re miserable hypocrites.
Dare to mention the staggering economic cost of pandemic-panic and they sniff that you’re “putting money ahead of lives”.
This is, not to put too fine a point on it, moralistic bullshit.
Economics is inevitably about lives. Even the most economically-illiterate socialist (ahem, Jacinda Ardern) is acutely aware that poverty equals human misery and, quite often, death.
There’s already plenty of evidence that lockdowns are costing more lives in suicidal despair than they’re saving. Worse, the lockdown fanatics are stocking up a tidal wave of economic misery that is about to swamp us all.
We’re already in pandemic-induced recession: within weeks, we’ll have seen two quarters of negative growth. But that recession is teetering on the edge of depression.
A recession is a normal part of the economy, a primarily financial event that imposes disciplines on an overheated economy. A depression, from a geopolitical standpoint, involves the physical destruction of the economy, something that lays waste to businesses, dislocates labor and vaporizes capital. A recession is the economy cycling. A depression is an economy breaking.
It must be remembered, first and foremost, that this is a completely induced recession. The contractions of the last two quarters are entirely due to government lockdown policies crippling the economy. Those policies show no signs of abating. Having panicked and reached for the lockdown hammer, governments are refusing to budge. “Flatten the curve” has, without explanation, become “eliminate the virus”.
But elimination is impossible without a vaccine. Despite massive dollops of wishful thinking from governments and media, there is no vaccine likely to roll out any time soon. Even then, it may be too late to stave off depression. Even if one appeared next week, it will take months to roll it out to billions of people – who may well be chary of injecting something rushed to market.
That means, barring a miraculous governmental epiphany, lockdowns are here to stay – and the economic wave will inevitably break.
Governments have been frantically plastering Keynesian band-aids, which have managed to hide the worst of the hemorrhaging. But, sooner or later the mortal wound they’ve self-inflicted is going to bleed through. Already the economic vital signs are plunging.
There’s no evidence that the economies of the United States and Europe – the center of gravity of the global economy – are recovering[…]So far, a depression has been delayed by massive government intervention.
The illusory and in any case weak success of government stimulus has led too many to conclude that this “new normal” is something we can live with and continue on as normal. In fact, it’s just been the economic Phony War.
What I think was less understood was that the economy had not reached a stable if unpleasant plateau, but was being held in place by inertia and government stimulus, and that the economy was fragmenting under the surface, past the point where government stimulus and patience would keep it together. In other words, the relative safety of the plateau afforded by the medical solution was being undermined and eaten away by unemployment and bankruptcies.
As we move into September, business failures will begin to mount, unemployment will soar, and underemployment may be even worse.
We’re at the point, now, that almost none of us have ever actually experienced a global depression. Recessions, sure. 70s “stagflation” and the Global Financial Crisis, too. But depression is another beast entirely. As a teenager, I was often puzzled and frustrated by my mother’s sporadic and apparently unnecessary parsimony. It was only much later that I realised that those were the lifelong scars of growing up in a depression. As Groucho Marx said, “If you lived through the Depression, you turn that light off when you don’t need it”.
Depression scares me. It creates not only vast human suffering but also political monstrosities. It is clear at this point that the current medical solution will remain in place until there is a vaccine. It is also clear that even with the best of luck a vaccine will not be fully produced, distributed and injected to a degree necessary or in time for the current solution to be improved. By that time, the economy will be in a very dangerous condition, if it is still salvageable.
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