Russell Roberts's Blog, page 109

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(Don Boudreaux)

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GMU Econ alum Dominic Pino, writing at National Review, explains to national conservatives that the home-country economy is best served by a policy of free trade. Two slices:

The U.S. baby-formula market has long been insulated from foreign competition, through tariffs and regulatory policies, so much so that 98 percent of all baby formula consumed in the United States was produced in the United States. The reduced competition led to higher prices, just as economic theory would predict, which then led to calls to subsidize baby formula. The government created the WIC program to do that, initially for people in poverty, but it has since expanded to cover over half of all baby-formula consumption in the country. Now the industry is so brittle that it can be destabilized by a thunderstorm in Michigan.

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The government has countless “Buy American” provisions in laws about the procurement of goods for public-works projects. These provisions are designed to harness the domestic market for domestic projects by prohibiting foreign purchases of certain materials. A 2017 Heritage Foundation report found that not only do Buy American provisions increase costs for supplies, but they also waste money through compliance costs and do not lead to job growth domestically. In fact, the report found that repealing every Buy American provision would add 300,000 jobs nationwide because money currently wasted on compliance could be used productively instead, which would involve hiring more workers.

Colin Grabow has written a blog post that ought to be especially interesting to those many people who insist that protectionism is an important tool for strengthening national defense. A slice:

Foreign countries—and U.S. allies in particular—are a resource to be harnessed. Laws that restrict access to their products and services should be greeted with default skepticism and, as applied to defense purchases, scrutinized to determine whether they serve more to bolster the country’s security or the profit margins of well‐​connected domestic firms. In numerous instances, the evidence suggests the latter.

My GMU Econ colleague Vincent Geloso ponders just who will be targeted by the scarily bulked-up IRS. Here’s his conclusion:

It is hard to arrive at a number of the extent of the underestimation of cheating by bottom and middle income groups, but there are clear signs of underestimation. With this in mind, one realises that the political quip that the rich just don’t pay what they owe is humbug. More importantly, one realises that greater enforcement by the IRS may lead to more collection of revenues at the top. However, it may also end up taking away income that, dollar for dollar, is more proportionally important for people at the bottom of the income ladder. In other words, the greater enforcement could be regressive. Policymakers and pundits should ponder this possibility before they wrap themselves in the cloth of virtue.

Nick Gillespie talks with Michael Shermer.

My GMU Econ colleague Bryan Caplan is skeptical of the reality of “politics as exchange.” Here’s his conclusion:

As I’ve said before, politics is cruelty.

In 1948, a Truman supporter shouted, “Give ‘em hell, Harry!” Truman famously replied, “I don’t give them Hell. I just tell the truth about them, and they think it’s Hell.” With rare exceptions, this is the official stance of all successful politicians. Their top goal isn’t to persuade or bargain, but to inflame antipathy and strife. If they can’t utterly win, they want to ensure that current miseries eternally endure. Can’t send your enemies straight to the fires of Hell? Then let’s slowly burn together here on Earth.

My GMU Econ colleague Chris Coyne writes thoughtfully about Nancy Pelosi’s recent visit to Taiwan. A slice:

This also matters beyond Taiwan. The U.S. government maintains a global network of military bases, deploys special operations around the world and is the world’s largest arms dealer. It spends more on its military than the next nine countries combined, including China and Russia. The logic behind these expansive forces and activities is the supposed need for a global hegemon to create and maintain order and freedom around the world. Perhaps. But another outcome could be disorder and a greater chance of conflict by elevating force over peaceful cooperation. By signaling that force is the default strategy, the projection of power can make it harder for others to offer cooperative gestures.

Pat Lynch is unsure just what is Niall Ferguson’s book, Doom.

Steven Malanga decries the “Californifying the U.S. Labor Market.”

K. Lloyd Billingsley is critical of Fauci’s and other U.S. government public-health honchos’ refusal to admit their many mistakes. Here’s Billingsley’s conclusion:

Drs. Collins and Fauci both lied about funding dangerous gain-of-function research at the Wuhan Institute of Virology in China. Collins conveniently retired last year, and Dr. Fauci, a government bureaucrat since 1968, remains at the helm of NIAID. Whitecoat supremacists never have to say they’re sorry.

Nate Hochman accurately accuses the Washington Post‘s Philip Bump of straw-manning Ron DeSantis and other early opponents of covid lockdowns.

Elize Aquila tells of how covid-vaccine mandates harmed her college experience.

Many physicians argue that covid-vaccine mandates are counterproductive.

“Do Masks Do Anything to Prevent Transmission of Influenza or Influenza-Like Viruses? Clinical Trials Show No Clear-Cut Effect” – so reads the title of this post by Carl Heneghan and Tom Jefferson.

Quotation of the Day…

(Don Boudreaux)

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… is from pages 299-300 of my colleague Peter Boettke’s 2021 paper “Liberalism, Socialism, and Our Future,” as this essay appears as the Conclusion to Pete’s excellent 2021 book, The Struggle for a Better World:

Our own lack of civility in the United States as this time is because of the explicit rejection of liberalism and the adoption of nationalism on the one hand and socialism on the other, with the result that we have unleashed both ideological politics and machine politics,, and have squeezed out the politics of responsibility and squashed civil society. Civility has lost its proper place as a restraining power in the public sphere of the United States. We must fix this issue for the sake of our future.

To All Supporters of Industrial Policy…

(Don Boudreaux)

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… I put the following question: Because the government cannot carryout a task as relatively simple as delivering monkeypox vaccines to their intended destinations, what reason have you to believe that the government is to be trusted to carry out successfully the far more complex task of conducting industrial policy?

Seriously. Have you industrial-policy advocates observed how the government routinely operates? Here’s a snippet from the above-linked report in the New York Times:

The federal government’s distribution of monkeypox vaccine has been blemished by missteps and confusion, burdening local officials and slowing the pace of immunizations even as the virus spreads, according to interviews with state health officials and documents obtained by The New York Times.

Bonus Quotation of the Day…

(Don Boudreaux)

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… is from page 59 of F.A. Hayek’s July 1946 speech at Stanford University titled “The Prospects of Freedom,” as this speech appears – for the first time in print – as chapter 3 of the hot-off-the-press Essays on Liberalism and the Economy (2022), which is volume 18 (expertly edited by Paul Lewis), of The Collected Works of F.A. Hayek:

But in a complex social structure like ours almost any policy which never hesitates to invoke coercion by the government when a particular desired end is to be achieved is bound to lead us into a system where the government controls everything.

DBx: Please note that Hayek is not saying here – and he did not say in The Road to Serfdom – that any use of coercion inconsistent with liberalism sets us on an unstoppable trek toward tyranny. His message, instead, is that if the idea is widely accepted that liberal principles of limited government should not stand in the way of government using coercion to attempt to achieve some particular goal that is currently desirable, then we are trekking down the road to serfdom. But it is a trek that can be reversed – a reversal that requires a restoration of acceptance in the popular mind of broadly limited principles. This reversal requires that the populace stop acquiescing in the government’s violations of property rights and freedom done, however earnestly, to achieve whatever are the particular concrete goals that the public fancies today.

Some Links

(Don Boudreaux)

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Writing in the Wall Street Journal, economist David Neumark has a tip for waiters and waitresses: For your own good, keep your fingers crossed that government doesn’t raise the minimum wage that applies to workers such as you. Two slices:

But new research shows that raising the minimum wage for tipped employees does little to help poor or low-income families. The federal minimum wage for tipped workers isn’t really $2.13. It’s the same $7.25 as for other workers, but it’s paid by tipping customers as well as employers. Under federal law, employers must pay a cash wage of at least $2.13 and top it up to the regular $7.25 minimum wage if tips aren’t enough to make up the difference. Employers are on the hook to pay $2.13 even if tipped minimum wages earned per hour are much higher, as they often are.

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First, each 10% increase in the tipped minimum wage reduces the employment of tipped restaurant workers by 0.8%. That’s not a huge effect until we consider that recent proposals would increase the tipped minimum wage dramatically. For example, raising the $2.13 tipped minimum wage to the regular minimum of $7.25 could reduce tipped restaurant employment by more than 20% within a year or two.

Second, we examined the direct effect of increases in state tipped minimum wages on the likelihood that families were poor. Consistent with findings for general minimum wages, there is no clear evidence that increases in the tipped minimum wage reduced poverty or the incidence of low income.

Anthony Gill reveals some of the negative consequences of subsidies.

Matt Weidinger reports on how the Orwellian-named “Inflation Reduction Act” provides “green welfare to high-income households.”

Mary Harrington busts the myth that climate change contributes to childhood obesity. A slice:

This is sensible stuff — but the study was reported as stating that climate change had caused reduced fitness in children. The study itself pointed to Covid lockdown measures, among many other factors, as having exacerbated an already-existing issue of poor fitness in children. But headlines suggested children are staying indoors because it’s too hot and that this is why they’re less fit than their parents.

You don’t have to be a scientist to know that reduced aerobic fitness in this generation of children long precedes measurably rising outdoor temperatures of the kind that could be attributed to climate change. Here’s a report from 2013 on the topic, for example, that describes aerobic fitness in children decreasing every decade from 1975 onward.

Nor do you have to be a scientist to come up with multiple factors that are plausibly contributing to this unhappy situation. Anyone with young children, or just rudimentary powers of observation, needs only a moment’s reflection to think of multiple ways in which 21st-century life militates against physically active childhood, compared to the world just a few decades ago. But we mustn’t let minor considerations like the patent absurdity of a claim, or its rampant misreading of an actual scientific paper, get in the way of a clickbait mass-media narrative on a much-hyped topic.

Arnold Kling (with an assist from Walter Block) inquires into the reason many firms today are having an unusually difficult time recruiting workers.

The Wall Street Journal‘s Editorial Board is not surprised that the Chinese economy is today showing the negative effects of Xi Jinping’s suppression of the market. A slice:

This is a consequence of the usual Chinese policy suspects. Unpredictable pandemic lockdowns continue to sweep the country under President Xi Jinping’s “dynamic zero-Covid” policy, with the resulting swings in consumer confidence and output. A crackdown on real-estate speculation is catching ordinary households in the crosshairs, and these consumers are seeing their accumulated savings and wealth evaporate as the property market in which they’d invested so heavily sinks. Property is the main source of savings for many Chinese families.

All of this makes China perhaps the only large economy currently experiencing a genuine disruption in economic demand. Most of the West is suffering the inflationary consequences of policy efforts to cure demand-side ills that didn’t exist, while governments hobbled the supply side with lockdowns, regulation and heavy taxation.

Cato’s Jim Dorn looks deeply into the Portman Report on China and the Fed. A slice:

However, the threat to U.S. national security and economic progress from the science and technology side does not easily transfer over to the Fed and monetary policy. The Portman Report, released in July 2022, does not offer compelling evidence that China is a threat to the Fed. Although there may be some cracks in the Fed’s information security system and compliance protocol, there is no crisis.

Fed Chair Powell, in his letter to Portman, makes a strong case that a free market in ideas—involving exchanges of scholars and the sharing of macroeconomic models—is beneficial to both the United States and China.

Paul Krause is impressed with a new collection of writings by Edmund Burke – a new collection assembled by my GMU Econ colleague Dan Klein and GMU Econ alum Dominic Pino. A slice:

Radical and totalitarian movements ultimately seek to eradicate these social relationships because in their top-down politics of control, the vibrancy and strength of social freedom must be destroyed for the totalitarian blueprint to emerge. The best of post-1789 art and literature has been attuned to this reality. The anti-revolutionary and anti-utopian literature of the twentieth century, in particular, reveal to us the depths of the attempt of totalitarian movements to destroy those social relationships and the spirit of love (Boris Pasternak’s Doctor Zhivago is one of the finest examples of this).

Edmund Burke and the Perennial Battle, 1789-1797, is a nice selection of Burke’s last decade of writing. Daniel Klein and Dominic Pino have a commendable introduction that sets the tone and directs the readers on how to engage with Burke more fruitfully. And after reading through this slim volume of Burke’s writings, one can graduate to his fuller collected writings to dive more deeply into a perennial thinker.

GMU Econ alum Dominic Pino reports that “truck-chassis industrial policy isn’t going well.” Two slices:

American companies have been unable to purchase enough chassis to meet their needs partly because the federal government instituted a combination of tariffs and duties in 2021 that amount to an effective ban on importing truck chassis from China, where the world’s largest truck-chassis manufacturer is located. Domestic manufacturers were left to pick up the slack.

I wrote against these tariffs in November 2021. In that article, I said that domestic manufacturers were struggling to meet America’s chassis needs, and orders would only begin to be delivered in the second half of 2022.

Well, it’s the second half of 2022, and domestic chassis manufacturers are still behind.

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The “make them here instead” mantra popular with politicians hasn’t worked for truck chassis. Americans in need of chassis have simply been stuck without them in many cases, and it looks like many will continue to be without them for at least the next year and a half.

Industrial policy in action.

Writing in the Telegraph, Szu Ping Chan explains that “Xi’s zero-Covid policy sparks economic chaos in China.” Three slices:

Navigating the maze-like showroom that is an Ikea store has always been notoriously difficult. But last weekend, hundreds of shoppers in Shanghai found themselves barging their way past security guards just to get out of the doors at the Xuhui district outlet.

On social media it looked like a closing-down sale or Black Friday scrum. But these shoppers weren’t in search of a bargain Billy bookcase. They were simply trying to leave the store.

China’s draconian approach to tackling Covid-19 has previously left some shoppers trading their handbags for sleeping bags. In Shanghai, those unfortunate enough to fail in the escape from Ikea were trapped for hours behind the locked exit as authorities ordered swab tests for all customers, all because one shopper was in close contact with someone with the virus.

They’re not alone. Horror stories have emerged of people being locked in Uniqlo for 48 hours or being trapped in Disneyland as authorities mass-tested tens of thousands in the pursuit of Covid-zero. “I never thought that the longest queue in Disneyland would be for a nucleic acid test,” one disgruntled theme park-goer said last year on social media.

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An even bigger worry is the growing number of young people who cannot find a job. A world where policymakers keep switching economic activity on and off has caused uncertainty among businesses. Many can’t be sure how many staff they’ll need today, let alone in a year’s time.

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Uncertainty surrounding the market means nobody is building at the moment. And an increasing number of Chinese homebuyers are refusing to pay mortgages on properties they have bought because developers can no longer finish them.

Anthony LaMesa tweets: (HT Jay Bhattacharya)

I often think about this hotel housekeeper who got a €280 fine — an outrageously large fine — for mistakenly wearing a surgical mask instead of an FFP2 mask on an Italian bus. How many lives were saved by fining this hardworking woman who made an honest mistake?

Quotation of the Day…

(Don Boudreaux)

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… is from page 9 of Robert Higgs’s pioneering 1997 paper “Regime Uncertainty: Why the Great Depression Lasted So Long and Why Prosperity Resumed after the War,” as this paper appears as Chapter 1 of Robert Higgs’s superb 2006 collection, Depression, War, and Cold War:

In any event, the security of private property rights rests not so much on the letter of the law as on the character of the government that enforces, or threatens, presumptive rights.

Bonus Quotation of the Day…

(Don Boudreaux)

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… is this August 13th, 2022, Facebook post by Georgetown University philosopher Jason Brennan:

The typical way the left argues for the state is to describe what economists in the 1850s thought markets would be like under monopoly or monopsony, and then compare that to a state run by angels. Both halves of the argument are bad, and yet philosophy treats this as if it were rigorous and sophisticated.

DBx: Yes, but philosophers are not alone in practicing such mysticism. Also practicing such mysticism today are many economists.

Far too many policy proposals are nothing more than prayers to the state-god. “We entreat you, Oh Powerful and Sacred One, to relieve our people of this or that misery, blemish, and market imperfection! We beseech you to bestow upon us – your faithful servants – cosmic justice, safety from new pathogens, unkind thoughts, and microaggressions, and protection from each and every burden of reality that we can imagine being cured by an omniscient, benevolent, and omnipotent deity! If we obey – and sacrifice to you without complaint our treasure and our freedoms – you will provide!”

I do not exaggerate. Pick at random any proposed government intervention offered by the likes of Progressives or national conservatives, and you’ll discover that the workability of this proposed intervention, when evaluated honestly, rests on nothing more solid than the above absurd faith that the state is – or, when in the right hands, will be – a secular god.

The Pretense of Knowledge Is Ubiquitous

(Don Boudreaux)

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I repeat: No advocate of industrial policy has ever explained just where or how he or she – or the government – will get all the detailed knowledge that would be necessary to get in order for such policy to have as much as a snowball’s chance in hell of working to improve the overall economy.

Editor, Wall Street Journal
1211 6th Ave.
New York, NY 10036

Editor:

In his insightful exposé of the ugly realities of the CHIPS+ Act, Andy Kessler quotes National Economic Council director Brian Deese’s assertion that “The question should move from ‘Why should we pursue an industrial strategy?’ to ‘How do we pursue one successfully?’” (“The Semiconductor Boondoggle,” August 15). Mr. Kessler then observes that “[t]his is as wrong as Soviet or Chinese five-year plans.”

True. But more might be said about what is perhaps the most important factor condemning industrial policy to failure – namely, the absence of any genuine market test.

The only way to determine which industries truly contribute to economic growth is through market competition – through the process of each firm, spending only its investors’ own money, going head-to-head with other firms to attract customers. Only in the free market is no one compelled to fund or to patronize any firm, and only in the free market is no one prevented from, or penalized for, experimenting with different peaceful ways to attract suppliers and customers. The resulting competition thus reveals which firms contribute most to economic betterment.

Industrial policy short-circuits the market’s discovery process. Such policy is premised on the fantasy that politicians or bureaucrats, spending other people’s money and protected from the competition of politically disfavored rivals, can foresee not only which particular products are best to produce, but also which of the countless alternative means of producing these products are most efficient (that is, most sustainable).

Just as it would be folly to cancel the upcoming NFL season and instead rely on experts to declare the next Super Bowl champion, it would be folly – indeed, much greater folly – to cancel economic competition and instead rely on experts to declare which firms should and shouldn’t survive.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

Steven Koonin on Climate Myths

(Don Boudreaux)

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Here’s Steven Koonin – former Caltech physics professor and provost, Department of Energy undersecretary during the Obama administration, and author of the superb 2021 book, Unsettled? What Climate Science Tells Us, What It Doesn’t, and Why It Matters – answering the question “Is there really a climate emergency?”

Some Links

(Don Boudreaux)

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Wall Street Journal columnist Andy Kessler describes the CHIPS+ Act as “simply swing-state pork for lackluster tech companies.” A slice:

Nothing is free. Even Commerce Secretary Gina Raimondo admitted “there’s a lot of strings attached” in the 1,054-page law. National Economic Council director Brian Deese endorsed command-and-control industrial policy: “The question should move from ‘Why should we pursue an industrial strategy?’ to ‘How do we pursue one successfully?’” This is as wrong as Soviet or Chinese five-year plans. Industrial policy eventually leads to disaster. Japan’s Ministry of International Trade and Industry micromanaged the country’s domestic semiconductor industry and ended up presiding over its decline. Today no Japanese semiconductor company sits in the global top 10. Because China doesn’t have access to ASML ExtremeUV equipment, it has made little progress in advanced chips.

Wall Street Journal columnist Allysia Finley explains that the Orwellian-named “Inflation Reduction Act” will significantly stifle American innovation in energy production. A slice:

Democrats might reply that their bill’s tax credits would encourage electric vehicle and renewable manufacturers to “on-shore” supply chains. But subsidies that encourage mineral extraction in the U.S. won’t help if the Biden administration continues to block projects such as a lithium mine in Nevada and a massive nickel, cobalt and copper mine in Minnesota.

James Meigs describes environmentalists’ efforts that thwart clean energy. A slice:

In 2018, a radical new environmental group emerged in the United Kingdom. The loose-knit organization called itself Extinction Rebellion, or “XR,” and aimed to raise awareness of climate change through disruptive protests. XR activists staged dramatic “die-ins” and shut down London bridges and metro stations. The group’s leaders warned that climate change could “kill six billion people this century” and called for Britain to halt the use of fossil fuels virtually overnight. Like the Occupy Wall Street movement that inspired it, XR disdains detailed policy prescriptions. But its members generally scorn our modern, energy-intensive lifestyles, while also rejecting nuclear power and other high-tech approaches to reducing emissions. To save the planet, many believe, capitalism itself needs to be overthrown.

One of the group’s most charismatic spokespeople was Zion Lights. The daughter of Indian immigrants and a mother of two, Lights was a longtime environmental advocate. (The Telegraph once dubbed her “Britain’s greenest mum.”) But she found herself hard-pressed to defend XR’s more extreme claims. Hoping to understand the issues better, Lights returned to college, where she studied the debates surrounding nuclear power and related themes. “I started to realize that almost everything I had believed was wrong,” she told me, when I interviewed her recently for a podcast. When Lights tried to discuss her new perspective with her XR colleagues, she said, “I found there was this immense, immense resistance.”

Brendan O’Neill, of Spiked, reports on “why eco-alarmists are wrong about almost everything.” A slice:

So it turns out that reports of the Great Barrier Reef’s death were greatly exaggerated. For years we were told that this glorious coral reef off the coast of Queensland was being slowly strangled by mankind. The Guardian even published an obituary. It was literally titled ‘The Great Barrier Reef: an obituary’. ‘[The] seeds of the reef’s destruction are well embedded’, it declared. And we all know who was to blame for this ‘destruction’: marauding mankind. It’s always us. Shipping, the transformation of the reef into a tourist hotspot and, of course, Queensland’s evil coal industry have been on a ‘collision course’ with this natural wonder for decades, we were told. ‘Climate change is killing the Great Barrier Reef’ – that was the frank, scary verdict in 2017.

And now? The reef is fine. It’s in better nick than it has been for ages, in fact. The reef’s obituarists focused on the problem of ‘bleaching’. This is where the coral becomes stressed by warmer-than-average waters, responds by expelling the algae that live within it, and then becomes weak and sometimes dies. The coral turns a deathly white, hence the term ‘bleaching’. Huge swathes of the coral in this vast reef system, which stretches for a mind-boggling 1,400 miles, have been bleached in recent decades. And unless ‘climatic conditions are stabilised’, unless mankind reins in his Earth-warming, sea-heating antics, then the rest could be bleached too, we were told. Only that isn’t what has happened. At all. A new survey of the reef by the Australian Institute of Marine Science reports that coral cover on the reef has recovered spectacularly. In two-thirds of the reef, coral cover is at its highest level since records began, 36 years ago. From newspaper obituaries just a few years ago to good health in 2022 – this reef is the Lazarus of the natural world.

Gary Galles exposes the dangers lurking in new legislation pending in California – lurking specifically in the so-called “Fast Food Accountability and Standards Recovery Act.” A slice:

As to causing faster recovery, for employers to be forced to pay higher costs may masquerade as a source of recovery, as is done when bill promoters only say “employees will be paid more, and that income will stimulate the economy.” Every dollar of such “stimulus” comes out of employers’ pockets, resulting in no net stimulus. Further, higher costs that lead to higher prices in an industry, without equivalent value being provided to buyers, will reduce the goods and services provided by the industry. So from society’s perspective, such a “stimulus” actually produces the opposite effect.

Pierre Lemieux is understandably dismayed by the irrationality of The Economist on the question of guns and the right to bear arms.

John Hinderaker reports the happy news that institutions of “higher learning” (so called) are beginning to feel some of the just consequences of their increasingly lunatic antics. (HT George Leef)

TANSTAFPFC (There Ain’t No Such Thing As Free Protection From Covid.)

Jeffrey Tucker explores the CDC’s recent reversal of many of its recommendations on covid. A slice:

The problem from the beginning was that there never was an exit strategy from the crazy lockdown/mandate idea. It was never the case that they would magically cause the bug to go away. The excuse that we would lock down in wait for a vaccine never made any sense.

People surely knew early on of the social, economic, and cultural devastation that would ensue. If they did not, they never should have been anywhere near the control switches of public health. Badges and bureaucracies do not terrify a virus destined to spread to the whole planet. And not one person with even the most casual passing knowledge of coronaviruses could have sincerely believed that a vaccine would magically appear to achieve something never before achieved in the whole history of medicine.

When the Great Barrington Declaration appeared on October 4, 2020, it caused a global frenzy of fury not because it said anything new. It was merely a pithy restatement of basic public-health principles, which pretty much instantly became verboten on March 16, 2020, when Fauci/Birx announced their grand scheme.

The GBD generated mania because the existing praxis was based on preposterously unproven claims that demanded that billions of people buy into complete nonsense. Sadly many did simply because it seemed hard to believe that all world regimes but a handful would push such a damaging policy if it was utterly unworkable. When something like that happens – and there never was the hope that it could work – the regime imperative becomes censorship and shaming of dissent. It’s the only way to hold the great lie together.

So finally, nearly two years later the CDC has embraced the Great Barrington Declaration rather than doing a “quick and devastating takedown” as Francis Collins and Anthony Fauci called for the day after its release. No, they had to try out their new theory on the rest of us. It did not work, obviously. For the authors of the GBD, they knew from the time they penned the document that it was a matter of time before they were vindicated. They never doubted it.

Daniel Hannan justifiably says to the pro-lockdowners “I told you so.” Two slices:

Most of us grasp the concept of a postponed reckoning. If you took two years off work, and maintained your income by borrowing, you’d be a lot worse off. We all understand that with reference to our own lives. So why do we struggle to extend the same reasoning to our nation’s finances?

Perhaps because it is human to prefer sweet falsehoods to bitter truths. It would be lovely if there really were a way to get back to growth and stable money without significant cuts. And, politics being politics, various fools and opportunists are now stepping forward to claim that this can somehow be done.

First, there are the half-educated spendthrifts gathered under the banner of Modern Monetary Theory. They argue that, since a state cannot go bankrupt (because there is no higher authority to administer the bankruptcy) its finances cannot be compared to those of a company or a family.

Governments can borrow whatever they need, they say, so don’t worry too much about debt. To which I can only respond, with John Dryden, “What fools our fathers were if this be true!” There we were for all those centuries wrestling with the problem of limited resources, when all we had to do was magic up more money!

The cranks who make this claim are few in number but, as often happens when an idea catches the mood of the times, mangled versions of it spill over into popular discourse.

…..

I hate to say “I told you so” but… oh, sod it, no I don’t. I bloody told you so. As early as May 2020, I was warning of what lay ahead:

“If you’re a pensioner, your pension will lose its value. If you’re a public sector worker, you’ll find that, as its tax take evaporates, the Government can’t afford to pay you. If you have savings, they will be inflated away.”

At that time, 96 per cent of people supported the restrictions, every broadcaster was droning on about “putting lives before the economy”, and only 26 per cent of people thought the lockdown was making them worse off. “Only when we are unable to afford the things we used to buy will we understand that ‘the economy’ is what we call the transactions people make to improve their lives,” I wrote. “And, even then, we may struggle to link our misfortune to the closures we have spent the past two months demanding.”

Just as people who clamoured for net zero now complain about the price of energy, so people who clamoured for the longest lockdown now complain about the cost of living. Naturally, politicians find it easier to humour them than to point out the connection. And, of course, no minister wants to take away even a notionally one-off benefit.

Anthony LaMesa tweets: (HT Martin Kulldorff)

One problem with shutting everything down is that it terrifies people. If it’s too dangerous to go to Starbucks, it’s too dangerous to visit the pediatrician and get my kids vaccinated. We’ll just wait. Lockdowns were a terrible mistake.