What year is it?
The administration devoted its first term to an economic policy that might be described as, “Gin up the economy right now and let future generations pay the price.”
Suddenly, everything has gone wrong with a once vibrant economy. The president is adrift, without answers for the nation’s problems. He public comments seem increasingly rambling and disjointed. He finds enemies all around him, especially in the press. He’s increasingly paranoid. The administration is mired in corruption.
Answer: It’s July of 1974.
Off topic: When I saw this WaPo headline:
Global surge in coronavirus cases is being fed by the developing world — and the U.S.
I thought to myself, “wouldn’t it be simpler to just say:
Global surge in coronavirus cases is being fed by banana republics
Tags:
16. July 2020 at 14:09
The George Will piece you linked to reminds me of classic George Will quip: “The benefit of being a pessimist is you will be pleasantly surprised. ”
Personally, I am more optimistic about the future. The reasons for my optimism are 2 fold: 1.) US is a democracy and we can always course correct 2.) The intellectual atmosphere today is much more rational and Neo-liberal than before. Lots of serious thinkers and economists are doing great work and asking great questions. Just this past month I had pleasure to read great recent works from Duflo and Banerjee, Pettis, Piketty. Of course I also read Scott’s writings as another source of enlightenment. I believe when history about this period is written it will be another era of intellectual ferment and enlightenment and Scott’s writings and role will be prominent.
16. July 2020 at 15:47
It surprises me that states like California are suddenly so badly affected again, although Trump must have rather little (or even close to zero) influence there. Is there a good exaplanation?
Maybe California not being affected in the beginning was not only their sudden reactions but also a lot of luck?
The hope that summer and hot weather could help us has not come true either.
It’s really amazing that a country like the US can’t get a grip on this rather trivial problem. What are good explanations? I’m really a little speechless.
16. July 2020 at 16:50
https://www.econlib.org/the-data-are-in-its-time-for-major-reopening-2/
Henderson says open the economy it up. He is Sumner’s colleague from Econolog.
Yes, we have no bananas!
In some ways, Sumner insults banana-land nations. How many of the bananarama boons send troops to the opposite ends of the globe to fight counterproductive wars at great expensive and carnage?
16. July 2020 at 17:48
@Christian:
Trivial?
It does seem the US is uniquely unable to handle a pandemic. Our people are much more individualistic than in other countries, and more mistrustful of government. And while those traits are beneficial in many ways, they are terrible for dealing with a public health crisis that requires cooperation and compliance.
Add in a large population with some dense clusters (NYC is what makes the US numbers terrible) and diverse cultures, and there you have it.
16. July 2020 at 17:50
@Ben Cole:
I can’t believe the open up/shut down debate is still so binary. We need to neither shut everything down nor open it all up like before Covid. We should simply continue to disallow large indoor gatherings (and a few other things like gyms), practice distancing and mask wearing inside, wash our hands, protect the vulnerable. That’s all it takes.
But large swaths of people in the US won’t even do that.
16. July 2020 at 20:07
BR indeed!
The Hill
@thehill
Kayleigh McEnany: “The President has said unmistakably that he wants schools to open… The science should not stand in the way of this.”
17. July 2020 at 02:22
” . . . US is a democracy . . . ”
“Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens
Martin Gilens and Benjamin I. Page
Each of four theoretical traditions in the study of American politics—which can be characterized as theories of Majoritarian Electoral Democracy, Economic-Elite Domination, and two types of interest-group pluralism, Majoritarian Pluralism and Biased Pluralism—offers different predictions about which sets of actors have how much influence over public policy: average citizens; economic elites; and organized interest groups, mass-based or business-oriented. A great deal of empirical research speaks to the policy influence of one or another set of actors, but until recently it has not been possible to test these contrasting theoretical predictions against each other within a single statistical model. We report on an effort to do so, using a unique data set that includes measures of the key variables for 1,779 policy issues. Multivariate analysis indicates that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while average citizens and mass-based interest groups have little or no independent influence. The results provide substantial support for theories of Economic-Elite Domination and for theories of Biased Pluralism, but not for theories of Majoritarian Electoral Democracy or Majoritarian Pluralism. “
https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf
17. July 2020 at 03:21
msgkings,
Maybe my choice of words was not quite correct in English. In German “trivial” can also mean “not complex” and “rather easy to solve”.
The reason you gave are all plausible, but I assume there are other countries where these reasons apply as well and still these countries seem to do better.
Perhaps it also has something to do with health insurance, lack of sickness benefit and lack of short-time work benefits. Americans have to work, they cannot pause for a certain amount of time. They are not much different from day laborers in Brazil.
The theory that people shut down activities on their own and go into lockdown on their own is now probably also history; or rather it is exactly the other way around as well: Citizens put massive pressure on politicians to close early but they also put at least much pressure on politicians to reopen too early.
17. July 2020 at 05:06
Scott loves the banana republic meme for some reason.
What should we do? Currently we permit states to decide. Europe does not have one policy—-are they not also a group of banana republics?
Should we make everyone wear masks? Should we check they are being worn properly, washed regularly? If not, should we fine them? It appears that the big three—-Cal, Fla, and Tex—-are going through a period the 6 state NY block went thru 2 months ago—-with a much lower marginal death rate. You used to complain we could not test, but we are up to 800k a day and rising and you say nothing.
So now we test more each day, and wow what a surprise—-8-10% tested still seem to have Covid—-which implies we are going to 33million eventually. Although perhaps some kind of herd immunity kicks in.
Covid and hopefully vaccines and curativeS will decide how many deaths we have. Trump leans toward opening. Biden has no view, as far as I can tell. I don’t know where deaths level out at——but the disease is still killing the low hanging fruit in nursing homes.
This will match 1957 and 1967 in relative terms. No one called us a Banana Republic then.
17. July 2020 at 13:21
@Christian:
Good points on health insurance and sickness benefits, add those to the list of why the US is not equipped to deal with this.
Sumner is correct about voluntary distancing though. If the virus hit and the government didn’t do anything, people would stay home on their own, and many businesses would make changes on their own including requiring masks.
But those voluntary actions would likely not be nearly as effective ads even the half-assed actions taken by governments in the US.
17. July 2020 at 15:17
Scott’s right. We shouldn’t mince words. We do resemble a banana republic more by the day, complete with a literally fascist White House and a House and Senate full of enabling Republicans. This is the low point in the history of the country and I only hope it isn’t too late to restore our dignity.
17. July 2020 at 15:18
And yes, Democrats have mismanaged these crises too, but it’s a matter of degree. Republicans are much worse. They obviously put politics above all else.
17. July 2020 at 18:50
Only the “Tax Cut for the Rich and Deficits Act of 2017” can remotely be thought of as having even a short term positive impact unless we give him credit for preventing the Fed from tightening because low unemployment was going sometime in the future produce inflation that would … be bad in some way.
But immigration and trade though having cumulative log run damage also reduce real GDP in the short run. The are supply shocks.
18. July 2020 at 21:46
msgkings,
You can see how well that worked in New York and in California, and now also in Texas. It’s pretty worthless after a while. These voluntary measures seem to neutralize each other relatively quickly, for example when people want to (or have to) go to work again or when they just have enough of social distancing after a few weeks.
It’s nice to think of voluntary systems with lots of freedom, which is better than a decreed mandatory system on paper, but in reality it hasn’t worked. Certain people can think up as many arguments as they want to, why it’s such a great system. The problem is that it’s just not true. It didn’t work.
19. July 2020 at 02:07
@Christian:
Did you see my last sentence? I already stated voluntary measures don’t work as well as government mandates. My point was only that those claiming the government is why the virus caused the global recession are incorrect, even if government did nothing we would have had one, and not contained the virus as well
21. July 2020 at 19:46
Scott, not all developing countries are banana republics.