There’s no easy way to convert airline employees into Zoom technicians. We know from both economic theory and history that markets alone are ill suited to manage such a transition, especially considering how sudden it has been. As such, it will continue to drive large changes in consumption and production patterns, which in turn will bring about a broader structural transformation. At the same time, microeconomics tells us that the virus acts like a tax on activities involving close human contact. Macroeconomics tells us that spending will fall, owing to households’ and firms’ weakened balance sheets, a rash of bankruptcies that will destroy organizational and informational capital, and strong precautionary behavior induced by uncertainty about the course of the pandemic and the policy responses to it. The current economic outlook can be viewed on two levels. The International Monetary Fund projects that by the end of 2021, the global economy will be barely larger than it was at the end of 2019, and that the US and European economies will still be about 4% smaller. The post-pandemic economy is likely to be anemic, not just in countries that have failed to manage the pandemic (namely, the United States), but even in those that have acquitted themselves well. But now it is July, and a V-shaped recovery is probably a fantasy. After two months of tender loving care and heaps of money, it would pick up where it left off. Early in the crisis, most people anticipated a quick V-shaped recovery, on the assumption that the economy merely needed a short timeout. Not only did Operation Warp Speed accelerate the development of a COVID-19 vaccine, but it also promoted more competition among vaccine producers.NEW YORK – Although it seems like ancient history, it hasn’t been that long since economies around the world began to close down in response to the COVID-19 pandemic. US Federal Aviation Administration safety regulations persuade passengers to trust new airlines, thereby encouraging new entrants and competition in the sector. The portability of mobile-phone numbers that most developed countries have introduced has spurred competition among cellular providers. In the twenty-first century, this state-market contrast is obsolete. The question is not whether there should be rules, but rather who should set them, and in whose interest. The battle cry of this quite legitimate struggle was later raised to the principle of laissez-faire, ignoring the fact that markets are themselves institutions whose efficient functioning depends on rules. The dichotomy emerged in the nineteenth century, when arcane government rules, rooted in a feudal past, were the main obstacle to the creation of competitive markets. New Deal-style state intervention is back.īut this opposition of state and market is misleading, and it poses a major obstacle to understanding and addressing today’s policy challenges. The neoliberal revolution started by Ronald Reagan and Margaret Thatcher has apparently run its course. Given the global challenges posed by the COVID-19 pandemic and climate change, the argument goes, it is governments, not markets, that should be responsible for allocating resources. CHICAGO – “The return of the state” is a phrase seemingly on almost everyone’s lips nowadays.

The syndicate project zombies