The worst symptoms of Long COVID are the ones from the global hangover caused not by a weapons-grade virus engineered in a Communist Chinese laboratory but by government-mandated lockdowns and so-called "stimulus" spending.
John Rapley, author of last year's "Why Empires Fall," which has been stuck for months on my ever-growing Kindle list, wrote for Canada's Globe and Mail this week that it "is increasingly apparent that the world economy is showing some of the chronic weakness we associate with long COVID."
"It appears the pandemic left some deep wounds in the economy," Rapley continued, "something few economists saw coming."
Before we get to the main point, just let me ask one simple question: then why the hell do we need economists? I saw it coming and planned accordingly. My wife and I figured out exactly how large a home improvement loan we could take out on the house for all the improvements we wanted to make, particularly remodeling the kitchen.
That's because I saw inflation coming. There's no way to artificially suppress both supply and demand while simultaneously pumping people's savings accounts with funny money and not expect a nasty bout of inflation. Honestly, Melissa and I couldn't wait to pay back a sub-3% loan with dollars that would lose 20% or more of their value in the first two or three years.
I'm not special. Countless other American families did the same thing I did and for the same reason. So again I ask: why the hell do we need economists?
Back to Rapley and our Long COVID hangover.
Last month the World Bank released its updated report on Global Economic Prospects. It drew a gloomy picture of slowing growth, marking what it calls a “wretched milestone” – a world economy that is expected to grow at its slowest rate in three decades: 2.4 per cent this year, with perhaps a slight improvement next year. As to all that money sitting on the sidelines, it’s still sitting there. Investment is expected to rise at 3.7 per cent a year, barely half the average of the last decade, potentially making slow growth a permanent feature of the postpandemic world.
Welcome to the New Normal. It sucks.
Rapley also reminded readers about those dunder-brained economists who were just so breathtakingly wrong when they assured us "that when the lockdowns were lifted, a new Roaring Twenties would erupt."
Central banks were pumping trillions of dollars into the financial system and governments were handing their citizens trillions more in support. With little for them to spend it on while economies were closed, it stood to reason that on reopening there would be a storm of spending, putting the economy on steroids.
This is the same magical thinking that allowed Presidentish Joe Biden to get away with claiming credit for creating millions of jobs when the economy was doing nothing more than hiring back most (but not all) of the people put out of work by the government lockdowns. The economy wasn't roaring — it was waking up after 14 hours of the kind of crappy sleep you get after downing a Unisom with three or four White Claw hard seltzers.
We woke up to trillions in new funny money, Biden's massive new regulatory schemes, rapidly rising interest rates and debt payments, and the worst inflation in more than 40 years.
No matter what the "experts" might tell you, it's impossible to build prosperity on a quicksand foundation of debt and inflation.
Robert Heinlein had a handy acronym to help you dispel nonsense notions such as those: TANSTAAFL.
There Ain't No Such Thing As A Free Lunch and it's the economist's job to remind people of that — especially our elected officials — at every opportunity.
So once more I ask: what the hell do we need economists for?
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