Saturday, December 16, 2023

The authors of 'The Big Fail' interviewed, a pandemic post-mortem and update

I haven't written an entry focusing on the COVID-19 pandemic since Mehdi Hasan takes a deep dive into 'The truth about DeSantis’ awful record on covid', a pandemic and primary election update last May, although I've mentioned it it passing since. That means it's time to return to the topic, especially since a book on the subject just came out. Watch Midday Fix - THE BIG FAIL: What the Pandemic Revealed about Who America Saves and Who It Leaves Behind from WGN News, an interview of Bethany McLean, who wrote the book along with Joe Nocera.

That's just a brief taste of the issues the authors raise in the book. MSNBC's Stephanie Ruhle explored some of them as she interviewed both McLean and Nocera on 'The 11th Hour' in Authors of 'The Big Fail' on what the U.S. learned from the COVID-19 pandemic.

Nearly four years after the start of the pandemic, the U.S. is still learning about what went wrong. Stephanie Ruhle sits down with Joe Nocera and Bethany McLean to talk about their book on the virus, our response, and whether the U.S. can do better in the future.
McLean and Nocera are probably the best people to write this book from an economic perspective, since McLean co-wrote Enron: The Smartest Guys in the Room, and got writing credit for the documentary, and she and Nocera co-wrote All the Devils Are Here about the 2008 Financial Crisis. From a scientific perspective, I'm not so sure. McLean and Nocera are very critical of school lockdowns, which weren't good for K-12 students' educations. I'm still dealing with all the effects of them on my students as a community college instructor. However, while the students didn't need them as protection, their teachers certainly did. I glad I was able to conduct classes over Zoom and built up the ability to run lectures and "labs" remotely. As I half-jokingly tell my students, that was probably the last new trick this old dog will learn in his teaching career.

I close with Forbes interviewing Nocera in 'The Big Fail': How America Failed To Manage The COVID Pandemic.

Joe Nocerra, co-author of "The Big Fail: What the Pandemic Revealed About Who America Protects and Who It Leaves Behind," speaks to "Forbes Talks" about his new book, what the U.S. did wrong during the COVID-19 pandemic, former President Trump's role in the failures, and more.
All this talk about fraud, inflation, supply chain issues, and labor shortages and activism reminds me of my analysis in Vox asks 'Why is everything getting so expensive?'
The traditional explanation for inflation is "too much money chasing too few goods." The people who give this answer, like Larry Summers, are usually arguing for less money. Summers thought the U.S. and other industrial democracies were pumping too much money into the economy to keep it on life support during the pandemic. While I think that money could have been better targeted to consumers and workers and not so much to business owners — I should write at least one entry about business owners being prosecuted for fraudulent use of these funds — that money helped end that recession almost as soon as it began. The alternative would have been much worse, especially since peak unemployment was the highest since the Great Depression. As much as it could be an example of "everything is connected to everything else and there is no free lunch," I'll take a temporary surge in inflation as the price to pay for preventing more suffering while people were staying safe at home.

In addition to being callous, the advocates of "too much money chasing too few goods" usually aren't as vocal about making more goods, which leads directly to supply shocks, the second explanation for inflation. I've written about supply shocks to explain the causes and effects of the chip shortage, baby formula shortage, and gas prices. That works very well as an explanation for why specific goods increase in price, but other than energy prices, which affect the prices of everything else, it doesn't work as a general explanation.

By the way, it's not just goods that are in short supply relative to demand; services and labor are in short supply as well. That means that the full version of the first explanation should be "too much money chasing too few goods, services, and employees." Increasing interest rates, which is inverting the yield curve, would be counterproductive on the supply side of the equation. Instead, it works by reducing demand. I'm an environmentalist who thinks over-consumption is a problem, but deliberately increasing suffering to destroy demand is not the way I want to do this. I'd prefer greater efficiency to reduce waste and a more educated populace who will choose to consume more responsibly and sustainably. Inflation while keeping people employed might actually help that goal.

Companies investing in their factories or other facilities and hiring more employees and paying them better would also help with increasing supply of goods and services, as well as induce more people to join the labor force.
As the MSNBC interview pointed out, a lot of companies have returned to their pre-pandemic ways. They haven't really learned anything. Sigh.

Stay tuned for the Sunday entertainment feature, which probably won't be highlights of tonight's Saturday Night Live. Instead, I'm thinking of covering awards shows.

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