This NYTimes Writer Thinks Too Much “Small Government” Caused the Covid Crisis
What’s the big lesson New York Times readers are getting after a year of coronavirus? America’s small government and frugal spending habit caused the unprecedented economic disaster, according to an op-ed by Zachary D. Carter.
Carter’s devotion to John Maynard Keynes and his interventionist economic ideology seems to blind him to reality. That sounds harsh, but how else can one explain Carter postulating that the US government had “[gotten] out of the way for decades” leading up to March 2020?
Carter necessarily finds that the transformation from “a manageable [health] emergency into a national calamity” was the consequence of too little government involvement and spending, most importantly.
To him, the robust, meddlesome, permanent bureaucracy in Washington, DC, is nothing but a mirage.
Despite his claims, and the fact that his article was published by the prestigious New York Times, the reality is that America’s spending has only grown over the decades.
The State’s Role in the Crisis
In his article, Carter wrote that low taxpayer-backed investments on “scientific research, physical capital, and education” led to the coronavirus crash. The unparalleled economic crisis, he concluded, could have been easily predicted by Keynes.
For Carter, Keynes’s view that the government is the stabilizer of the fundamentally unstable free market, can easily be applied to the pandemic-led crisis.
Over the past year, we have been relearning the lessons of the [Keynes]. In 1937, Keynes wrote that serious economics was not a realm for “pretty, polite techniques, made for a well-paneled board room and a nicely regulated market.” The real world is messy, the future uncertain. And the genius of profit-maximizing entrepreneurs does not automatically arise to provide solutions when calamity strikes. For Keynes, the economy was not a self-sustaining engine of prosperity; it was something that societies created to meet social needs and that had to be actively managed to function properly.
An economic crisis demands a confluence of coordination, expertise and judgment that governments alone can provide. If the government gets out of the way, everything falls apart. And when the government gets out of the way for decades, it can transform a manageable emergency into a national calamity.
The idea that “governments alone” can provide the “expertise and judgment” necessary to lead the way during an economic crisis is one that fails to recognize the shortcomings of large bureaucracies.
Governments are necessarily unequipped to deal with economic crises partly
Article from Mises Wire