One of the Greatest Economic Blunders in History

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by Jim Rickards, Daily Reckoning:

The U.S. economy lost 140,000 jobs in December. Only about 55% of the jobs lost in March and April have returned. That’s a significant number.

Americans and others around the world who make their living as bus drivers, bartenders, waiters, hair stylists and boutique store clerks, among thousands of other jobs, make up 50% of all jobs and 45% of U.S. gross domestic product.

This is the part of the economy affected by the lockdowns. They are being destroyed.

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When the pandemic passes, and we are able to look back on the experience without fear or political bias, it will be clear that the lockdowns were one of the greatest economic blunders in history. Lockdowns do not stop the spread of the virus, but they do destroy the economy. This is not merely a matter of opinion or conjecture.

The pandemic has now lasted long enough that we have solid comparative data from all 50 U.S. states and many countries around the world. This data covers states and countries that tried extreme lockdowns, moderate lockdowns or completely voluntary methods that involved no mandatory lockdown at all.

The empirical results show that the experience of all of these jurisdictions was about the same and that lockdowns have not “contributed in any meaningful way” to saving lives. In fact, there is other evidence that shows lockdowns killed more people than they saved due to suicides, drug abuse, alcohol abuse, domestic violence and depression.

This study on the ineffectiveness of lockdowns was produced by Dr. Jay Bhattacharya, a Professor of Medicine at Stanford University, and his collaborators. One TV anchor who interviewed Dr. Bhattacharya said, “California has the strictest lockdowns in the country and cases there are absolutely exploding. What am I supposed to take from the usefulness of lockdowns?”

The fact is that lockdowns do not stop the spread of the virus, but they are very good at destroying the economy. I covered this all in my new book, The New Great Depression.

People are social beings and do not like lockdowns. No matter what the rules are, people will find their way around them. And, with or without strict compliance, the virus goes where it wants.

I’ve been to the White House on official business numerous times. It’s hard to think of a more locked-down place. It has multiple security perimeters, multiple entrances before one can reach the Oval Office, and numerous security guards.

Still, the President and First Lady contracted the COVID-19 virus last October, most likely in the White House itself. As I said, the virus goes where it wants. If lockdowns don’t work, why do public health officials and government officials keep insisting on them? There are two reasons.

The first is that academic epidemiologists are just as out of touch with everyday Americans as any other elite group. They sit in their labs and ivory tower offices and have had no difficulty working from home and avoiding routine exposure that other Americans face.

They have not lost their jobs or seen their businesses destroyed. It’s easy to order a lockdown when you’re not the one whose job or business is ruined. The other reason is that politicians have to be seen doing something, even if they don’t know what they’re doing.

Everyone agrees that washing hands, social distancing and masks in crowded venues make sense. But, that’s not enough for the politicians. They want to appear to be “saving the population” even if they’re just destroying the economy.

If you think the lockdowns have been an economic disaster (I do), then get ready for something worse…

Two of the top public health advisors in the new Biden administration are Ezekiel Emanuel of the Center for American Progress and Michael Osterholm of the Center for Infectious Disease Research and Policy at the University of Minnesota.

Both Emmanuel and Osterholm have long histories of calling for lockdowns during pandemics. In June Ezekiel said, “You have to actually have people at home, close nonessential businesses, stop bars, stop indoor dining, have everyone wearing face masks. These are the things we need to do. … You need to do it nationwide.”

The evidence is clear that lockdowns don’t work. Biden’s health advisors are calling for them anyway.

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