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October 2, 2020 | The High Price of COVID-19 Lockdowns

Is an American author of books and articles on economic and financial subjects. He is the founder and president of Agora Publishing, and author of the daily financial column, Diary of a Rogue Economist.

SAN MARTIN, ARGENTINA – We begin today with a new study by the RAND Corporation.

It tallies a little more of the hidden cost of House Arrest.

ABC News reports:

Now, new data shows that during the COVID-19 crisis, American adults have sharply increased their consumption of alcohol, drinking on more days per month, and to greater excess. Heavy drinking among women especially has soared. […]

“The magnitude of these increases is striking,” Michael Pollard, lead author of the study and a sociologist at RAND, told ABC. “People’s depression increases, anxiety increases, [and] alcohol use is often a way to cope with these feelings. But depression and anxiety are also the outcome of drinking; it’s this feedback loop where it just exacerbates the problem that it’s trying to address.”

The bills will continue to trickle in for years. Jobs lost. Companies bankrupted. Careers and families stifled and stunted.

Job Cuts

Yesterday came more news of job cuts. Here’s Bloomberg:

American Airlines Group Inc. and United Airlines Holdings Inc. will start laying off thousands of employees as scheduled, spurning Treasury Secretary Steven Mnuchin’s appeal for a delay as he negotiates with Congress over an economic relief plan that includes payroll support for U.S. carriers.

American is furloughing 19,000, while United is laying off about 13,000.

Bloomberg also reports:

Tens of thousands of job cuts announced by blue-chip companies in a 24-hour period are a warning sign for the world’s recovery and emerge just ahead of two key reports forecast to show limited progress in the U.S. labor market.

In one of the biggest layoff announcements since the pandemic caused widespread economic shutdowns, Walt Disney Co. said late Tuesday that it’s slashing 28,000 workers in its slumping U.S. resort business. In the hours that followed, the pace of job cuts at some of the world’s biggest companies – across a range of industries from energy to finance – quickened. On Wednesday, Allstate Corp., the fourth-largest car insurer in the U.S., said it will cut 3,800 jobs, roughly 8% of its workforce. And Bloomberg reported that Goldman Sachs Group Inc. plans to cut roughly 400 jobs after temporarily suspending job reductions at the beginning of the crisis.

High Price

When the figures are eventually toted up, they will show that the U.S. paid a very high price – for nothing. Different countries (and different states) tried different techniques to control the spread of the coronavirus, from strict lockdown (as here in Argentina) to a light touch (as in Sweden).

Their results are all over the place. Northern Italy had a high death rate; Southern Italy had a low rate. Sweden’s death rate was high in nursing homes, but low in the general population.

America, with the most sophisticated and expensive medical care in the world, has had more deaths than any other nation. But some areas had almost none at all. Africa, with minimal medical services, has had relatively few.

As near as we can tell, it doesn’t matter what the feds do. The virus has a mind of its own.

Why Do It?

But today, we are puzzling over a larger phenomenon: How come? If the payoff from LockDown-LockUp policies was so uncertain, why do it?

Old people are about 1,000 times more at risk from the virus than young people (and seniors are 10 times more likely to die from something other than the coronavirus). Why not just advise them to lay low?

Why inconvenience millions of young people for the convenience of a few old ones? Why make 300 million fearful… when only 30 million had much to worry about?

But a similar question could be asked about a lot of things. Why are so many things set up that way? Each new bugaboo sends the nation into hysterics; many suffer and only a few benefit.

The War on Terror benefited a few military/industrial/consulting companies in Northern Virginia; it cost the rest of the nation $6.4 trillion. The anti-racism industry makes billions; it puts everyone else at each other’s throats.

Likewise, the poverty fighters have been gaining wealth and status on the front lines of the War on Poverty; poor people are just as poor as ever.

The government’s medical care giveaways are designed, chiefly, for old people; the young pay.

The Federal Reserve’s fake-money/fake-interest-rate policies have shifted more than $30 trillion to the richest people in the country over the last 30 years; the poor and middle classes got nothing.

Getting right to the point, the fix is in – a few benefit… most pay.

Optical Illusion

And now, a geriatric elite controls the country… its businesses… its armed forces… its money and its government.

Donald Trump is 74. Joe Biden is 77. Nancy Pelosi is 80. Mitch McConnell is 78. Jerome Powell is 67. Anthony Fauci is 79.

Biden, Pelosi, McConnell, and Fauci have been in government for a combined 185 years. Naturally, they arranged the furniture to suit them.

And what suited them all was a scammy, modern look – heavy on the trompe l’oeil, where things are never quite what they appear.

That’s why the subject never came up in the presidential debate. The reds and blues may disagree on the details – Who’s more corrupt? Who’s more dangerous, Antifa or Proud Boys?

But there is one thing they agree on so completely that it is never even mentioned…

Complete Agreement

The biggest threat to the U.S., and most of its people, remains hush-hush… like the source of a mobster’s wealth…

And whatever else may happen… nothing can be allowed to interfere with it. The flimflam must go on.

Not since the French Revolution has there been an elite so desperate to hold on to its privileges.

The French aristocracy hoped to remain exempt from taxes.

But the American geriatric aristocracy seeks an exemption from the laws of economics!

More to come…



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October 2nd, 2020

Posted In: Bill Bonner's Diary

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