New Study: Lockdowns Were Biggest Factor In Destroying US Economy

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It should be obvious to anyone who cares to study the economy, the authoritarian COVID19 policies, and the pop media rhetoric, that the mantra “COVID19 is responsible for a terrible recession” is missing something extremely important.

Whether that sort of myopic reportage is intentional must be evaluated on a case-by-case basis, but one thing is certain, those who honestly report on the economic disaster caused by the lockdowns stand out and deserve praise.

Jon Miltimore, Managing Editor at The Foundation for Economic Education, and a handful of other reporters, are those honest dealers, and Miltimore has just offered us excellent information substantiating the claim that, indeed, the primary driver of this 2020 economic collapse has not been social reaction to the virus, but political power.

'There’s no question the US experienced an economic recession unlike any it had ever seen before, highlighted by a 33 percent GDP drop and 22 million jobs lost,' writes Miltimore.

But, as he correctly notes, many media figures, and the “experts” they promote, either assiduously avoid discussing the lockdowns, or they seem to forget about them, when bemoaning the state of the economy.

’The economic crisis is unprecedented in its scale,’ Brookings Institution scholars wrote in a September paper, ‘the pandemic has created a demand shock, a supply shock, and a financial shock all at once.’

Few would deny the first claim—that the economic crisis is unprecedented in scale—but the second half contains a point of contention? Did ‘the pandemic’ create the economic destruction or  - the collective response to the pandemic?

As Miltimore points out, leftist outlets like the New York Times almost continuously have played the theme that it was the social response.

’It will take years for the global economy to recover from the jobs taken away by the pandemic,’ the Times reported in July.

Taken away by the pandemic. Numerous other examples by the Times and other media can be found espousing similar language.

Miltimore stresses that this isn’t a matter of semantics. It’s about truth and lives.

For nearly nine months, we’ve pointed out many of the unintended consequences of government lockdowns, which have included surging global poverty, mass job loss and business closures, spikes in depression and suicideexcess deaths, and other adverse social consequences..

Yet, swirling in the obscurant storm is spittle like that from The Washington Post, literally claiming, “Governors’ shutdowns did not cause the pandemic jobs crisis.”

Miltimore, and facts, beg to differ.

He notes that The Post cites a so-called “study” to back up its claim. But this study wouldn’t pass muster in a Sixth-Grade science class.

To arrive at this claim the paper relies primarily on two key points: 1) humans were social distancing even in the absence of mandatory restrictions, which resulted in a decline in economic activity; 2) jobs data do not show a wide divide between blue states and red states.

About the first, Miltimore notes that it’s obvious that people began social distancing.

The first point is a non sequitur. It’s no revelation that people were social distancing and avoiding travel in the absence of mandatory restrictions. This fact was pointed out in many FEE articles, and it was used to demonstrate that lockdowns weren’t necessary because people were voluntarily modifying their behavior to lower the risk of exposure to a strange and deadly virus.

But the fact that people adjusted their behavior does not mean that the economy would be damaged to the extent we have witnessed. And it could be difficult to get a sense of how these voluntary changes effected business, because government lockdowns overwhelmed that voluntary calculation.

It could be difficult, unless one worked to distinguish between areas that were politically locked down and areas that were not.

To gather such data, Miltimore first refers to a working paper by economists Robert W. Fairlie and Frank M. Fossen, of the National Bureau of Economic Research. In their work, Fairlie and Fossen studied the first two quarters of California economic activity.

Leading the way in sales losses was the accommodation sector (91 percent), followed by bars (86 percent). Entertainment venues saw sales drop 83 percent, while full-service restaurants saw a decline of 61 percent.

And these losses stand in stark contrast to other sectors – sectors that were deemed “essential” by king-like Governor Gavin Newsome and his lackeys. As Miltimore observes, Fairlie and Fossen conclude:

’The results (of our research) suggest that local implementation and enforcement of lockdown restrictions and voluntary behavioral responses as reactions to the perceived local COVID-19 spread both played a role,’ the economists state, ‘but enforcement of mandatory restrictions may have had a larger impact on sales losses.’

And Miltimore adds more to the compelling argument. He notes that the Post relies on a claim that some so-called “Red States” “fared no better” than “Blue States”, implying what we know is implied: that those “Red States” were uniformly not “locking-down”.

A far more helpful analysis would compare states with the most restrictive COVID policies with the states with the least restrictive policies. And that data is readily available, though you’ll not find it in the Post’s story—perhaps because the conclusion this data set reaches.

Miltimore opens the window to just that data:

Data from Oxford University and the US Bureau of Labor and Statistics show that states with the most restrictive policies had substantially more unemployment than states with the least restrictive policies.

And he cites graphics for the Oxford study, and commentary provided on Twitter by user PLC, who said:

The governors of the most restrictive states did achieve one thing with all their interventions, though: unemployment nearly 2X that seen in the least restrictive states.

And Miltimore tips the proverbial hat to Ryan McMaken, of the Mises Institute, who delved into this looming problem early in the COVID-lockdown nightmare last year.

Early in 2020 Ryan McMaken of the Mises Institute pointed out that the 2020 pandemic was starkly different from the pandemics of 1918 and 1957-58, both of which were incredibly deadly.

‘Yet we will see that neither produced economic damage on a scale we now see as a result of the government-mandated lockdowns,’ McMaken observed. ‘This thoroughly undermines the claims that the lockdowns are only a minor factor in economic destruction, and that the virus itself is the real culprit.’

 

 

 

And, as new information has come forward, we’ve seen more and more that the authoritarian, anti-constitutional, anti-rights lockdowns also did not generate the salutary medical effects politicians promised. In fact, as Art Moore notes for WND:

The 11 U.S. states that did not impose lockdowns over the fall and winter in response to the coronavirus have faired better than states that did, an analysis of public data shows.

But don’t pay any attention to this information, or to the vast array of political forces trying to silence people who want to share this info. It’s much more important to walk in lock-step with the leftist media establishment and their political pals who adore authority and scorn rights and individual analysis of risk.

...The people who scorn those who want to run their businesses or go to their churches, be with loved ones for Christmas, go to weddings... and who might have the temerity to research and think for themselves.

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