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<\/a><\/p>\nYesterday we discussed how the Black Plague of the 14th century contributed to the rise of economic and political freedom.\u00a0 Today I want to discuss how the COVID pandemic is contributing to the loss<\/em> of economic and political freedom.<\/p>\nAgain, the Black Death led to a massive labor shortage, which drove up the economic power of individual workers, and to the decimation of the feudal elite, which led to the decentralization of power, with peasants and city-dwellers electing their own leaders.<\/p>\n
COVID, which is far less fatal, has also led to a labor shortage and to the consequent rise of wages.\u00a0 But notice the difference.\u00a0 The labor shortage this time is caused not by the death of millions but by people leaving the workforce, either voluntarily or because of government-imposed lockdowns.\u00a0 We now face the additional prospect of the labor shortage getting even worse because of vaccine mandates, either from governments or from private companies, as large numbers of workers in key sectors are vowing to quit their jobs rather than get vaccinated.<\/p>\n
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But the wage gains from the labor shortage are being cancelled by the surge of inflation.\u00a0 According to the Econ 101 textbook explanation, inflation comes from too much money chasing too few goods.\u00a0 Productivity is down because of the world-wide lockdowns, as well as the labor shortage.\u00a0 But the government has been pouring money into the economy, beginning with $4 trillion-dollar bailouts and continuing with the recently-passed trillion dollar infrastructure bill, with an additional $2 + trillion social infrastructure bill waiting in the wings.<\/p>\n
Incredibly, President Biden is describing his infrastructure bills as inflation fighters because they will put more money in people\u2019s hands.\u00a0 But that cannot stem inflation.\u00a0 Another way of looking at inflation is high demand coupled with low productivity.\u00a0 Deficit spending and printing money unconnected to productivity simply devalues the currency.\u00a0 A big part of the social infrastructure bill aims at restricting and eventually eliminating fossil fuel, which will make energy prices skyrocket.\u00a0 Instead, the bill hopes to promote electric vehicles, regardless of consumer demand for them.\u00a0 And the higher taxes the bills include, though they will not be enough to pay for the programs, will take money out of the productive economy.<\/p>\n
My point is that whereas the aftermath of the Black Plague led to economic growth and increased prosperity\u2013by unleashing the laws of free market economics\u2013the aftermath of the COVID pandemic is defying the laws of free market economics and can only put a leash on long-term prosperity.<\/p>\n
As for political freedom, over the last two years, we have all felt the weight of government\u2019s coercive power as never before.\u00a0 During the initial lockdown, the government\u2013yes, under Donald Trump\u2013forbade us from going to work, going to church, and even leaving our homes.\u00a0 I can\u2019t recall any government presuming to exert control over its citizens to that extent.\u00a0 You could argue that such actions were necessary to stem the pandemic, but, even if they were, the sheer imposition of state power was enormous.<\/p>\n
Also contributing to the rise of unlimited government as a result of the pandemic were the above bailouts.\u00a0 For the first time, the government gave vast amounts of money directly to its citizens,\u00a0 extending the social safety net not just to the disadvantaged but to everyone.\u00a0 Again, maybe this was necessary and a good policy, a compensation to businesses for being shut down and to the public for not being allowed to go to work.\u00a0 I\u2019m just saying that this largesse, justified or not, greatly expanded the role of government, as well as the willingness of citizens to accept that expanded role.\u00a0 The subsequent multi-trillion dollar infrastructure bills would have been unthinkable without the recent multi-trillion dollar bailouts.<\/p>\n
The researchers I quoted in yesterday\u2019s post conclude that because the COVID pandemic was so much less severe than the Black Plague, the socio-economic effects will be temporary, not historic.\u00a0 Let\u2019s hope and pray that this is the case.\u00a0 Already a backlash seems to be setting in against the government\u2019s overreach and its counter-productive attempts to control the economy.\u00a0 Perhaps our experience with COVID can serve as an inoculation against our political, economic, and cultural plagues.<\/p>\n
\u00a0<\/p>\n
Image by\u00a0Miroslava Chrienova<\/a>\u00a0from\u00a0Pixabay<\/a><\/em><\/p><\/div>\n<\/body><\/html>\n","protected":false},"excerpt":{"rendered":"The Black Plague of the 14th century contributed to the rise of economic and political freedom, but the COVID pandemic is contributing to the loss of economic and political freedom.<\/p>\n","protected":false},"author":1281,"featured_media":58091,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13,19,30,36],"tags":[11327,11324,872,11336,11333,11330],"class_list":["post-58085","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economics","category-government","category-medicine","category-politics","tag-covid-and-government","tag-covid-pandemic","tag-freedom","tag-influence-of-covid-pandemic","tag-infrastructure-bills","tag-unlimited-government"],"yoast_head":"\n
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