Society and Culture

Ignore the self-publicists – nobody has been “vindicated” by coronavirus


After the 2008 financial crisis, there was no shortage of “hindsight sages”, who, supposedly, had been warning us about this for years and had now been tragically vindicated.

But whenever you looked up the actual publications of any of these wannabe Cassandras, you would invariably find that they had not “predicted” anything. They had just written generic anti-capitalist rants full of fashionable platitudes, waffling about “casino capitalism”, “corporate greed” and “neoliberal fundamentalism”, without saying a word about the very specific causes of this very specific crisis. A lazy, superficial diatribe against capitalism is not a prophecy, it’s a Comment is Free article. It’s every George Monbiot article and every Paul Mason article ever written. They had been vindicated only in the same way a horoscope might occasionally “come true”.

Something similar is happening today, in the wake of the corona crisis. This time, it is economic nationalists and “communitarians” who are feeling vindicated. “How’s your globalisation coming along, liberals?”, they ask. “Open borders, hypermobility and globe-spanning supply chains are working a treat right now, eh? See, we told you that a borderless world would leave us vulnerable and exposed. But you wouldn’t listen. All you saw was the cheap flatscreen TVs.”

In a trivial sense, they are right. Had this virus developed fifty years earlier, it might never have reached us (unless a group of Maoist students from Britain, France or West Germany had picked it up on a backpacking trip). China was a hermit kingdom and an economic non-entity. There was no such thing as a “Chinese tourist”, because virtually nobody in China who was not a high-ranking party official could afford to travel abroad.

Conversely, if Britain were completely isolated from the outside world today, it would also have been possible to keep the virus out. North Korea seems to have managed so far (although their figures are, for obvious reasons, not massively reliable).

“That’s a ridiculous straw man argument”, I hear you say. “Nobody is saying that we should have no trade with China whatsoever. Nobody is saying that there should be no cross-border movement of people whatsoever. This is about moderation. We want those things – just not in excess.”

But this is where the problems start. What sort of trade restriction, what sort of travel restriction, or what sort of immigration restriction do you think would have kept the coronavirus out? The number of COVID-19 cases in a country is not proportional to that country’s trade volume with China. It is not a function of the number of laptops, printers or trainers with a “Made in China” label. You cannot keep it out with tariffs or import quotas.

What about the economic effect of the disruption of international supply chains?

That was indeed the problem two months ago – but it now seems utterly trivial in comparison. International supply chains are not the issue. They have held up remarkably well, all things considered. The economic damage inflicted by the coronavirus consists, first and foremost, of the fact that it has paralysed domestic economic activity. Here. In Britain. That is a vastly bigger issue than delayed orders from China.

How about travel?

If we could turn back the clock by four or five months, most governments (and definitely the Italian government) would obviously impose severe restrictions on travel to and from China. But if we had known then what we know now, even the keenest advocate of open borders would have accepted such temporary restrictions. The point is that we did not know that. Which is why nobody was advocating such measures at the time.

The disease was, most likely, brought to northern Italy by Chinese tourists, and then spread rapidly from there. What general policy lessons can we learn from that? None, of course. Communitarians may feel queasy about people moving around, but even they never suggested that we should pre-emptively clamp down on all tourism, on the off chance that one day it might help contain a deadly novel virus.

What about immigration controls? Irrelevant, in this context. Over the past four years, we have mainly been arguing about how to make it harder for Polish plumbers and Lithuanian construction workers to come here, because of the perceived impact on domestic wages. Those are not exactly pandemic control measures.

COVID-19 does not confirm and it does not refute any particular worldview. Nobody has been “vindicated” and those who think they have been are displaying a combination of confirmation bias and hindsight bias. The truth is coronavirus has caught pretty much everyone off-guard and nobody should pretend otherwise.

 

This article was originally published on CapX.

 

Head of Political Economy

Dr Kristian Niemietz is the IEA's Head of Political Economy. Kristian studied Economics at the Humboldt Universität zu Berlin and the Universidad de Salamanca, graduating in 2007 as Diplom-Volkswirt (≈MSc in Economics). During his studies, he interned at the Central Bank of Bolivia (2004), the National Statistics Office of Paraguay (2005), and at the IEA (2006). He also studied Political Economy at King's College London, graduating in 2013 with a PhD. Kristian previously worked as a Research Fellow at the Berlin-based Institute for Free Enterprise (IUF), and taught Economics at King's College London. He is the author of the books "Socialism: The Failed Idea That Never Dies" (2019), "Universal Healthcare Without The NHS" (2016), "Redefining The Poverty Debate" (2012) and "A New Understanding of Poverty" (2011).


2 thoughts on “Ignore the self-publicists – nobody has been “vindicated” by coronavirus”

  1. Posted 21/04/2020 at 10:33 | Permalink

    Peter Hitchens of the Mail on Sunday has shown a quite impressive degree of foresight on this issue. Not a rabid anti-capitalist but still. Consequently, I find it quite surpsising how little air time he has gotten – especially re the BBC which, in itsef, constitutes another nail in the coffin of BBC impartiality as far as I am concerned.

    Certainly at the end of it all Peter will be fully entitled to declare “I told you so”.

  2. Posted 21/04/2020 at 19:38 | Permalink

    Was this article written as an example of how not to make an argument? It seems to contain just about every BTL rookie error along with a fair amount of disinformation. So …’whenever you looked up the actual publications of any of these wannabe Cassandras, you would invariably find that they had not “predicted” anything’ Really? Roubini? Pettifor? And what about Peter Schiff’s 2007 book, Crash Proof: How to Profit from the Coming Economic Collapse. Not even a raving leftie, that one. Then a touch of the ad hominens with a dig at Monbiot and Mason, but without any examples, you’ll notice. A splash of exaggerating for effect with the not very funny line about maoist students. Some serious straw man stuff then, with a made-up rant which not surprisingly the author finds it easy to knock down..And then some fairly uncontentious bits about the difficulty in making policy, but nothing in the way of answers. And finally: ‘The truth is coronavirus has caught pretty much everyone off-guard and nobody should pretend otherwise.’ Seriously? Scientists have been predicting it for years!

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