SHUTDOWN

Economic historian Tooze examines the unprecedented decision of governments around the world to shutter their economies in the face of pandemic.

“The virus was the trigger,” writes the author. But other elements were at play, including a serious slowing of global economic growth, a rise in nationalist and authoritarian regimes around the world, and what, in effect, was a new cold war with China. In other words, the agents for destabilization were myriad well before Covid-19 arrived. Tooze, a scholarly writer of uncommon clarity, summons from the language of EU economic forecasting the useful word polycrisis to describe this multipronged series of failures of imagination and governance. Whereas the financial crisis of 2008 showed the weakness of the world banking system, Tooze writes, the shock of the pandemic spoke to the weakness of asset markets as a whole, requiring entities such as the U.S. Treasury to assemble “a patchwork of interventions that effectively backstopped a large part of the private credit system.” It did not help that the “fascistoid” Trump administration was so inept, though it did help that Steven Mnuchin, “the least ‘Trumpy’ of the Trump loyalists,” led those Treasury efforts. Other economies suffered in even greater proportion, especially that of the U,K,, whose structural shortcomings were exposed at just the time the country was departing the EU. Unlike in the crisis of 2008, though, British far rightists, like their American counterparts, had cut their ties with the business community, and the business community responded by rejecting austerity. So it was, Tooze observes, that when Joe Biden assumed the presidency, he pushed for big-dollar measures, which corporations supported, to jump-start the economy—with the proviso, Tooze notes, that Biden drop his push for a $15 minimum wage. Even so, he concludes, it is in the U.S. that “the disharmony between politics and economic and social development is at its most extreme and consequential.”

As the pandemic hopefully continues to fade, other crises remain. This book is a valuable forecast of future problems.