![]() Instead of following the example of the U.S. ![]() Congress and the White House would have oversight power through a bipartisan board but would not micromanage decisions. A HFC could be a vehicle by which the Federal Reserve disburses large sums to critical medical equipment suppliers and state and local hospitals. The HFC would have broad powers to do anything necessary to fight the virus, from rescuing medically necessary supply-chain firms to making grants or loans to state and local government for constructing temporary hospitals. The HFC would be a temporary, federally-chartered, government-owned corporation that could leverage federal seed money to crowd in private capital by issuing its own government-guaranteed bonds. Galbraith and I have proposed the creation of a time-limited Health Finance Corporation (HFC). During the Great Depression, the War Finance Corporation was the model for the Reconstruction Finance Corporation (RFC), which stabilized the economy during the 1930s and then helped finance war production during World War II. In World War I, this role was performed by the War Finance Corporation and other agencies. Fighting the aliens therefore requires Congress and the White House to temporarily delegate the power to raise and allocate critical resources to a bipartisan, independent organization, the equivalent in fiscal policy of the Federal Reserve in monetary policy. But in today’s America, too much authority wielded by a partisan president would not be considered legitimate by half of the citizenry. The republican city-states of ancient and Renaissance times recognized the need for temporary dictatorship during emergencies. It does not work well during an alien invasion when the aliens are wantonly slaughtering great numbers of Americans throughout the country, including the nation’s capitol. Our system of government, with separation of powers and checks and balances, works well during peacetime. ![]() The focus should be on ramping up mass production here and abroad of testing kits, PPE, ventilators and palliative medicine, along with rapid training of new medical workers and R&D to find treatments and a vaccine. and other nations are handicapped by inadequate testing and inadequate medical supplies. The main front is the medical war against the virus. It is secondary, collateral damage as a result of public safety measures. But the economic recession is not the main crisis. Our political and pundit class is treating this alien invasion as though it were a replay of the Great Recession of 2008, with recycled ideological arguments from a decade ago about bail-outs to firms and individuals. The other mistake is trying to deal with the crisis by means of ordinary legislation, rather than delegating authority temporarily to a bipartisan agency which can carry out fiscal policy quickly, backed up by the Fed with monetary policy. One mistake is focusing on the indirect economic consequences of the measures taken to slow the pandemic while neglecting the urgent need to contain and neutralize this lethal microbe. ![]() In battling the coronavirus, America’s political leadership is making two harmful mistakes. The role of economic policy is secondary and has two purposes: providing wartime resources to science and industry and cushioning the collateral economic damage done by the government’s order that everyone hide from the aliens. To thwart their invasion of our planet, it is necessary for people to hide from the aliens (social distancing/quarantine), to identify them (testing), and to develop and deploy superweapons to neutralize them (treatments and if possible vaccines).Īs in a 1950s science fiction movie, the war against the alien invaders will be won by the combined forces of mobilized science and industry. COVID-19 viruses are the equivalent of extraterrestrial invaders.
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