The fractional-reserve fragility hypothesis makes a prediction that is largely falsified by banking history. Inherent fragility implies runs should be largely random. But this isn’t so. Runs usually occur at banks where depositors have a rational basis to question the health of the balance sheet. The most recent round of failures, including Silicon Valley Bank and Signature Bank, didn’t happen at sound institutions beset by bad luck and depositor hysteria. They happened at unsound institutions with foolish capital structures.
Public policy, not market forces, makes banking unstable. US banking history is case in point. Contrary to the popular impression of unregulated “cowboy capitalism” in the republic’s early years, banking has always been heavily controlled by the state. Two especially costly restrictions imposed on banks were (a) limits on note issue based on government bond holdings and (b) limits on branching. The first rendered the money supply inelastic to the needs of trade. Money demand shocks needlessly threatened balance-sheet integrity. The second overexposed banks to location-specific risk. Shocks to agriculture and industry, sectors largely underwritten by nearby banks, could have been absorbed had banks been permitted to branch. It also meant that notes traded at a discount when circulating far from the issuing bank, reflecting the cost of redemption, and that money demand was somewhat less stable, since note-traders would gather notes up in one location, transport the notes back to the issuing bank, and then present them all at once for redemption.
Rather than “holding schools harmless” when students choose to leave, or double-counting students to generate more money for school systems, we should take all the money dedicated to education, divide it by the number of students—living, breathing students—and give each the same amount.
Given enough time, a seamless transition to zero-emissions cars that don’t impact a person’s quality of life or their pocket is eminently possible. The same cannot be said of the proposed shift to heat pumps, or decarbonised air travel, or low-carbon construction, or reduced meat diets. These are likely to end up being explosively expensive and unpopular. We will eventually crack a new way of powering planes, but not a commercially viable one by 2050. The public will go wild if every home is forced to stump up a five-figure sum to retrofit a heating system that doesn’t even work properly when it gets really cold, or if foreign holidays are effectively banned.
Do you notice how advocates for censorship focus on examples of ‘misinformation’ that only the most credulous believe (“5g chips!”) to justify censoring true facts that it would be inconvenient for the censors that everyone believe (“immunity after covid recovery”)?
There is no debate. The authors’ answer is unambiguous, and no reader of this book will die wondering what they think. Not about how governments responded to the Covid-19 pandemic (barring a Sweden here or a Florida there). Nor about the authors’ own left-wing principles, both economic and political, and how they bear on recommendations for the future. The authors bring swathes of data and evidence to bear to argue that lockdowns were a public policy disaster of gargantuan proportions. They weaponized the police and flew in the face of data that was, in fact, available early on in the crisis. There was censorship, bans, shadow bans, fake and politicized “fact checking,” and the stifling of dissenting views, some directed at the most credentialed epidemiologists in the world. Not least among these were the three authors of the Great Barrington Declaration, which argued for focused protection on the elderly and vulnerable and for leaving everyone else to get on with life and make his or her own choices; this was the gist of every pandemic plan before the start of 2020. What happened in six or seven weeks from late 2019, you might ask, other than an authoritarian government in China welding people into their homes?
Green and Fazi look at Sweden, which came in for huge criticism from the mainstream press, along with the doctorly caste and social media. Sweden was widely castigated for going against the lockdown zeitgeist that demanded widespread business closures, masking, mandates, isolation of many from their loved ones even when death was in the offing, and a myriad of inane rules. The whole Swedish approach was pilloried by the great and the good because it served as a control case, a counter-example, to what virtually every government on earth opted to do to its own citizens.
As I write this review in March 2023, Sweden has the lowest cumulative excess deaths in the entire OECD from the start of the pandemic till now. Governments and cheerleaders of the orthodox response might be able to game the question of who died from Covid (as opposed to something else) but it is much harder to game excess deaths. Sure, there is a bit of wiggle room about when to start counting and what prior years to look at to set the benchmark to measure excess deaths, but this really is the gold standard. If more people died with lockdowns than without them, they clearly didn’t work.
In Australia, where I live, excess deaths are currently running at about 15 to 17 percent above pre-pandemic expectations. The US, Britain, and continental Europe are all likewise bad on this measure—the ungameable one. But the same press that trumpeted every octogenarian’s death and a relatively meaningless “case count” is, well, deathly silent now. The Swedes’ chief epidemiologist Anders Tegnell— who says “I only followed the pre-pandemic existing plans by the WHO and by Britain and did not panic”—should win a Nobel Prize for medicine, not to mention everyone’s gratitude for bravery. Of course, he will not.