Rich countries try radical economic policies to counter covid-19
History suggests that the effects will be permanent
Editor’s note: The Economist is making some of its most important coverage of the covid-19 pandemic freely available to readers of The Economist Today, our daily newsletter. To receive it, register here. For more coverage, see our coronavirus hub
“THE GOVERNMENT intervention is not a government takeover,” the American president argued. “Its purpose is not to weaken the free market. It is to preserve the free market.” The IMF pointed to the “unprecedented policy actions undertaken by central banks and governments worldwide”. The economic response to the financial meltdown of 2007-09 was big enough. But in answer to the covid-19 pandemic policymakers are launching even bigger, more radical interventions. Putting the economy on a wartime footing is supposed to be temporary. A look at 500 years of governmental power, however, suggests another outcome: the state is likely to play a very different role in the economy—not just during the crisis, but long after.
This article appeared in the Briefing section of the print edition under the headline "Building up the pillars of state"
More from Briefing
America’s $61bn aid package buys Ukraine time
It must use it wisely
America is uniquely ill-suited to handle a falling population
Which is a worry, because much of it is already shrinking
Homeowners face a $25trn bill from climate change
Property, the world’s biggest asset class, is also its most vulnerable