by Ethan Yang
The American Institute for Economic Research
To say the future looks bleak for sound economics and good government would be an understatement. The year 2020 has seen an unprecedented expansion of government intervention that has absolutely devastated the global economy. It is highly unlikely that national governments will simply put those powers back into the lockbox; they will likely keep them for years to come. Even in the short term, lockdowns do not seem like they are going away anytime soon with countries like France and Germany already reclosing their economies. On top of that, debt and spending have soared astronomically in response to Covid-19 as if existing debt wasn’t high enough. AP News writes
In August, CBO issued a 10-year estimate predicting the deficit would decline to $1.8 trillion in the 2021 budget year that began Oct. 1 and would register $13 trillion over the coming decade. It would average 5% of GDP over that time, a level that many economists fear could lead to higher interest rates and a stagnating economy.
We have absolutely no idea what that amount of quantitative easing and low interest rates will mean for the health of the economy in the long run.