The Bottleneck Economy: Summary

Deliberately slow walking our way to prosperity

There is a great debate right now about the shape of the coming economic recovery and how that will be anticipated by financial markets.

However, a more profound issue is that the concept of a recovery relies on normal conditions, and we are so far out in Wonderland that literally anything is possible.

We are living through a kind of suspended time, one hundred percent stalled in the moment. Call it the unnormal.

Even in an unnormal situation, however, we can use some facts from the here-and-now to peer around the coming corners.

For example, we know today that the virus is now lodged in the human ecosystem and so it is highly unlikely to disappear. Another fact on the ground is that we have tens of millions of newly unemployed workers and widespread business closures. These and other known facts all point to downward pressure on prices and economic activity.

As a result, this article discusses continuing government policies to enforce barriers to social interaction, creating inevitable economic bottlenecks.

Bottom line, then, the specific shape of the recovery is a bit of a side issue discussion.

What is far more important are the structural changes in our thinking and attitudes towards social interaction, a coming Era of the Safety State, where trust, security, stability, reliability, community, and safety trump all other considerations.

Ninety days ago, no one could have imagined a shattering of wealth and confidence that already rivals the Great Depression in terms of its destructive capacity.

A measure of this confounding time is that no one knows where we will be at the end of the next ninety days.

The full article is found here.