The US Will Never Get Back to Pre-Coronavirus Spending Levels, History Suggests. And That Means Trouble

Not only does the US government never pay back what it has borrowed, somehow the emergency stimulus spending always becomes the new normal.

It just took a couple of weeks for the world to go from business-as-usual to dark-even-for-a-scifi-movie. It wasn’t long ago that people worried about things like doing their jobs, taking classes, and planning summer vacations. Now we all wonder how long we can stay in our homes before losing our sanity, how we can make a living and pay the bills, and even where we can find toilet paper. And everywhere we turn, it’s all coronavirus all the time.   

It feels for all the world that it’s the end of the world.

And while things are bad, maybe even grim for some, it’s not the end of the world. Supply lines are coming back online, cities have not descended into violence or madness, and people are genuinely helping their neighbors and trying to make the best of a bad situation. But that message gets lost when the talking heads start talking

Nowhere was it lost as completely as when the initial jobless claims number rolled in following the country’s shuttering of most of its doors. That number, which is routinely in the neighborhood of 225,000, came in at a whopping 3.3 million in the first week after the government-mandated economic shutdown, and another 6.6 million in the second week. As bad as that is—and it is bad—it is not as bad as it might seem. A little historical perspective goes a long way here.  

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