But there are other responses that would be far more useful as the world recovers from the pandemic, economists say.
“The crisis actually gives us, people who are anti-government or who want smaller government, an opportunity and we shouldn’t waste it,” Joseph Salerno, an economics professor at Auburn University and academic VP at the Mises Institute in Alabama, said in an interview.
“That is that we radically cut taxes at least for a period of time, cut government spending, take regulations off businesses to lower costs and to stop small businesses from going out of business or to give them an opportunity to earn profit during this time.”
Salerno says the response to COVID-19 has created many of the existing problems, which can be solved by changing course.
“We’re not getting more goods by the government printing out money and giving it to people. All we’re doing is redistributing wealth, and the wealth is shrinking because we’re keeping the economy shut down,” he said. “I think that’s crazy, insane.”
World Economic Forum founder Klaus Schwab announced his Great Reset in June. On the WEF website, he warned that the world “could be facing the worst depression since the 1930s” and that “global government debt has already reached its highest level in peacetime.”
Schwab's suggested solutions include “wealth taxes, the withdrawal of fossil-fuel subsidies, and new rules governing intellectual property, trade, and competition.” Investments would “advance shared goals, such as equality and sustainability,” and a fourth industrial revolution would be harnessed “to support the public good, especially by addressing health and social challenges.”
Schwab said the pandemic presents “a rare but narrow window of opportunity” to re-engineer society through the rebuilding process to create a new world “that is more resilient, equitable, and sustainable in the long run.”
Salerno has both questions and concerns with the proposal.
“So then, who becomes the all-powerful decision maker? It’s really the heads of the corporations and their government allies. This is really a scary development,” he said.
“It’s going to be full-blown fascism where the corporations are nominally private, but you have government technocrats telling them what to produce, how much to produce, who to sell to, whom to hire. That’s Nazi Germany and U.S. in World War II to a great extent.”
Alberta Premier Jason Kenney expressed similar sentiments in a Dec. 6 Facebook video. He called the Great Reset “a whole bunch of failed socialist policy ideas.” “How about we focus on the crisis, on protecting lives and livelihoods, helping people … [and] get refocused on generating economic growth?” Kenney wrote.
Nicholas Rowe, a professor emeritus at Carleton University, says the Great Reset seems more sentiment than substance.
“It seems like just putting together all the things that actually people might want to have happen … without much thought about actually how,” Rowe said. “It’s looking to me like a Rorschach ink blot, where you throw out all of the buzz words and people look at it and … see into it what they want to see, either their hopes or their fears.”
Rowe believes that publicly funded vaccination is the response the pandemic warrants, and that the post-war baby boom presents longer-term economic issues.
“The idea that you might have a retirement, that you might live a long time in retirement—that’s fairly new at least to this extent,” he said.
“It means interest rates are low, asset prices are high compared to where they’ve been historically. There’s going to be a lot more old people around. Population won’t be growing as quickly. Those things are pretty big.”
Salerno said that if a reset were truly possible, the best option would be a return to the classical gold standard for currency held until 1914.
“I do not trust government to oversee the transition from fiat money to a gold standard,” he said, but a positive step would be to remove taxes on gold and silver “and also off of people’s holdings of foreign currencies and allow banks to offer chequing deposits in the form of gold and silver or in terms of foreign currencies ... [and to] allow alternative moneys to compete with the dollar.”