As you all know, I get by with a little help from my friends.
The Joy of Pandemics
As an example, my attention has been called to Paul Krugman’s column, No, Team Trump, the Coronavirus Isn’t Good for America: The commerce secretary just flunked microbe economics. Krugman writes,
Wilbur Ross, the commerce secretary, appeared on Fox Business on Thursday morning to declare that he “didn’t want to talk about a victory lap,” but that the coronavirus “will help to accelerate the return of jobs to North America.” By saying this, he demonstrated a couple of things: (1) why Gail Collins’s readers voted him Trump’s worst cabinet member, and (2) why Trump’s trade war has been such a failure.
What Ross and his colleagues apparently still don’t understand — although some of them may be getting an inkling — is that modern manufacturing isn’t like manufacturing a couple of generations ago, when different countries’ industrial sectors were engaged in fairly straightforward head-to-head competition. These days we live in a world of global value chains, in which much of what any given nation imports consists not of consumer goods but of “intermediate” goods that it uses as part of its own production process.
In such a world, anything that disrupts imports — whether it’s tariffs or a virus — raises production costs, and as a result if anything hurts manufacturing.
Oh, and by the way, we may not be prepared to handle a pandemic.
Driving into the Dreck
Meanwhile, another friend points out that, in Germany, they’re using Brexit to sell off-road vehicles.
The caption reads of the German ad above reads, “Do you also feel like driving your car into the dirt? Off-road vehicles now at bargain rates at SIXT.”