Many parts of the economy have suffered no ill effects from Covid – the US government should restrain its largesses

One year after the emergence of covid as a threat to our daily existence, a peculiar narrative has taken hold whereby the undoubted turmoil of the past 12 months is being treated as a general economic catastrophe. The mismatch between rhetoric and reality is reflected in the degree of monetary and fiscal stimulus being enacted and promised for the future, while the expansion of government regulation over both commerce and private behaviour seems likely to far outlast the medical emergency.

All of the above may seem preferable to the bleak future that threatened to engulf us in March 2020, but what started as a slew of emergency measures designed to prevent a deflationary bust has been expanded to a programme that threatens to place us in the alternative hell of an inflationary boom. The inconvenience of daily staples being unavailable last spring is being replaced by an equally dramatic shortage of household and corporate goods, as surging demand meets the reality of logistical and manufacturing capacity that is already being overwhelmed by current spending.