The wrong diagnosis

Calls for fiscal stimulus and monetary overreach will not help deal with the pandemic's economic consequences

When all you have is a hammer, everything looks like a nail. That old line seems particularly apposite today, when the preferred response to the current economic woes of so many economists and industrialists seems to be a stimulus of some sort. Yet the fact is that the pandemic and its associated economic costs are not the same as a regular recession, and we should be very careful in using the same tools as we would during other slowdowns.

First, the obvious: Previous recessions may have some supply-shock component, but what economists seek to respond to is a slowdown in aggregate