Two tentative economic conclusions can be drawn from this experience. One is that once we emerge from the current hysteria, recovery ought to be rapid, even if the economy grows back in a somewhat different form. Despite the recent spike in infection rates in the US and the developing world, there is good reason to believe this moment could be sooner than we think.
Failures to adequately protect care homes, which account for nearly a half of all deaths in the UK, have now been addressed, we’ve got better at protecting our NHS staff, where a lot of asymptomatic transmissions were taking place, we’ve dramatically improved our test, trace and isolate regimes, it now seems more likely than not that effective vaccines will be available by the end of the year, and we are fast learning how better to treat the disease.
In the Spanish flu pandemic, the second wave was much more devastating than the first; there is obviously that possibility this time too, but it looks increasingly unlikely. Even in the US, death rates remain comparatively low, despite the resurgence in infections. So assuming the economy hasn’t entirely expired while in induced coma, there still remains a reasonable chance of the sort of V-shaped recovery we saw after the Spanish flu.
The second, more speculative, conclusion is that galvanised by unprecedented quantities of fiscal and monetary stimulus, in combination with the power of the virus to accelerate the transition from one economic age to another, we could indeed in a few years time be looking at more of a Roaring Twenties boom than a depression. Things could of course go the other way, but this would actually be a quite unusual outcome for a serious, global pandemic, the long term economic consequences of which are generally and ironically quite positive. Economic rebirth is in other words more likely than final death.