Bailouts in this time of coronavirus with Dr Dan Mitchell

Economics Explained host Gene Tunny speaks with Dr Dan Mitchell about government bailouts of companies such as airlines which we are seeing in this time of coronavirus. Dr Mitchell is the Founder of the Center for Freedom and Prosperity and a former Senior Fellow at the Cato Institute. He runs the highly informative and thought-provoking blog International Liberty.

Timestamps

Use these (approximate) timestamps to jump right to the highlights:

• 1:05 – discussion of venture capitalist Chamath Palihapitiya’s view that companies should go bankrupt rather than being bailed out (check out Government should let airlines fail)
• 5:15 – an ostensible libertarian justification for bailouts, the concept of regulatory taking (check out Dan’s post Protecting Airlines and Other Companies from Government Control)
• 7:40 – we need to ensure there isn’t a permanent expansion of government when it’s all over
• 10:00 – discussion of merits of different ways of bailing out companies, after Gene quotes from a Guardian article US government agrees on $25bn bailout for airlines as pandemic halts travel
• 11:50 – “There are no good options” according to Dan
• 17:00 – is the coronavirus crisis an indictment of capitalism? No, says Dan. Check out Dan’s post Coronavirus and the Tradeoff Between Big Government and Competent Government
• 19:10 – to what extent is US situation a failure of the federal government versus state governments? Dan thinks the states are best placed to deal with coronavirus
• 25:10 – discussion of what Dan thinks are misplaced concerns about stock buybacks (check out Dan’s post Washington’s Counterproductive Attack on Stock Buybacks)
• 32:05 – discussion of Dan’s Venn diagram in his post Coronavirus, Economics, and Saving Lives
• 34:05 – reference to UN report which acknowledges economic cost of coronavirus containment measures (check out this NPR article U.N. Agency Fears ‘Vulnerable’ Africa May Suffer At Least 300,000 COVID-19 Deaths)

This episode was recorded early on the morning of Saturday 18 April 2020 (Australian Eastern Standard Time) via Zoom.