The Pandemic Response, Act II

PARIS – Twelve years ago, governments in the world’s major economies responded swiftly and effectively to the financial crisis. Teetering banks were nationalized. Monetary policy went into overdrive. Massive fiscal support was provided. Global coordination was intense.

But big mistakes were made, with consequences that emerged only gradually. Failure to punish those responsible for the financial meltdown paved the way for the populist surge of recent years. And Europe’s economy stumbled repeatedly, because banking woes were denied for too long and fiscal support was withdrawn too early. The results were deep socioeconomic and political scars that remained very visible when the COVID-19 crisis arrived. Will the same pattern be avoided? As Act II of the pandemic crisis begins, this is a key question.  

Wide disparity in the pandemic’s effect on countries is already apparent. The differences are bewildering: the United Kingdom has recorded 650 deaths per million inhabitants, while South Korea’s death rate per million is just five. Likewise, death tolls within the EU are a hundred times larger in the most affected countries than in the best-sheltered ones.