Lockdown economics: Arguments without conclusions

Lockdown or Economic Destruction?

Author: Madan Sabnavis

Publisher: Atlantic

Pages:198

Price: Rs 595

One of the most interesting philosophies proposed by Plato is the “Allegory of the Cave”. Plato uses the cave as a symbolic representation of how humans live, contrasting reality with perception. Plato starts with prisoners who have been condemned to a cave for life and can only witness the world via shadows, which ultimately becomes their reality. When one prisoner is freed and witnesses the world differently, he tries to go back and tell others but is blinded. This cements the thought in others that freedom is dangerous. Though Plato’s allegory can be used for any contemporary phenomenon, it is most applicable to Covid-19 and the government’s response to it. In this case, there might not be just one version of reality.

Madan Sabnavis’ new work deals with one part of the pandemic’s associated economic destruction that has now been contested and debated for two years. As India deals with another wave of rising Covid-19 infections,

Mr Sabnavis sets out points on the economic implications of lockdowns, whether they were helpful or whether they just wreaked economic destruction. The book has four parts and 20 chapters. Mr Sabnavis, combining anecdotal evidence with media reports and economic data (both micro and macro), attempts to present a picture of what happened during lockdowns imposed by the government in 2020 to deal with the pandemic. The last part details his views on the impact of lockdowns along with an argument and counter-argument version of whether lockdowns were beneficial or not.

If you read the introduction, however, it becomes amply clear where the author stands in the whole debate. His disdain for lockdowns is too apparent in his research. To be sure, it does not show much in data or its representation and he does try to evade that bias across the first three parts of the book, but the bias creeps into his writing eventually. For instance, the discussion on the utility of lockdowns centres too much on the rise in infections post-lockdowns or flattening of the curve but does not tackle the issue of governments trying to build medical infrastructure during this period. The impact could well have been different had it not been for the jumbo hospitals created in Mumbai or the government requisitioning more beds from private facilities. Whether or not governments could achieve this feat is a matter for another debate. Similarly, while extolling the West for its generous stimulus packages, the author fails to take into account that the helicopter money may have alleviated some pain, but also led to rising inflation even when recovery was not in sight. The US is dealing with the effects of this today as inflation is at decadal highs.

The first part of Mr Sabnavis’ work, titled “Experiences”, is poorly structured. The author starts with anecdotal evidence, alludes to media reports and presents an overview of economic data pertaining to the lockdown. Mr Sabnavis’ training as an economist is on display in the second and third parts, where he discusses the macroeconomic effects and the policy approach. Most of it is sourced from economic data and his calculations. This part also mimics his writings in several newspapers on policy issues during this period. The chapters are succinct and

Mr Sabnavis does well to keep his analysis to the point. But the problem with these chapters of three or four pages each is that they do not connect properly and place a heavy burden on the reader to interpret things on her own. Doing so may be easy for an economist, a lay reader may need some hand-holding.

The last part, titled “Ruminations”, is too short to present any meaningful analysis of how the author arrived at his conclusions. The points raised are haphazard and do not do justice to the point Mr Sabnavis was trying to make. Even if he does lean on one side of the argument, the reasons for doing so are not clear from the last few chapters. For instance, in presenting both sides of the argument, he does not present any empirical research or data to show why and how each point holds and why these were considered over others.

Poor sentence construction and grammatical errors throughout the book make matters worse. You will better understand the author’s views by reading the articles he has published over the past two years in various publications. The book does well to present economic data for the last two years in one place and the policy approach, but there is a failure to connect the dots. One can’t say whether it was deliberate or not.

To put it another way, Mr Sabnavis starts well but fails to draw the reader out of the cave.