COVID-19, economy
Photo credit: Adapted by WhoWhatWhy from FrankundFrei / Pixabay, Mark Mathosian / Flickr (CC BY-NC-SA 2.0) and Rafael Javier / Pixabay

A look at how the world economy and individual lives were changed forever by the pandemic, and where that leaves us now.

Everyone desperately wants to know what the post-pandemic world will look like. Adam Tooze has been thinking hard about it and he thinks he knows. We find out what his research reveals on this week’s WhoWhatWhy podcast.

Tooze, Columbia University history and economics professor and author of Shutdown: How Covid Shook The World’s Economy, offers a global perspective on what “back to normal” will mean.

Comparing the US experience to China’s, he notes how cultural and political differences have determined successes and failures in dealing with the unprecedented challenge of COVID-19.   Tooze argues that, like soldiers returning from mortal combat, we are suffering from a kind of national — and even global — PTSD. 

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Full Text Transcript:

(As a service to our readers, we provide transcripts with our podcasts. We try to ensure that these transcripts do not include errors. However, due to a constraint of resources, we are not always able to proofread them as closely as we would like and hope that you will excuse any errors that slipped through.)

Jeff Schechtman: Welcome to the WhoWhatWhy podcast. I’m your host, Jeff Schechtman. Today, it seems as if there are two competing narratives in both America and the world psyche. One says that we are busy recovering from the pandemic and its result in shocks and that that is the driving force behind our daily efforts. The other is that the pandemic changed everything. That we will never look at work, the economy, government, or our own lives in quite the same way.

In the conflict between these two ways of looking at the world lies a great deal of the anxiety and fear that is so pervasive today. The pandemic, our personal and collective response to it forced us to use muscles and strengths and resources that we didn’t know we had and today is really the morning after. Are we going to continue to tone those muscles, build up the strengths that helped get us through and be a better society? Are we going to fall victim to the sloth that has been eroding us for years?

Some of this is at the heart of a new work by my guest, Adam Tooze, entitled Shutdown. Adam Tooze is a professor of history at Columbia. He’s the author of the award-winning book Crashed, which was also a New York Times notable book, and one of the economists’ books of the year, and his newest work is Shutdown: How COVID Shook the World’s Economy. It is my pleasure to welcome Adam Tooze here to the WhoWhatWhy podcast. Adam, thanks so much for joining us.

Adam Tooze: Pleasure to be here.

Jeff: When we look at the damage and the results of the shutdown and of the pandemic, are any of the things that happened, things that came about as a result directly of the pandemic, or were they things that were lurking in the system that were simply brought out and exacerbated by the shutdown in the pandemic?

Adam: I think it’s a combination of both. The pandemic itself is, after all, not, it’s obviously at some level an act of God, but if we examine its deeper causes, you could say that it too came out of the system. The best guesses or the two best guesses are either it came out of the labs and escaped, which is still a minority view, I think, and the other one is that it’s the result of zoonotic mutation from the unfortunate juxtaposition of a big urban society with what’s left of wildlife in China. Those are systemic causes too.

Once that, as it were, was unleashed upon the world through the malfunctioning of China’s disease reporting system, then it unleashed the shock that is really like nothing we’ve ever seen before. And the effects of that are long-lasting, less, in fact, in the rich countries of the world because they were able to cushion themselves, but in the poorer countries of the world, the damage is long-lasting and it’s persisting right now.

If you were an East African safari operator, you are still struggling to your bare survival at this point. But you’re right, obviously, it also, as it were dug into preexisting weaknesses, preexisting tensions, you could think of like in Europe, the fragility of the governance of the eurozone, or tensions between the West and China or in the United States, the evident fragility of our political system here. So, it’s as with any big, complex historical event, it’s always an interaction of those two different dimensions.

Jeff: One of the things you talk about is that the West really has no systemic ability, no inherent ability to really effectively deal with this kind of large-scale crisis. Talk about that.

Adam: It is a fragility of Western societies’ democracies that we don’t have powerfully intrusive surveillance apparatuses, certainly not from a centralized government point of view in most aspects of our lives. We don’t have the infrastructure of a Communist Party system’s spread out throughout our societies. And so yes, to a degree, we have to improvise our response every time and you can think of that as a great weakness. But frankly, we don’t know it’s any different and it’s hard to imagine our societies operating any other way. The idea that we could somehow opt for Chinese-style structures, I think, is completely fanciful.

And we do have strengths, and strength consisting of the obvious things, they’re the innovative societies to a degree anyway, and we’re able by those means to produce a response in the form of a vaccine. Also, if you live in a community like New York, we’ve seen both, as it were, the dark and the light. We’ve seen both the collective failure of the spring of 2020, which was grievous and put New York at the very top of the global mortality rankings, and on the other hand, since then, we’ve actually seen rather an effective low-key, genuinely consensual approach to handling the crisis, which also reflects the values and attitudes of a big independent-minded city like this, but it works. We have not, unlike many other major cities around the world, certainly in Europe, we haven’t had second and third shutdowns. We haven’t needed to because the epidemic’s remained largely under control and then the vaccines arrived, and they were promptly applied on a dramatic scale.

Jeff: What have we learned in terms of the importance or lack of importance of top-down leadership within the West? To what extent did we learn things about how leadership really can shape events?

Adam: I think it’s important. It’s difficult for us to talk about concertedly because in a sense, as democratic societies, we resist the idea I think of top-down leadership, but when it’s absent, you really feel it and it was effectively absent in the United States, or if it was present, it was to a large degree disruptive. Obviously, through the sheer constitution of the US, the lead in dealing with crises like this does resolve to the governor level, to the state level. And again, we see very wide discrepancy across states, and it aligned to a degree with party lines but not exclusively so.

So constructed leadership at the state level, banging heads together, insisting on a clear public health message, helping to coordinate hospital systems made a very big difference. And so, we’ve seen, I think, both ends of this. We’ve seen the absence, we’ve seen disruption, and we have, in fact, seen examples of concerted action. That’s in the political sphere. But we’ve also seen active leadership of a significant type in more technical areas. I spend a lot of time, because economics is my thing, talking about the central banks of the world.

Their decision-making matters enormously, not immediately fighting the virus but to the conditions under which societies do cope with the economic shocks. And they, in March, after a little hesitation, a little bit of foot-dragging, nevertheless, by the second and third week of March, they’re doubling down on the gigantic response, which was a necessary, not a sufficient condition but necessary condition, for us coping with the crisis.

Jeff: What was the broader impact as you see it with respect to globalization, which was already coming under some pressure before the pandemic and at the impact on the world of the globalization?

Adam: I think it’s important to differentiate between different movements here. We’ve seen an unprecedented shutting off of global connections. It’s worth remembering that for months on end, it was impossible to travel trans-Atlantically, it was very difficult for people from all over the world to get in and out of each other’s countries. This is really unprecedented in its intensity. There has also been, as it were, a plateauing of globalization rather than a retreat, I think it’s fair to say a sort of plateauing. And that’s been a feature of the world economy really since the 2008 crisis.

The period to really grow, grow, grow, which characterizes the ‘90s and the early 2000s, I think are long gone. And on the other hand, there have also been dimensions of, not exactly globalization, but at least global cooperation and communication. And most striking is something like the vaccine effort, which was the result of the sequencing of the vaccine was originally done in China and the data was put online by a brave scientist who said he disobeyed orders and enabled the global science community for the focus of developing the vaccine.

But I don’t think we should underestimate other more mundane things like the prevalence now of Zoom communication and the ease with which we can see and talk to each other all over the world at basically zero cost. And that I think, it does actually offer the means of a new type of globalization both in academic life. I did a series of seminars with colleagues in South Africa that I might not otherwise have done. There’s a whole network of communication like that, but I think our imagination has been spurred. We’ve had to come up with ways of reaching out to each other.

Jeff: What is your sense of how long it’s going to take us for the dust to settle to realize both the pluses and minuses from this and have them become part of our daily existence essentially?

Adam: I think the first and crucial thing to recognize is that we’re not done with this pandemic. If you look globally, mortality is still high, and only a matter of weeks ago in our own country in the United States, 2,000 people were dying every single day of this disease, and the great fear has got to be that because the rate of infection is still so elevated, that we spawn a variant which is even more deadly and even more infectious than delta. 2022 is even worse than 2021. That’s the most important thing to say at this point. I think the beginning of the fact that this conversation about the aftermath of the pandemic is already beginning, that’s a sign I think of our failure to grasp the seriousness of the situation that we’re in.

This is not a criticism of you. I find myself sliding into this conversation, these sorts of thoughts all the time, and in a sense publishing a history book which packages the events and the experiences though they were over. It’s not helpful to this cause in a way, because we’re not out of this. If we are in the particular bits of the world that we’re in privileged enough to live in communities that are no longer massively disrupted, then that is good fortune. If we argue the vaccines now, personally say, that too that half the world’s population hasn’t even seen a vaccine yet.

Jeff: There is two parts of this. There’s the practical and reality-based part where a thousand people a day are still dying. And then there is the psychological component, which people are adjusting to where they say, it is over, where that is a prevailing sentiment out there. The degree to which these two things are in conflict seems to be another problem that’s lurking out there.

Adam: I completely agree. On the one hand, one wants to celebrate the human capacity to forget, basically, and deny to an extent, because our desire to get back to our former lives is resilient. My wife’s in the travel business, and her firm was totally paralyzed, obviously, for two years. She’s got an entirely full-booked roster of trips in 2022. I feel nothing but good about that. On the other hand, we all know, I think, in the back of our minds lurks a new sense of fragility. I think that at least has remained.

If we are able by looking at the present and the immediate future to convince ourselves that we are back where we were before the crisis hit, I don’t think that we are going to easily lose the sense of fragility. After all, if we did have to cancel everything next year, it will be the third year in a row that we’d have to have done that. It would no longer be the novel shock that it was the first time round.

Jeff: There is an interesting conflict that is going on, there too. On the one hand, there are so many people that want to say things are not the same since the pandemic, things are not the same since the shutdown. They don’t want to go back to the office, commutes different. There’s just a lot of things people want to be different in their lives. And yet at the same time, there is this overwhelming sense that seems to wash over us every day of people wanting things to be back the way they were.

Adam: I completely agree. I think it’s a very interesting experiment in our consciousness. It’s precisely because it reflects the fact that we went through this completely unprecedented experience that we’re even posing this question that you and I are discussing. Are we back to normal, presupposes, of course, for a long period of time, we all know that we absolutely weren’t, and I think that’s, as it were, what this book is trying to bring home and recall, is that extraordinary moment in March and April 2020 when the whole world had stopped.

It was as though literally everything had come to a standstill wherever you were on the planet, everyone was going through the same experience of discovering what it was like to spend days on end living at home, to barely go out, to consider seriously whether you should go shopping for groceries. It was a truly extraordinary experiment in a completely new way of life.

Yes, I agree, of course, there is this desire to get back to the previous reality, but in some ways, the more surprising thing is that we have to pose the question at all. I don’t remember ever asking after March 2020, are things normal again? That wasn’t a question that we had. Now, I agree we do. We are, of course, absolutely drawn to the idea, should I go and see the new James Bond? I’m English, an English dude, I’ve not missed a James Bond in my entire life. Should I go and see this film? Or should I wait till it appears on the small screen?

Jeff: There’s a kind of, almost global sense of PTSD that the world is still suffering from.

Adam: Yes, I think that’s about right. I think that to me captures it. I think I happen to be closely attached to a community in the Bahamas that was devastated by Hurricane Dorian in 2019. It’s really interesting being in touch regularly there. Most of the time, the people who survived that, even more devastating shock, their lives appear completely normal, they carry on.

Come the anniversary, the 1st of September, and come a major electric storm with lightning and thunder. The next day, you see people wandering around the island, obviously, in a state of shock, badly shaken up, barely having slept with the jitters. If you’ve been in a community that’s actually experienced a natural disaster like this, the memory process, the trauma is absolutely not linear. That most of the time, yes, we go back to this normal mode, but there’s also this other memory that’s triggered in quite unpredictable ways.

Jeff: In Shutdown you also talk about China’s response to all of this and the way this played out in Chinese society. Talk a little bit about that and what we can learn from watching that.

Adam: One of the things I think to reckon with in the future is that they didn’t have our 2020. In the longer-term horizon, that may turn out to be one of the more striking things, is that they went through a lockdown process, but it was very brief. By the end of February, their regime is already pushing hard for them to return to normal. So, their 2020 was much more normal than ours in everyday life terms, in terms of going about their everyday business.

I have students who took jobs in China in the course of 2020. And they describe this process of coming out of the crazy West, going through a two-week quarantine period, and then emerging into a world which though Chinese and very alien in that respect, but in other respects far more normal than the place that they left in Europe or the US. So that is, I think, going to be an abiding reality. Their history has been more linear than ours. Their shock was less intense.

But early on, I think it’s crucial not to underestimate how severe it was because though they have appeared in retrospect to have won the pandemic, to have been the people who managed it best, that’s, of course, not what it looked like in January. It was by far and away, the most severe failing of public policy, probably, the Chinese regime had suffered since the beginning of the reform period, well, at least since 1989 at the Tiananmen Square protests.

They were struggling to keep a lid on public opinion. There was mass protests online that they were having to repress. Then the economic shock delivered by their version of the shutdown was devastating. Again, they’ve done a good job of covering this up, but we think probably the unemployment amongst the huge army of migrant workers that make up such a large part of the construction workforce, the service sector workforce, and the cities, nationally, they had unemployment of over 20 percent. Even worse than our crisis.

We have to remind ourselves, China is this huge economic success story and its big, modern cities are on a par, in fact, in many ways, far ahead of us in the West, but 600 million Chinese get by on very, very low incomes. This was actually brought to the forefront of discussion by Prime Minister Li Keqiang, who then had to be silenced by the regime because he was saying, “Look, we have to take seriously how long COVID, if you’d like, is affecting Chinese society, because those people, those 600 million, they don’t work in the shiny office blocks and the new businesses, they are casual labor. They’re in the informal sector, they work in small private firms, businesses, shops, takeaway outfits, and so on.” They were really suffering in very severe crisis. If you like, it’s our failures that have turned this into a success for Xi’s regime. If we had done better, this would be a huge trauma and problem to them, too.

Jeff: Is there anything that we can learn or take away from their experience that would be positive for us?

Adam: Well, I think my general point with regard to China would be not so much that we need to learn from them, but we do need to learn about them. The crucial failing in February of 2020 is that we exoticized this. This was their problem, a Chinese problem that was going to be handled by Chinese means, with a Chinese regime that was authoritarian and was going to do its thing. I instead what we should have been saying is, you know what, if they’re shutting off Beijing to Wuhan, two huge cities, just like New York, London, LA, well, then we’re going to have to do the same thing. In fact, we need to do it now because the same airports that connect Wuhan to Beijing, the same airlines fly into all our cities too. And that was the failure of imagination that was absolutely pivotal to this entire crisis.

I don’t think, in general, there are many lessons to be learned for Western politics, society, culture, from China’s very different politics, society, and culture. We should accept those differences in my view, there’s no alternative in any case. They are a law unto themselves, and absolutely properly so, and a very powerful force in world affairs. But emulation is not really something that is reasonable for us to anticipate or expect, but knowing about them, being aware of what’s happening there, following closely events there and trying to figure out the implications for us, how we are geared, caulked into a relationship with them, that’s absolutely imperative.

Jeff: Talk a little bit about the economic resiliency, particularly of equity markets since all this. Certainly, if one looks at the market since February, March of 2020, it’s pretty amazing how successful it’s been and how awash in money the system is.

Adam: Yes, I mean, and that’s an effective policy. It’s difficult, of course, to counterfactualize about how things might have turned out, but we I think probably would have suffered a gigantic financial heart attack in the spring of 2020 if it had not been for truly gigantic action on the part of the central banks. And if you look at the course of equity markets, they turn in the last week of March 2020, and they turn as it becomes clear that the Fed is really going to do everything that it takes to revive the financial system because the last thing that we needed on top of the pandemic and the derangement of American politics was a financial heart attack as well.

And the equity markets are smart, they’re very, very tightly wired. There’s a spectacular amount of intelligence and observational capacity concentrated in those markets for obvious reasons because trillions of dollars are at stake, and as soon as the message was clear from the monetary authorities, and as soon as Congress had passed the CARES Act, the giant stimulus program, the markets just pivot, turn on a dime, and so all of the smart money bets one way, and then it becomes a momentum trade because the market is moving so the smart thing to do is to move with it. And that’s what we’ve been living with ever since.

And on the one hand, it was absolutely necessary, and for the top 10 percent of American society who own 80 percent of those equities, it’s, of course, been a giant blessing. But it has also divided American society between those who do have that stake in those financial markets which have been the privileged recipients of all of this stimulus. And the vast majority of Americans who they imagine, perhaps that they have some stake in the S&P 500, but in any material sense really don’t. And as a result, there was of course a pulling apart of a perfectly good part of society.

Jeff: One of the things that you talk about though is that when you look at the big picture, it widens the imagination as to what’s possible economically and that that is a lesson from all of this.

Adam: It is, it absolutely is an invitation to think constructively, to think imaginatively of what we might do. What we’ve discovered is that if we really want to, we could put the entire economy or very large parts of it anyway, on some sort of life support, and we didn’t know that we could do that. And we’ve also discovered that in extremis, if we have to, in a situation like that, we can borrow giant amounts of money without there being a catastrophic increase in interest rates. And those are powerful, and they ought to be empowering, realizations.

What we’ve also, of course, discovered is that you have to figure out good things to spend that money on, and as we know from the negotiations which are going on in Washington right here and right now, you also have to actually agree to do it. So, at the same time, if you like, as we have overcome hang-ups and imagined limitations about what we might be able to finance and pay for, we’ve run straight into the constraint of, “Well, are we technically able to do it? Are we technically able to deliver effective vaccines? Are we technically able to organize systems that enable us to work while socially distanced?”

Then, on the other hand, the political constraint, “Can we actually agree and cooperate with each other to do those things?” which we are able to afford to do, but we would need to agree to do them.

Jeff: There does seem to be this pervasive fear though, this sense that “Yes, we did these things that pulled the markets back from the brink and that it provided survival in a very difficult time, but gee, let’s not ever have to do that again, even though we see that it worked, we don’t want to try that again. It’s too dangerous.”

Adam: Well, I think you have to judge, don’t you, what your priorities are? And we did it in 2020, and there was, in fact, the broad basis support, at least for the first phase of stimulus, and just about enough to get the second deal passed in December, remember the one at the very end of the Trump presidency. We did that for very concrete, for reasons. Tens of millions of Americans were facing absolute disaster in social-economic terms. And at those moments it’s evidently worth laying out the money, it’s evidently worth spending the political capital to get those kinds of deals done, and America is not a polity that easily agrees to do anything.

So, if we are able to concert ourselves, that tells you something about the seriousness of the situation that we’re in. And so, then this is a judgment call about what you actually think we’re up against and how serious you think those challenges are. And, obviously, there is broad backing in American society right now to spend say $755 billion on the Pentagon and national security. There’s an agreement on that. That’s a huge amount of money. That’s as much as wild-eyed progressives, in this case, would like to spend on things like social care, welfare, rebuilding America’s infrastructure, and climate, roundabout the Bernie Sanders program.

They’re a couple of hundred billion dollars short, but not far off. And we may not all agree, but there is this very broad spectrum of opinion backing that giant national security bill because we judge it to be an urgent priority. So, it’s a question really of what your priorities are. But one of the things we’ve learned is that if you were to be serious about remedying poverty in the United States, we just wanted to ensure that everyone in America really had enough cash in their pockets and children didn’t go hungry. We know what to do, which is send people checks.

And the fact that we don’t do that and instead spend $755 billion on the Pentagon is a particular statement of what our priorities are. That kind of security matters against China or whatever and that other type of security or insecurity that faces the harder — the 10, 20, 30, 40 million Americans who really, really struggle every day to get by — they’re not our priority. If they were, we would allocate spending differently. So, you’re absolutely right. There are tradeoffs to be made here and it becomes— If you’ve removed this financial constraint, it becomes a pretty unsparing test of what you actually care about.

Jeff: But I guess the other element though that enters into the equation is the competence element. You have the wonderful quote, “Anything we can actually do, we can afford.” I guess the do is the question mark in there, whether or not we have the competence to do it even if we can afford it.

Adam: Yes. And that, of course, is the argument around something like poverty often. We don’t do it because we don’t really know how or we’ve tried previously to raise up those in American society who are worst off and it’s failed, and so you retreat in a kind of resignation. So, then the argument would be, “Well, what about the children? The children are just the hapless victims of whatever social dysfunction is going on surely.”

So yes, that issue is absolutely central, and it could be something, as it were, complex technically, but in a sense, crystalline in its simplicity: “We need a vaccine that works against this coronavirus, tell us how much money you need. Go to it and we’ll start a dozen labs and half a dozen big pharmaceutical firms.” Let’s call this mission-orientated economics. “This is what we need. We’ll throw all the necessary resources at it.” That’s one type of problem because it’s quite— It’s neatly defined. “We need something that will capture carbon.” If you really, really need it, go for it.

Any sensible research proposal in that line, that will be one way of thinking about this, how we shift this constraint. When you’re talking about super complex, deeply entrenched, deeply historic social problems, that question of how we actually do it, “How do you improve public education in the United States?” The problem is really not whether we can afford to do it, the question is, “How do you do it?” And so, I agree with you, absolutely. There’s the political side to this and then there is, as it were, the recalcitrance of the gaps between our intentions and our ability to deliver on them.

Jeff: And inside that is the question of delivering through the public sector or the private sector.

Adam: Absolutely. All of those are key choices. And the decision to go by the public sector is, this is a public good, we shouldn’t necessarily be pricing this. This is a traditional appropriate role for the government, and the private sector, what is generally speaking more of a gamble, it’s we offer the right incentives, some bright spark will flash, and somebody will come up with some innovative solution or just be incentivized to figure it out. And both of those have their merits or solutions. I don’t think there’s any reason to be dogmatic about it one way or the other.

They both also have distributional implications. So, who gets what, who ends up wealthy, who doesn’t? And we need to think through the entirety of all of the tradeoffs there holistically. But say Operation Warp Speed was a case in point, right? Where it’s a mixture of government money, military bureaucracy in part, believe it or not, and then private firms, some very big like Pfizer, some very small like Moderna, some trans-Atlantic like the funding to the German firms and the European firms that we’re involved in Operation Warp Speed.

And I think the question is, was it large enough, and were the benefits and the costs appropriately distributed between the taxpayers on the one hand and the private companies that were involved on the other hand. And it’s a very good example, I think, of janus-based quality of this, because it’s, on the one hand, an absolute triumph, an extraordinary miracle on the fact that this worked in Russia and China, as well as just double that. And on the other hand, also a lamentable failure to actually solve this problem at the global scale.

Jeff: And finally, you talked about this earlier, is this giant experiment in so many ways that we’ve all been engaged in. How long do you think it will be before we can look back on this and really have a better picture of what worked and what didn’t and what the experiment really was all about? How long is it going to take, given how fast the world moves today and how fast things change?

Adam: I wish I knew the answer to that question. To me, the final judgments can’t begin until the epidemic is over. And it’s absolutely not over. So, every judgment that we make until the overall infection rate globally and the death rate is well down is provisional and this book is intended as nothing more than a provisional stock-take of the first 12 months of the epidemic. But we won’t and we shouldn’t kid ourselves that we’re entitled to draw any conclusions. Again and again, we’ve seen the fronts reversed. First, America was failing really badly, then with the vaccines it did much better.

In Europe, you see the opposite reversals happen with Germany doing well in the first stage and then really failing quite badly in the second wave, slow to roll out the vaccines. Now, however, more vaccinated in the United States, so it’s going back and forth, back and forth. We should be taking stock as we go along. We won’t arrive at any conclusive settlement of this until it’s over. And we’re just not there yet.

Jeff: Adam Tooze, his book is Shutdown: How COVID Shook the World’s Economy. Adam, I thank you so much for spending time with us.

Adam: Pleasure to be on your show. Thank you for the great conversation.

Jeff: Thank you. And thank you for listening and joining us here on the WhoWhatWhy podcast. I hope you join us next week for another Radio WhoWhatWhy podcast, I’m Jeff Schechtman. If you like this podcast, please feel free to share and help others find it by rating and reviewing it on iTunes. You can also support this podcast and all the work we do by going to


  • Jeff Schechtman

    Jeff Schechtman’s career spans movies, radio stations and podcasts. After spending twenty-five years in the motion picture industry as a producer and executive, he immersed himself in journalism, radio, and more recently the world of podcasts. To date he has conducted over ten-thousand interviews with authors, journalists, and thought leaders. Since March of 2015, he has conducted over 315 podcasts for

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