Question 1 (15 marks)

Economists differ in their response to how governments should respond to the COVID19 crises.

Economist 1 Gigi Foster:

"I think that Australia can follow in the footsteps of many other countries in the world, some of which have not had lockdowns as strict as we have had here, such as again, Sweden". Foster argues the economy should be kept open or even more people will die from not having work or not being able to cope with lockdown. If people die that is simply a cost of keeping the economy healthy.

Economist 2 Paul Krugman:

"The main driving force behind reopening, as far as I can tell, was the administration's desire to have big job gains leading into November, so that it could do what it knew how to do boast about economic success. Actually, dealing with the pandemic just wasn't Trump's kind of thing". Krugman argues that government should, for the sake of health and the economy, deal with the virus. The economy simply will not revive until the virus is under control.

Discuss the merits or otherwise of these different views using the four core principles.