Economy vs COVID-19
Week of 30th March 2020
“We cannot let the cure be worse than the problem itself”
As governments fight to prevent a spread of the virus, economies are suffering.
Some tries to put a number to a life and argue that the cost to a shutdown is too much in comparison. Some argues that a vulnerable economy has already taken so much beating that it can no longer afford a shut down. Meanwhile, some offers a solution that can save both.
There is no price tag that can be placed on compassion and it is insensitive to put a figure to human lives. But it is, at the same time, to everyone’s benefits in both the perspectives of economy and livelihood, to keep a shut down short.
If time is short, I highly recommend:
David L. Katz’s Is our fight against Coronavirus worse than the disease?
From the web:
by Jonathan Freedland
Trump’s narcissism has taken a new twist. And now he has American blood on his hands
The South China Morning Post
by Richard Harris
The world simply can’t afford China-style coronavirus lockdowns
From our Chief Opinionator:
Yes shut it down but keep it short
When faced with a pandemic that can kill significant percentage of the human population, the economy will hurt regardless, whether because a large proportion of its working force is too sick to work, or whether the country is placed in a shutdown mode for too long. And yes, the economy will also bounce back but the questions are, how long does it take before the rebound, at what cost and how steep will that recovery be.
To answer those questions, we need to realize time is the essence. The key ingredients are leaders need to impose effective plans quickly, and citizens need to understandably cooperate. A concoction of both will help minimize the time it takes for an economic shutdown, and death of a population.
The plans from the governments, meanwhile, need to be multi-prong.
Economically speaking, during the short-term economic shutdown, the government needs various stimulus plans or aids that will help businesses and its people to survive. We cannot allow those unemployed to grow desperate and worry about their next meal. Affordable loans need to be extended easily for businesses to stay afloat or generous help offered as businesses lay off and unemployment grows.
Medically speaking, testing kits need to be made available. One reader of IO was discussing this issue with me recently and emotionally asked, why are testing kits not widely and cheaply available yet? If testing kits are as easy and cheap to come by as a drive-through meal, every person can get tested before going to work or school and follow guidelines of quarantining, wouldn’t the world continue to rotate with minimal cost to our livelihood? Unfortunately while this is not the only answer to the issue, it is certainly one aspect of this multi-prong approach, I would imagine. Let those healthy enough to continue working and living while keeping those sick away from others, for a short 2 weeks. In reality, however, those test kits are not going to be here as cheaply and abundantly as we like, yet, and those who are sick are not going to voluntarily isolate themselves. We also forget the exposure to weak healthcare and insurance systems in even developed nations like US where some workers, despite knowing that they are sick, just cannot afford two weeks out of work.
Reaction time and cooperation are everything. This is an opportunity for governments to also understand where they are vulnerable at, whether it’s in their healthcare system, insurance affordability, cultural cooperation or other issues. The economy will be in pain, whether there is a shut down or not, it’s a matter of how long.