The current infection rates in the U.S. stand at over 50,000 new cases per day, the highest ever, and they continue to rise. Many of the new infections have been traced back to the Memorial Day holiday in late May, when many people in this country gathered together socially without regard to social distancing, or without wearing any type of facial covering in public. As the Fourth of July holiday looms, public health officials have already begun warning people to avoid groups and maintain distancing, and states are already reversing their reopening policies, most notably those that allowed people to patronize bars and restaurants.
At this point, Republican governors in states such as Texas and Florida are seeing the consequences of their premature pushes to reopen unfolding in real time, exactly in accordance with what was predicted by many health experts. Their response, understandably, has been to shift blame from themselves and onto the people becoming infected. For instance, Gov. Ron DeSantis has blamed the sharp upsurge in Florida COVID-19 cases on young people failing to social distance in bars, without acknowledging that it was he who ordered the bars to open. Likewise in Texas, Gov. Greg Abbott, also a Republican, has “paused” his state’s reopening, but businesses that are currently open stay open, albeit some restaurants are now at a reduced capacity.
But it is not only bars and restaurants that contribute to COVID-19 infection. Offices and businesses with centralized air conditioning can spread it as well, particularly in relatively close environments. Since most establishments in this country operate with some type of air conditioning during the summer months, there remains that risk, which has little to do with social distancing but is more a consequence of reopening in general. The same concern remains with air travel and most forms of public transportation.
In short, the country finds itself nearly exactly where it stood at the beginning of this pandemic, with cases of infections and deaths still skyrocketing, and no end in sight. The reason this has occurred is due to the lack of a unified national response, the type of unified response that has permitted several other countries to more fully reopen. Former Vice President Joe Biden, who clinched the Democratic presidential nomination in June, recognized the poor response in a speech he gave Tuesday, excoriating the Trump administration for its failure to unify the country in containing the spread of COVID-19. As Jennifer Rubin, writing for The Washington Post, noted this week:
In sum, without a national plan based on science, we are right back where we started in March — or in an even worse spot. Biden echoed Fauci’s warning, asserting “the crisis is real — and it’s surging.” Trump has frittered away valuable time, urged counterproductive measures and set a poor example by declining to wear masks, which studies have suggested could save thousands of lives.
What no one has apparently bothered to do thus far is assess the social and economic consequences of Fauci’s prediction—of the likely ramifications of an infection rate amounting to 100,000 Americans per day (or more) that now seems possible. Of course, that figure translates to 3 million Americans infected per month, with a corresponding death rate to match. So by simple math, it appears that we could ultimately see fatalities in this country approaching 500,000 or more, assuming we continue on our current course, as hospitals become overwhelmed and the spread of the virus finally seeps more comprehensively into more rural areas of the country—areas with less capacity to cope with that type of catastrophic stress on their medical capacities.
While that sounds extreme, there is little on the horizon to suggest this will end any other way. The takeaway from Fauci and others this week is that we have essentially lost control of the virus; that the patchwork of states’ efforts that reduced rates of infection by adhering to strict social distancing now risk totally squandering those gains by reopening businesses too soon; and that ultimately, the economic choice facing this country will be between losing hundreds of thousands more American lives, or entering into a Second Great Depression.
The reasons for this seemingly inevitable and horrific outcome are as sad as they are mundane, but they all trace back to the political. While Democrats have emphasized the salutary effects of social distancing, testing, and enforcing protective measures in the workplace, Republicans have been more singularly focused on reopening the economy at all costs. The virus appears to be rendering its verdict now, and sadly it appears impervious to the GOP’s economic and political considerations.
Even if Joe Biden wins the election in November, he would not take office until mid-January. Even if Democrats win the Senate, that Democratic-controlled Senate will not be able to legislate measures that could possibly mitigate this tragedy until mid-January. That is nearly seven months from now—seven months which fairly promise only continued outbreaks from an uncontained pandemic. With Donald Trump in office until then, various states will doubtlessly continue their sporadic efforts to reopen, but those fits and starts will be ineffective in restarting the economy; as the current situation shows, they are most likely doomed to fail. Unemployment is unlikely to drop significantly (despite June’s deceptive jobs numbers which pre-dated the resurgence of the virus in many states) because people will simply not be patronizing businesses to the extent needed to reemploy the millions currently out of work.
Again, all of this was predicted: If a “second wave” of infections began to spike after attempts to reopen, experts vowed that the result would be worse than if no reopening had been attempted at all. But we are not even in a “second wave.” This is still the first wave. As observed by Annie Lowrey, writing for the The Atlantic last week, in an article that did not receive the attention it should have (probably because of “Bounty-gate”): “At least four major factors are terrifying economists and weighing on the recovery: the household fiscal cliff, the great business die-off, the state and local budget shortfall, and the lingering health crisis.”
None of these factors have been sufficiently mitigated thus far, thanks mostly to Mitch McConnell and the Republican-dominated Senate, and thanks to a clueless and incompetent federal response under the aegis of Donald Trump, who apparently has grown “bored” of the pandemic. Unfortunately, for the next seven months (at least) we are stuck with both of these obstacles; barring some miraculous change of policy by the Republican Party, we will still be in the throes of an economic calamity by Election Day.
Now, imagine adding an infection rate of 100,000 persons per day to that mix. As Lowrey observes:
(A)bsent dramatic policy action, a pandemic depression is possible: the Congressional Budget Office anticipates that the American economy will generate $8 trillion less in economic activity over the next decade than it projected just a few months ago, and that a full recovery might not take hold until the 2030s.
If and when that federal intervention dries up, millions of families just keeping their head above water will sink, as lost jobs and canceled hours force them to stop paying their rent and go into arrears on their debt payments. Hunger, homelessness, forgotten plans to attend community college, babies growing up in stressed households: These are the stakes. The CBO forecasts that every quarter through the end of 2021, American consumers will buy $300 billion to $370 billion less than they would have if the pandemic had never happened.
This drastic reduction in consumer spending due to the pandemic and social distancing will have a “cascade” effect of wiping out many of the businesses that have managed to survive by the skin of their teeth through the PPP program (Disclosure: Daily Kos has received a PPP loan). Even with that program, as Lowrey notes, 100,000 businesses have now permanently shut their doors. But with a vastly increased number of people at risk for infection thanks to short-sighted attempts to reopen, and thanks to lack of adequate testing and contact tracing, we can expect some industries, such as travel, tourism and hospitality, to essentially disappear. This won’t be as the result of any state policy, but as a result of simple human behavior: People want to live and they aren’t willing to risk their health or that of their families.
Absent massive federal aid, the fiscal disaster bearing down on us in the coming months will also wipe out state and municipal budgets. Because of unprecedented revenue shortfalls (Lowrey cites the loss of sales taxes, income taxes, real estate transfer taxes, fines, and fees), state and local governments are careening towards budget losses totaling one trillion dollars next year. As Lowrey states, “Without help from Washington, this will necessarily mean massive service cuts and job losses: namely, an estimated 5.3 million job losses.”
All of these factors point to an absolute economic disaster on the horizon. Significantly, Lowrey’s article was written before Fauci delivered his grim assessment of what we are likely to see in terms of infections if we keep on our current course. At that time, she called it the “Alpha and Omega” of worst case-scenarios.
Never getting the pandemic under control means never unleashing the economy. Just look at the casinos in Las Vegas: open, yet half-empty. The botched response means millions of parents will need to continue watching their young children instead of committing to work. It means thousands of offices will remain on work-from-home orders, hurting the commercial operations built to support them. It means Americans will avoid doctors’ offices, bars, and sporting events, staying at home and starving local businesses of revenue. It means localities might end up having to return to extreme social-distancing measures over the summer and fall. And it means fear and mistrust: depressed consumer confidence, ruined faith in government, and concerns about the economy’s ability to recover.
That is the future that Trump and his Republican proponents of magical thinking have led us to. That is the future that President Joe Biden and a Democratic Congress will have to face in 2021. There is no getting around it: The world may recover around us, but as long as the pandemic remains uncontrolled, we are heading into a depression. As Lowrey writes, Trump is to blame.
The Trump administration has repeatedly argued that there is a trade-off between the country’s economic health and its public health. But economists and physicians have repeatedly argued that that is untrue: Ending the pandemic would have been the single best thing the federal government could have done to preserve the country’s wealth, health, and economic functioning. The Trump administration, in its hubris, obstinacy, and incompetence, failed to do it.
There is still time to avoid this outcome, but it will require a massive spending effort by Congress that includes not only aid to the states but aid to those individuals whose jobs are not coming back. But most importantly, we have to get control of the pandemic, through testing and tracing on a national level—which is what we should have done all along instead of wasting the past four months.
If we don’t do that, everything else is just more magical thinking.