We’re starting to have serious discussions about how and when to get our economy moving again. But like the medical response to the COVID-19 virus, the prospective economic cures are tentative, often conflicting and invariably contentious.
Flat lining the world’s largest economy indefinitely is not an option. Another 6.6 million Americans were added to the jobless rolls, the Labor Department reported today. The United States has lost 10% of the workforce in three weeks.
President Donald Trump, who said in late March that he wanted the country to reopen by Easter, backed off that claim. But he’s considering a second coronavirus task force to consider just how to do that. Another hopeful sign is the release on April 8 of new guidelines from the Centers for Disease Control and Prevention on how “essential” employees can get back to work – even if they have been exposed to infected people.
National Economic Council Director Larry Kudlow said in an interview with Politico on April 7 that “I still believe, hopefully and maybe prayerfully, that in the next four to eight weeks we will be able to reopen the economy, and that the power of the virus will be substantially reduced and we will be able to flatten the curve.”
There’s another problem hanging over the pandemic, and it’s not medical in nature. The coronavirus response is turning into the nation’s biggest political blame game and will only get worse as we get closer to the November elections. The people running some of America’s largest corporations know this and are terrified of a public relations fiasco on their hands. In “What top CEOs fear telling America about the coronavirus shutdown,” Axios reported that these executives “realize it sounds callous to talk about work when people are scared of death, but believe it’s an urgent debate the nation needs. Several are debating going public with this concern, but fear the optics and timing look discordant.”
The Wall Street Journal reported that states are crafting their own economic plans in absence of a federal strategy.
Tensions are simmering, in some states, about how and when to reopen. Republican lawmakers in Pennsylvania have proposed legislation to scale back Democratic Gov. Tom Wolf’s business closure order from mid-March and create a Covid-19 emergency plan to allow businesses to reopen.
“Our governor is being overly aggressive on this, I feel,” said Matt Stuckey, president of Stuckey Automotive, which owns three dealerships in Altoona, Pa.
Democrats say the Republican proposal in the state would threaten public health and risk increasing the spread of the virus.
Many states and counties lack resources to set up their own systems for identifying infected residents and people who may have been exposed, a necessary step to contain the virus once social distancing rules have been eased.
In Michigan, too, plans are underway. A bipartisan state legislative committee is looking at ways to balance public health concerns with getting people back to work. “Most workplaces, if we properly challenge ourselves, can be as safe as home,” State Senate Majority Leader Mike Shirkey told the Detroit News. He said it was possible “to walk and chew gum, safely.” More:
“There are tremendous financial and psychological impacts to people from being out of work,” Shirkey said. “Without the option to maintain employment, many of our citizens will experience extreme mental stress and that in turn can manifest itself as physical ailments, a weakened immune system and tense domestic environments. The more prepared we are to bring workplaces back online, the quicker we can return financial stability, reduce stress levels and provide hope for our citizens.”
He’s right about the “financial impacts” of course, but what of the “psychological”? The hope that Shirkey is referring to is, first of all, the ability to return to jobs and stabilize households with earned income after the economic footings have been kicked out from under millions of lives – through no fault of their own.
What else has been taken away are the manifold social interactions that accompany work and business: the relationships of daily commerce, membership in business and civic groups, pitching in on community causes and programs, support for school and youth sports. Work is not just about money.
For many, there is a great dignity in becoming an accomplished tradesman, building a flourishing small business or thriving professional practice, or taking satisfaction in doing an entry level hourly job perfectly. In varying degrees, a person’s identity is tied up in their work. A man or a woman who spends a lifetime operating a restaurant, for example, isn’t just making a buck by dishing up food: They understand themselves as restaurateurs. Here’s another gut wrenching update from WDET Detroit public radio:
In a span of 22 days in March, Michigan saw 72,000 restaurant-specific jobs disappear and $491 million in lost sales for restaurants. Those numbers include both mom-and-pop and chain restaurants throughout the state, part of a group of restaurant operators across the nation that were surveyed by the National Restaurant Association in the past week.
At the same time, we have an entire service economy right now where people are working – often for not much more than minimum wage – to keep the “essential” economy moving. I marvel at the folks in the supermarket and behind these clerks and managers are long supply chains of truck drivers, warehouse people, agricultural cooperatives and farmers and their field workers keeping us fed.
I’m not nominating anyone for sainthood here. People have all sorts of reasons for taking a job and their reasons could be thoroughly cynical and selfish. The U.S. labor market has plenty of room to accommodate them.
But even in a heavily regulated mixed economy like our own, we’re seeing millions of people behaving in ways that can’t be explained by selfishness (not the same thing as self-interest) or greed – the common critiques.
The late Paul Heyne, in his “Are Economists Basically Immoral?” (collected in the 2008 edition of his essays published by Liberty Fund) was getting at this when he asserted that the “selfish” canard about market economies had no basis.
The primary consequence of people’s participation in the market system is a continuous expansion of cooperative endeavor, mutual accommodation, and valued goods. That’s certainly not a selfish outcome.
In a very different time, Heyne talked about what happens in a downturn.
For Americans, an economic reverse entails principally the frustration of expectations. We fail to obtain what we had hoped to obtain and counted on obtaining. We make our plans in the expectation that we’ll be receiving no less than some minimum amount of income; and when those expectations aren’t fulfilled, we’re compelled to revise our plans, our life patterns, and sometimes even our conception of our own worth.
I am not trying to minimize these costs of economic failure. Social expectations are vitally important. We look to one another for assistance and cooperation in obtaining not just the goods that money will buy, but also the more fundamental goods (more fundamental, at least, in an affluent society) of justice and respect. When our income expectations are frustrated, most of us feel the cost primarily in the ultimate frustration of expectations with regard to our personal worth. If at the same time we believe that we were morally entitled to the fulfillment of those expectations, we will conclude that an injustice has been perpetrated against us. And we will begin to look for changes in the legal-political order that might correct the injustice we think we have suffered.
It is in this area that we find the deepest and most genuine moral dilemmas of the market system. Complaints about selfishness and materialism are altogether wide of the mark. Ethical thinkers who object to capitalism on the grounds that it is based on or even that it encourages selfishness or materialism only prove, to me at least, that they have not paid close attention to the system they claim to be criticizing.
So before we get too far down the road of revising “our plans, our life patterns, and sometimes even our conception of our own worth” let’s add a sense of greater urgency to getting our work lives going again. This effort will not exhaust the wellsprings of human intelligence and creativity. Americans need their paychecks and their dignity back sooner rather than later.