U.S. economist: Easing controls doesn’t help the economy

The CURRENT COVID-19 pandemic continues in the U.S. and shows no signs of slowing,media reported, but U.S. President Donald Trump has urged the relaxation of travel restrictions. “We have to get our country back to normal,” Trump said Tuesday on Fox News’ “City Hall.” “This treatment is worse than the problem. If we allow this to continue, there will be many people (i think more) who will die. Our people must return to work. “

U.S. economist: Easing controls doesn't help the economy

He used Easter (Sunday, April 12) as a potential end date for the restrictions, and he looked forward to seeing “churches crowded” across the country.

But there is a problem trying to restart the economy by loosening controls: economists don’t think it will work. Maurice Obstfeld, a professor at the University of California, Berkeley and a former chief economist at the International Monetary Fund, says the economy will not recover unless the pandemic is brought under control. “We have to stabilize infection levels before we start economic activity again,” Obstfeld told The Verge. If we act too early, he worries that we will see a new increase in infections, “and it is time to be more decisive in the health crisis, or else the damage to the economy will be greater.” “

In recent years, conservative media have increasingly suggested that curbing restrictions would do more harm than good. In a Fox News interview Monday, Texas Gov. Dan Patrick appeared to call for broad lifting of restrictions, regardless of human factors. “My message is, let’s get back to work,” Patrick told Tucker Carlson. “Let’s get back to normal life.” Let’s be smart. And those of us over 70 will take care of themselves. But don’t sacrifice this country. “

Glenn Beck, a former Fox host, even used harsher words to describe it. “I want my kids and all the people over the age of 50 to stay at home,” Baker told the audience Tuesday night. Even if we are all sick, I would rather sacrifice myself than sacrifice my country. “

As experts say, the recent economic collapse has been caused by public health constraints rather than the coronavirus itself, and that easing controls could mitigate the damage. But economists who study the recession say returning to normal activity is likely to cause more economic damage.

Given the exponential growth of the disease, Justin Wolfers, an economist at the University of Michigan, says the cost of stopping it is now cheaper than the cost of future action. “The relevant choice is whether significant action will be taken today when there are tens of thousands of cases, or, if there are hundreds of thousands or millions of cases, will greater action be taken in the future?” he said. “

According to data collected by Johns Hopkins University, confirmed cases in the United States are growing at a rate of about 38 percent a day. The mortality rate has increased at a rate of about 23 per cent per day, indicating that some of the increase in the number of cases may be the result of accelerated testing. Nevertheless, any relaxation of social distance could lead to a surge in these figures, with devastating consequences for public health and economic activity.

As a result, even sceptical economists suggest a targeted response rather than a return to the status quo. James Stock, an economist at Harvard University who is a member of the National Bureau of Economic Research, said he believes public health responses have played down the ongoing economic crisis.

“I think the right framework is how to minimize the spread of the virus while allowing certain economic activities,” Stock told The Verge. Nevertheless, more testing is needed before meaningful recovery measures can be taken. “There is an urgent need for random testing of populations to understand their prevalence and asymptomatic rates. “

Countries like South Korea have been able to control the outbreak by testing people extensively, whether or not they have symptoms, and then isolating those who test positive. But the U.S. still faces a severe shortage of test kits, which means doctors can’t even test every patient with symptoms. Without more testing, it will be difficult to know who is at risk of spreading the disease, and it will be difficult to relax the restrictions on infection.

It is unclear how the White House plans to proceed. At a news conference at 5:30 p.m. EST on Tuesday, the U.S. president continued to mention the Easter goal, but appeared to have lowered expectations for ending social segregation. “I hope Americans will be back at work on that beautiful Easter, but rest assured that every decision we make will be based on the health, safety and well-being of Americans,” Trump said. “

At the same time, experts believe that the economic crisis will be difficult to separate from public health problems. “My concern is that it’s hard for us to get the best out of it right now: the economy is stagnant and public health’s response to the pandemic is ineffective,” Obstfeld said. The answer is not just to pretend we can work as usual. “