The Economy’s Path Back From Today’s Shutdowns

At last Washington and the governors have begun to talk about reopening the economy. It is none too soon. To be sure, all want caution. Should the nation or even a particular state abandon social distancing and quarantines too fast, society risks another spike in rates of infection and hospitalization as well as death. But there are risks on the other side as well – to people’s jobs and incomes and to national wealth. Dr. Anthony Fauci has acknowledged what he describes as the “inconvenience” of the shutdowns and quarantines. They are, however, more than that, a lot more. Necessary as they may be from a medical perspective, they also have attacked the substance of people’s lives, perhaps not as medical people and epidemiologists see them but surely as most people do. It is a step beyond “inconvenience” when more than 20 million Americans have to apply for unemployment insurance in the space of four weeks. That is about 12% of the country’s workforce, a proportion that will only grow the longer today’s lockdowns and quarantines stay in place.

The presence of this economic threat makes it especially welcome that the recent path of the virus has allowed the authorities at several levels to consider a relaxation in the present severe constraints. The State of California has led with specifics on what would allow a reopening. It is not alone. The White House and other states – governors in the northeast jointly – have also indicated a path to an economic reopening, as have various think takes and advisory bodies. These suggestions vary in detail one from the other, but each effectively foresees a three-stage process through which public health developments – what the White House calls “gating criteria” — will allow a relaxation of today’s constraints and hopefully a return to former levels of prosperity.

The first phase identified by California and these others is the place where the nation is today and has been since mid-March. People are exhorted to stay at home regardless of their vulnerability or symptoms. All businesses are closed except those designated “essential” and there is a ban on large gatherings. Without easy widespread testing, these strictures were and are the only way to guard against random infections and the risk of overwhelming existing healthcare facilities. These strictures are also the reason why so many American have been thrown out of work, especially in retail and hospitality but also in manufacturing and professional services. Plans today indicate a continuation of this phase until mid-May. Some recent ebbing in new cases and a drop in hospitalizations, however, offer hope that the transition back to work can begin then. 

Most of those working on these plans indicate that a decline in new cases and hospitalizations would trigger a movement to the next phase of reopening.  The redoubtable Dr. Fauci has identified when we could say that the infection has been constrained: a concerted drop in new cases and hospitalizations over a period of 14 days (the time needed by an infected person will develop symptoms). That hopeful sign, he and others have said, has begun to develop, though no one is making any promises. That would start a very cautious process that could only proceed after the nation also develops sufficiently widespread, same-day and point-of-care testing even of the asymptomatic so that the authorities can isolate only those who are sick instead of just about everybody. One researcher identified an ability to do 750,000 tests a week as a reasonable number. Even at this, easing would wait until healthcare facilities are considered adequate to handle a new spike in cases should it occur and perhaps facilities are also in place to do contact tracing of those who have been infected.  Those identified as vulnerable would still face pressure to isolate, and there is some suggestion that they would be subject to GPS tracking.

Different states or regions would likely take steps to reopen at different times. Wherever it occurred, the authorities would still forbid large gatherings. As California made clear, openings would also be subject to a raft of rules.  Among these would be less concentrated seating at restaurants with wait staffs wearing gloves and face masks, if not still more protective gear. Offices might reconfigure to make the by now famous six-foot distances easier, and offices and factories might include temperature scanners as well as firm-wide testing for antibodies. Airlines might forbid any passengers until six weeks after virus dissipation and sanitizers will become even more ubiquitous than they already are. As in the Texas plan, state parks and other facilities will reopen but only to people who ware masks and arrive in groups of five or less. Schools could reopen in the fall.

Though this second phase would allow most businesses and schools to reopen, at least on a constrained basis, by late spring, the final, third phase of opening would wait for a vaccine. The authorities in California also include what they call “herd immunity” as a trigger for this phase. (This is a slippery term that seems to mean that the population has had widespread exposure in which those who succumb to the virus are no longer a concern and others have immunity.)  Only at such a time would the authorities allow society to return to its former practices. Only at such a time would the economy have a chance to recapture its former level of prosperity. Forecasts on vaccines are by nature difficult. Those working in the area are hopeful that they can shorten the timeline because earlier coronavirus scares had started work long ago. Estimates now say a vaccine for healthcare workers should be available by late summer, early fall and one for the general population early next year – something to which to look forward but a long time to wait for full employment.