THE NEW NORMAL

It is difficult to write about our new virus driven dystopian life as the reality changes by the hour.  The fear guided daily routine now revolves around staying at home with our families, watching our investments bleed away as the paper loses cascade downward and listening to the media talking heads describe our descent into a social and economic apocalypse. 

There is one undeniable fact.  If we cannot quickly solve the underlying health problem caused by the coronavirus, the prospects for solving the economic problem will spiral out of control.

Optimists are in short supply.  The world economy has shut down and entered a recession.  A depression mirroring the 1930s becomes more likely by the day. 

 As coronavirus testing increases, the news on disease spread gets worse. Millions of retail and food service jobs may not exist on the other side of the crisis. Fear of the unknown has many Americans expecting the most dismal of outcomes.  Toilet paper hording and the purchase of firearms reflect the mood of the country. 

Americans do not do well staying at home for extended periods.  I would not be surprised if the number of fatalities caused by domestic violence, alcohol/drug abuse, and suicide fostered by isolation, greatly exceed the number of coronavirus deaths.

In some respects, these new vicissitudes of life do not differ much from our medieval ancestors faced with the plague.  When there is no cure, human nature, not science, prevails. The wealthy decamp to their country homes to escape infection, not unlike the nobility of Florence and London in the 14^th century. The internet is rife with prayer chains and group Hail Marys asking for relief.  The plague doctors of yore and our modern medical staffs place their lives on the line to tend to the sick.  Social interaction comes to a halt, including funerals for the dead.

The role of government in addressing the pandemic will be a much discussed topic. Early indications are that countries that were able to stay ahead of the virus (Singapore, South Korea, Taiwan, Hong Kong) implemented massive testing to identify infected individuals and to quarantine these people in dedicated locations.  Others who were exposed to infected individuals were located by contact tracers, systematically tested and quarantined to prevent further spread.

Unfortunately, America found itself reacting to the outbreak rather than taking a proactive approach and listening to the experts. The New York Times reported on 3/19/20 that the White House was warned last year that it was not prepared to manage an infectious disease outbreak. A Health and Human Services simulation, called “Crimson Contagion” contained a draft report dated October 2019. It drove home just how underfunded, underprepared and uncoordinated the federal government would be for a life-or-death battle with a virus for which no treatment existed.

The initial American response to the pandemic was abysmal. Without explanation, many of the most qualified infectious disease experts in the country were terminated from critical positions in the White House, Homeland Security and the Defense Department when the Trump administration took office.  Moreover, the President was snail like and reactionary in accepting the gravity of the growing crisis.

Without massive testing and isolation at the onset of the pandemic, our government was forced to adopt the Italian response and to propose a countrywide “stay at home” solution.  The problem is that this approach does nothing to shut down the early spread of the disease, does not identify potential hot spots, and causes massive economic and social dislocation.

The Wall Street Journal in its 3/20/20 editorial began to question the efficacy of our national path to defeating the virus.  It concludes: “America urgently needs a pandemic strategy that is more economically and socially sustainable than the current national lock-down.” This would no doubt involve moving the country out of the present stay at home mode and back to work in the social distancing mode.  However, the hospitals need to be properly provisioned before this can happen.

The election will be a Trump versus Joe Biden Affair. It will be a one-issue campaign without political rallies or hand shaking.  If the President is able to recover from his gaffes and project any sense of leadership, with the pandemic ending with minimal long-term dislocations, he may win.  Conversely, if we are staying at home come autumn, he will be fortunate to carry one state. 

For those who are willing to look ahead, economic green shoots and positive results will eventually appear. First, the zombie companies surviving on cheap credit will be gone, replaced by well-capitalized enterprises.  Second, for those who had patience and did not sell into the teeth of the financial panic, retirement accounts will be replenished on the other side of a deep but hopefully brief recession.  Third, a valuable lesson has been learned on how not to prepare for a worldwide pandemic and we will be prepared for future outbreaks. Fourth, millennial couples, now forced to stay at home, will not escape their nesting instincts and will begin producing large numbers of coronial children.

Lastly, I am reminded of the excellent epic study, The Great Leveler, written by the historian, Walter Scheidel.  The premise was that over the arc of civilization, catastrophic events have done more to lessen inequality than anything else. While everyone suffers in times of economic collapse, the rich simply have more to lose and the large gap in equality becomes more manageable.  Let us hope that one of the byproducts of this disaster, hastened by actions taken by Congress, is a rebalancing of the economic scales in favor of the less fortunate in our society.