Closed beaches, national parks, sports venues, restaurants, bars, and most non-essential businesses… we’re all familiar with devastating economic effects of the measures taken to stem the spread of coronavirus. With millions losing their jobs, a question comes up. Is it worth it?
This might sound like an obvious trade-off between saving lives and saving the economy, but it’s not so simple.
MIT economist Emil Verner said:
“One can do those types of quite gruesome calculations,” but evidence suggests “that in some sense, that’s a false tradeoff.”
Verner recently co-authored a paper about the response to the 1918 flu epidemic. His research showed that cities imposing restrictions sooner and for longer had fewer deaths, which helped them eventually come out of the pandemic with stronger economic growth.
Looked at that way, saving lives could be one of the keys to eventually saving the economy. But people need to have a sense of when things will end.
Paul Winfree, director of economic policy studies at the conservative Heritage Foundation, agrees that easing restrictions too early could be damaging. But, he said, allowing the downturn to deepen into a depression would ultimately negatively impact health.
“The White House is starting to weigh the long and short term health consequences of coronavirus and mitigation…(and) they are hearing from the business community that there needs to be some level of certainty.”
If government officials lift restrictions but infections and the death toll are still rising, will consumers be confident enough to return to malls and restaurants?