Jun 18, 2020 - Economy

The amorality of finance is at the core of America's biggest issues

Illustration: Sarah Grillo/Axios

Economics is rarely aligned with morality. That's one lesson from the looting example I wrote about last week: Looting is harmful to society, and is criminalized for good reason, even though it can have positive economic consequences.

Why it matters: The disconnect between economic and moral imperatives lies at the heart of the biggest issues facing America today, from the rising appeal of socialism to the question of how to deal with the coronavirus outbreak.

Driving the news: Those who want to reopen America and get the economy moving again are pitched against those who think the highest priority is to minimize the spread of COVID-19.

  • A fragile consensus emerged early on that there was no real tension between the two imperatives — that unless and until the pandemic was brought under control, the economy could never return to its former health. The hope was that if the virus could be eradicated this summer, the economy could bounce back to its pre-pandemic state some time this fall.
  • Today the virus is so widespread that there is no realistic chance of new cases dropping to near zero before a vaccine arrives. New cases are being found at a rate of about 24,000 per day, while about 700 people per day are dying. So now the economic question has changed.

The economy won't return to its former health any time soon, given the enduring prevalence of the coronavirus and the sobering fact that about 3% of Americans diagnosed with COVID-19 are likely to die of it.

  • A PwC survey released this week found that fewer than half of employees say that safety measures like wearing masks or reconfiguring layouts will make them more comfortable returning to the office.
  • Since a "V-shaped economic recovery" won't happen, the economic best-case scenario is now a partial bounceback in the face of continued health concerns. The more that the economy reopens, the stronger that partial bounceback — and the more lives that will be lost to the virus.

The bottom line: America has made its choice. While lockdown protocols vary from state to state, the broad trend is that constraints on commerce are being lifted even as the virus continues to kill thousands of Americans every week.

  • The moral imperative has surrendered to the economic imperative. Any future lockdowns will likely be imposed only if a wave of hospitalizations and deaths threatens to imperil the nascent economic recovery.
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