Mar 25, 2020 - Economy & Business

Economists say Trump's coronavirus reopening plan is dead wrong

Illustration: Sarah Grillo/Axios

President Trump's proposal to get business around the country back open by Easter Sunday, April 12, will do more harm to the economy if the coronavirus outbreak has not been contained, economists say.

Why it matters: Such a plan would sow uncertainty in markets and among customers and business owners and make the recession longer and harsher.

Threat level: "We are still significantly behind the curve in containing coronavirus and reopening the economy for political expediency in the middle of a pandemic, to which no has has an immunity, is absolutely mindless," Bernard Baumohl, chief global economist at the Economic Outlook Group, tells Axios.

  • "It will only delay a full economic recovery."

On the other side: A smattering of business owners and asset managers backed Trump's plan to push forward with lifting the lockdowns sooner than later.

  • David Neeleman, founder of JetBlue and WestJet, told Bloomberg that the suffering from a major economic downturn would outweigh the damage from the disease.

The big picture: "THIS IS A FALSE CHOICE!!!!!!" MacroPolicy Perspectives president Julia Coronado says in an email.

  • "If we go back to work and the disease continues to spread not only will people die and the 20% of our economy dedicated to health care be overwhelmed, but people won't have the confidence to resume normal activity."
  • "They won't go on airplanes or travel or hold conferences or events because they won't be able to trust the public health response has been adequate to protect them."

The latest: The World Health Organization said Tuesday the U.S. risks becoming the epicenter of the global COVID-19 outbreak with more than 55,000 confirmed cases and over 800 deaths so far, according to Johns Hopkins University.

  • Declarations from the president may not even have any impact, as governors and mayors have led the effort to quarantine much of the country.
  • More than 160 million people in 17 states are being told to shelter in place, accounting for nearly half the U.S. population.

The bottom line: "Trump is deluding himself if he thinks that he can step behind a podium and reopen the economy," Michael R. Strain, director of economic policy studies at the conservative American Enterprise Institute, wrote in an op-ed for Bloomberg.

  • "A warning to the president: Trying and failing to reopen the economy before economic activity is organically ready to resume could have dire economic consequences."

Go deeper: Lindsey Graham: "There is no functioning economy unless we control" the coronavirus

Go deeper

96% of small business owners are already feeling coronavirus impact

Photo: Andrew Lichtenstein/Corbis via Getty Images

More than half of U.S. small business owners say their business will not be able to continue operating more than three months due to economic strain caused by the coronavirus pandemic, according to a Goldman Sachs survey of more than 1,500 small business owners conducted March 16-17.

Why it matters: Much of the conversation around the economic effects of the outbreak has centered on the stock market and bailouts for large corporations, but its most acute impacts are being felt on Main Streets around the country.

Coronavirus updates: Italy records deadliest day with nearly 1,000 dead

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. Note: China numbers are for the mainland only and U.S. numbers include repatriated citizens and confirmed plus presumptive cases from the CDC

Italy on Friday reported 969 COVID-19 deaths over a 24-hour period, marking the deadliest single-day for the country since the global outbreak began, according to data from the Health Ministry.

The big picture: The U.S. now leads the world in confirmed coronavirus cases, as the number of global cases nears 600,000. Governments around the world are trying to curb the medical and financial fallout of COVID-19, as infections surge across Europe and the U.S.

Go deeperArrowUpdated 11 hours ago - Health

WHO official leads criticism of Trump's coronavirus response

President Trump with members of the new coronavirus task force at the White House on Wednesday. Photo: Tasos Katopodis/Getty Images

Ezekiel Emanuel, special adviser to the director general of the World Health Organization, told MSNBC Wednesday he found "most" of what President Trump said at his briefing on the novel coronavirus "incoherent."

The big picture: As the number of confirmed cases reaches 60 in the U.S., the top health professional — who was a health policy adviser in the Obama administration — is among several leading figures, in particular, Democrats, to criticize the president for his response to the outbreak.

Go deeperArrowFeb 27, 2020 - Health