The U.S. is scrambling to prepare for the second phase of the coronavirus outbreak — beyond the threat, to the actual response — and hospitals, investors and policymakers are already behind.
- Why it matters: It's no longer that this could be bad for the economy; the layoffs are starting. It's no longer that the health care system may be overmatched; hospitals are on the verge of it.
- It’s no longer that this might surpass government’s abilities; we are headed to a $2 trillion deficit, invoking wartime powers, and vast and wide economic destruction.
What's next, reported by Axios' Sam Baker, Jennifer Kingson and Bob Herman:
Hospitals and government agencies are trying to throw together enough medical supplies, but also simply enough physical space, to do the work of responding to a widespread outbreak.
- Hospitals are postponing elective procedures, and even organ transplants.
- NYU's now-vacant dorms may become makeshift hospital rooms, and cities are looking to motels, vacant buildings and even RVs as quarantine sites.
- Faced with looming shortages of hospital beds and ventilators, President Trump — calling himself "a wartime president" — yesterday freed up military manufacturing tools, and some doctors are even making their own equipment out of common craft supplies.
The economic crisis is entering a new phase, too: Investors have gone from panic selling to logic selling.
- In Phase 1 of the crisis, major American companies saw their share prices sink on fears that the virus would ripple through the U.S. — even though the companies themselves were fundamentally sound.
- That's no longer true. Corporate America's backbone — brands like Hilton, Ford and American Airlines, which have been synonymous with national pride and prosperity — are in free fall.
What's next: The Senate signed off on a coronavirus relief bill yesterday just as the White House formally proposed a separate $1 trillion relief and stimulus plan, with half the money going to cash payments to needy Americans.
- The working class is confronting a very real crisis: The U.S. has gone from near-record-low unemployment to mass layoffs and indefinite furloughs.
- Several states have already recorded dramatic spikes in applications for unemployment insurance. And the widespread shutdown of so much of the service industry has only just begun.
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