Sleepwalking into depression: The economic response to COVID-19 in the United States — Jacob Robbins

 Sounding the alarm. Is anyone listening?

A careful review of the data reveals gaping wounds caused by the coronavirus pandemic: large declines in market incomes, consumer spending, and employment, all barely propped up by the temporary government stimulus payments. To prevent economic collapse, it is urgent that policymakers take further action. Congress must continue to support unemployed workers’ incomes, send additional stimulus payments to families to keep them financially afloat and increase spending, and give aid to local and state governments so they don’t have to lay off workers.

But, most importantly, policymakers at the state and federal levels must do more to control the spread of the coronavirus, which is now growing at the rate of 70,000 cases a day.

I live in Iowa City, home of University of Iowa (Hawkeyes), where cases are rising. Iowa City Mayor Bruce Teague (an old friend who happens to be black in an overwhelming white town) issued an unenforceable edict to war masks two days ago. People and stores appear to be largely complying. The Johnston County Board of Supervisors has asked the county Department of Health to require masks in firms that do business with the public. The governor of Iowa (so far) oppposes mandatory masks.

Why is this crucial to Iowa City. Public health in the first place. But Iowa city is heavily dependent on the University of Iowa economically and the longer the school is closed, the more pain the city, its fimrs and its residents feel. The university has been forced to introduce a a budgetary austserity regime owing to lack of funds, since the State of Iowa is also strapped and not able to offer financial support.

While this is anecdotal, it is not difficult to imagine how this is likely taking place in many other parts of the country.

The federal government needs to step up fast as the last resort to head off systemic breakdown.


WCEG — The Equitablog
Sleepwalking into depression: The economic response to COVID-19 in the United States

Jacob Robbins