The United States, and much of the world, is embarking on a large-scale, unplanned experiment: shutting down and then rebooting the economy.
COVID-19 has been sweeping across the globe, and with little global immunity to the new SARS-CoV-2 virus and few-to-no medical tools to fight it, societies have been falling back on various means of social isolation.
Shutting down the economy
Various individual counties in the United States had been issuing “shelter in place” orders, and then things got serious on March 19. On the evening of Thursday March 19 California Governor Newsom effectively issued a shelter-in-place order for the entire state. On Friday March 20 New York Governor Cuomo shutdown most retail businesses and ordered nonessential businesses to keep 100% of their workforce at home. Later on Friday Texas Governor Abbot issued similar orders.
The goals of these shutdowns appear to be
Reduce peak load on the healthcare system to reduce fatality rates (“flattening the curve”)
Buy us time to develop medical solutions (antivirals for treatment, vaccines for prevention)
Reduce the active number of cases, so we can deploy more precise methods of containment (testing, contact tracing)
Don’t sugar coat the shutdown
Americans will often comment on how quickly China got back on its feet, pointing to Starbucks reopening most of their stores by the end of February and Apple reopening their stores by the middle of March.
But what these headlines miss are the extraordinary steps China has taken and is still taking to control the spread of COVID-19. Many people I’ve spoken to seem to think the virus just burned itself out naturally, that we just need to relax and it will be over soon enough. Compare this laissez-faire attitude to this video capturing some of the steps China has and is still taking.
This twitter thread by a Westerner traveling to China tells a similar story, and these are experiences that are still happening in China after many in the West think China has recovered (you may need to click “Show this thread” on the tweet).
The implications are that the US (and much of the West) may need to embark on much more stringent shutdowns than what we have seen so far and/or be shutdown for a much longer period of time than is being openly discussed by government leaders.
Rebooting the economy
But at some point we will come out of this. And then we will face the next big challenge - rebooting a complex, interconnected economy.
What business and industries should be brought back online first?
Will equipment still work after being idle for weeks or months?
Will many business-to-business companies have gone under requiring surviving business to find new suppliers and new business customers?
Will most of the employees come back, or will employers have to train large numbers of new employees?
Will critical keepers-of-corporate-knowledge (e.g., the folks who understand how the complex enterprise computer networks work) return?
How long will it be before laid off (and traumatized) Americans find jobs, recover from their debts, and start spending again?
Will businesses start hiring and producing goods or will they wait until consumers start buying first?
How will society deal with the massive amount of debt (and interest payments) we will be accumulating during the shutdown and recovery?
Personally, I have no clue to any of these answers.