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If President Trump’s primary goal is to reopen the economy, he is going about it the wrong way.
Out of a misplaced conception of federalism, or perhaps to avoid responsibility for problems that are messy to solve, he is deferring to the states on testing and building an effective virus tracking and isolation program. The result is confusion and a patchwork response that will be much less effective than an assertive — and funded — national plan.
The current moment provides an opportunity for building public confidence that the public health emergency that has engulfed the country can be managed successfully. The scramble to avoid a catastrophe in the New York metropolitan region is passing. The human toll from the virus has been terrible, but the feared shortage of ICU beds and other critical supplies largely did not occur. Most importantly, the nationwide spread of the virus has plateaued, with new cases stabilizing at an average of 28,600 per day since reaching a peak of 35,100 on April 10.
Read:The coronavirus changes everything in New York: Let us count the ways
While stabilization is better than geometric escalation, social distancing requirements must remain in place until there is strong evidence of a steady and persistent decline. Having endured more than a month of severe economic dislocation, the public deserves a payoff in the form of a virus that is under control and a realistic plan for keeping it that way.
It is this second deliverable that is most in doubt. While there is no shortage of plans for reopening the economy, what is missing is a realistic plan from the federal government that the country can rally behind and execute. The plan the administration released is too general to be useful and is completely silent on how states are supposed to meet the phased reopening milestones.
Without a clearer national strategy, it is possible, and maybe probable, that the country will experience a re-acceleration of new cases as states open up before having in place a structure to effectively contain future outbreaks.
There is widespread agreement that the only way forward is a traditional public health strategy consisting of: widespread testing to identify the infected; an expanded workforce, assisted with information technology, for tracing the contacts of those who test positive; removal of the COVID+ population from public circulation; and early treatment of patients.
In a recent article, former World Bank President Jim Yong Kim, who has long experience in fighting global epidemics, makes a convincing case that aggressive identification and isolation of cases can work to prevent outbreaks, as it is doing in South Korea.
“ Federal leadership is needed for reasons beyond money. ”
A recent plan produced by Harvard professors and others outlines a comprehensive program across all of the key dimensions of such a strategy. Among other things, the country will need to develop the capacity to provide financial support for those who get pulled out of public circulation, along with guarantees that they will not lose their jobs during their period of social isolation. Further, it will be necessary to repurpose some facilities (such as hotels and dormitories) to serve as early treatment centers for patients experiencing symptoms from the virus.
This will require a significant investment of resources, which is one reason it cannot be left entirely to the states. A large new cohort of workers will need to be trained as contact tracers and then employed until a vaccine is available to keep outbreaks under control. Massachusetts is hiring 1,000 new workers for this task, and many other states are doing likewise.
But the scale of what is needed will far outpace state resources. The $25 billion for expanded testing provided in the latest emergency legislation approved by Congress is helpful but far from sufficient. The low end of the needed public investment for an effective state-administered surveillance, testing, tracking, and isolation system is probably $50 billion, and more likely well in excess of $100 billion. The only entity capable of providing such funding is the federal government.
The added cost from this program, while high in normal times, would be a fraction of the economic cost that each month of lockdown is inflicting on the public. Taking into account the latest relief bill, the federal government is expected to borrow about $4 trillion in 2020 to cover its normal expenses, fight the pandemic, and support the economy. It would be foolish to argue that an investment that is vital to restarting business activity is somehow unaffordable in this environment.
Federal leadership is needed for reasons beyond money. There is room for state adaptation of a national program, but the U.S. needs a coherent plan to get the entire country up and running over the coming months. Many companies have interstate operations, and they will not function if some states remain in lockdown while others are open. Moreover, unless interstate travel is heavily restricted, an uncontained outbreak in one state is likely to cause problems for its neighbors in short order.
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There is also no realistic alternative to going down this path. A frantic search is underway for an effective therapy, but there is nothing on the immediate horizon that will adjust the basic facts on the ground. Further, the availability of an effective vaccine is months and perhaps years away. Aggressive containment of the virus is the only way to give the public confidence that it is safe to engage in productive commerce.
Reopening the economy without a fully funded and realistic containment plan will disappoint. Yes, some people will restart normal activity, but others will be too afraid to do so, given the lack of a coordinated plan for ensuring public safety. When new cases begin to surge again, the public will spontaneously fall back into isolation to protect themselves.
Read:Some states reopen for business, but big chains remain hesitant to open their doors
The only way forward, hard as it is, is to build an effective, federally funded and state-administered testing, tracing, isolation, and treatment program. It will require building a new workforce, creating new treatment facilities, and testing millions of people on a continuous basis. There will be trial and error. Once in place, though, we might be surprised at how well we can adapt to the new normal.
James C. Capretta is a resident fellow and holds the Milton Friedman Chair at the American Enterprise Institute. This was first published by the AEI — “Federal passivity won’t reopen the economy”.
