The rapid surge in COVID-19 cases, concentrated in states that reopened too fast without following CDC guidelines, has dented America’s plans to restart its economy. On Wednesday a record 50,203 new coronavirus cases were reported, according to data compiled by Johns Hopkins University. With cases rising rapidly, governors of at least 16 states and many businesses are pulling back from reopening. As New York Federal Reserve president John Williams said bluntly on Tuesday: “The economy’s fate is inextricably linked to the virus. A strong economic recovery depends on effective and sustained containment of COVID-19.”
With cases rising in 38 states, Florida, Texas, Arizona, and Southern California are experiencing unprecedented surges in new cases. The virus has broadened its reach from impacting older Americans primarily to younger people ages 18-49. The spread of the virus can be attributed to failures like not wearing masks or practicing social distancing and large indoor gatherings in churches, bars, and other establishments.
In Arizona, Gov. Doug Ducey ordered all bars, gyms, movie theaters, and water parks to close. Miami and Los Angeles have closed all beaches for July Fourth weekend. Hospital intensive care units are reaching their limits, most notably in Houston, with its vast hospital facilities, whose ICUs are at 97% of capacity. The COVID-19 surge led Apple to close 48 of its stores, and Disney has delayed its long-awaited reopening of its theme parks in California.
The country’s inability to slow the spread of COVID-19 will delay the recovery of the U.S. economy from its spring shutdown, as hopes for a “V”-shaped economic rebound have been shattered. While Americans are eager to get their lives back to normal, fears of contracting COVID-19 are causing many consumers to hesitate about going to public places.
Meanwhile, subsidies are running out for small businesses, which will force thousands of retail stores and restaurants to close permanently. Large companies are reassessing their staffing strategies and planning sizable layoffs. Macy’s reduced its headquarters staff alone by 3,900 employees. Other companies burdened by enormous debts, such as Chesapeake Energy and Cirque de Soleil, have declared bankruptcy, causing thousands more to lose their jobs.
While it is easy to blame governors for the surges their states are experiencing, the root cause of the problem is a lack of federal leadership. The American government is unique among developed nations in delegating full responsibility for managing the virus to its states. Throughout Europe and Asia, national leaders brought the virus under control through strict enforcement of national guidelines. As a result, America now has 10 times as many new cases per day as the European Union; America’s cases have increased 80% in the past two weeks to 40,000 per day compared with fewer than 4,000 per day in the European Union. As a consequence, 20 European countries have banned Americans from entry until COVID-19 cases are below the European average.
Dr. Anthony Fauci, the nation’s leading expert on viruses, told a Senate committee on Tuesday, “It is going to be very disturbing. I would not be surprised if we go up to 100,000 a day if this does not turn around.”
Delegating management of the coronavirus to the states has failed. The only way for America to regain control over COVID-19 spread and get its economy restarted is for the Trump administration to take charge. Here are seven actions the administration should take now to accomplish this:
1. Strictly enforce revised guidelines from the Centers for Disease Control and Prevention, including mandatory wearing of masks and six-foot social distancing in public spaces, and limiting the size of public gatherings to 50 people or fewer.
2. Expand free testing to determine asymptomatic carriers of COVID-19.
3. Establish contact tracing for all positive cases.
4. Create public health “fast action” teams to fly into hotspots to help stop COVID-19 spread.
5. Hold regular national briefings by public health experts—not politicians—to rebuild public confidence.
6. Provide additional federal financial support to unemployed persons and small businesses.
7. Stimulate immediate job creation through a trillion-dollar infrastructure program, similar to the one undertaken in 2009 during the Great Recession.
To lead this effort, President Trump should appoint an established health care expert, such as former FDA Commissioner Scott Gottlieb, as COVID-19 czar, with authority to enforce these science-based orders. During the 2009 financial crisis, the Obama administration appointed Steven Rattner as automobile czar; Rattner quickly restructured the industry, leading to its resurgence.
The restart of the U.S. economy cannot be separated from control over this deadly virus. This requires immediate action by the Trump administration to stem the virus’s spread. The alternative is not only millions more Americans getting sick, but the current economic crisis spiraling into an extended decline.
Bill George is senior fellow at Harvard Business School and former chair and CEO of Medtronic. He is the author of Discover Your True North.
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