How bad will the economy be damaged by the coronavirus?
By Joseph Minarik, opinion contributor — 03/16/20 06:00 PM EDT
The last few weeks have been a whirlwind for the financial markets and the economy, capped off by the president giving a number of speeches and conferences during which he tried to calm Americans and reassure businesses. Although the coronavirus crisis is expected to have a finite duration, similar to other outbreaks, its rippling effects could have lasting impacts on the economy and public policy. Here are several reasons why.
We simply do not know enough about the coronavirus. We do not have a preventive or a curative medical treatment for it. While the first vaccine is being tested, it might not be available for a while. This uncertainty alone instills anxiety and even panic. We do know that the coronavirus is easily transmissible, even by people who show no symptoms, and it is virulent beyond the normal seasonal flu. This situation could lead us to important and adverse consequences for the economy both at home and abroad.
Workers could be incapacitated by the coronavirus, while public safety precautions could stop production. Mitigation efforts could also prevent goods shipments, including intermediate goods and materials for other production. Broken global supply chains extend business costs across borders and around the world. The trade war between the United States and China made supply chains and production vulnerable to start with.
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https://thehill.com/opinion/finance/487896-how-bad-will-the-economy-be-damaged-by-the-coronavirus
