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Tracking the Covid economy’s pulse

Coronavirus Daily
Bloomberg

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Tracking the Covid economy's pulse

As America nears the sixth month of living with Covid-19, the country still doesn't have a strategy to balance the deadly risk of virus with the crushing economic consequences of shutdowns.

In the spring, most states initially curtailed economic activity for long enough to avoid the catastrophe of hospitals and morgues overflowing that New York and other hotspots endured. But they lifted those measures prematurely, leading to the summer's surge in the Sun Belt and dire conditions in places like Florida, Arizona, Texas and California.

A public charter school in Provo, Utah. Students and staff in Utah who dont wear a mask in K-12 schools in accordance with state mandate can be charged with a misdemeanor.

George Frey/Bloomberg via Getty Images

Now that swell of cases is receding, just in time for attempts to go back to school to risk a new round of outbreaks.

"The kind of mindset that we probably needed to be in, and that we're still not in, is one of a pulsing economy," Katherine Baicker, a health economist and dean of the University of Chicago Harris School of Public Policy, said in an interview last week.

Strict retrenchment, like what Americans did in the spring, can bring the virus down to low levels. With a low base rate, you can resume activity with vigilant testing to detect new cases. If viral spread reaches a certain threshold, it's time to close down again, like a "circuit-breaker," Baicker said. That approach, which depends on truly driving the virus to low levels before reopening, could maximize both safety and economic activity over the long term.

"We could bump along at a very low-prevalence rate, in a sort of cyclical way, until we get a vaccine," she said.

But it would require a degree of shared purpose and political will. It would also mean living with deep uncertainty over a long period, a psychologically taxing circumstance.

"There's a hunger for certainty that I see on small scales and large scales," Baicker said. "It feels like you don't have a plan when your plan is, 'We're going to react to health circumstances.'"

The situation is even more challenging for people who are most exposed to both the economic and health risks. Congress allowed a $600-a-week bump to unemployment checks to lapse this month, even as new cases far exceeded the levels of the spring, when lawmakers passed the emergency measure. (A new reading on U.S. consumer confidence, which has been bolstered by the stimulus measures, is due on Tuesday morning.)

People with savings and white-collar salaries can work from home and wait out any surges. Other Americans are left to face both the virus and the economic calamity it incurred, largely on their own.—John Tozzi

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