Lockdown Economic Takeaways

The lockdown imposed to fight the coronavirus has highlighted 3 economic facts.
   1. The health of everyone is essential for the entire economy to operate.
   2. Essential services are delivered by many people who are paid too little by their employer.
   3. Corporations don’t like free markets when they show the corporation should go out of business. First TARP and now this bailout.

Remedies

Hospital room and personnel ready for the next emergency.

    1. We should have universal health care, independent of a person’s employment. It should be single payer and not-for-profit. It should be a national medical service administered by medical professionals.
    2. Essential workers should get, at least, the average wage earned at their employer. We have neglected to pay work according to the value it delivers.
    3. Corporations. Their bailouts must come with significant strings attached. First, no stock buybacks and no bonus. Second, for each dollar of dividend they pay out, they must pay back a dollar to the government.

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   In the transition to universal healthcare, current employers and employees should pay their health care premiums to national medical service.
   This pandemic clearly demonstrates, the health of the entire society is dependent on the health of all its members. This common connection is not delivered to the society when health care depends on being employed.
   Also, this pandemic and the Great Recession show that business plans do not acknowledge or provide for outlier events. The businesses collect excess profits unhindered by cautionary expenses and expect the federal government to bail them out.

Preparedness and Cost-Splitting

Preparedness costs to businesses, governments, and individuals is a type of insurance. We didn’t have sufficient insurance costs and expenditures built into our response to COVID-19. The costs of the governmental bailouts is a reflection of the under-preparation of companies—at the cost to the taxpayers.

Each dollar spent in preparation saves us six dollars of spending in response. Our government should be funding for future pandemic and disaster preparations

Map of USA without state boundaries
One country or fifty states

One Country or Fifty States

The virus doesn’t stop at state boundaries. We need a national response, although not the same response to an unaffected area as to an affected area. The response should depend on measured targets, not the whim of the president or the person in charge.

The national government should be the custodian of the collective preparatory efforts. They are to serve the states when it does not conflict with the national interest. The federal government should not be bidding against the states for equipment of common interest.  

More about lockdown decision

   Because sufficient testing was not available at the start, identification of infected individuals couldn’t be used to support sensible isolation of those individuals; therefore, social distancing was mandated for the entire population—to flatten the peak requirement on our hospital system. However, essential services needed to continue, which required many employees to have contact with their coworkers and customers. Since there was the lack of personal protective equipment (masks, immediately), those essential workers were at risk and many caught Covid-19.
   Now, so many people (1 million in US; 800 thousand active cases) have caught the virus that it is with us to stay and we must adjust to that reality.
   Because of the surging pandemic, many governments moved to shutter most of the economy. They hoped to limit the numbers of sick and hospitalized so that the best care could be offered, to lessen the death rate.
   Although different governments varied somewhat on which services to deem essential, the result was approximately 1/3 of the economy was shuttered. Those employees and owners had to live off savings, until the government delivered additional unemployment benefits and corporate bailouts. These actions use borrowed money.


Images, public domain. Retrieved from Wikimedia Commons

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