Wed. Apr 8th, 2020

Trump signals change in coronavirus strategy that could clash with health experts

US THEGUARDIAN

 

Donald Trump has signalled a potential change in his handling of the coronavirus pandemic, amid warnings of a record plunge in economic activity and unemployment potentially hitting 30%.

Writing in capital letters in a tweet late on Sunday, the US president said: “We cannot let the cure be worse than the problem itself. At the end of the 15-day period” – of White House guidelines to enforce social distancing and other measures which began on March 16– “we will make a decision as to which way we want to go.”

Mike Pencewho heads the White House coronavirus task force, said earlier in the day the federal Centers for Disease Control and Prevention (CDC) would issue guidance on Monday meant to allow people already exposed to the coronavirus to return to work sooner.

The shift in tone could foreshadow a clash between a White House alarmed by economic paralysis in an election year and public health experts urging caution. The US now has more than 39,000 confirmed cases of coronavirus and more than 400 deaths.

After being criticised for a slow response to the crisis, Trump declared a national emergency and agreed to implement drastic measures. But the economic pain was swift. Last week the wall street journal editorial board  warned that “federal and state officials need to start adjusting their anti-virus strategy now to avoid an economic recession that will dwarf the harm from 2008-2009”.

Bret Stephens, a conservative columnist at the New York Times, which Trump monitors closely, wrote on Sunday that treating the virus as a threat comparable to the second world war “needs to be questioned aggressively before we impose solutions possibly more destructive than the virus itself”.

And Tom Fitton, a conservative commentator known to influence the president, tweeted “The consequences of this national shutdown, apart from any pandemic, are dire and will not be materially alleviated by any ‘stimulus’ and [government] spending. The only stimulus that will work is opening America back up for business.”

The change came as central bankers warned of unprecedented fallout. The St Louis Fed chief, James Bullard, said America’s GDP could shrink 50%, with unemployment rising to 30% in the second quarter. On Wall Street, Morgan Stanley saw a 30% contraction, driving unemployment to 12.8%.

The Federal Reserve said: “Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate.”

The central bank said it was “using its full range of authorities to provide powerful support for the flow of credit to American families and businesses”.

In the Senate, attempts to pass a far-reaching stimulus package floundered – and a Republican senator, Rand Paul of Kentucky, was revealed to have Covid-19.

Democrats said the $1.8tn proposals were weighted toward a corporate bailout at the expense of workers, hospitals and state and local governments. Republicans claimed Democrats were obstructing the bill in the middle of a national emergency. Both sides said they were confident a deal could still be agreed.

Trump warned that a rattled American public would take a dim view of an impasse. “The only reason a deal couldn’t get done is pure politics,” he said on Sunday.

On Monday the likely Democratic presidential nominee, Joe Biden, said Trump should “start acting like” the the wartime president he has claimed to be.

The stalemate in the Senate was felt in the markets, where Dow Jones Industrial Average futures dropped more than 600 points.

In New York, which contributes close to half of the US tally, 15,168 cases, the governor, Andrew Cuomo, said an estimated 40% to 80% of residents could be infected but echoed the Trump administration’s impatience to reboot the economy.

“I take total responsibility for shutting off the economy in terms of essential workers but we also have to start to plan the pivot back to economic functionality,” Cuomo told reporters in Albany. “You can’t stop the economy forever.

“So we have to start to think about does everyone stay out of work, should young people go back to work sooner, can we test for those who had the virus, resolved and are now immune, and can they start to go back to work?”

Cuomo, who has been praised for his handling of the crisis, added: “We implemented ‘New York pause’, which stopped all the essential workers, etc. We have to start to think about ‘New York forward’… How do you restart, or transition to, a restart of the economy?”

Decisions to quarantine one in three Americans and shut down non-essential businesses in several large states, including New York, New Jersey, Illinois and California, have effectively frozen the service and manufacturing sectors of the US economy.

Measures being considered by legislators include financial aid for regular Americans, small businesses and critically affected industries including airlines, which have warned they may not survive without at least $50bn in government support.

Chuck Schumer of New York, the top Senate Democrat, has said more money is needed for community health centers, nursing homes, masks, ventilators, personal protective equipment and aid to state and local governments. The Republican majority leader, Mitch McConnell, of Kentucky, has urged Democrats to stop delaying aid and hurting financial markets.

Negotiations with the treasury secretary, Steven Mnuchin, continued on Monday. The House speaker, Nancy Pelosi, said that should the Senate fail, Democrats there would craft an alternative bill.

Meanwhile health officials warned of a dire shortage of protective masks and growing pressure to increase available ventilators. Trump has resisted pleas by governors to fully use his powers under the Defense Production Act, which can compel companies to produce vital equipment.

The surgeon general, Dr Jerome Adams, told NBC: “I want America to understand this week it’s going to get bad. We really need to come together as a nation … we really, really need everyone to stay at home.”

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