Here is what the US government should do right now to protect the economy

26/03/2020

The coronavirus pandemic needs decisive leadership to ensure medical and civilian supplies and to safeguard livelihoods

March 25, 2020

The first big need is medical supplies, facilities and personnel. That is why we need to finance immediate domestic production of masks, oxygen tanks, ventilators and the construction and staffing of field hospitals, including the conversion of existing structures such as hotels, dormitories and stadiums, and the hiring and upgrading of staff.

Ideally HHS should finance supplies, the army corps of engineers should run construction, and Fema should manage and coordinate. The Federal Reserve should be empowered to buy unlimited debt from state and local governments and both debt and equity from private companies. If Congress cannot agree quickly on specifics, create a government-owned Health Finance Corporation and give it unlimited full-faith-and-credit bonding authority, as was done for the Depression and the second world war.

Maintaining vital civilian supplies, especially food, medicines and fuel, is the second big need. This is a two-part problem. The first part is to make sure that there are goods in the stores and pharmacies, and that gas stations and drive-through restaurants can remain open. The second part is to ensure that those at home have the means to pay, and that local distribution remains orderly.

To keep supplies flowing, there must be higher pay and credible protections for essential workers, such as drivers, stockers, checkout clerks and security guards. Amazon and Walmart are already raising pay. Groceries, pharmacies and service stations must most urgently protect their workers, who are exposed to hundreds of customers every hour, from getting sick. After healthcare, protection should go there. Distribution networks will break if stores can’t stay open or if shoppers won’t go in.