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The Pandemic Will Cause A Global Depression – We Need Demand Side Measures To Counter It
Last week's post on Boeing ended with this line:
The pandemic, and the global depression it will cause, now make it certain that Boeing will have to ask for a gigantic government bailout or go into bankruptcy.
With most flights grounded due to the pandemic Boeing is now thinking about cutting its production and laying off workers.
In the quoted sentence I used the words "the global depression it will cause" with care. I do indeed believe that a sustained, long-term downturn in economic activity in many countries will be one of the results of this pandemic.
 bigger
The airline industry is just one of many that will be hit hard. About 70% of the U.S. GDP is generated by the service industry. Travel, entertainment, gyms, restaurants and bars, hotels, education will all be hit extremely hard by the finally coming shutdown. The U.S. will, like Germany did today, soon shutdown churches, brothels and other entertainment outlets. Only a few service industries, like healthcare, online gaming and gun sales, will continue to strive.
The pandemic will be with us as a major danger for probably two or three years during which it will race around the globe in several large waves. Each wave will require another shutdown. To develop a vaccine against the SARS-CoV-2 virus is likely to take over a year but may take much longer. We may be more lucky with a new medication that can reduce the symptoms of the Covis-19 disease the virus is causing.
Restrictions on major parts of the service industry are therefore likely to be with us much longer than the one or two months that are currently anticipated. After the restrictions are over many people will have have changed their habits. The travel industry will not come back for a long time. The cruise industry will probably die. That is personal to me as the place where I learned to work metal depends on it.
There will also be lots of layoffs caused by this crisis which guarantees that demand will fall further off the cliff.
On Sunday's the Fed cut its interest rates to zero. That was a push on a string. Today the stock markets tanked another 10%. Crude is now below $30 per barrel and may well go down to $20/bl. The Fed move was likely demanded by Trump who last week remarked that he has the power to fire Fed chair Powell. The Fed should take care that the credit markets stay liquid as many companies will need additional resources. A credit crunch right now would increase the general damage. But Trump and the Fed should stop to push supply side measures like interest rate cuts and tax relieves. There is no lack of investment or supplies but a lack of demand and that will continue for at least the rest of the year.
Last week the House passed a bill with some emergency help. It was mostly fake. House leader Nancy Pelosi sold it as covering way more than it actually does:
The legislation secures paid emergency leave with two weeks of paid sick leave and up to three months of paid family and medical leave, according to Pelosi. It also enhances unemployment insurance. The legislation also increases federal funds for Medicaid, and bolsters funding for food assistance programs.
Those were a number of lies and even the neoliberal editors of the New York Times called her out:
House Speaker Nancy Pelosi on Friday night celebrated the coronavirus legislation that passed early Saturday as providing paid sick leave to American workers affected by the pandemic.
She neglected to mention the fine print.
In fact, the bill guarantees sick leave only to about 20 percent of workers. Big employers like McDonald’s and Amazon are not required to provide any paid sick leave, while companies with fewer than 50 employees can seek hardship exemptions from the Trump administration.
“If you are sick, stay home,” Vice President Mike Pence said at a news conference on Saturday afternoon. “You’re not going to miss a pay check.”
But that’s simply not true. Sick workers should stay home, but there is no guarantee in the emergency legislation that most of them will get paid.
When even rightwing Republican Senators think that the Democratic leader of the House is not socialist enough something has changed:
Tom Cotton @SenTomCotton – 12:21 UTC · Mar 16, 2020
The House relief bill doesn’t go far enough & fast enough.
We’re going to do everything we can to get cash into the hands of affected workers & families as quickly as possible so we can all get through this pandemic together.
There are way more measures needed than Pelosi's bill allows for. The government must cover all costs for virus testing and Covid-19 care. It must pay sick leave to everyone who has to stay home independent of their job status. Not providing such will prolong the crisis as infected people who need to work because they lack money will otherwise continue to spread the virus.
The U.S. and other economies will also need a fiscal injection on the demand side. Send a $5.000 check to every household which makes less than $100,000 per year and include the homeless in it. The money can be taken from the defense budget. A 355 ship navy will never stop a pandemic.
The last global social and economic shock of this size came after 9/11. The fall of the towers changed the world. It became the justification for militarized policies and large defense budgets. The pandemic will cause changes of a comparable size.
Public demands and political priorities will change. Health crisis preparedness and response will become a new priority issue. Globalization will become more restrained while global cooperation on health issues will likely increase.
This crisis is not the end of the world but it will be the impetus for significant changes.
— Previous Moon of Alabama posts on the issue:
2020 CORONA ARRIVES, CROWNS TRUMP-END OF HISTORY OR NEW BEGINNING (Feb-March 16)
Feb 19, 2020- The Lancet published an unprecedented “correspondence” from twenty-seven (27) co-authors who condemned “conspiracy theories” related to the outbreak.
These correspondents wrote:
“The rapid, open, and transparent sharing of data on this outbreak is now being threatened by rumours and misinformation around its origins. We stand together to strongly condemn conspiracy theories suggesting that COVID-19 does not have a natural origin… Conspiracy theories do nothing but create fear, rumours, and prejudice that jeopardise our global collaboration in the fight against this virus. We support the call from the Director-General of WHO to promote scientific evidence and unity over misinformation and conjecture.”
Boy, doesnt that remind you of Bush speech after 9/11 warning against entertaining conspiracy theories? Anthrax letters sent out soon afterwards to reporters/politicians reinforced that
The Lancet is financed, for instance, by RELX’s foremost investor, Capital Research and Management Company. This is a wholly-owned subsidiary of The Capital Group Companies, Inc., which ranks among the world’s oldest and largest investment management organizations, with over $2 trillion in assets under management.” According to Capital Group’s advertisements, “the company is owned by 450 partners,” including some of the world largest companies based in the U.S., Europe and Asia, each heavily invested in healthcare and disease response.
Feb 24, 2020 Moderna began shipping vials from a plant in Norwood, Mass., to the National Institute of Allergy and Infectious Diseases, in Bethesda, Md., for a planned clinical trial to test its safety.
Feb 26, 2020 – SCMP reports Tencent teams up with ‘Sars hero’ Zhong Nanshan on AI, big data lab to combat coronavirus and predict outbreaks through the use of big data and artificial intelligence.
March 10, 2020 -Volunteers are being recruited in the Seattle area to take part in a clinical trial for a COVID-19 vaccine. Kaiser Permanente Washington Health Research Institute is asking for volunteers to participate in a study that will test an “investigational vaccine” for SARS-CoV-2, which is the virus that causes COVID-19. The experimental vaccine is an mRNA nucleic acid vaccine, meaning it is made up of a segment of mRNA rather than the whole virus.
The vaccine is skipping preliminary testing on animals before proceeding to human trials, which is unheard of. Of course, vaccine manufacturers are free of liability so why not? The vaccine has never before been administered to humans, but it is similar to vaccines developed previously for the Zika virus although never approved for use.
Though sponsored by NIAID, the first-in-human experiment is taking place in Seattle, at the Kaiser Permanente Washington Health Research Institute. Researchers began recruiting healthy volunteers in early March. Their plan is to enroll 45 people between 18 and 55, who will get two shots of Moderna’s investigational vaccine, about a month apart. Why not enroll older people who are most seriously affected and most likely to be vaccinated (unless vaccines are mandated).
March 11, 2020 WHO declares COVID-19 a global pandemic . WHO is now receiving more than half of its yearly budget from private sources .Bill Gates has given more than one billion dollars to the WHO. Private funding of WHO has brought WHO much closer to the pharmaceutical industry. It is a political organization. Its director is not a scientist.
March 11- Trump declares US-Europe travel ban (ex UK). Basically requiring Europeans to have to go through UK to enter US . That should help UK with Trade negotiations with EU.
March 13, 2020. Trump declares national emergency. He now has dictatorial powers. Nice to have going into an election, assuming there is an election. Maybe people can mail in their votes or use an app. Pffft. Or maybe Trump puts on his Corona Crown and declares himself King
And under regulations revised and reissued by Obama just before Trump entered office, the government can stop and seize any plane, train or automobile to stymie the spread of contagious disease. Some even interpret the statute as meaning a president could deploy the military to cordon off a city or state. He can detain individuals suspected as being a risk to transmit disease
March 15-Prime Minister Benjamin Netanyahu’s trial in three corruption cases has been postponed by over two months, a district court announced on Sunday as he suspends all court activities. Announces digital surveillance of citizens to halt spread of disease. He offers Gantz in a desperate bid to remain Prime Minister two options to break the political deadlock in Israel: joining a six-month emergency government with Netanyahu at the head, or a unity government that would allow Netanyahu to serve as prime minister for two more years before Gantz takes over. Covid-19 a dream come true for Bibi
Stay tuned, more fun and games are heading our way.
Posted by: Pft | Mar 17 2020 1:38 utc | 111
Japan, China and Taiwan Reports on the Origin of the Virus
https://www.globalresearch.ca/china-coronavirus-shocking-update/5705196
http://axisoflogic.com/artman/publish/Article_87277.shtml
EXCERPTS
Japanese and Taiwanese epidemiologists and pharmacologists have determined that the new CoronaVirus almost certainly originated in the US since that country is the only one known to have all five types – from which all others must have descended. Wuhan in China has only one of those types, rendering it in analogy as a kind of “branch” which cannot exist by itself but must have grown from a “tree”.
Immediately prior to that, the CDC totally shut down the US Military’s main bio-lab at Fort Detrick, Maryland, due to an absence of safeguards against pathogen leakages, issuing a complete “cease and desist” order to the military. It was immediately after this event that the ‘e-cigarette’ epidemic arose.
We also had the Japanese citizens infected in September of 2019, in Hawaii, people who had never been to China, these infections occurring on US soil long before the outbreak in Wuhan but only shortly after the locking down of Fort Detrick.
Then, on Chinese social media, another article appeared, aware of the above but presenting further details. It stated in part that five “foreign” athletes or other personnel visiting Wuhan for the World Military Games (October 18-27, 2019) were hospitalised in Wuhan for an undetermined infection.
The article explains more clearly that the Wuhan version of the virus could have come only from the US because it is what they call a “branch” which could not have been created first because it would have no ‘seed’. It would have to have been a new variety spun off the original ‘trunk’, and that trunk exists only in the US.
Next, Daniel Lucey, an infectious disease expert at Georgetown University in Washington, said in an article in Science magazine that the first human infection has been confirmed as occurring in November 2019, (not in Wuhan), suggesting the virus originated elsewhere and then spread to the seafood markets. “One group put the origin of the outbreak as early as 18 September 2019.”
In this case, the Western media flooded their pages for months about the COVID-19 virus originating in the Wuhan seafood market, caused by people eating bats and wild animals. All of this has been proven wrong.
Not only did the virus not originate at the seafood market, it did not originate in Wuhan at all, and it has now been proven that it did not originate in China but was brought to China from another country.
Part of the proof of this assertion is that the genome varieties of the virus in Iran and Italy have been sequenced and declared to have no part of the variety that infected China and must, by definition, have originated elsewhere.
This would provide impetus for caution among the public in accepting the “official standard narrative” that the Western media are always so eager to provide – as they did with SARS, MERS, and ZIKA, all of which ‘official narratives’ were later proven to have been entirely wrong.
AND LET’S NOT FORGET…
John Pilger
http://johnpilger.com/articles/a-pandemic-is-declared-but-not-for-the-starving-the-preventable-sick-the-blockaded-the-bombed
A PANDEMIC IS DECLARED, BUT NOT FOR THE STARVING, THE PREVENTABLE SICK, THE BLOCKADED, THE BOMBED
A pandemic has been declared, but not for the 24,600 who DIE ! EVERY ! DAY ! from unnecessary starvation, and not for 3,000 children who die every day from preventable malaria, and not for the 10,000 people who die every day because they are denied publicly-funded healthcare, and not for the hundreds of Venezuelans and Iranians who die every day because America’s blockade denies them life-saving medicines, and not for the hundreds of mostly children bombed or starved to death every day in Yemen, in a war supplied and kept going, profitably, by America and Britain. Before you panic, consider them.
Posted by: Ashino | Mar 17 2020 13:55 utc | 184
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