Ted S. Warren/AP Photo
A disaster recovery team in Kirkland, Washington, March 11, 2020
First Response
Last night’s Oval Office address was such a nightmare it had to be corrected even though it was written down (cargo isn’t being blocked from Europe). As far as emergency response goes, however, Trump had three messages:
1. There will be an emergency leave/quarantine policy that sounds at least somewhat like the Pelosi-Schumer proposal from Sunday night;
2. A lot of the business lending and tax deferment stuff will be carried out on his own authority;
3. He still wants that payroll tax cut, the one he proposed 6 months ago before anyone knew such a word as “coronavirus.”
The scuttlebutt on the emergency-leave plan is that it will apply to the sick, their caregivers, and anyone furloughed because of the pandemic, with no cap on benefits. That lines up favorably with the House Democratic bill, which will get a floor vote today. In fact Trump’s proposal could end up more generous; the emergency leave part of the bill includes those categories, and authorizes two-thirds of monthly earnings up to $4,000.
Because the legislative apparatus in the White House is so desiccated, Trump is likely to just jump on the House bill, which also has increased nutrition assistance and unemployment insurance, getting meals to poor kids if their school (and school breakfast/lunch plan) closes, an end to food stamp work requirements, health care worker protections, free testing for COVID-19, and a waiver of cost-sharing for treatment under public plans. Senate Majority Leader Mitch McConnell initially blasted the bill and said the chamber wouldn’t take up anything until after a scheduled one-week recess, but that must have not gotten a good reception, because he just canceled the recess. Discussions are ongoing.
There’s also a requirement in the House bill for large employers to provide sick leave, but it’s unclear to me whether that’s permanent beyond this outbreak. That has to happen. We have no idea if COVID-19 comes back again even if it’s extinguished in the next month, and the fact that we have no mandatory sick leave policy has already made us incredibly vulnerable. The Senate blocked an emergency sick leave bill just yesterday. Trump needs this bill; he has lost all leverage and last night’s performance weakened him further. Now is the time to ensure that nobody in America ever has to decide between getting paid and preserving their health and that of their work colleagues. It simply has to be permanent.
Vital Stats
According to the CDC, there are 938 total cases of COVID-19 and 29 deaths as of Wednesday, March 11. They’ll update this number later today.
Supply Chain Woes
Nearly 75 percent of all companies report disruptions to their supply chains, according to the Institute for Supply Management. This is a little old, based on surveys between February 22 and March 5. But the vast majority of respondents—80 percent—said the supply chain impacts would only increase throughout the year.
That may sound discordant, because China is starting to recover and production there may start to improve. But there’s such a backlog on the shipping side of things. There’s this huge imbalance of containers, so even if you have something to ship you might not have anything to ship it in. And that includes component parts, which ripples out the manufacturing slowdown from China and Korea throughout the world. More than half of respondents aren’t getting good supply chain information from China, which feeds the uncertainty.
Meanwhile, for all the talk of unconscionable delays in test kits in the U.S., now that we’re finally seeing testing, there is the threat of shortages of the nasal swab materials that generate the specimens. One thing this crisis is teaching us is that we have pushed ahead with globalization without building in any resiliency or redundancy in the event of a disruption. Self-sufficiency has to be atop a post-COVID agenda for industrial policy.
Also, if you think China is fulfilling the purchases in the “phase one” trade deal you’re nuts.
Today I Learned
The financial system’s fragility, consistent even after post-crisis reforms, now becomes a real challenge. (The New York Times)
The FDIC laying off their most experienced people when they’re going to need them as banks fail is insane. (Government Executive)
On the bright side, mortgage refi applications are up as rates fall. (CNBC)
Amazon joins other companies in changing its paid sick leave policies. (The Wall Street Journal)
The insurance industry is retrading the deal on eliminating co-pays for COVID-19 treatment. Now they’re saying they’re only waiving co-pays for testing. (Common Dreams)
Coronavirus layoffs begin. (The Washington Post)
This story of triage at Italian hospitals is heartbreaking. (The Atlantic)
