Tag Archives: Furlough

What should we do about the Wuhan coronavirus?

The economic cost of making workers stay home
The economic cost of making workers stay home

I think by now most people have realized that there is an economic cost to shutting Americans of all ages into their homes. If people can’t work, then businesses can’t make money, and they have to furlough or lay off workers. We can’t keep up this policy of making everyone stay home forever – it would lead to another Great Depression. Is there a way to get people back to work?

This article from The Federalist explains, and comes up with a different solution. The author argues that the Wuhan virus is most dangerous to the elderly, and people with pre-existing conditions. And therefore they should shelter in place securely, while the rest of us who are under age 50 keep the economy from sliding into a depression by going back to work as soon as possible.

It says:

Richard Epstein at the Hoover Institution… points out that South Korean data, which is more complete than most other countries’ data, shows huge disparities in risks between old and unhealthy and young and healthy. “Clearly, the impact on elderly and immunocompromised individuals is severe, with nearly 90% of total deaths coming from individuals 60 and over. But these data do not call for shutting down all public and private facilities given the extraordinarily low rates of death in the population under 50,” Epstein writes.

[…]The costs Americans are being forced to bear may be more than is rational to impose. Already one-fifth of working Americans are being laid off and having work hours cut due to not even one week of suspensions.

“[T]he massive curtailments of the U.S. economy can have as many health consequences as the virus itself—if millions lose income and jobs, become depressed in self-isolation, increase smoking, and drug and alcohol use, and postpone out of fear necessary buying and visits to doctors and hospitals for chronic and serious medical conditions unrelated to the virus,” writes Victor Davis Hanson.

What if the real scenario is one of these: 1) We plunge the nation into a depression that kills many businesses and addicts millions to welfare, in a nation that has already pledged more welfare than it can afford for at least the next three generations. Because of this depression, many people die due to poverty, lack of medical care, and despair. Millions more transform from workers to takers, causing a faster implosion of our already mathematically impossible welfare state.

2) The nation quarantines only at-risk populations and those with symptoms, like South Korea has, and ensures targeted and temporary taxpayer support to those groups, goes nuts cranking out ventilators and other crisis equipment such as temporary hospitals using emergency response crews, while the rest of us keep calm, wash our hands, take extreme care with the at-risk groups, and carry on.

Why would the entire nation grind to a halt when the entire nation is not at a severe risk? I would rather have a flu I am 99.8 percent likely to survive than the nation plunged into chaos indefinitely because we pulled the plug on our economy during a stampede.

At the very least, Congress should wait a week or two, while half the nation or more is home, to see how the infection rates look as millions of test kits go out. The worst-case scenario they are predicating their actions on may not be the one we’re facing. Prudence suggests a measured, wait and see approach to policy until we have better information, not chucking trillions of my kids’ dollars out the window “just in case.”

Right now, I think we should expand testing so we understand the problem better, fast-track whatever drugs are known to work, expand hospital capacity, build more N95 masks, build more ventilators, and get people under 50 back to work. This is in addition to proper hand-washing, social distancing and working from home where possible.

The cost of a depression seems to me to be much higher than what is happening to South Korea right now. They have massive testing effort and they are only quarantining people who are at high risk or who show symptoms. That makes more sense to me than shutting the economy down, or pass massive spending bills with bailouts for businesses that should not be shut down more than a month.

House Republicans offer deal: delay Obamacare for a year, no government shutdown

This new House bill is a good compromise – even Tea Party stalwart Ted Cruz has endorsed it.

Excerpt:

During a speech on the Senate floor Monday afternoon, Texas senator Ted Cruz endorsed the latest House bill to fund the government. This continuing resolution would not defund Obamacare, as Cruz has demanded for months, but it would delay Obamacare’s individual mandate by one year and end employer subsidies for members of Congress and their staff.

During his speech, Cruz praised the House of Represenatives for trying to compromise and criticized Senate majority leader Harry Reid for refusing to negotiate. Senator John Cornyn, Cruz’s Republican colleague from Texas, then pointed out that the House will reportedly pass a continuing resolution that will include a delay the individual mandate and the Vitter amendment.

Cruz said that the Senate should pass “whatever” the House passes this evening.

“If the House of Representatives asks tonight I believe this Senate should come back immediately and pass the continuing resolution the House–whatever the House passes,” Cruz said. “I don’t know what it will be, but it will be yet another good faith effort to keep the government running and to address the trainwreck of a law that is Obamacare. And I very much hope that this body begins to listen to the people.”

Cruz’s comments mark an apparent shift in his position on defunding Obamacare. During his 22-hour speech on Obamacare last week, Cruz said he could not support a compromise.

[…]Monday evening, the Club for Growth endorsed the House compromise but Heritage Action opposed it.

Not sure how I feel about this compromise, because this Wall Street Journal article makes it sound like a good deal.

Excerpt:

Air traffic control will continue, in addition to airport and airplane safety inspections.  All Federal Highway Administration activities will also continue.

[…]The IRS will cancel audit appointments.

[…]The Department of Education could have to delay its issuing of competitive and formula grant awards later this year.

[…]Workplace dispute cases would not be resolved until after the shutdown, as the National Labor Relations Board would halt all case handling.

[…]Agency functions that protect national security and ensure human safety are exempt from the shutdown. Military operations, border security, coastal protection (including the Coast Guard), law enforcement, criminal investigations, counter-terrorism efforts and care of prisoners are all expected to continue. The Federal Bureau of Investigation, the Drug Enforcement Agency, the U.S. Secret Service, and the U.S. Marshals Service will all continue to function. The Transportation Security Administration will continue to staff airports.

On Friday, the Pentagon warned that a government shutdown could force the Defense Department to furlough about 400,000 civilian workers, delay military contracts and defer training.

The move would impact about half the department’s 800,000 civilian employees, most of whom were required to take six unpaid days off earlier this year as a result of the automatic spending cuts imposed under so-called sequestration.

Because of the unique role the Pentagon plays in protecting the country, defense officials are planning to exempt large numbers of people and projects. All active duty military personnel will not be furloughed – and large numbers of civilians supporting the war in Afghanistan and other essential military initiatives will stay on the job.

Pentagon leaders created a long list of exemptions, including counseling services for sexual assault victims, some child care facilities, and some base cafeterias.

[…] The U.S. Postal Service will continue to function as usual.

Social Security payments will continue to go out, and the administration is expected to continue taking applications for benefits, as in plans released Friday. In that plan, the agency said it will furlough 18,006 of its 62,343 workers.

Medicare and Medicaid payments will also continue, although the programs could encounter difficulty if the shutdown stretches into weeks.

[…]Food and Drugs: The Food and Drug Administration will continue its review of imports into the U.S., according to the Department of Health and Human Services’ plan released Friday.

Inspection of meat, poultry and egg products will continue, as these functions fall under the category of human safety. The HHS will furlough 40,512 workers, 52% of its staff.

Disease: The Centers for Disease Control and Prevention will cease disease surveillance, which could be particularly problematic as flu season approaches.

Medical care of inpatients and emergency outpatient care will continue.

The National Institutes of Health clinical center will not accept new patients into clinical research, but it will continue to provide medical services for current patients. In the 1995-96 shutdowns, calls placed to NIH’s disease hotline were not answered, according to the CRS report.

Obamacare: The Affordable Care Act will continue to be funded.

Other: Handling of hazardous waste, disaster assistance and power grid maintenance will continue.

On balance, it doesn’t sound like the catastrophe that the left-wing media make it out to be, at least for a couple of weeks.

Meanwhile, Senate Democrats are refusing to negotiate.