President Trump has said that the cure shouldn’t be worse than the disease. In other words, sacrificing the economy through social distancing could end up harming more people than the virus itself. Trump said he wanted to see churches packed all across the country for Easter celebrations. Many experts vigorously condemned the idea and emphasized that the outbreak was no where near subsiding. On Sunday, Trump gave up on the idea and extended social distancing guidelines until April 30th as science prevailed.
Economic and health concerns are deeply intertwined. But the notion that re-opening business before the epidemic is controlled will return consumption faster, is questionable.
MIT economist Emil Verner said it was a “false tradeoff” to view the economy and public health interests as in conflict. In fact, Verner co-authored a paper last week about the 1918 Spanish flu epidemic. The paper points out that cities which limited social gatherings earlier had fewer deaths and stronger economic growth after the outbreak.
If the outbreak worsens due to inadequate social distancing, then consumers will be reluctant to consume regardless of government policy.