WEBVTT - Where Do We Go From Here? 0:00:00.280 --> 0:00:03.400 Hi, I'm Carol Masser and I'm Jason Kelly. It's time 0:00:03.440 --> 0:00:05.480 for this week's cover story, and Carol, I have to 0:00:05.519 --> 0:00:08.400 say it is a provocative one. Well, the US has 0:00:08.400 --> 0:00:10.800 gotten into a very bad place during the pandemic. No 0:00:11.000 --> 0:00:13.800 argument there, and no argument about the fact that there 0:00:13.840 --> 0:00:16.840 are no good exits, and I think it's safe to say, Jason, 0:00:16.840 --> 0:00:19.800 no argument too, that we desperately need to reopen the economy, 0:00:19.960 --> 0:00:23.439 yet doing so makes us vulnerable to a resurgence of 0:00:23.440 --> 0:00:26.640 the coronavirus. And in pushing for such a quick return 0:00:26.680 --> 0:00:29.640 to normalcy, President Trump chooses to frame the debate around 0:00:29.720 --> 0:00:34.360 lies versus livelihoods. But that's a false choice. According to 0:00:34.400 --> 0:00:37.680 Peter Coy in game theory, Trump is quote gambling on 0:00:37.760 --> 0:00:40.920 a resurrection. According to the story, the concept is that 0:00:40.960 --> 0:00:43.239 if you're playing from behind, big moves with only a 0:00:43.280 --> 0:00:46.320 small chance of payoff can make sense. And then Jason, 0:00:46.360 --> 0:00:49.440 under what Peter Coy calls the divider in Chief, Americans 0:00:49.440 --> 0:00:52.239 are fighting each other instead of the virus. And yet, 0:00:52.240 --> 0:00:54.480 as Peter goes on to write, our best laid plans 0:00:54.520 --> 0:00:57.680 for reopening the economy are worth nothing if they don't 0:00:57.720 --> 0:01:00.560 factor in how the virus will respond to that. Now, 0:01:00.640 --> 0:01:03.279 the virus simply isn't going away anytime soon, and our 0:01:03.320 --> 0:01:06.800 inability to deal with that unfortunate reality, well, it will 0:01:06.800 --> 0:01:10.200 only add to its costly birden And that's really Peter's argument. 0:01:10.600 --> 0:01:13.480 Where do we go from here? Trump is gambling on 0:01:13.520 --> 0:01:17.440 reopening the American economy early, even if it costs more lives. 0:01:18.000 --> 0:01:21.280 But that's a false choice. We can reboot and still 0:01:21.319 --> 0:01:25.039 be safe. Here's a realist's guide to getting through the 0:01:25.040 --> 0:01:30.240 pandemic by Peter Coy. David Rock, a mathematician at the 0:01:30.319 --> 0:01:34.080 University of California at Davis, has been watching President Trump's 0:01:34.080 --> 0:01:38.360 pandemic performance with a scholars interest. The president's touting of 0:01:38.520 --> 0:01:42.320 and now maybe even using the rheumatism drug hydroxy chloroquine, 0:01:43.000 --> 0:01:46.840 his musing about injecting disinfectants, and his egging on of 0:01:47.040 --> 0:01:50.600 armed anti shutdown protesters all look to Rock like a 0:01:50.640 --> 0:01:55.480 species of what game theory calls gambling for resurrection. The 0:01:55.560 --> 0:01:58.280 concept is that if you're behind in a game, say 0:01:58.440 --> 0:02:02.920 a presidential campaign, big bold moves can make sense, even 0:02:02.920 --> 0:02:05.160 if there's only a small chance they will pay off. 0:02:05.960 --> 0:02:09.000 If someone does stumble on a miracle cure for COVID nineteen, 0:02:09.560 --> 0:02:12.440 or the national economy somehow gets going by election day, 0:02:12.880 --> 0:02:16.160 then both Trump and the American people win. If the 0:02:16.160 --> 0:02:19.320 gambles fail, he's no worse off because he was probably 0:02:19.360 --> 0:02:22.800 going to lose the election anyway. As for the American people, 0:02:23.240 --> 0:02:26.000 they could wind up much worse off from his experiments. 0:02:26.560 --> 0:02:28.920 But if the president has a bad election day, that 0:02:28.960 --> 0:02:33.120 won't be his problem anymore. From the perspective of game theory, 0:02:33.360 --> 0:02:36.880 Trump's wager is highly rational, says Roc, who handled the 0:02:36.919 --> 0:02:39.480 math parts of a nineteen ninety five book on gambling 0:02:39.520 --> 0:02:44.600 for resurrection called Optimal Imperfection, Domestic Uncertainty and Institutions in 0:02:44.600 --> 0:02:48.359 International Relations, which he wrote with the late political scientist 0:02:48.480 --> 0:02:52.160 George Downs. On the other hand, Roc allows that the 0:02:52.200 --> 0:02:55.480 president may just be winging it. With Trump, he says, 0:02:55.800 --> 0:02:58.320 it's very difficult to tell how much is craft and 0:02:58.400 --> 0:03:02.040 how much is idiocy. The U s has gotten into 0:03:02.080 --> 0:03:04.600 a bad place from which there are no good exits. 0:03:05.000 --> 0:03:07.919 It desperately needs to reopen the economy, and yet is 0:03:08.000 --> 0:03:10.520 vulnerable to a resurgence of disease if it does so 0:03:10.639 --> 0:03:15.120 without careful preparation. The economy lost twenty point five million 0:03:15.200 --> 0:03:18.320 jobs in April, and the unemployment rate rose to fourteen 0:03:18.360 --> 0:03:22.000 point seven percent at the same time. As of May twentieth, 0:03:22.040 --> 0:03:24.120 there have been more than one and a half million 0:03:24.200 --> 0:03:27.600 cases of COVID nineteen in the US and almost ninety 0:03:27.600 --> 0:03:31.280 two thousand deaths versus fifty eight thousand in the Vietnam War. 0:03:31.960 --> 0:03:35.240 With the election approaching, it's reasonable to assume that Trump 0:03:35.240 --> 0:03:37.880 will double down on his gamble to get the economy 0:03:37.920 --> 0:03:41.280 to bounce back from what Bloomberg Economics calls the sharpest 0:03:41.320 --> 0:03:45.080 decline since World War Two. But what about everybody else? 0:03:45.640 --> 0:03:50.320 What's the right strategy for companies, Congress, state and local governments, 0:03:50.360 --> 0:03:53.480 and families As the US begins to reopen with the 0:03:53.560 --> 0:03:57.320 virus still on the loose. Consider this a realist's guide 0:03:57.360 --> 0:04:01.560 to outlasting the pandemic. There's actually a fair chance that 0:04:01.560 --> 0:04:04.440 Trump's bet will pay off. Let's say the number of 0:04:04.440 --> 0:04:07.560 new cases continues to fall nationally, as it has in 0:04:07.640 --> 0:04:11.200 most of the world because most people continue to take precautions. 0:04:11.920 --> 0:04:16.400 Deaths remain elevated in nursing homes, prisons, and crowded multigenerational housing, 0:04:16.760 --> 0:04:19.640 but the public regards that as an inevitable consequence of 0:04:19.680 --> 0:04:23.520 the pandemic and doesn't blame Trump. Democrats come to be 0:04:23.560 --> 0:04:27.320 seen as silly handwringers, or worse, obstructionists who tried to 0:04:27.400 --> 0:04:30.719 kill growth for political ends. Trump suddenly has a good 0:04:30.720 --> 0:04:35.400 shot at winning a second term. Two points about that scenario. One, 0:04:35.720 --> 0:04:39.200 allowing more vulnerable people to die is a choice, not 0:04:39.279 --> 0:04:43.440 an inevitability. Two, There's a risk that things will turn 0:04:43.480 --> 0:04:46.680 out much worse with a second or third national wave 0:04:46.720 --> 0:04:50.560 of infections that kills tens of thousands or more. The 0:04:50.640 --> 0:04:55.480 Trumpian framing device lives versus livelihoods is a false choice. 0:04:56.080 --> 0:04:59.120 Will some people be affected, yes, Will some people will 0:04:59.160 --> 0:05:02.920 be affected badly? Yes, Trump told reporters during a factory 0:05:03.000 --> 0:05:05.280 visit on May five. But we have to get our 0:05:05.279 --> 0:05:07.520 country open, and we have to get it open soon. 0:05:08.200 --> 0:05:11.520 In reality, reopening too soon is likely to cost both 0:05:11.560 --> 0:05:15.520 lives and livelihoods. The economy won't regain full strength if 0:05:15.560 --> 0:05:18.560 people remain afraid to leave home, or if fresh outbreaks 0:05:18.600 --> 0:05:22.640 force renewed closures. Other countries, from Iceland to South Korea 0:05:22.680 --> 0:05:25.599 to New Zealand have shown that stopping the virus cold 0:05:25.720 --> 0:05:28.920 first is the most effective way to save the economy. 0:05:29.000 --> 0:05:32.520 Even then, victory is not complete. China has imposed a 0:05:32.560 --> 0:05:35.279 new lockdown on more than one million people in its 0:05:35.279 --> 0:05:38.440 northeast amid fears that a flare up there may have 0:05:38.520 --> 0:05:42.479 been caused by a harder to detect version. While Trump 0:05:42.520 --> 0:05:46.279 aspires to refill stadiums with fans, the hard reality is 0:05:46.320 --> 0:05:49.320 that until there's a vaccine, life will have to be 0:05:49.320 --> 0:05:53.920 different and worse. Surviving the pandemic will be enormously expensive, 0:05:54.400 --> 0:05:56.760 not only in dollar terms, but in the changes people 0:05:56.760 --> 0:05:59.440 need to make, from mask wearing to isolation of the 0:05:59.480 --> 0:06:04.000 elderly two bands on large gatherings. Months after the outbreak began, 0:06:04.440 --> 0:06:08.000 the US remains short of reagents, swabs, and other materials 0:06:08.040 --> 0:06:11.640 needed for widespread testing, and lacks the infrastructure to trace 0:06:11.680 --> 0:06:15.200 the contacts of people who test positive, critical components of 0:06:15.240 --> 0:06:19.840 any reopening plan. Trump recently promised a vaccine by year end, 0:06:20.560 --> 0:06:23.520 but as a reality check, there are still no approved 0:06:23.600 --> 0:06:28.120 vaccines to prevent COVID nineteen's older cousins, twenty twelves mers, 0:06:28.160 --> 0:06:31.400 and two thousand and threes stars. We have to find 0:06:31.400 --> 0:06:33.760 ways to live with the virus for now, and this 0:06:33.839 --> 0:06:36.960 is the new normal. To Keishi Kasai, the World Health 0:06:37.040 --> 0:06:40.159 Organization's Regional director for the Western Pacific set in a 0:06:40.200 --> 0:06:43.520 briefing on May fourteenth, as long as the virus is 0:06:43.560 --> 0:06:46.640 circulating in this interconnected world, and until we have a 0:06:46.680 --> 0:06:51.360 safe and effective vaccine, everybody remains at risk. The International 0:06:51.360 --> 0:06:55.200 Monetary Fund estimates that shutdowns will destroy nine trillion dollars 0:06:55.200 --> 0:06:58.560 in world economic output in twenty twenty and twenty twenty one. 0:06:58.880 --> 0:07:02.120 If that's true, then the world saves three seventy five 0:07:02.160 --> 0:07:04.839 billion dollars for every month by which it manages to 0:07:04.839 --> 0:07:08.920 shorten them. That huge sum can be interpreted two ways 0:07:09.480 --> 0:07:12.360 as a reason to reopen right away, with safety as 0:07:12.360 --> 0:07:16.480 a secondary concern, or better as a justification for spending 0:07:16.560 --> 0:07:20.360 crazy sums to make the reopening safe. Opening only to 0:07:20.360 --> 0:07:23.480 shut down again just extends the pain and cost. But 0:07:23.640 --> 0:07:27.080 government spending that accelerates development of a vaccine or effective 0:07:27.080 --> 0:07:30.680 anti viral treatment, allowing the economy to open safely even 0:07:30.720 --> 0:07:33.520 a month or two earlier, will pay for itself many 0:07:33.560 --> 0:07:37.960 times over. Subsidize the construction of multiple factories for vaccines 0:07:38.000 --> 0:07:41.200 that are still undergoing testing just in case they pan out, 0:07:41.600 --> 0:07:47.280 even though most probably won't. Sure. COVID nineteen has changed everything. 0:07:47.880 --> 0:07:51.080 Things that made sense before the pandemic don't anymore, and 0:07:51.120 --> 0:07:54.000 things that were absurd before the pandemic are reasonable and 0:07:54.040 --> 0:07:58.080 realistic now. Spending gargantuan sums of taxpayer money is not 0:07:58.160 --> 0:08:02.760 wasteful at all. To screw imp is penny wise, pound foolish. 0:08:03.200 --> 0:08:05.760 The same logic argues for going big on aid to 0:08:05.800 --> 0:08:08.400 families and businesses that have been harmed by the virus. 0:08:09.280 --> 0:08:12.520 Some of the money will inevitably be caged by unworthy parties, 0:08:12.840 --> 0:08:17.000 providing fodder for investigative journalists and congressional committees. But in 0:08:17.040 --> 0:08:19.760 a crisis, the perfect can be the enemy of the good. 0:08:20.440 --> 0:08:23.400 There's even a public health angle. People who are managing 0:08:23.400 --> 0:08:25.960 okay in a lockdown because of help from the government 0:08:26.280 --> 0:08:30.200 won't be so desperate to reopen economies that will save lives. 0:08:30.640 --> 0:08:33.600 It's hard to imagine that running up huge government deficits 0:08:33.640 --> 0:08:36.880 could ever be a sound strategy. But then, the greatest 0:08:36.880 --> 0:08:40.080 policy failure of the pandemic has been a failure of imagination, 0:08:40.760 --> 0:08:43.960 an inability to grasp the magnitude of this disaster and 0:08:43.960 --> 0:08:47.400 the measures required to combat it. Trump was far from 0:08:47.400 --> 0:08:50.640 the only myopic leader in the early going. British Prime 0:08:50.640 --> 0:08:54.080 Minister Boris Johnson briefly gambled on letting the virus spread 0:08:54.280 --> 0:08:58.320 to achieve her community before coming down with COVID nineteen himself. 0:08:59.160 --> 0:09:02.600 Even now, the UK, Italy, and France have more fatalities 0:09:02.640 --> 0:09:06.360 per capita than the US does. New York City's terrible 0:09:06.360 --> 0:09:08.880 outbreak is partly the fault of Mayor Bill de Blasio 0:09:08.960 --> 0:09:12.120 and Governor Andrew Cuomo, who have feuded for years and 0:09:12.200 --> 0:09:16.040 reacted tardily to the virus. Cuomo pushed de Blasio to 0:09:16.080 --> 0:09:18.920 close city schools, but when de Blasio spoke of a 0:09:18.960 --> 0:09:22.200 shelter in place order for the entire city, Cuomo initially 0:09:22.240 --> 0:09:25.800 opposed the idea, saying on March seventeenth that no city 0:09:25.840 --> 0:09:29.680 in the state can quarantine itself without state approval. The 0:09:29.720 --> 0:09:32.080 imagination that was absent at the start of the crisis 0:09:32.400 --> 0:09:34.720 is more important now that the US is attempting to 0:09:34.760 --> 0:09:38.520 emerge from it. To defeat the virus, think like the virus, 0:09:39.200 --> 0:09:42.600 not literally, of course, since viruses don't have brains or intent. 0:09:43.640 --> 0:09:45.520 We just need to be aware that the best laid 0:09:45.559 --> 0:09:48.320 plans for reopening are worth nothing if they don't factor 0:09:48.360 --> 0:09:51.000 in how the virus will respond to them. Probing for 0:09:51.040 --> 0:09:54.959 weaknesses in society's defenses and flaring up in inconvenient places. 0:09:55.480 --> 0:09:59.480 A single infected person entering an unexposed population is like 0:09:59.559 --> 0:10:02.880 dropping a blob of ink into clean water. Kim Gang Lip, 0:10:02.920 --> 0:10:06.040 South Korea's Vice Minister of health, warned on May eighth, 0:10:06.080 --> 0:10:10.199 after an outbreak at nightclubs, by now we know what works. 0:10:10.800 --> 0:10:13.880 The pandemic fighting strategy that was pioneered by China and 0:10:13.920 --> 0:10:16.760 applied successfully elsewhere is to get the rate of new 0:10:16.760 --> 0:10:19.480 infections low enough that you can stamp out fresh flare 0:10:19.520 --> 0:10:22.600 ups through testing and tracing. If there are too many 0:10:22.640 --> 0:10:25.760 active infections, though testers and tracers won't be able to 0:10:25.840 --> 0:10:28.520 keep up. They'd be fighting a brush fire with a 0:10:28.559 --> 0:10:33.239 water pistol. That's why in Wisconsin, where cases have been increasing, 0:10:33.640 --> 0:10:36.600 Governor Tony Evers wanted to extend to stay at home order, 0:10:37.160 --> 0:10:39.840 but the state Supreme Court overruled him on May thirteenth, 0:10:40.200 --> 0:10:44.400 and residents flocked to bars and restaurants. In Texas, armed 0:10:44.440 --> 0:10:47.840 militia members have guarded some establishments that opened illegally to 0:10:47.920 --> 0:10:51.679 keep police from shutting them down. With Trump presiding as 0:10:51.720 --> 0:10:54.960 divider in chief, Americans are fighting each other instead of 0:10:54.960 --> 0:10:57.800 the virus. The risk, of course, is more waves of 0:10:57.800 --> 0:11:01.080 infections in the Spanish flu pen deemic of nineteen eighteen 0:11:01.120 --> 0:11:05.400 and nineteen, the second wave was bigger than the first one. 0:11:05.440 --> 0:11:08.280 Pragmatic way out of this political log jam could be 0:11:08.320 --> 0:11:11.760 truly massive testing enough to tamp down even a high 0:11:11.800 --> 0:11:15.680 infection rate. It could be coupled with contact tracing, which 0:11:15.679 --> 0:11:17.720 can be done using cell phone data as well as 0:11:17.720 --> 0:11:20.600 trained human tracers, some of whom could be people who 0:11:20.640 --> 0:11:24.439 lost jobs because of the pandemic. Mike Bloomberg, the majority 0:11:24.440 --> 0:11:27.320 owner of Bloomberg LP, is financing such an effort by 0:11:27.320 --> 0:11:31.200 New York States Department of Health, but tracing is costly 0:11:31.600 --> 0:11:33.360 and the US isn't prepared to do it on a 0:11:33.400 --> 0:11:37.840 massive scale. Fortunately, using nasal swabs to find and isolate 0:11:37.840 --> 0:11:41.880 asymptomatic carriers sharply reduces the spread of the virus, even 0:11:41.920 --> 0:11:44.719 if it's not accompanied by tracing of the carrier's contacts. 0:11:44.960 --> 0:11:48.400 According to simulations by New York University economist Paul Romer, 0:11:49.040 --> 0:11:52.520 to control this pandemic and any future pandemic, the U 0:11:52.600 --> 0:11:55.160 s should make the investment necessary to test people every 0:11:55.200 --> 0:11:58.520 two weeks, which would mean twenty five million tests per 0:11:58.640 --> 0:12:01.920 day on an ongoing basis. He writes, in a reopening 0:12:02.000 --> 0:12:05.440 road map. The US has done just over twelve million 0:12:05.520 --> 0:12:09.760 tests in total so far, according to the COVID Tracking Project, 0:12:10.080 --> 0:12:13.400 a volunteer effort launched by The Atlantic magazine to speed 0:12:13.480 --> 0:12:17.320 up a vaccine. Harvard economist Michael Kreamer and others advocate 0:12:17.400 --> 0:12:21.400 government co funding of research, development, and manufacturing. That's because 0:12:21.480 --> 0:12:24.240 vaccine makers won't invest as much as society needs them 0:12:24.280 --> 0:12:27.160 to if they bear all the risk. To make sure 0:12:27.200 --> 0:12:29.680 the companies have skin in the game, some of their 0:12:29.720 --> 0:12:32.320 compensation from governments would come at the back end, in 0:12:32.360 --> 0:12:35.760 the form of guaranteed, fixed price purchases of vaccines that 0:12:35.800 --> 0:12:39.960 meet standards of safety and effectiveness. Another way to accelerate 0:12:40.000 --> 0:12:43.000 things is a so called challenge trial of a vaccine, 0:12:43.400 --> 0:12:47.240 in which experimenters deliberately infect volunteers instead of waiting for 0:12:47.280 --> 0:12:50.640 subjects to get exposed by chance. A group called One 0:12:50.720 --> 0:12:54.359 Day Sooner has lined up thousands of young, healthy altruists 0:12:54.400 --> 0:12:57.520 who are willing to risk getting sick, and survivors of 0:12:57.559 --> 0:13:00.960 COVID nineteen with antibodies to prove it are stepping up 0:13:01.040 --> 0:13:03.520 to work amid contagion in the belief that they have 0:13:03.600 --> 0:13:07.679 at least some immunity. For business, the primary concern is 0:13:07.760 --> 0:13:11.880 keeping employees and customers safe while restarting the engines of commerce. 0:13:12.440 --> 0:13:15.840 One concept is the Qoran team, a small group of 0:13:15.840 --> 0:13:18.720 people who mingle with each other but remain socially distant 0:13:18.760 --> 0:13:22.400 from other quarrant teams. A more straightforward idea is to 0:13:22.440 --> 0:13:26.600 just keep working from home where that's possible. Video conferencing 0:13:26.720 --> 0:13:30.480 is here to stay. Jimmy Ethridge, chief executive officer of 0:13:30.520 --> 0:13:34.960 North America for Accenture, says his consulting organizations productivity metrics 0:13:35.000 --> 0:13:38.400 were higher in March and April than in January and February. 0:13:39.080 --> 0:13:42.080 Some jobs that require a physical presence can be restructured 0:13:42.120 --> 0:13:45.360 to minimize contact. It's already common in parts of the 0:13:45.400 --> 0:13:49.079 country for cashiers to be separated from customers by plastic shields. 0:13:49.559 --> 0:13:52.760 As punishing as a comprehensive shutdown is, it has the 0:13:52.800 --> 0:13:57.480 advantage of clarity. Reopening is baffling, who, how much, and 0:13:57.559 --> 0:14:01.000 when are all in question and influx. Trump has left 0:14:01.000 --> 0:14:03.960 the tough decisions to the states, despite tweeting in April 0:14:03.960 --> 0:14:07.160 that reopening is the decision of the president and later 0:14:07.240 --> 0:14:10.800 bashing Democratic governors who followed his own administration's guidelines in 0:14:10.880 --> 0:14:14.680 delaying reopening, police departments are being put in a difficult 0:14:14.679 --> 0:14:18.079 position having to enforce rules that are constantly changing as 0:14:18.080 --> 0:14:22.280 the pandemic itself changes. Police officers are not social workers, 0:14:22.720 --> 0:14:26.920 they're not homeless outreach coordinators. They're not medical professionals, says 0:14:27.000 --> 0:14:30.400 Monipha Bandele, senior vice president of Mom's Rising dot Org, 0:14:30.680 --> 0:14:33.280 which has protested heavy handed enforcement of stay at home 0:14:33.360 --> 0:14:37.560 orders in minority neighborhoods. As in the case of vaccine development, 0:14:37.800 --> 0:14:39.800 it's worth spending a lot of time and money to 0:14:39.920 --> 0:14:42.960 enable safe reopening because the cost of staying shut is 0:14:43.000 --> 0:14:46.920 so enormous. Thin doubt seating in offices, in public places, 0:14:47.200 --> 0:14:49.920 and on planes and trains is better than no seating 0:14:49.960 --> 0:14:54.560 at all. Likewise, why not carefully reopen schools but tell 0:14:54.640 --> 0:14:57.520 children who live with their grandparents or have other complications 0:14:57.720 --> 0:15:01.040 that they'll have to continue learning online. Better some students 0:15:01.040 --> 0:15:04.280 in the classroom than none. The end of social distancing 0:15:04.400 --> 0:15:07.520 increases the peril to residence of nursing homes because it 0:15:07.560 --> 0:15:09.920 means their staffs will be more exposed to the virus 0:15:09.920 --> 0:15:12.800 while at home, So why not pay workers extra to 0:15:12.840 --> 0:15:16.120 live on the premises. The government could help cover the cost. 0:15:17.120 --> 0:15:20.240 Speaking of cost, the war against COVID nineteen is not 0:15:20.320 --> 0:15:23.280 going to get any cheaper. Trump and the Republicans in 0:15:23.320 --> 0:15:26.200 Congress have supported heavy spending to fight the virus and 0:15:26.240 --> 0:15:29.280 the economic downturn, but they seem to be retreating before 0:15:29.280 --> 0:15:33.120 the battle is over. Senate Majority Leader Mitch McConnell opposes 0:15:33.160 --> 0:15:36.280 a three trillion dollars stimulus bill the House of Representatives 0:15:36.280 --> 0:15:39.720 passed on May fifteenth. It includes more than one trillion 0:15:39.720 --> 0:15:42.440 dollars for state and local governments, which are bearing much 0:15:42.480 --> 0:15:45.080 of the expense of fighting the pandemic, along with a 0:15:45.120 --> 0:15:48.520 new round of twelve hundred dollar checks for families. One 0:15:48.520 --> 0:15:51.480 reason the GOP opposes the bill is that it's stuffed 0:15:51.520 --> 0:15:55.960 with partisan measures such as reductions and immigration enforcement. Another 0:15:56.120 --> 0:15:58.840 is that Senators want to pause to gauge the effect 0:15:58.840 --> 0:16:02.320 of previous stimulus. It's always interesting to see how much 0:16:02.400 --> 0:16:04.920 patience some people have with the pain and suffering of 0:16:04.960 --> 0:16:07.920 other people, Speaker Nancy Pelosi said on the House floor 0:16:07.960 --> 0:16:12.200 before the vote. Deficit spending can be problematic, but in 0:16:12.240 --> 0:16:16.040 the depths of a recession, it's necessary. Even Federal Reserve 0:16:16.120 --> 0:16:20.080 Chairman Jerome Powell, who's paid to worry about inflation, said 0:16:20.120 --> 0:16:23.200 in a May thirteenth speech that additional fiscal support could 0:16:23.200 --> 0:16:26.000 be costly, but worth it if it helps avoid long 0:16:26.120 --> 0:16:29.360 term economic damage and leaves us with a stronger recovery. 0:16:30.360 --> 0:16:33.040 Gambling on a resurrection is one of the pathologies that 0:16:33.120 --> 0:16:36.840 can emerge from what finance types call the principal agent problem, 0:16:37.560 --> 0:16:41.040 the potential for misalignment of interests between the principle in 0:16:41.080 --> 0:16:43.920 this case, the American people, and the agent who works 0:16:43.920 --> 0:16:47.520 for them, in this case Trump. In business, the fix 0:16:47.600 --> 0:16:50.440 for a principal agent problem is for shareholders to have 0:16:50.520 --> 0:16:55.120 the information in power to control the CEO with COVID nineteen. 0:16:55.520 --> 0:16:58.560 A further complication is that the American people aren't speaking 0:16:58.680 --> 0:17:02.400 with one voice. The pandemic and the struggle over reopening 0:17:02.680 --> 0:17:06.919 are dividing Americans along familiar lines, Red States versus Blue 0:17:07.280 --> 0:17:12.480 Country versus City, Shaun Hannity versus Anderson Cooper. That's unfortunate 0:17:12.800 --> 0:17:16.840 because fighting the coronavirus requires a united effort. It thrives 0:17:16.840 --> 0:17:19.800 in an unprotected nursing home on a beach crowded with 0:17:19.880 --> 0:17:22.760 blithe young people, in a boarding house jammed with low 0:17:22.760 --> 0:17:27.520 paid migrant workers. From there, it spreads as with Injustice, 0:17:27.840 --> 0:17:32.720 an outbreak anywhere is an outbreak everywhere. Thanks for listening 0:17:32.800 --> 0:17:34.960 to our cover story. I'm Carol Masser. Be sure to 0:17:35.040 --> 0:17:37.480 check out the cover story along with the entire double 0:17:37.480 --> 0:17:40.239 issue of Bloomberg Business Week magazine. It's on newstands, it's 0:17:40.280 --> 0:17:42.840 on the Bloomberg and of course oways at Bloomberg dot com. 0:17:43.200 --> 0:17:45.560 And I'm Jason Kelly. Check us out every day on 0:17:45.640 --> 0:17:49.440 the radio, our daily Bloomberg business Week Radio show. It's 0:17:49.440 --> 0:17:52.639 a two p m. Wall Street Time. Also via podcast 0:17:52.680 --> 0:17:54.119 wherever you get your podcasts.