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Unsanitized: The COVID-19 Report for Oct. 21, 2020

Where Future Crisis Mitigation Must Be Targeted

Plus, nothing doing in Congress just yet

 

A shuttered storefront in New York City. (STRF/STAR MAX/IPx)

Universal Family Care

Here are today's stories from our special issue on universal family
care , as we pivot to solutions:

* I interviewed Ai-jen Poo about the concept of a universal social
insurance program
with a
single point of access to handle childcare, paid leave, and long-term
care for the elderly or people with disabilities.

* Bill Spriggs on how we must build a care economy
, and
value families and particularly the women of color who bear most of the
burdens.

* Cassandra Lyn Robertson and Darrick Hamilton explain how economic
rights like the right to family care comprise a new industrial policy

to better support economic growth.

* Bob Kuttner costs out a universal family care system
,
and the choices that will need to be made.

You can browse these and other stories at prospect.org/familycare

Click to Support The American Prospect

The Road We're Headed Down

I get accused of being a downer sometimes, and my usual response is
"when the news gets cheerier, so will I." And the news is just not
that cheery these days. This filter of reality allows some focus on what
really matters. And until the means to fiscal policy are wrested away
from those who'd rather watch the world burn, what really matters, sad
to say, is targeting what exactly the rotted state of the economy will
look like come January 2021.

Most important, we will be in the throes of another wave of the virus.
Fortunately, the medical profession is doing its work, and there's
been a sharp drop in mortality

for sick patients. Unlike the Spanish flu of 1918, the fall/winter wave
will probably not accompany an exponentially greater number of deaths.
Nevertheless, the virus remains deadly and creates some still
indeterminate long-term consequences, enough for people to likely stay
out of public even without a lockdown order. That's going to
inevitably lead to depressed spending and economic activity. Don't
expect many large gatherings this winter. Cancel Times Square on New
Year's.

The CARES Act delayed a reckoning that those economically affected by
the pandemic should never have had to face. But that reckoning is
finally here. Some charts from JPMorgan Chase

show that spending for the unemployed cratered after the expiration of
the $600/week federal benefit, and the median checking account balance
has fallen sharply as well. The reporting only goes through the end of
August, and by now it's likely that those checking account balances
are below where they were at the end of February. In other words,
whatever savings came from the boosted benefits is gone.

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The same dynamic is in place with credit scores
,
which soared to a record high in July as people were flush, but will now
serve as a lagging indicator of financial stress. Forbearance in student
loans, auto payments, and mortgages also assisted credit scores and
financial health. That too is coming to an end.

This dovetails with even more expirations

due at the end of the year. Long-term unemployment (over six months) was
up to 2.4 million in September, and the 13-week extension under the
CARES Act known as Pandemic Emergency Unemployment Compensation ends
December 31. So does Pandemic Unemployment Assistance for close to 10
million gig workers, freelancers, and independent contractors. Those
people will shift to no benefits

whatsoever. Evictions have been on hold thanks to a federal moratorium
of dubious quality
.
But $32 billion in rent

is going to come due in January, and up to 8 million eviction cases.

State and local governments, the source of economy-breaking austerity
during the Great Recession, have already given up as many jobs as the
public sector. But an interesting report from Josh Lehner of the Oregon
Office of Economic Analysis

(h/t Bill McBride) finds that the bulk of the losses so far are
attributable to the pandemic-substitute teachers, employees at public
zoos, convention centers, public pools, and libraries that have been
shuttered. The usual recessionary job losses are all in the future, with
cuts to administrators, furloughs, and the like. So that's hitting
just as no money has been made available.

Meanwhile, we can expect more job loss simply because of the path of the
economy. Goldman Sachs is the recognized leader among mergers and
acquisitions bankers, and its president stated bluntly that a wave of
M&A will lead to job cuts

(known as "efficiencies" to the merging companies). "Politicians
are going to be faced with the uncomfortable reality that you're going
to have more big business doing better and that there's going to be
more losses of jobs along the way," John Waldron said. Consolidation
will compound the employment problem.

Meanwhile there's no money available

to actually distribute a coronavirus vaccine nationwide, meaning that
we're short in the specific budget area required to fight the virus,
when the time comes.

There's an assumption that a Democratic trifecta will lead to a larger
stimulus
.
This indicates where that money needs to go. We need to extend the time
frame and funding for unemployment; put a moratorium on large-scale
deals that are likely to lead to mass layoffs; fully fund bars and
restaurants and music venues and other gathering spots that won't be
reopened for a while; construct and fund housing for everyone who needs
it; fill the shortfall in revenues for state and local governments; add
as much funding as possible to actually attack the virus, including in
particular vaccine production and distribution.
If we do all that, given the likely time frame there will still be a lot
of economic scarring that cannot be fixed. But swift and immediate
targeting can pull many people through.

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Wake Me Up When the Senate Ends

Two weeks ago, news leaked that Mitch McConnell told President Trump he
should not negotiate with Nancy Pelosi on a coronavirus relief bill, and
that his caucus wouldn't be able to pass it. That's what led Trump
to temporarily suspend negotiations. That suspension lifted, for two
weeks House Democrats and the White House have been dutifully
negotiating, and then... yesterday news leaked

that Mitch McConnell told President Trump he should not negotiate with
Nancy Pelosi on a coronavirus relief bill.

I feel bad for the reporters being yanked around on this. They could be
talking to renters facing eviction, or unemployed people unable to feed
their families. They could be laying out the consequences of inaction
rather than running back and forth in the futile hope that there won't
be inaction. This treadmill has been running for six months, and nobody
has gotten anywhere.

Days Without a Bailout Oversight Chair

209
.

We Can't Do This Without You

Today I Learned

* I was on Rising with Krystal Ball this morning talking about our
family care issue. Watch here . (YouTube)

* "Talks" will "continue
"
today. (Wall Street Journal)

* There have been 300,000 more deaths in 2020 in the U.S. than expected
in a typical year. Eventually this will become the COVID death toll.
(Washington Post)

* Every resident in a Kansas nursing home has COVID-19
.
(The Hill)

* Infections have risen to record highs in rural areas every week for a
month
.
(Daily Yonder)

* A USPS Inspector General report confirms that mail delivery slowed

after operational changes this summer. (USPS OIG)

* "Flight simulator" a reminder of simpler times; you just sit in
an airplane seat
.
(Wall Street Journal)

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