How to Avoid a W-Shaped Recession

[swag]

https://www.project-syndicate.org/commentary/covid-19-response-premature-withdrawal-w-shaped-recession-by-jeffrey-frankel-2020-05?utm_source=Project+Syndicate+Newsletter&utm_campaign=1cfd702284-covid_newsletter_07_05_2020&utm_medium=email&utm_term=0_73bad5b7d8-1cfd702284-107122785&mc_cid=1cfd702284&mc_eid=fda0f43812&fbclid=IwAR07k47q-wXzxcvRLrdRXpUb08L46PY6hQr6Fj-y-scn-ckeSeQNl1IQsL8

May 1, 2020
JEFFREY FRANKEL

Excerpt:

The first mistake – toward which many leaders, beginning with US President Donald Trump, have already shown a dangerous predilection – would be to declare “victory” over the virus prematurely, abandon public-health interventions, and allow a second wave of infections to take hold. That is what happened during the so-called Spanish flu pandemic a century ago. The first wave hit the US in early 1918. The second wave, in September 1918, was far deadlier. The third wave persisted into 1920.

In 1918, like today, cities instituted social-distancing measures, including school closures, prohibitions on public gatherings, and face-mask requirements. But delayed action was common, and few maintained the interventions for long. A 2007 study from the National Academy of Sciences found that US cities’ success in reducing the number of deaths “was often very limited because of interventions being introduced too late and lifted too early.”

In fact, nobody upheld the public-health interventions as long as they should have. San Francisco reduced mortality by at least 25% – the highest rate among US cities. But, rather than reinforcing its commitment to its interventions, this success led the city to cancel its restrictions in November; a second, much deadlier wave of infections followed in December and January. Had San Francisco sustained its social-distancing rules for longer, the National Academy of Sciences estimates, it could have cut the death toll by 95%.

Political leaders might also abandon economic stimulus too soon – the second mistake that could lead to a W-shaped recession. The events of 1936-37 in the US show just how devastating this decision can be.

. . . more

[alwaysinasnit]

1. Yup. History seems about to repeat itself.

[RainCaster]

2. The fatality dips will look like his signature

Think about it - it's not a pretty picture.