America is going back to work. It must be done safely. And it can be done safely, even with the limited testing capacity available today.
The President’s guidelines appropriately do not open the economy all at once. However, they do not adequately account for the fact that the U.S. does not currently possess the robust capacity and capability to safely and rapidly test, diagnose, treat, and isolate COVID-19 cases and trace their contacts at scale.
Under the following modified approach, the economy can start reopening, but at the slower pace allowed by its current testing capacity—while ramping up its testing and tracing capabilities for more extensive reopening as soon as is safely possible. Federal, state, and local government leaders must work urgently with business leaders on the following key elements to ensure that reopening does not cause a resurgence of the pandemic, which would have debilitating effects on American lives and set the economic recovery back even further.
First, the economy will not reopen without putting more lives at risk unless the federal government plays a greater leadership role. Under the President’s guidelines, the states compete not only with each other, but also with private businesses to acquire personal protective equipment, tests and testing equipment, cleansing materials, and other needs.
Such an approach will result in price inflation, acquisition chaos, and supply shortfalls, as well as opportunities for fraud and abuse, particularly in testing devices. Greater use of the Defense Production Act, which enables the President to compel businesses to produce essential goods, may be the only recourse.
Increased personnel to carry out testing and contact tracing, as well as increased funding for the states—particularly for increased hospital capacity and implementation of the testing guidelines—are also critical.
Sufficient funding—at a Manhattan Project scale—and smart regulatory relief are essential to quickly and safely finding treatments and a vaccine, as well as achieving reliable testing capacity for both the disease and its antibodies. Treatments may be as important as a vaccine in dampening the coronavirus threat, as we have seen in the battle against HIV/AIDS.
Second, the President’s guidelines should state how low the infection rate must be before a state or local economy is reopened. The confusion that results can be seen already, as some states and localities are opening quickly and haphazardly.
Third, the administration needs to guide governors’ plans. Even with increased federal leadership, the states are at the epicenter of managing the fight against this pandemic. Given the shortfall of testing and public health capacity (and the lack of treatments and a vaccine), the most realistic approach for governors would be to carefully scale the opening of the economy by sector in keeping with the public health infrastructure’s capacity to test, track, and isolate.
This process demands close cooperation and collaboration with business leaders. The businesses that governors should reopen first fall into three categories: sectors that meet a gradual, broadening definition of “essential,” expanded beyond security and safety and based on the sector’s importance to the economy; businesses most able to effectively implement social distancing in the workplace—given warmer weather, this could include construction, other outdoor industries, and a federal and state infrastructure program that could help put Americans back to work; and those that can most effectively operate remotely with a limited physical presence in the workplace.
Under this approach, the sectors that closed first—because they were hotbeds for the spread of the virus—should be among the last to reopen. Food services and drinking establishments, sports stadiums, museums, movie theaters, spas, gyms, and vacation and hotel locations should be the last to reopen, assuming they are confined to their pre-COVID-19 business models.
But as other sectors open, demand for services such as food and drink will also increase. That demand should initially be met under alternative business models where takeout and catering services would expand before physical spaces open to the public. Similarly, in entertainment and sports, the NBA’s idea of restarting games for virtual audiences, or drive-in theaters reopening, are examples of altered, realistic business models that can follow CDC guidelines for employees and customers more manageably.
As testing capabilities ramp up, small gathering places could start to open first, followed by larger ones if they demonstrate they can follow appropriate protocols to keep employees and customers safe.
Schools should also remain closed physically but open virtually at least until the fall term. At the same time, childcare and youth centers, vital to America’s ability to get working again, could gradually reopen under CDC guidelines to accommodate parents who must go back to work.
For this approach to be successful, it must also include federal government relief targeted to those individuals and companies that remain adversely affected by COVID-19. The federal and state governments should also help expand access to broadband, as the economy and education are relying on it heavily right now.
Fourth, the federal government must provide clearer guidelines for employers so they can develop their business plans to reopen with the best advice from public health officials. Employers are the sentinels for tracking the spread of the disease and can help us prevent a widespread recurrence.
Employers need clearer guidance on what workplace policies the government wants them to develop and implement. These include providing health screenings, performing temperature checks, enforcing social distancing in the office, workforce contact tracing, provision of personal protective equipment, cleaning protocols, and procedures for handling employees who become sick with COVID-19.
By the government issuing clear standards, businesses can reopen with greater confidence that they will not be held liable for any unfortunate outcomes that may occur. Ideally, the government could soon develop comprehensive safe harbors, adaptable to firms in different industries, that establish standards for conscientious businesses to safeguard their employees and customers.
Finally, federal and state government leaders need to help strengthen our most vulnerable communities that are taking the brunt of this economic and health crisis. They can accomplish this by ensuring that small- and minority-owned businesses receive the economic relief promised to them and that health institutions serving diverse populations most urgently receive financial support.
Americans have proved over recent weeks that democracies can effectively and responsibly respond to a pandemic threat. We can likewise effectively and responsibly reopen our economy as we race to develop effective treatments or a vaccine.
To achieve this objective, the U.S. must apply a wartime approach, relying on stronger federal, state, and private sector leadership to gradually achieve a peacetime, post-COVID-19 economy.
W. Bowman Cutter is senior fellow and director of the Next American Economy project at the Roosevelt Institute. He was director of the National Economic Council and deputy assistant to the President in the Clinton administration. He is cochair of the ad hoc subcommittee on COVID-19 for the Committee for Economic Development of the Conference Board (CED).
Joseph E. Kasputys is chairman and CEO of Economic Ventures. He was assistant secretary of the Commerce Department in the Ford administration. He is cochair of CED’s ad hoc subcommittee on COVID-19.
Joseph J. Minarik is a senior vice president with CED. He was chief economist at the Office of Management and Budget in the Clinton administration.
Lori Esposito Murray is president of CED. She is a former adjunct senior fellow at the Council on Foreign Relations and previously held the national security chair at the U.S. Naval Academy.
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