COVID-19 AND THE ECONOMY: LESSONS FROM AROUND THE WORLD

            USA finds itself today in the unenvious position of having the highest number of COVID-19 deaths and experiencing the steepest decline in the economy compared to all other economic powers in the world. Historically, we have led the world in handling crisis and everyone tried to emulate the best practices developed in this country. Unfortunately the best examples of managing COVID-19 and the economy concurrently lie elsewhere.

            Almost every successful example starts with complete lockdown and strict enforcement. China, where the virus originated and later spread via Europe to the rest of the world, literally shutdown the affected Wuhan region with zero tolerance for movement of population into or from that region. During this period every individual and business was supported financially by the Chinese government. Other than the Wuhan region, the rest of China was allowed to operate with strict infection control guidelines. The strict policies and even stricter enforcement worked and now Wuhan is back to pre-COVID-19 normal. The lesson here is that COVID-19 can be contained and managed. It is of course easier in a highly regulated communist country.

            Japan is an excellent example of how they managed their economy and the pandemic concurrently. After shutting down the economy internally and externally for six weeks, they opened up with the businesses, government, and unions working in close coordination and total cooperation. Stockholders, who typically benefit during economic prosperity, decided to forfeit dividends. Employers instead of laying off employees decided to keep them on the payroll at reduced salaries with the full cooperation of unions. The government kept the economy afloat with zero-interest loans. Japan with a 2.6% unemployment rate stands in stark contrast to all the industrial powers in the world.

            South Korea, Taiwan, and Singapore were notable for their aggressive testing, tracking, and social distancing. They enforced all the anti-infection policies with steep fines and quarantined anyone with symptoms. It should be noted, however, that people cooperated with the government and were willing to give up their privacy for safety. Also, most Asian countries had learned from the experience of dealing with SARS, MERS, and H1N1 mini pandemics and were quick to put strict policies into operation. There was little resistance from the general population.

            In Europe, Germany stands out among others as a success in fighting the COVID-19 virus. They paid attention to what was happening in Italy and put into place a robust policy of testing, followed by tracking and social distancing emulating South Korea and Taiwan. Chancellor Angela Merkel played a central role in coordinating the COVID-19 response with complete cooperation from opposition parties.

            Among the Middle Eastern countries, the United Arab Emirates decided to assume all costs relating to fighting and treatment of COVID-19, so there were no issues relating to who will be responsible for the costs. This was important. There were significant delays in countries where it was not clear who will ultimately bear the cost of treatment.

            Among our neighbors, Canada stands out for its success in stark contrast to us. Unlike us, they have a single-payer system and a robust public health policy. There was no division among the political parties with respect to the path charted by Prime Minister Trudeau to fight the endemic. Canada followed a very strict policy first of absolute lockdown, followed by directing resources where they were most needed and the political leadership setting the example of wearing masks and social distancing. To date, less than 10,000 people have died in Canada compared to almost 200,000 in the United States. Canada also showed how effectively the federal government and its provinces (comparable to our states) can coordinate the response to COVID-19.

            Finally, the common thread of success can be summarized in a few bullet points –