Economic Commentary: A Year of COVID-19, Child Benefits, Democracies
IN THIS ISSUE:
- The Year Of Living Cautiously
- S. Revamps Child Tax Credits
- Democracies Perform Better
Carl reflects on the anniversary of the pandemic.
There are 73 sets of hash marks on the paper my wife uses to record the duration of her home confinement, five days at a time. The tally was kind of a joke at first, but it is now a sobering reminder that it’s been a year since lives and economies were turned upside down.
In early March of 2020, I visited several clients in Europe. It was a typically busy itinerary: seven cities in two weeks across five countries. The coronavirus had been in the news for several weeks already, but didn’t seem overly threatening. I found room for hand sanitizer in my luggage but didn’t expect to use it much.
When I arrived in Dublin to begin the journey, I learned the first Irish cases had been diagnosed and schools were to be closed. An outbreak in northern Italy had been spread to other European cities by skiers who had gone to Lombardy for a spring holiday. Clients began cancelling our meetings, and we ultimately decided to cut the trip short. I flew home a week early and spent a couple of days in the office upon my return. I haven’t been to the airport or the office since then.
At the outset, many of us presumed we were facing a relatively temporary interruption. (For a time, I continued paying for a monthly train pass and a gym membership close to the office.) Early analysis of the situation determined it would manifest largely as a supply shock affecting production chains that snaked through China. Our forecasts, and those produced by others, were slow to recognize the extent of the damage that would ultimately be done to commerce.