Mitch turns off the spigot, or at least tries to!

  

Well, it’s time for another round of support for the economy!  The House Democrats yesterday released a $3 trillion bill, which is surely a 2-3X multiple of what they’ll ultimately settle for. Meanwhile, Mitch McConnell made it clear that he’s not looking for any more money for the economy now – not for states, not for individuals, not for businesses.

Mitch – and the economics team in the White House – wants to wait and see whether the current wave of reopening is going to give a boost to the economic recovery, which is closely akin to saying he wants to see if Santa Claus will make a rare May appearance and make everything better for the country. He knows quite well that the unemployment rate is going to set an all-time record (even compared to the Great Depression) next month.

But I’m not being completely fair to Mitch. There is one thing he wants to do to fight the crisis: give immunity to businesses from lawsuits filed due to Covid-19 infections of workers or customers. I guess he figures that, since it will be a year or two (at least) for a vaccine to be available to give us all immunity to the novel coronavirus itself, the least he can do is make sure no workers can sue their employers if they get sick from Covid-19.

In other words, if an employee comes back to work, yet their employer hasn’t bothered to make the changes that are needed to keep the workplace reasonably safe (and why should they? OSHA has already made it clear they don’t think they have any responsibility for workplace safety in the pandemic. Think about it – the head of the agency tasked with ensuring workplace safety has decided that the biggest workplace safety threat ever is outside of his purview. Where does Trump get these guys, anyway?), they won’t be able to sue the employer – or perhaps their estate won’t be able to, since many will have since gone to a place where lawsuits don’t mean anything.

So let’s be clear: for most workers laid off by now, unemployment benefits will run out at the end of July, if not earlier. If their employer says they’re open for business again, they will have to go back or risk having nothing to live on, regardless of any health considerations they may have (Silly workers. They should know that health considerations are a luxury only available to those – like me – who have the ability to earn money while at home. For anyone else, if they don’t want to go back to work because they don’t feel safe, there are always food pantries – with mile-long lines. Is this a great country or what?). And if they have young kids at home, they’ll have to make an even tougher choice – since, unless they have a very enlightened employer, they won’t have any good options for child care (unless they have money of course…Do you notice a pattern here?).

But here’s the really interesting part. How will it help Donald Trump to get re-elected if most of America is still out of work in November (and that’s a very real possibility, especially given the increasing likelihood of a second wave of infections and deaths in the fall, as both Dr. Fauci and the head of the CDC have said is certain, not just likely), and those that are back at work – in an office or factory – are only there because they’ve decided that the risk of death is preferable to the certainty of poverty? Moreover, if they think the workplace is still unsafe, their only option is to quit, since their employer knows they can’t be sued. It doesn’t quite sound like Trump will be able to play “Happy days are here again” at his (virtual) campaign rallies, does it?

So why is Mitch McConnell pursuing this self-defeating strategy now? I would be asking that question myself, had the scales not fallen from my eyes when I read a great column by Paul Waldman in the Washington Post on Monday. He points out what should have been obvious to me by now: McConnell, and probably a number of other smart Republicans, have realized that Donald Trump no longer has any realistic possibility of getting re-elected. So Mitch’s strategy is now looking toward a world where Joe Biden will be president at the end of next January. The current occupant of the White House has a short-term lease, as far as he’s concerned. No point in worrying about him anymore.

Now this all makes sense. But even then, there’s the question: What good will McConnell’s strategy do him, or the GOP, in 2021 and beyond? After all, if we turn off the money spigots at this point, we’re almost guaranteeing that whatever recovery there is will be anemic, as was the case in the recovery from the last recession.

And that’s where the story gets really interesting. I need to admit here that I don’t know the answer to this question, except to say that McConnell is a very clever man, who always puts the interest of the Republican Party – or at least the current Senate majority – above that of the country itself; so he’s definitely trying to save his party from possible total annihilation, if that’s even possible at this point. More on this topic, and more generally on the economic recovery, in my next few posts.

The numbers

These numbers are updated every day, based on reported US Covid-19 deaths the day before (taken from the Worldometers.info site, where I’ve been getting my numbers all along). No other variables go into these numbers – they are all projections based on yesterday’s 7-day rate of increase in total Covid-19 deaths, which was 15%.

Note that the “accuracy” of the projected numbers diminishes greatly after 3-4 weeks. This is because, up until 3-4 weeks, deaths could in theory be predicted very accurately, if one knew the real number of cases. In other words, the people who are going to die in the next 3-4 weeks of Covid-19 are already sick with the disease, even though they may not know it yet. But this means that the trend in deaths should be some indicator of the level of infection 3-4 weeks previous.

However, once we get beyond 3-4 weeks, deaths become more and more dependent on policies and practices that are put in place – or removed, as is more the case nowadays - after today (as well as other factors like the widespread availability of an effective treatment, if not a real “cure”). Yet I still think there’s value in just trending out the current rate of increase in deaths, since it gives some indication of what will happen in the near term if there are no intervening changes.

However, it’s 100% certain that deaths won’t stop at the end of June! They might decline some more this summer, but Drs. Redfied (CDC head) and Fauci both predict there will be a new wave of the virus in the fall, and one noted study said there was a good probability the fall wave would be greater than the one we’re in now, as happened in the 1918 pandemic.

Week ending	Deaths reported during week/month	Avg. deaths per day during week/month	Pct. Change from previous month
March 7	18	3
March 14	38	5
March 21	244	35
March 28	1,928	275
Month of March	4,058	131
April 4	6,225	889
April 11	12,126	1,732
April 18	18,434	2,633
April 25	15,251	2,179
Month of April	59,812	1,994 (= 1 death every 44 seconds)	1,474%
May 2	13,183	1,883
May 9	12,592	1,799
May 16	12,353	1,765
May 23	14,260	2,037
May 30	16,460	2,351
Month of May	60,391	1,948 (= 1 death every 44 seconds)	101%
June 6	19,001	2,714
June 13	21,933	3,133
June 20	25,318	3,617
June 27	29,226	4,175
Month of June	103,574	3,452 (= 1 death every 25 seconds)	172%
Total March - June	227,834

Red = projected numbers

I. Total deaths

Total US deaths as of yesterday: 83,425

Increase in deaths since previous day: 1,629 (vs. 1,009 yesterday)

Percent increase in deaths since previous day: 2% (vs. 1% yesterday)

Yesterday’s 7-day rate of increase in total deaths: 15% (This number is used to project deaths in the table above)

II. Total reported cases

I no longer pay any attention to the reported case number. It is a huge underestimate of actual cases, which is at least 5-10 times what’s reported. This is because of the huge shortage of testing capacity. For reported cases to be anywhere near actual cases, we would need to be doing millions of tests a day. I believe the US has done fewer than 7 million tests since the start of the pandemic.

Total US reported cases: 1,408,636

Increase in reported cases since previous day: 22,743

Percent increase in reported cases since yesterday: 2%

Percent increase in reported cases since 7 days previous: 14%

III. Deaths as a percentage of closed cases so far in the US:

Total Recoveries in US as of yesterday: 296,746

Total Deaths as of yesterday: 83,425

Deaths so far as percentage of closed cases (=deaths + recoveries): 22% (vs. 24% yesterday) Let’s be clear. This means that, of all the coronavirus cases that have been closed so far in the US, 22% of them have resulted in death. Compare this with the comparable number from South Korea, which is below 3%. The reason this number is so high is that total reported recoveries are so low. I’ve been assuming since March 26, when the recoveries number was first published, that it would rise, so that this percentage (which was 41% on March 26), would be far lower than it is now. This number is high, comparable with those of Italy and France (China’s is 6%).

I would love to hear any comments or questions you have on this post. Drop me an email at tom@tomalrich.com