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Confidence Called Key Ingredient for Robust Post-Covid Economy

Confidence Called Key Ingredient for Robust Post-Covid Economy

(Bloomberg) -- “Confidence” is the secret sauce needed for Americans to get back to public life once the deadly coronavirus pandemic ebbs and as restrictions on movement are gradually lifted.

A range of policy-makers and elected officials spoke Sunday of what it will take to get the economy moving again as weeks of mandatory shelter-in-place orders give way to a tentative reopening, even as thousands of new cases are diagnosed each day.

“The economy’s not going to open no matter what we do, whatever we order, unless people have confidence. And we’re trying to give them confidence,” Ohio Governor Mike DeWine said on “Fox News Sunday.”

Ohio moved against the virus early, instigating a stay-at-home order in mid-March. A phased reopening is under way that will have much of the state’s businesses open by the end of this week.

“At the same time we’re telling them, look, the virus is still out there, it’s still very, very dangerous. We have to keep the distancing,” said DeWine, a Republican. “We can’t let up.”

Neel Kashkari, president of the Minneapolis Fed, said instilling confidence for Americans will be tied closely to medical advances.

The People Decide

“I would love to see robust economy, but that would require a breakthrough in vaccines, a breakthrough in widespread testing, a breakthrough in therapies to give all of us confidence that it’s safe to go back,” Kashkari said on ABC’s “This Week.”

“I don’t know when we’re going to have that confidence, and ultimately the American people are going to decide how long the shutdown is,” said Kashkari, a voting member of the Federal Reserve’s policy-setting body this year.

Reopening many places of businesses will require a radical rethink, said former Google Chief Executive Officer Eric Schmidt. That will take creativity on the part of employers.

“As an employer, you have a bunch of employees, some of whom are dying to get back to the office and some people who are afraid that if they go to the office, they will die,” Schmidt said on CBS’s “Face the Nation.” “We’re going to have to figure out how to get people into buildings that they’re fearful of.”

Schmidt was recruited this month by Governor Andrew Cuomo to lead a 15-person commission to help New York, the U.S. epicenter of the Covid-19 pandemic, re-imagine sectors of its regional economy. He said large businesses would likely reinvent themselves around these new concerns.

Office Space

“My guess is that we’ll have more demand for office space, not less, because people will want social distancing,” Schmidt said. Companies may create hub-and-spoke workplaces, so that employees would travel less and work with smaller concentrations of their colleagues, he said. Cities would rethink public transit around those changes, all of which will take some time.

Senator Lamar Alexander, a Tennessee Republican, said getting a Covid-19 vaccine -- and until then, greatly expanded testing -- is the only solution.

“If you take a test and you know that you don’t have Covid-19 and you know that everybody around you took a test that same day, you’re going to have enough confidence to go back to work and back to school,” he said on NBC’s “Meet the Press.”

Infectious diseases specialist Dr. Tom Inglesby said the potential arrival of a coronavirus vaccine by the end of the year, plus the arrival of viral treatments and expanded testing, were key elements.

“All these things are going to help give American business and American workers the confidence to reopen,” Inglesby, director of the Center for Health Security at Johns Hopkins University, said on “Fox News Sunday.”

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