Gov. Gavin Newsom continues to refuse to set a date for relaxing the coronavirus stay-at-home orders and the government-mandated economic shutdowns that are smothering California workers, businesses, and governments.
“I wish I could prescribe a specific date to say when we can turn on the light switch to return to normalcy,” Gov. Newsom said. “We’ve tried to make it crystal clear there is no light switch. There is no date.”
While the governor’s well-intentioned focus on flattening the curve for public health is part of the solution, the longer Newsom keeps our state shut down, the worse the long-term economic problems—which also severely impact public health and poverty—will be for Californians.
Newsom said he’s focused on a data-driven, scientific approach that involves significantly ramping up the state’s testing capabilities far beyond what is being done now. Meanwhile, the state is failing to provide even key COVID-19 metrics that would allow Californians to make informed decisions about state policy and their own welfare.
For example, the state government is failing to report the age distribution of COVID-19 deaths—a data set also omitted in the dashboard offered by Los Angeles County. Newsom could start his data-driven focus by reporting data that Orange and San Diego counties are providing in their more informative coronavirus data dashboards. Doing so might confirm the finding from elsewhere that healthy individuals under the age of 50 have a minimal mortality risk from this disease and could potentially return to work.
It’s also worrying that rather than setting simple steps and metrics to open parts of the economy, Newsom has announced the formation of an unwieldy, 80-member task force to plan the eventual reopening of the economy. The task force will be co-chaired by philanthropist, environmentalist and businessman Tom Steyer, who suspended his campaign for the Democratic Party’s presidential nomination at the end of February.
“Our goal is to present Governor Newsom with tangible actions that leverage the task force’s expertise to rebuild California, emphasize smart, green technologies and provide a model for just economic development for our country,” Steyer said in an April 17 press release.
The state’s news release indicates that one of the task force’s goals will be “to shape a fair, green, and prosperous future.” While equity and environmental protection are reasonable goals, they are irrelevant to the urgent task of preventing California from falling into a depression and allowing economic activity to resume.
In recent weeks, one-in-six working Californians have filed new unemployment claims, suggesting that the state may be on its way to unemployment rates not seen since the Great Depression of the 1930s.
The longer the government-imposed lockdown persists, the more businesses, especially small and independent businesses, will be lost permanently due to their inability to pay fixed costs, like rent and insurance, without any revenue coming in.
Similarly, deprived of sales tax revenue, hotel taxes and amusement fees, among other revenue, state and local governments are going to struggle to maintain public services while also meeting their pension and retiree health care obligations — leading to more debt and burdens for taxpayers.
The city of Los Angeles has already announced extensive furloughs, while, El Cerrito, a small city in northern California, is teetering on the edge of bankruptcy.
This year Steyer spent a lot of time campaigning in South Carolina—a state that is reopening. “Under the governor’s new order, department stores can reopen, along with other retail businesses deemed ‘nonessential’ such as sporting goods stores, book, music, shoe and craft stores, jewelry stores, floral shops and other luggage and leather goods stores,” The State newspaper in South Carolina reported.
Georgia and Tennessee are making similar moves. As this trend shifts to western states, such as Texas and Idaho, California could eventually face a long-term economic risk: increased outmigration. If Californians endure extended closures, more may follow their friends and relatives who have already moved out of state. The state’s working-class could head to these “receiving” states, where they can work and operate businesses.
Rather than massive task forces and Green New Deal experiments, Newsom should give the public more COVID-19 data, identify industries and businesses that can operate while observing best social-distancing practices, and resume some economic activity before the state risks heading into another Great Depression.
A version of the column previously appeared in the Los Angles Daily News.