The choice we face as a nation in this crisis is not between protecting our citizens or protecting the economy. Our ability to take care of each other with food, clothing, housing, security, health care, and basic government services is dependent on the capacity of the private sector to produce the goods and services that support every aspect of our lives. If our economy collapses, our heroic health care workers and their patients will be stuck behind in the Middle Ages, without the essentials of modern medicine.
The debate about the response to the coronavirus has polarized us in an illogical and harmful way. Somehow, perhaps due to our unhealthy habit of partisan politics, we are increasingly dividing into the binary camps of “public health” versus “economic prosperity.” This scathing debate does not assist anyone except those in the media peddling conflicts and more than a few political aspirants. To save the country, we have to prioritize both health and prosperity immediately. It is now a matter of survival.
We should reflect on how we came to this point. A disease originating in China started to spread to the rest of the world. China downplayed the threat and hid evidence of the growing pandemic. Once evidence of a threat to our country was clear, President Trump responded quickly and decisively with early travel bans from highly infected countries. He has surrounded himself with medical experts to help millions of Americans avoid the coronavirus and prepare for possible worst case scenarios.
President Trump, however, has not paused the economy. It has been our mayors, governors, and executives who are mandating business closures, lockdowns, and quarantines. They are all trying to one up each other in a competition to be the most careful, and want to avoid costly political and legal liability. It is hard to blame them. The media has whipped the public into a frenzy by publishing the projections of millions of deaths in coming months. It does not matter what measures our leaders take if someone in the media always declares that more could be done and politicians who do less than the most extreme measures have “blood on their hands.”
We have lost sight of a hard fact that even the most extreme measures taken cannot completely eradicate the coronavirus or create a situation with zero risks. We have to balance the risks to our health with the risks of an economic meltdown. The reason for our current shutdown has been to minimize the spread of the disease while we quickly build up the medical capacity needed to better manage the disease as we get back to work and our lives. We are very close to having this expanded medical capacity, and it is time for us to have all hands on deck to get Americans back to work.
We direly need millions of tests, masks, ventilators, medical supplies, and additional treatment options, so those who get sick have a good chance of recovery. These priorities are not only essential but are very expensive. We must get our economy going again quickly so that we can pay for it all. The only way this shutdown works is if it is brief. The federal government cannot print enough money to support an idle country. Make no mistake, however, printing money is precisely what we are doing at this moment.
Congress had already planned a $1 trillion budget deficit this year before the pandemic. Now lawmakers added billions in new spending for the first stimulus package. Congress last week passed an additional $2 trillion in loans, bailouts, and family relief. These are all forms of debt. Meanwhile, the Federal Reserve has expanded its balance sheet to a record high of nearly $5 trillion to add financial liquidity to the sagging bond market.
Factor in a dramatic drop in tax revenues this year, and the United States could add upward of $10 trillion to our money supply, diluting the value of our dollar. This could equal half of our gross domestic product and more than twice the size of our annual federal budget. That means many more dollars will be chasing fewer goods in a slow economy, raising the specter of historic levels of inflation. If the Federal Reserve is right that as many as 47 million Americans could lose their jobs in coming weeks, then extreme policy measures are in order. We cannot solve this by borrowing if nearly one out of every three Americans is unemployed. If we do not act quickly to reopen our economy, this could be worse than the Great Depression.
Our doctors, nurses, and scientists have demonstrated great courage and strength. We must be thankful for the dedication and commitment of the workers in our health care system. We need a fully functioning economy to survive the coronavirus. We also need a fully functioning economy to ensure the future of our nation. It is time to get Americans back to work.
Jim DeMint, a former Republican representative and senator from South Carolina, is now the chairman of the Conservative Partnership Institute.
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