COVID-19 is creating significant issues in supply chain activity throughout the world. Most large industrial economies have created supply chains based upon China’s cheap manufacturing and although there has been some movement in recent years to step away from that supply chain, it has not occurred in any material way. We in the United States, face it in almost every aspect of our economy even if the basic manufacturing plant has relocated to another country or even back to the United States. The need for parts which are sourced in China is overwhelming. Will this event cause a refocus on the issue or just a short-term reflection and increased prices? My guess, the latter.
Pundits are saying the interim Chinese trade deal may deliver some additional purchases of AG products and, then again maybe not because of how bad the Chinese economy has been hit. The question of whether or not the world reorders (excuse the pun) by shifting market forces is another factor to consider, will our economies be materially altered?
Are US hospitals able to handle the number of cases of COVID-19 contamination that Italy has experienced; the answer is very unlikely. We have too few beds, inadequate stores of supplies, and insufficient staff. Ask any nurse you know. The blame is complex and cannot be laid at Trump’s door no matter how viscerally it might appeal to us.
Mr. Trump said recently in a FOX town hall that he “planned to propose cuts to government benefit programs like Medicare and Social Security in his 2nd term”. His spokespeople in the White House immediately followed with statements that he really did not mean that. How else do you pay for increased military spending and an out-of-control budget deficit due to tax cuts unless you hit programs like those that make up a large portion of our nation’s budget? It looks like what worked in 2018 in the mid-term is likely to help again as Democrats will be able to focus on “your loss of healthcare” and now they can add to that “your loss of Medicare”. This could be amplified if the Supreme Court strikes down Obamacare in its entirety. POTUS nor Republicans have a replacement plan, and that phrase will be staring at POTUS and Republican’s throughout the campaign. 10 years to develop a plan, but there is no plan.
POTUS’s address last Wednesday to the nation on COVID-19 clearly showed, as have numerous press conferences, that POTUS and this White House have no clue nor do they care. Talk shows, including Fox, have taken up the conspiracy mantra claiming it is a news and Democratic hoax to get rid of POTUS. If we still had the Directorate for Global Health Security and if its advice were followed, we would not have nearly the level of panic those on the right complain about. Thank God for Dr. Fauci and his colleagues.
The stock market has taken a terrible beating as the result of COVID-19, being down almost 20%. The stock market during Mr. Trump’s first three (3) years in office went up considerably, in large measure impacted by the tax legislation that was introduced in 2017 and the glowing economy left by President Obama. Mr. Trump took great pride and asserted that he was solely responsible for it. Mr. Trump is now saying that the world was blindsided by COVID-19 and that the actions of the stock market are the result, of course, of the fake media and Democrats. He appears to assert along with Fox News that Democrats created COVID-19 just to attack him. It is hard to ignore reality and the facts. By the way, it came from China. We all know that Presidents are not solely responsible for a good economy nor a bad economy, but many factors weigh-in.
Canada passed the USMCA this week. A spot of goods, eh!
If you are in need for social connectivity, find a good radio music program, circulate its call sign and jump on Skype and sing along with friends.
Fortunately, our home confinement comes as spring is arising and the opportunity for a hike, a bike ride or a stroll is with us. It will reduce anxiety, blood pressure and maybe shed a few pounds. All good.
Bill Owens is a former member of Congress representing the New York 21st, a partner in Stafford Owens in Plattsburgh, NY and a Senior Advisor to Dentons to Washington, DC.
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