In the parlance of economists, we aren’t just facing a demand shock from people who have suddenly become afraid to fly or attend a concert. We’re facing a supply shock from things that haven’t been made in shuttered factories, that aren’t on ships to the factories and stores here that need them. If the epidemic grows here, as many expect it to, we will soon be facing another supply shock as quarantines and social-distancing measures prevent us from making some of the goods and services we’d normally produce.
That doesn’t necessarily mean we’re facing a worse-than-normal recession, just a different kind. And it’s possible that when this is over, the economy may actually rebound more quickly than it would from a traditional recession. But in the interim, our problem won’t be reassuring people that they can afford to spend, but, rather, supporting existing firms and workers while local shutdowns test global supply chains, local quarantines restrict movement and local illness shrinks the workforce.
And to reason by metaphor, rather than analogy, suggesting traditional fiscal measures in the face of these novel shocks is like building a wooden man o’ war to fight World War II.