Americans have lived through recessions before, but this one is different. It came suddenly, without warning. It wasn’t caused by any of the usual suspects, such as tight money or oil shocks. And it calls for a recession-fighting tool kit that is starkly different from past models. Standard antirecession measures such as tax cuts and low interest rates will have weak effects when people are afraid to shop. We must think outside the box.
That means setting aside trade-offs for the moment. We economists dote on trade-offs: If you want more of this, you will have less of that. But while the crisis lasts, policy makers must send the public-health system every resource it needs—physical, financial and human. Other priorities can wait. The population needs therapeutics and then a vaccine as soon as possible.
It is also essential to cushion the blow to the most vulnerable by providing a much thicker social safety net than Americans are used to. Thankfully, Congress started down this road with the Cares Act, passed at the end of March. It will have to go further—by expanding food stamps and Medicaid, for example.