The interplay between the outbreak and the steps meant to vanquish it reveals a cruel paradox: The faster and more painfully that ordinary economic life shuts down, the faster the health crisis can be solved and the faster people and businesses may gain the confidence to return to normal life. Conversely, a prolonged period of fighting the virus would delay an economic rebound and imperil many small businesses.
Much, too, will depend on how swiftly and aggressively the Federal Reserve, Congress and the Trump administration deliver financial aid to tens of millions of economic victims — from hourly workers with no more income to suddenly furloughed employees to businesses with loans to pay but no customers. Solving the health crisis by shutting down the economy, though, will have to come first.
“The more rapidly you want to contain the virus, then the more severe the lockdown has to be and the more severe the disruption to economic activity is,’’ said Gregory Daco, chief U.S. economist at Oxford Economics. “The hope is, the more severe the lockdown, the sharper the rebound will be.’’