Find more Heritage Foundation research and commentary on the coronavirus—and public policy solutions—by visiting our collection page at heritage.org/coronavirus.
The COVID-19 pandemic is just starting in African countries, but it has already wounded many of their economies. The fragility of the health systems and economies is a reminder that the U.S. should focus its Africa initiatives on promoting economic freedom, the long-term solution to the continent’s weak health security capacities and many of its other problems. To do so, the Trump Administration and Congress should speed the implementation of the Prosper Africa initiative, plan another U.S.–Africa leaders forum focused on promoting American and African private sectors’ contribution to economic recovery, and prioritize advocating for and helping with regulatory reform in any American economic recovery initiatives designed for Africa.
Since the start of the pandemic, the Chinese Communist Party (CCP) has obfuscated important facts and information about COVID-19. The Chinese government has silenced whistleblowers, forcibly disappeared citizen journalists, and misreported the rate of COVID-19 infection and number of deaths, among other concerning actions. The CCP’s decision to limit knowledge about the novel coronavirus significantly hampered other countries’ abilities to respond to their own domestic outbreaks. The international community is now interested in taking measures to hold the CCP accountable. The U.S. government should lead the way in pressing for a level-headed, apolitical investigation into the CCP’s mishandling of COVID-19. It should also consider levying sanctions on individuals and entities responsible for the cover-up.
The Quadrilateral Strategic Dialogue between the U.S., Australia, Japan, and India (the Quad) is not just an important diplomatic and strategic relationship, but has the potential to be an even greater economic partnership in the Indo–Pacific region. Collaborating now will be essential for a quick economic recovery from the COVID-19 pandemic. Already, the Quad-plus partners South Korea, Vietnam, and New Zealand are communicating ways to deal with the spread of the COVID-19 virus. In the same way that the devastatingly tragic 2004 tsunami triggered the Quad, the global COVID-19 crisis should give birth to a new era of Quad cooperation that includes the expansion of economic freedom.
Eliminating Tariffs Would Free Up to $6 Billion a Month for Americans
By Riley Walters and Tori Smith
By May 12, 2020
Before the economic slowdown caused by the COVID-19 containment measures, Americans paid an average of more than $6 billion a month in customs duties. Tariffs increase the cost of doing business, which suppresses employment. They make common household products more expensive. Frequent changes in tariff rates create supply-chain uncertainty. Temporarily deferring tariff payments on some imports was a positive step, but the Administration and Congress should seriously consider extending the deferral of tariff payments to more products and for a longer period of time. And, the Administration should permanently eliminate the tariffs imposed since 2018.
Europe is being devastated by the coronavirus pandemic, and the economic situation in the United States is not much better. The U.S. and Europe need each other more than ever in order to pull each other out of the post-COVID-19 economic crisis. This Special Report has identified seven areas of potential transatlantic community cooperation between the U.S. and Europe: (1) economic freedom, (2) a U.S.–EU Free Trade Agreement, (3) a U.S.–U.K. Free Trade Agreement, (4) the Three Seas Initiative, (5) the Visa Waiver Program, (6) Europe’s energy security, and (7) Europe’s approach to China 5G technology. Cooperation on these seven areas offers a realistic and meaningful approach for Americans and Europeans to help each other.
The ongoing coronavirus pandemic represents the greatest health, social, and economic challenge of the past century. U.S. leadership, both at home and with its Mexican and Canadian trade partners, will be essential to achieving a market-based economic and health recovery. North America’s economic comeback hinges on adhering to the principles of economic freedom that launched the region’s prosperity, alleviating Mexico’s health crisis, and using the new U.S.–Mexico–Canada Agreement (USMCA) as a framework for economic growth. This Special Report provides policymakers and the private sectors of the United States, Mexico, and Canada with a recovery plan to restart the leading North American economies.
The economic damage following COVID-19 has already led to bipartisan calls for more aggressive federal stimulus programs to jump-start economic recovery. A program of stimulus spending would be misguided. Estimates of the effectiveness of fiscal stimulus show that it does not boost private activity or increase total output. Following the Great Recession, stimulus policy experiments illustrate how direct transfers and government purchases fail to jump-start the recovery—and may even slow it. Individuals and businesses react to new government programs by scaling back their personal spending and shifting—rather than expanding—production, canceling out any theoretical benefits. Instead, Congress should allow the private sector to drive the recovery by removing barriers preventing businesses from expanding, hiring, and creating new products.
The responsibility for maintaining the health and safety of their armed forces lies with individual member states, not with NATO. That is not to say that NATO does not have a role to play in pandemic response, and member states heavily affected by COVID-19 quickly turned to the Alliance for assistance. NATO’s response to the coronavirus pandemic thus far has shown that the Alliance can indeed play a positive supporting role in helping member states respond to health emergencies, especially in the transatlantic community. The lessons of COVID-19 also underscore that pandemics pose a risk to the health and safety of service members and their families, while posing a challenge to maintaining military readiness.
Liability Protections Are Critical to Ensuring Economic Recovery
By Brian E. Finch
May 4, 2020
For America’s economic recovery to move forward with relatively few hitches, liability limits are essential. History has shown how easily the mere threat of lawsuits by aggressive tort lawyers can derail critical recovery efforts. The White House and Congress should therefore work together to establish effective and appropriate liability limits. By modifying existing statutes that limit liability in a way that assures both fewer frivolous tort suits and effective pandemic mitigation and recovery policies, Washington will have done its part to prevent unscrupulous lawyers from needlessly hindering the economic recovery that Americans so desperately need.
COVID-19 and Ebola: What We Can Learn from Prior Elections
By Hans von Spakovsky and J. Christian Adams
May 1, 2020
There is unprecedented pressure being brought to bear on election officials by the media, liberal advocacy organizations, and legislators like Speaker Nancy Pelosi (D–CA) to hold an all-mail election in November. Even assuming that COVID-19 will still be an issue six months from now, states will have the funds and resources needed to implement all protective health protocols recommended by experts for polling places. The recent Wisconsin elections and the Liberian elections during the Ebola outbreak are successful examples of how this can be done. We should not put the ballots of all Americans into the hands of the U.S. Postal Service—at least not if we want to have faith in the security and integrity of the outcome.
How Congress Can Enable the Great American Economic Recovery
By Romina Boccia and Adam N. Michel, PhD
April 30, 2020
The COVID-19 pandemic and resulting public policy responses are unprecedented. Intentionally shutting down economic activity deemed non-essential by state governors to contain the spread of the novel coronavirus has had dramatic effects on the livelihoods of millions of Americans. As the public health threat abates, and shutdown orders and stay-at-home measures are lifted, people will return to work and drive the economic recovery, as long as bad policy does not get in their way. Congress should remove barriers to employment, business expansion, entrepreneurship, capital formation, and supply chains in order to enable the great American economic recovery. The most pressing barriers to economic activity include those that unnecessarily increase costs, restrict access to crucial resources, and limit people’s ability to work. Removing barriers to economic activity, not stimulating new spending or further federal bailouts of state and local budgets, is key to getting America back to work.
On April 10, 2020, Apple and Google announced a partnership to fight the COVID-19 pandemic. Mobile devices manufactured by the two tech giants will support digital contact tracing in response to the COVID-19 pandemic. This digital tracing promises to increase the scale and speed of tracing the contacts of those who test positive for the virus, and also provokes questions about security and privacy. This Issue Brief answers basic questions about how the—voluntary—use of this technology will work, and how privacy can be protected.
Congress’s creation of an additional $600 per week in unemployment insurance benefits allows a majority of Americans to earn more from unemployment than employment. Economic studies show that higher unemployment benefits translate into higher levels of unemployment claims and longer durations of unemployment, which translate into lost goods and services. Two Heritage Foundation economists estimate that the impact of the additional $600 bonus will cause 13.9 million more people to file unemployment claims and reduce GDP by between $955 billion and $1.49 trillion. To prevent unnecessary losses and to allow the economy to recover more quickly, policymakers should cap unemployment benefits at no more than 100 percent of workers’ wages and tighten eligibility requirements for claiming benefits to prevent misuse and abuse.
Although decisions have been made by state and sometimes local officials, the United States is effectively subject to a national lockdown. States representing 95 percent of the economy are subject to statewide public health–motivated shutdowns. Under lockdown orders lasting eight weeks, economic output could fall by as much as $2 trillion (about 9 percent), employment is likely to decline by around 9.5 percent, and the unemployment rate could reach between 16 percent and 23 percent. The economic losses from shutdown orders accelerate over time because employers exhaust their financial reserves and fail. Policymakers should consider these costs and the public health costs of severe economic slowdowns when determining the breadth and duration of public health–motivated shutdowns and restrictions.
Nearly every economic indicator, from the stock market to unemployment and beyond, suggests that a global financial crisis is imminent. While an economic downturn may affect every parent, family, and taxpayer, education special-interest groups are demanding that Washington bail them out now, regardless of future tax or spending implications. These groups have a record of making financial demands that are incommensurate with school needs or taxpayer resources. Policymakers should reject such demands and renegotiate union contracts that would interfere with flexible learning solutions such as online instruction and continuing the school year into the summer. Federal lawmakers should extend the waivers offering more budgetary discretion to schools during the pandemic so that educators can direct resources to areas of need.
The federal response to the COVID-19 pandemic has already provided hundreds of billions of dollars to state and local governments to cover unforeseen shortfalls. Further, bailing out state budgets with unrestricted federal dollars would grow states’ budgets, increase future funding shortfalls, further undermine local decision making, and set a dangerous precedent that could lead to additional federal bailouts of the most irresponsible states. Instead, Congress should provide more flexibility to states by lifting unfunded mandates.
Although all U.S. states have reported cases of COVID-19, the distribution is so far concentrated in a small number of counties. Challenges to medical capacity posed by the contagion can thus be expected to be localized and episodic. The U.S. has no structural shortage of hospital capacity; its ICU bed capacity per 100,000 population is about two to three times that of European countries. Its excess capacity of acute-care beds, measured as unoccupied beds per 1,000 population, is near the median for highly developed countries. The U.S. should not permanently increase its hospital excess capacity. Instead, public health officials should prepare for forthcoming, localized outbreaks, executing a comprehensive strategy that temporarily enhances the surge capacity of the medical system.
Most policymakers agree that the Affordable Care Act has failed to achieve its promised objectives. Some progressives argue for a more radical government intervention in health care through Medicare for All. Other liberals support a public option or massive bailouts. These approaches miss the point. The ACA has failed to reduce insurance costs, increase choice, or bend the cost curve down because it depends on a centralized, top-down approach that is insulated from the real-life problems most Americans face in health care. The Health Care Choices Proposal offers a plan that would move the resources and regulatory control to the states, guarantee protections for the poor and those with preexisting conditions, and give individuals more affordable health plan options.
Recent Trump Administration Venezuela Initiatives—and Next Steps
By Ana Quintana
April 16, 2020
The Trump Administration should be commended for its commitment to Venezuela’s democratic aspirations. No other country has dedicated as many resources to this effort. It would be naïve to assume Nicolás Maduro would wittingly play a productive role absent external influence. Washington is wise to wield leverage to incentivize change. It would also be prudent for the U.S. and regional partners to apply those same principles with COVID-19 assistance. Maduro cannot be allowed to politicize foreign assistance for his criminal benefit.
A number of attempts have been made to forecast the spread and mortality of COVID-19. Two Heritage Foundation analysts examine one common model for doing so. As all epidemiological models are grounded in assumptions, the analysts examine the model’s sensitivity to a variety of important assumptions, about which there is currently little knowledge. They find tremendous variability in the associated forecasts, and discuss how state-level and county-level heterogeneity make these modeling exercises even more challenging. They conclude that in order to make well-informed decisions, policymakers must use a range of forecasts, and fully understand how sensitive models are to the smallest changes in assumptions.
The President’s annual budget proposal serves as a road map to Congress for how the executive and legislative branches can work together to secure the nation and increase individual freedom and economic prosperity for all Americans. Out-of-control federal spending threatens that freedom and prosperity for current and future generations. Much has happened since the President introduced his budget with the nation confronting an exceptional public health crisis, including with legislative measures that are projected to triple the annual deficit this year. A pro-growth budget that right-sizes federal spending and focuses the federal government on national responsibilities will be critical to returning the nation to a path to fiscal sustainability and to avert a public debt crisis once the immediate public health crisis is contained. President Trump continues to lead the way in proposing bold reforms to balance the budget and adopt a path to long-term sustainability. Heritage Foundation experts have analyzed the President’s 2021 budget and offer their insights on a wide range of policy issues in an “immediate reaction” piece. This Special Report is based on their contributions.
Countries in Southeast Asia have mobilized a wide range of responses to the COVID-19 pandemic—with some better-prepared than others. Without a swift response, countries in the region risk a severe outbreak, especially among the more vulnerable refugees and internally displaced persons. The U.S. should examine its current aid portfolios—especially for poorer countries in the region—and consider whether it can offer additional assistance to its friends in Southeast Asia. It should also seek to safeguard liberty in the midst of a crisis that some countries could see as a carte blanche to expand government power.
The Trump Administration has taken pragmatic steps to shore up the domestic supply of mechanical ventilators and other critical medical equipment in response to challenges faced by the nation during the coronavirus crisis. Congress and the Administration are also proposing policies that would reduce imports of these products from China. Unfortunately, the proposals could worsen the supply issues being faced today and undermine America’s ability to innovate and bring Americans the best treatments and cures. These supply chains are being analyzed by Congress and the Food and Drug Administration, but the process requires careful deliberation independent of the pandemic. Should a pharmaceutical or further medical equipment shortage occur amidst the crisis, the Administration could make use of the Strategic National Stockpile or the Defense Production Act in a targeted and temporary manner.
COVID-19 cases are growing in the United States, and Americans are in the midst of a nationwide public health crisis. Every state faces different challenges, and the conditions for success vary greatly, based on demography, public compliance, and the capacity of medical professionals and health workers to cope with the surge in demand for medical care. While the President and federal health officials should provide vital information, guidance, and material support, state leaders can and will take the lead in combating this virus. As more tests become available, state officials will be able to adopt a broader variety of strategies than social distancing, while learning from both domestic and international experience, including the comparative performance of Italy and South Korea. Such measures can stop the spread of this virus with the help of medical professionals, and, with the cooperation of the public, reverse the rising caseloads.
By silencing whistleblowers and sidelining charitable organizations, the Chinese government exacerbated the human toll of SARS, earthquakes—and now COVID-19. To aid the Chinese people and to mitigate the global impact of COVID-19 and any future infectious diseases, the U.S. government should press the Chinese government to respect freedom of speech, freedom of association, and freedom of religion so that citizens and nongovernmental organizations (NGOs) can contribute their information, expertise, and resources. The U.S. is already the top single-country donor to China to counter the spread of COVID-19. As such, it should also press for better access for the U.S. Centers for Disease Control, as well as international aid organizations, including faith-based NGOs.
Each level of government has its own peculiar responsibilities to address the COVID-19 pandemic. The states are responsible for licensing physicians who can treat the affected people. Each year, a large number of American and foreign medical school graduates do not find a residency position in the United States. Medical school graduates who have passed the qualifying examination have acquired a considerable amount of education and training during their medical studies, far more than physician assistants, nurses, military corpsmen and medics, and civilian paramedics or emergency medical technicians. They comprise a pool of talent that could be immensely useful in ameliorating the shortage of physician care throughout the country during the pandemic. State lawmakers should allow those graduates to receive a provisional license so that they can provide emergency medical care under the supervision of a licensed physician to help treat the ever-increasing number of COVID-19 patients we will see throughout the near future, or those patients who suffer from more common illness and injuries.
Congress Should Focus on Pandemic Control and Fix the CARES Act for an Economic Rebound
By Romina Boccia, Lindsey Burke, PhD, David Burton, Rachel Greszler, Adam N. Michel, PhD, Norbert J. Michel, PhD, Jude Schwalbach, Parker Sheppard, and Paul Winfree
April 2, 2020
A stimulus package designed to increase spending will have limited effect in the face of sweeping mitigation measures that have shut down most economic activity deemed nonessential. Nor will stimulus spending on unrelated projects reduce the spread of the novel coronavirus, which is the primary cause of economic contraction. Lawmakers must stay focused on containing the pandemic through targeted, timely, and temporary measures that keep workers attached to their employers and avert widespread business failures. These policies will enable the economy to rebound once the pandemic response allows for it. Congress should fix problems introduced in the hastily drafted CARES Act, not introduce poorly targeted stimulus measures that will confuse public communication, undermine pandemic mitigation, and distort an eventual economic rebound.
As the pandemic forces schools to innovate, Americans will get a glimpse into what the future of learning looks like. Such a perspective could change education content delivery forever, making instruction more flexible and suited to the needs of each individual student. In the coming weeks, schools should continue to attempt to teach students, and they should be able to do so without fear of reprisal from federal or state officials over regulatory
The Senate’s Coronavirus Bill: Bailouts, Missed Opportunities, and Positive Reforms
By Lindsey Burke, PhD, David Burton, Marie Fishpaw, Rachel Greszler, Adam N. Michel, PhD, Norbert J. Michel, PhD, Parker Sheppard, and Paul Winfree
March 20, 2020
Any action that Congress takes should be targeted, temporary, and linked directly to the coronavirus epidemic in order to address the source of the economic shock while limiting any political abuse that can develop in a moment of crisis. Unfortunately, the Senate’s coronavirus bill, the Coronavirus Aid, Relief, and Economic Security (CARES) Act misses this mark by including special benefits to specific industries that will exceed $200 billion. We have specified a number of proposals in other papers that would do more to help workers continue to receive paychecks while mitigating the economic effects associated with the coronavirus pandemic. Congress must resist the urge to provide special benefits to select industries and give the robust fiscal and monetary policy response that has already been enacted time to work.
The coronavirus pandemic is acutely affecting the delivery of K–12 education. As of March 19, 2020, 44 states had closed 104,000 schools, affecting nearly 48 million students, turning millions of families into accidental homeschoolers. This homeschooling trial by fire for families across the United States has hastened the need for district, state, and federal officials to implement policies that can ease the transition to learning at home. In order to address this immediate challenge, policymakers should provide families with emergency education savings accounts (ESAs), in order to enable them to access virtual tutors and to pay for online learning options, so that students can continue learning to the greatest extent possible during this difficult time.
The ‘Third Inning’ Next Steps for Congress in Address the Coronavirus
By Michel Burton, Marie Fishpaw, Norbert J. Michel, PhD, Parker Sheppard, and Paul Winfree
March 17, 2020
Congress has taken and can still take a number of steps to mitigate the economic effects associated with the coronavirus epidemic. Any action that Congress takes should be targeted, temporary, and linked directly to the coronavirus epidemic in order to address the source of the economic shock while limiting any political abuse that can develop in a moment of crisis. This paper outlines several specific reforms that Congress should consider to achieve these goals. However, Congress must also resist the urge to overreact while giving the robust fiscal and monetary policy response time to work.
The economic effects associated with the coronavirus epidemic are potentially significant. Moreover, in the United States, these effects represent an economic shock to an otherwise healthy economy. The response to the coronavirus should be targeted, temporary, and transparent. Any emergency fiscal policy response should link directly to the coronavirus in order to address the source of the economic shock while limiting any political abuse that can develop in moments of crisis. The epidemic tax credit outlined in this paper would achieve these purposes. Should policymakers want to improve the underlying fundamentals of the economy, they should look to other pro-growth policy tools.
The 2019 Coronavirus: How to Think About It and How to Respond
By Peter Brookes
February 3, 2020
On January 9, the United Nations’ specialized agency, the World Health Organization, announced an outbreak of a new—or novel—coronavirus (2019-nCoV) in the large, central China city of Wuhan. In the weeks since the announcement, the virus has intensified in China, infecting thousands there, and is now spreading across the globe, far beyond its origin in Hubei Province. In dealing with an emerging crisis such as this one, the fundamentals apply, including keeping the crisis in context, pushing for full transparency, seeking international coordination and cooperation, employing a “whole of government” approach, enhancing epidemic indications and warning, prioritizing the development of treatments, and supporting all elements of the U.S. health care system.