How business and consumers will shape our recovery
by Tenapo Lee
Mr. Lee is an economist and professor of economics at Niagra University in New York.At the beginning of the pandemic one year ago, there was a swift, government shutdown of the economy. Today, one year later, reopening has begun, but the process will be quite different.
It will most certainly not be mandatory and sudden and should not be so. A return to “normal,” pre-pandemic levels will likely take some time and will require flexibility on the part of businesses and consumers.
Hindsight Is 20/20?
In March and April of 2020, businesses that did not follow shutdown orders may have been fined, so they were forced to do so. Now, as reopening begins, the same is not true as it will be up to individual businesses to define their return timetables. We are not China where government dictates what businesses do.
In hindsight, it might have been better to have allowed businesses (and individual jurisdictions) to create their own policies based on the level of disease in their areas and the nature of individual businesses – could they operate without putting employees and customers in peril?
We may never know if we could have prevented the level of unemployment and economic slowdown that resulted from a full-scale national closure. Now, we face the dilemma of whether to open or whether to approach the idea gradually to minimize the spread of COVID-19 as more and more Americans are vaccinated.
An Economy Changed Forever By Pandemic
The pandemic has changed everything. Most Americans have learned and adjusted to living with COVID-19. So, even if we open the economy fully, the economy will be structurally different and not comparable to the pre-pandemic conditions.
For example, the demand for travel (especially air travel) may take years to return. Working from home will likely become permanent in some industries. Remote learning may become more common for higher education. Masks may be a part of our daily lives, especially during the cold weather months. Large, indoor gatherings may not be desirable anytime soon.
Hence, opening the economy fully will mean allowing businesses and their patrons to make their own decisions, allowing for flexibility and efficiency. With freedom, the economy will open slowly at its own pace, shaped by the marketplace of supply and demand. Government may announce that “we’re open,” but cannot determine when “normalcy” will occur.
On the other hand, if government continues its shutdown policies, the result will be restrictions thwarting forward movement and recovery.
With vaccines becoming more readily available to the entire population by May, as predicted by the Biden administration, the dictate should be a cautious, business and consumer-driven return to full operation, based on need and the ability to operate within safe guidelines. We do not want to risk another surge and an extended pandemic.
To shut down or not to shut down, to open or not to open? We must be consistent with our dedication to safety and decision-making must be based on the concept of a free economy, not centralized, economy, especially in light of what we have learned, how we have evolved and our ability to self-direct. Government should not make decisions for individual businesses. We must open the door and let the people decide.
Niagara University
Founded by the Vincentian community in 1856, Niagara University is a comprehensive institution, blending the best of a liberal arts and professional education, grounded in our values-based Catholic tradition. Its colleges of Arts and Sciences, Business Administration, Education, and Hospitality and Tourism Management offer programs at the baccalaureate, master’s and doctoral level.
