Stephen Moore, an economic adviser to President Donald Trump, thinks the U.S. economy needs to be opened back up immediately, despite the very real ongoing health threat from the coronavirus.
If the administration waits any longer, it could get even uglier for the economy, Moore said.
“Summer is going to be a disaster under any scenario. This disaster will be really brutal. But I think you could start to see by late August, early September, the signs of a recovery where people feel better about things,” Moore said on Yahoo Finance’s The First Trade, on how the economy would react to a May 1 reopening.
Moore added, “If we wait until June or July, you can write off not just 2020, but the first half of 2021. You’re talking about real devastation. So that’s why I have been such a bull on getting the economy open quickly. Really it’s just heartbreaking, and you see what’s happening with the food lines, with people at the Salvation Army where trucks in some cities are a mile long. We are facing real devastation here, and the human toll is growing with each passing day.”
With 22 million Americans having filed for unemployment claims in the last four weeks as the coronavirus causes sweeping layoffs, the president is eager to get the U.S. economy back into gear. The administration released a plan last week outlining a three-tiered approach to easing social distancing measures.
Most governors across the U.S. — notably in the hard hit coronavirus areas such as New York and New Jersey — remain wary of moving too quickly on any form of economic re-openings. To Moore’s point, that resistance is likely to cause the economic pain to persist for some time. But there is very little alternative given the health risks associated with the coronavirus and lack of adequate testing and a vaccine.
Investors have turned more hopeful of late on the prospects for the economy to reopen sooner rather than later. The Dow Jones Industrial Average and S&P 500 have rallied 22% and 19.3%, respectively, from the March 23 lows. Powered by strong gains in big cap tech names Microsoft, Netflix and Amazon, the Nasdaq Composite has gained 17% from March 23.