CORONAVIRUS AND THE NEW ECONOMY REALITY

The arrival of Covid-19 was brutal, and in just a few months, it had already spread to other countries, making it necessary a social isolation to contain the new virus.

But what would the next steps be? What should one do after isolation? Do we really have to sit back and wait for the emergency to end?

At Aventura de Construir we do not believe in a trade-off between economy and health. However, we have many questions that arise from direct contact and the seriousness of the situation, which we see among the beneficiaries that we continue to serve remotely. That is why it has caught our attention to the fact that recently, the professor from New York University and 2018 Nobel Prize in Economics, Paul Romer, and the Harvard University dean, Alan Garber, published an article in the New York Times with a plan to combat the coronavirus.

The article “Will our economy die from coronavirus?” (Will our economy die from coronavirus?) Signed by Romer and Garber, it has been used by quarantine critics as an argument to justify opening up the economy.

According to them, total quarantine really is necessary for a few weeks, with the closing of businesses and enterprises, but in the long run, it is necessary that we have better options.

Initially, both advocate the massive expansion of Covid-19’s testing capacity, so that we are able to carry out these tests on an important part of the population every week or two. Conforming to them, it is the only way to guarantee a safe recovery of the economy, without the collapse of the health system and without the explosion of cases.

The world economy would not support it, if the only strategy used by governments is social isolation and waiting for the end of the pandemic and, according to the forecast, this isolation would last between 12 and 18 months worldwide. According to Romer and Garber, in 12 months, most of us would be alive, but our economy would have died.

By increasing the population’s testing, the test results would come out even before people had symptoms, since technology companies have already developed tests that show results in 45 minutes. Not only tests on those infected, but those who have already had contact with the disease and, therefore, their immune system would be “immune” to the Coronavirus.

With large-scale testing, governments and the population would know exactly who would need to stay at home and who can do their daily activities normally, reducing the risk of contamination with personal protective equipment.

To structure this type of scale expansion, companies that manufacture both tests and protective equipment would have to buy machines that increase their production by up to 4 times more than in normal production times.

Then there is an impasse. Companies are reluctant to buy the machinery so that as soon as the crisis ends, that same machinery will be idle in normal times. Solving this type of problem depends on an organizational capacity of the federal government to orchestrate coordinated actions in the same direction.

It still seems distant and depends entirely on the investment and intervention of federal governments, especially in Brazil, where the ideas are controversial and vary from state to state regarding to social isolation and closing of businesses. But it is certainly something that should be placed on our sight because we cannot just sit, wait and hope.

The low-income microentrepreneurs from the periphery, with whom we work, in a time of quarantine in which bussiness close, they are reinventing themselves to think of solutions to be able to support their business and their family in a time of crisis. We are following these attempts, guiding them to put the lives of each one, their families and the people of the neighborhoods first. However, the inevitable question arises: how long will this be sustainable for them and for institutions like ours that carry out this type of social work and for which funders have temporarily suspended projects?

We have also created an Emergency Fund to respond to the most urgent needs, but we believe in the protagonism of people and that the thought of Romer and Garber intrigued us so much.

For now, there’s nothing we can do but donate to this Fund. Be part of the donor team, just click here!

BE PART OF THE TRANSFORMATION TO OVERCOME THIS CRISIS TOGETHER … LONG-DISTANCE! DONATE NOW!

Source: https://www.nytimes.com/2020/03/23/opinion/coronavirus-depression.html

Aventura de Construir