This is War. No Really.

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March 30, 2020 11:20 a.m.

Like many of you I’ve struggled to make sense of the so many ways our world has changed, been upended over the last month. Beyond the personal, the emotional and the professional, a key question is how our society gets through the coming months. I don’t mainly mean the clinical or public health dimensions of the crisis. That’s largely the domain of science and public health. I mean the broader question of how our society maintains itself while we are grappling with that public health crisis.

American society has been addicted for decades to the metaphor of war to address various public problems – the war on crime, the war on drugs, the war on this or that disease. The metaphor has most often abetted all manner of bad policy and brutalizations of our society. But here I mean something more specific and I believe more grounded in concrete and important policy needs.

The US has fought many wars that required large scale mobilization. The Civil War and World War II are the most obvious examples. What the US has rarely faced is war on its own soil. World War II entailed a massive restructuring of the civilian economy, rationing and more. But with some tiny exceptions there were no hostilities in the mainland United States that shut down parts of the civilian economy.

But that is what we’re dealing with now. It’s not an economic shock or a subsequent rebuilding effort, both of which might require a major one-time spending package. It’s an extended period of crisis when a substantial portion of the civilian economy simply ceases to function – not simply because of lost supply or demand but because it is not physically able to function. This is a categorically different economic reality. And this is where the historical analogue of war is a helpful one, not as a slogan but as an analog that can provide key policy guidance on how to move forward. Countries that are at war, especially on their own soil, often have comparable economic and operational challenges. The face the challenge of keeping the essentials of life moving forward while large sections of the economy can’t function.

One big question is rents. Starting on Wednesday people have to pay rent. Substantial numbers of people have either lost their jobs or will soon lose their jobs. Either on Wednesday or a month later won’t be able to play their rent. Logically the answer should be some sort of general hiatus. No one pays rent. Landlords don’t have to pay mortgages. A sort of general timeout that could sorta kinda work if everyone up the chain abides by it. That’s obviously much easier said than done.

States like New York have already instituted a three month ban on evictions which provides a limited backstop. There are some mortgage moratoriums which may protect homeowners and landlords who have cash shortfalls because of rents in arrears. However these matters are resolved in the ordinary course of things, when it happens to a significant part of the society at once it creates a systemic economic and societal risk. Big corporate landlords must see that some of this is actually in their interest because if the owner of hundreds or thousands of middle class or working class apartments suddenly evicts a third of tenants it’s not like you’re going to be able to rent those units to other people any time soon. In high density areas like New York, in normal circumstances, there’s always more tenants where that came from. That clearly doesn’t apply in such a circumstance.

The United Kingdom has at least pledged to become what amounts to the payroll of last resort for the all dislocated sectors of the civilian economy for the duration. The recently passed stimulus bill provides some of the answers to this and does on a more rickety and short-term basis some of what the UK plan does. For all its shortcomings it will pump short-term cash into many economic veins bled dry by mass lay offs and furloughs. This could of course be extended. Nancy Pelosi signaled over the weekend that the first bill is more than a down payment or first installment on what will be necessary. But thinking about how to address this calamity at scale, at the policy level requires a more holistic approach to the whole economy. And wartime economies – particularly in countries fighting wars on their own territories – provide the closest analogs from the past and guides to the future.

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