Steve Dittmer | Mar 05, 2020 BEEF Magazine
The human coronavirus, now called Covid-19, outbreak has sparked fear, concern and questions as world economies struggle to recover.
How dangerous is the human coronavirus, now called Covid-19, epidemic to the U.S. economy, the world economy and politically to the Trump Administration?
All of those questions are hard to even speculate on, given the fluid nature of the outbreak. China’s outbreak appears to have peaked. South Korea’s, Japan’s and Italy’s have not. Neither has the U.S. outbreak.
But the scale of the outbreaks outside of China are nowhere near as serious, at least in terms of the human toll. Economic consequences are still being tallied.
There are many countries whose manufacturing sectors rely on Chinese components to operate. There is no question that a couple months of little or no supply will affect at least the first quarter in many countries and globally. But to date, the Organization for Economic Cooperation and Development has projected only a slight drop in global GDP from earlier projections of 2.4% to 2.9%.
It seems hard to grasp, but the impact of China’s tourism on the rest of the world is substantial, amounting to roughly $250 billion a year; a quarter trillion dollars. It is easy to see that halved in 2020.
As for President Trump and the election this fall, it is likely the impact will be substantially less than the opposition party is hoping for. Trump has established a solid reputation for his handling of the economy, taxes and regulations, and much of the public seems to understand that the trade war with China dampened the economy in the short run.