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About this blog: I grew up in Los Angeles and moved to the area in 1963 when I started graduate school at Stanford. Nancy and I were married in 1977 and we lived for nearly 30 years in the Duveneck school area. Our children went to Paly. We moved ...  (More)

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A Slow Economic Recovery Ahead--What do You Need to See Before the Economy Reopens

Uploaded: Apr 13, 2020
Dear Mayor Fine and council members,

You are aware of the many health related prerequisites for reopening parts of the economy.

And you are aware that reopening will go slowly.

--some residents will remain at higher risk and under stay at home orders

--shops, offices and restaurants will probably have limited openings with smaller capacity, queues and some physical distancing.

I urge you to consider some additional factors, particularly the distinction between what the law allows and how residents, workers and visitors react.

Take air travel, which is important for tourism (here think Stanford Shopping Center, hotels, meetings and related spending activities.

I suspect foreign travel, key to our tourism, tech deal making, and home sales will not reopen soon or at full capacity and when it does, many will be hesitant to travel.

The same may be true for domestic travel. We used to go down to see our grand kids every month and flew. When we can travel, at first we will drive. Every year they fly up and we go to Tahoe. This year they will drive if we can go.

How many home sales are to out of regions buyers. Even if they can purchase a home without being here, if they cannot physically move or think where they are is safer, no home sale. And the big sales season is now in the spring when we are at stay at home orders.

This will mean continued economic pressure for our residents and particularly small businesses.

But it will also mean that city revenues will likely be restricted for a long time. To me that implies that the council should remain flexible with frequent revenue and budget updates.

We all have friends in tech who are working from home and seem less affected. This is good news but not a good guide to the overall challenges facing our local economy.

Finally, Palo Alto was experiencing rising vacancy rates and slow or negative job growth before the virus became widespread. Another risk is that small businesses may not reopen or reopen here.

The city's future economic competitiveness deserves a careful look as the COVID-19 emergencies subside.

Stephen Levy

We need your support now more than ever. Can we count on you?

Comments

 +   10 people like this
Posted by the trump pandemic response, a resident of Palo Alto Orchards,
on Apr 13, 2020 at 2:16 pm

So many factors listed above. Air travel alone accounts for so many jobs - look at the employment at the 3 airports alone in the Bay Area: Oakland, SFO (~60k jobs: direct, indirect, induced, etc..) & SJC. Going to be a year, at least, until they are at full employment.

Now take a look at the ripple effects of the economic misery of those employees, and multiply it times 'every' industry.


 +   14 people like this
Posted by Gail Price, a resident of Barron Park,
on Apr 13, 2020 at 5:14 pm

I agree with Steve!s comments. The challenge will be, of course, when and how government has a role in some of these decisions. Certainly the economic impacts will be significant and difficult" lots of uncertainties about variations and timing. I would imagine both residents and businesses will exhibit various degrees of caution. I also wonder how staff and students at Stanford will forge ahead..on-line education and services will be a very different model.

The sales tax impacts and hotel occupancy transient taxes likely will take a hit and this will have direct impacts on the City's general fund" and how the funds are a allocated. Financial projections will likely be very challenging. I hope the community is understanding and patient.

I agree that real time and frequent updates will be crucial. A series of discussions will be what core services are critical and which are less so for the short term? Will this have a longer term impact on how and where work is done? How will this impact employee bargaining units and various types of private consultant contracts currently underway ? Stay tuned.


 +   10 people like this
Posted by stephen levy, a resident of University South,
on Apr 13, 2020 at 7:22 pm

stephen levy is a registered user.

Readers,

Tell us what needs to happen for you to feel safe flying, going to a concert of sporting event, eating out, in general being with crowds.


 +   72 people like this
Posted by Random Internet Guy, a resident of Another Mountain View Neighborhood,
on Apr 13, 2020 at 7:51 pm

"Tell us what needs to happen for you to feel safe flying, going to a concert of sporting event, eating out, in general being with crowds."

To be perfectly honest, I wouldn't worry about it. Why? I am convinced that I had COVID-19 in mid-January. Same with my 80-yr-old mother.

Unfortunately, serology tests are scarce and I did not hear about the recent Stanford study.

But yes, I would have no problem walking onto an airplane or into a sports arena at this time.

I realize that public health officials don't really want people like me around to discredit their efforts. THEY ARE DOING A GOOD JOB.

But since you asked, there's my answer.

Do with it as you wish.


 +   12 people like this
Posted by Dan, a resident of Midtown,
on Apr 14, 2020 at 12:54 am

"Tell us what needs to happen for you to feel safe flying, going to a concert of sporting event, eating out, in general being with crowds."

government to permit it. Not much more.


 +   12 people like this
Posted by the trump pandemic response, a resident of Palo Alto Orchards,
on Apr 14, 2020 at 9:19 am

> I am convinced that I had COVID-19 in mid-January.

I hear that a lot, from folks who say "well, I had a bad cough back then" or I had a weird case of flu". If every anecdotal "case" back in January were really Covid19, our hospitals would have been inundated.

This is part of the Victor Davis Hanson/Rush Limbaugh bogus "West Coast herd immunity" nonsense from last week. Don't think you're bulletproof until:
- you're tested for immunity
- it's proven that prior exposure does indeed provide 99% immunity

- - - - - -

"Tell us what needs to happen for you to feel safe flying, going to a concert of sporting event, eating out, in general being with crowds."

Immunity, likely through a vaccine. I'm willing to re-evaluate when, after "opening up" for 4 weeks, we don't see a bump in cases.


 +   6 people like this
Posted by Adrian, a resident of Professorville,
on Apr 14, 2020 at 1:39 pm

Home sales activity is permitted under the current County stay-at-home order. Escrow, notary, legal, moving and financial services are considered "essential." Realtor-client interactions are required to be virtual with an exception for an in-person visit to the property. In that case, only 2 people, who must already live in the same residence, can visit along with the realtor, and the occupant of the home must not be absent.


 +   5 people like this
Posted by Adrian, a resident of Professorville,
on Apr 14, 2020 at 1:41 pm

Sorry, mistake in my prior comment. The owner of the residence must be absent so only the realtor and up to 2 buyers are in the residence during the on-site visit.


 +   11 people like this
Posted by S, a resident of College Terrace,
on Apr 14, 2020 at 1:46 pm

Don't eat animals for five years.


 +   8 people like this
Posted by Phil M., a resident of Willowgate,
on Apr 14, 2020 at 3:08 pm

We're going to be wearing masks to do basic things we never would have had to before. I'm not looking forward to it.


 +   11 people like this
Posted by Anon, a resident of Another Palo Alto neighborhood,
on Apr 14, 2020 at 3:39 pm

This is a perfect time to think outside the box. Transportation is generally bad wrt GHG/CO2 emissions. I'm planning on using videoconferencing as much as possible and avoiding flying as much as possible. Perhaps some of those people/jobs in the airline industry should move to the videoconferencing industry instead. Not only does it safer wrt SARS-CoV-2, but, it is also a lot better for the environment. Instead of trying to get back to the state we were in 6 months ago, let's try to get to a better state with lower CO2 emissions, and, lower risk of coronavirus transmission.


 +   5 people like this
Posted by ASR , a resident of College Terrace,
on Apr 14, 2020 at 4:33 pm

We may have to wear cleanroom gear for a couple of years to be away from infecting each other


 +   8 people like this
Posted by Mark Michael, a resident of Community Center,
on Apr 15, 2020 at 11:37 am

I appreciate Steve's post and the comments from Gail Price. In light of Gov. Newsom's framework for reopening the economy, it seems likely the pandemic response will take considerable time. Particularly since protecting public health requires more testing, contact tracing, therapeutics and vaccine development. Vaccination of the public may be out two or more years. In the meantime, inconsistent management among states and other countries -- per Dr. Fauci -- raises the risk of a 2nd, 3rd or 4th wave of the global pandemic.

Cognitive bias takes many forms and is very powerful. My sense is that people are yearning for a return to the previous normal -- in defiance of the current challenges and likely changes. Instead, widespread behavioral changes may be inevitable. Jumping to behavioral economics, this will impact consumer demand, spending patterns, the food supply, supply chains, and structures of public finance tax budgets.

Despite trying to understand, much less propose, a solution for these issues, I am at a loss to project how cities and states that must balance budgets are going to maintain the same level of spending. High unemployment and layoffs and reduced business earnings will cut taxable income for individuals and businesses. Consumer demand, which accounts for over 70% of GDP, will sink. Retail spending and sales taxes will decline. Ditto with real estate and the assessed value of properties.

One example of a positive change may be increased utilization of video conferencing, and applications like tele-medicine and tele-working. If so, this could reduce automobile traffic and commuting and improve air quality. But, office space demand may suffer, along with commercial real estate, property tax collections, etc.

Until and unless the 3 key elements for public health protection are mastered, the adverse economic impact will deepen and we will have limited visibility into the post pandemic behavioral changes. Which could be vast. TBD.


 +   6 people like this
Posted by Evaluate in context, a resident of Woodside: other,
on Apr 15, 2020 at 1:17 pm

We SIP to alleviate the medical onslaught, we got that. Now we need to pay attention so we don't have an uncontrolled spike, but a ton more information needs to be disseminated to people to hold them in too much longer. You see there needs to be a reason to SIP...

Portions deleted


 +   3 people like this
Posted by the trump pandemic response, a resident of Palo Alto Orchards,
on Apr 15, 2020 at 1:40 pm


deleted because the reference was deleted


 +   3 people like this
Posted by the trump pandemic response, a resident of Palo Alto Orchards,
on Apr 15, 2020 at 1:41 pm

deleted because the reference post portion was deleted


 +   4 people like this
Posted by ASR , a resident of College Terrace,
on Apr 15, 2020 at 3:07 pm

Need maximum resources for developing cure. Allocate most of the resources.


 +   4 people like this
Posted by ASR, a resident of College Terrace,
on Apr 15, 2020 at 3:18 pm

Need a newer face mask invention.


 +   11 people like this
Posted by got all the story?, a resident of Crescent Park,
on Apr 15, 2020 at 5:31 pm

17,000,000 unemployed in the last 3 weeks and more millions more to come . Out of job , bad things happen, financial ruin, depression, suicide, domestic abuse, drug and alchohol abuse.

Let's juxtaposed that to US total of virus deaths of 25,000 - yes 25 thousand. So are our politicians making the right choices ?? just asking


 +   12 people like this
Posted by the trump pandemic response, a resident of Palo Alto Orchards,
on Apr 15, 2020 at 7:15 pm

> So are our politicians making the right choices ?? just asking

Don't think our top politician is making the right choices, no. Our healthcare professionals, however, are making the correct choices.

jes' answering...


 +   7 people like this
Posted by Barb, a resident of Another Palo Alto neighborhood,
on Apr 16, 2020 at 7:23 am

Thanks Steve, great article. All I need to get back out to my regular doctor appointments, ortho appointments for my kids, kids sports, outdoor sports, outdoor arenas, and retail is a required face covering for all employees and patrons. Most retail already have hand sanitizer stands by the door during flu season and those should stay all year. A temperature check too would be fine before entering large groups indoors. Restaurants will have more scrutiny via OSHA. but should be allowed to open as well In the next few weeks.


 +   2 people like this
Posted by the trump pandemic response, a resident of Palo Alto Orchards,
on Apr 16, 2020 at 10:14 am

> Restaurants will have more scrutiny via OSHA

Huh?


 +   3 people like this
Posted by C, a resident of Palo Verde,
on Apr 16, 2020 at 12:38 pm

> Finally, Palo Alto was experiencing rising vacancy rates and slow or negative job growth before the virus became widespread.

So, basically, everyone criticizing Palo Alto for their business-unfriendly practices were right. And not all businesses will reopen at all if they go bankrupt.

We're going to wait for a vaccine or similar treatment. It'll take a long time, but, with elderly household members, we don't leave the house. Government actions have been far too slow, imo, because they're more interested in the economy than our lives. Especially with the late school closures and CDC reversal on masks, we'll make our own decisions based on those countries who are best able to contain the virus.


 +   7 people like this
Posted by Martha Dogood, a resident of Old Palo Alto,
on Apr 16, 2020 at 1:14 pm

Martha Dogood is a registered user.

We definitely need more articles like Steve's, and discuss how we can and must turn the lights back on by May 1st if not sooner. Many sectors could open up safely over the next two weeks, with more and more opening by May 1st.

Most have learned how to practice better hygiene, social distancing, wearing masks, etc. Will any of us miss the end of “close talkers" or “loud talkers" who spew sputum faster and farther than most? We can all become better and more hygienic humans forever, this is part of our evolution. We can also start revolutionary new ways for many of us to work remotely, new distance learning methods, new remote healthcare methods, etc., we've been “practicing" this for decades already, now is the time to go “big" on all of this. Fewer cars on the road would be a great side effect.

Here's why and how we need to open by May 1st.

First, everyone says look at the data, make science based decisions. Yes, great, let's look at the data:

1) Santa Clara County population: 1,928,000 (2019 estimate)
2) 16,585 tested so far for Covid19, with 1,793 tested positive (10.81% of tested population positive, 89%+ NEGATIVE)
3) 188 of the 1,793 are currently hospitalized (0.0001% of our population is currently hospitalized)
4) 76 of the 188 Covid19 hospital patients are currently in ICU - God please save them - .04% of the tested positive Covid19 are in the ICU currently. That is 0.0000394% of Santa Clara's total population currently in ICU.
5) Mortality rate: to date, presumably with the worst behind us, 65 of our citizens have died of Covid19, yet 85% of those deaths had at least one serious comorbidity condition (underlying health problem).

Bottom line: to date, sadly 55 unhealthy people have died of Covid19 complications in Santa Clara County and 10 healthy people have perished due to it. Of our 1,928,000 citizens, we have lost 10 healthy people to this horrible virus.

If we look at 10 basically healthy people who died of the 1,793 who so far tested positive, that is a 0.005% mortality rate of that “tested positive population". Remember this: if we could test even 10% of the Santa Clara population, or 192,000 people, it is almost certainly a much lower mortality rate.

The death rate from the usual seasonal flu is about .1% to keep this in perspective.

One loss of life is always too many, especially to the family mourning their loss. Sadly, I lost my father to cancer some years ago. More sadly, a friend lost his sister to a driver high on marijuana who struck her car and killed her (she was a nurse driving to work when she was killed by the marijuana stoned driver).

We all know Wuhan Covid19 is a contagious - and deadly for some - flu like virus, different from cancer or death by auto accident. Yet imagine if our society were obsessed every day with the death around us, all looking at the dashboard of death: cancer, heart attack, auto accidents, etc, and we all decided “we must stop the world until the death rate is lower on all forms of illness and accidents."

As Thomas Smith of Prescott Investments stated in his article today:

“We did not close the world economy in 1957 when the world endured the Asian Flu pandemic, which caused 1.1 million worldwide deaths, 160,000 in the United States. The current estimate of COVID-19 deaths in the United States is around 60,000. The population of the United States in 1957 was 177 million. Today, it is 320 million. Who even remembers the Asian Flu? That will not be the case with regard to the COVID-19 pandemic."

Web Link

Let's get back to LIFE and WORK! New methods, good social distancing, better hygiene, be smart and safe! We can do it!

It may or may not have been a good idea to shut down our economy for 30 days to “mitigate" this flu like pandemic, only time will tell. Yet we must now move forward into our future based on life, not death, as we have for over 2,000,000 years of human evolution.

For the Santa Clara County Covid19 data, see link below, all my data above is from their data. AKA “the illness and death dashboard"

Web Link


 +   5 people like this
Posted by Martha Dogood, a resident of Old Palo Alto,
on Apr 16, 2020 at 1:24 pm

Martha Dogood is a registered user.

@ASR

Check it out, great new face mask invention. Kills virus before enters your esophagus and lungs. Needs improvement, but great idea.

Web Link


 +   2 people like this
Posted by the trump pandemic response, a resident of Palo Alto Orchards,
on Apr 16, 2020 at 1:30 pm

> Wuhan Covid19

Says it all, eh?

Right up to the point that some guy who's chief concern is an investment company is somehow a better judge of pandemic response than public health professionals.

The same health professionals who *know* it's not possible to "open up safely over the next two weeks."

Keep in mid Mark Twain's comment on misuse of statistics. Listen to the experts.


 +   3 people like this
Posted by stephen levy, a resident of University South,
on Apr 16, 2020 at 1:58 pm

stephen levy is a registered user.

I will leave the exchange between Martha and Trump Pandemic up for now.

But I will delete future arguments on those comments

Let's stick to what you need to feel safe about reopening the economy and how that would work to make you feel safe.


 +   9 people like this
Posted by the trump pandemic response, a resident of Palo Alto Orchards,
on Apr 16, 2020 at 2:29 pm

Steve: thanks. I believe there have been few direct answers to your question.

> "Tell us what needs to happen for you to feel safe flying, going to a concert of sporting event, eating out, in general being with crowds."

> Immunity, likely through a vaccine. I'm willing to re-evaluate when, after "opening up" for 4 weeks, we don't see a bump in cases.

re: your rephrased question: what you need to feel safe about reopening the economy and how that would work to make you feel safe.

About a million tests in the greater Bay Area, including both current infection and antibody status. I'd settle for half a million, depending on the results (ie.. more/less than 70% immunity, minimal active cases with tracing, etc..)

Mostly, I'd listen to the professionals, including recognized economists, most of whom are NOT pushing for this fake news reopening fallacy.

As one Nobel-recognized economist noted this week:

"I've seen some people portray it as a conflict between epidemiologists and economists, but that's all wrong. Serious economists know what they don't know " they recognize and respect experts from other disciplines. A survey (see link and study questions below) of economists found almost unanimous support for “tolerating a very large contraction in economic activity until the spread of infections has dropped significantly." "

Web Link (paywall open)


From the survey: Web Link

- "Question A: A comprehensive policy response to the coronavirus will involve tolerating a very large contraction in economic activity until the spread of infections has dropped significantly."

Most agree, none disagree.

- "Question B: Abandoning severe lockdowns at a time when the likelihood of a resurgence in infections remains high will lead to greater total economic damage than sustaining the lockdowns to eliminate the resurgence risk."

Most agree, none disagree.

Steve: I'm most curious on where you fall in among these economists? Thanks again...


 +   7 people like this
Posted by stephen levy, a resident of University South,
on Apr 16, 2020 at 3:22 pm

stephen levy is a registered user.

Trump Pandemic

I agree with the majority of economists, health experts and governors.

That is why the first part of the blog cautions us to expect a slow recovery, especially here where we follow the science guidelines.

Moreover, the reopening when it occurs is being hyped. The President's guidelines if followed specify most of the steps you mentioned as prerequisites.

Moreover, even as places are reopened, some will not come immediately and capacity will (hopefully) be limited in accord with the health guidelines.


 +   9 people like this
Posted by Recent PA resident, a resident of another community,
on Apr 16, 2020 at 3:44 pm

I'm a senior, and have several health conditions linked to increased severity of COVID-19 cases. My husband is fortunate to be able to telecommute. I do the grocery shopping, and he mostly does the pharmacy runs. We frequently get restaurant takeout (to help keep our favorite places going), and my husband picks that up.

"what you need to feel safe about reopening the economy and how that would work to make you feel safe":
" A clearer sense of how long one can have the virus and be asymptomatic, and passing it to others
" Tests known to have a very low false-negative rate
" Ubiquitous, freely-available-to-anyone testing, both for active COVID-19 and for antibodies. Just because you test negative one day doesn't mean you'll still be negative three days later.
" Cheap, comfortable, easily-obtainable masks.

BUT, about me personally: "Tell us what needs to happen for you to feel safe flying, going to a concert or sporting event, eating out, in general being with crowds.": All of the above, PLUS:
" A highly-protective vaccine (i.e., like measles or polio, not like the seasonal flu vaccine) that is universally administered.
" Or, if the vaccine is more like the flu vaccine with a lower level of protection, a very high degree of herd immunity in the population.

I personally don't expect to be going to any large events for quite a while yet, even if things open up to the general public sooner.


 +   2 people like this
Posted by ASR , a resident of College Terrace,
on Apr 16, 2020 at 5:15 pm


Gilead drug is showing success to cure Coronavirus

Great news


 +   5 people like this
Posted by got all the story?, a resident of Charleston Gardens,
on Apr 16, 2020 at 5:44 pm

States should have the right to say what should be shut down and what should reopen. BUT , then don't go running to the Federal government for handouts deal with the consequences of your actions that dry up tax revenues and explode unemployment payouts


 +   7 people like this
Posted by mon gotta go, a resident of Midtown,
on Apr 16, 2020 at 6:03 pm

@got the story

Have you answered the blog host's questions yet?


 +   3 people like this
Posted by got all the story?, a resident of Charleston Gardens,
on Apr 16, 2020 at 6:41 pm

@ mon gotta go

That's not my point. I never pretended to answer the question

I'm saying those that make decisions need to pay for those decisions - both literally and figuratively


 +   4 people like this
Posted by K. Dann, a resident of Crescent Park,
on Apr 17, 2020 at 6:55 pm

I would feel safer opening things up pronto. Martha Dogood's comment describes some specific local impacts, but the country as a whole is experiencing a lot of bad things as a fallout of the lockdowns; a longish list with some sources is here Web Link but includes: small business loss, chronic stress for too many reasons to list but which impacts the whole body, negative health consequences to loneliness/isolation, etc.

I've also started to hear concern about so many resources being used for COVID-19 when there are still other major illnesses around i.e. in 2018 10M people in the world fell ill with tuberculosis.

All in all I am more concerned for the long-term consequences of continuing to live in limbo and lockdown than I am from this virus.



 +   1 person likes this
Posted by Feel Safe???, a resident of Rex Manor,
on Apr 18, 2020 at 5:45 am

@stephen levy, who asked:
"Tell us what needs to happen for you to feel safe"

First, NOBODY has a right to "feel safe", that's a subjective personal state of mind and cannot and must not be achieved by suppressing the rights of others in the process. (I recognize the current irony in that.)

For most people they would "feel" safer if they just turned off the main-stream TV and internet news, except for one brief moment a day for the important updates. Stay away from anything political and do as Dept. Joe Friday asked: "Just give me the facts"

Spend the rest of you time working on stuff you can to make your life better.

"Tell us what needs to happen for you to feel safe"

Well, reopening the lawful firearms dealers would signal the California government is no longer afraid of We The People....naaaa.

First-time gun-buyers broke all sales records all over the place and broke the state and federal software systems too. Lead by Asians, then Women of color and then men of color, with white women next and white men way way last, mainly because they are already well armed and well prepared for disasters in general. People buying their first guns were none too picky either on what they bought. Long-time gun-owners already had all the guns and ammo they wanted years ahead of time.

"Tell us what needs to happen for you to feel safe flying,"

Flying? I never really feel safe flying, I have only flown once since 9/11.
So maybe a rollback of the rules that makes the captain and flight crew totally helpless would make me feel safer flying. After all, the USA never saw any airplane hijackings until AFTER the Federal gov outlawed airplane captains (mostly highly-trained military pilots with close quarters combat training), from being armed in the cockpit. Once the crazies knew the pilots were helpless, then the hijackings began.

"Tell us what needs to happen for you to feel safe going to a concert"

Physical distancing between groups in the audience along with temps being taken at the entrance. That and a really worth-while old classic rock band.


"Tell us what needs to happen for you to feel safe of sporting event,"

Not going to happen, well maybe a kids league, if my kid is playing.

"Tell us what needs to happen for you to feel safe eating out,"

It depends on the behavior of the staff and how many people are sitting/standing in the place and if it has a bar.

"Tell us what needs to happen for you to feel safe in general being with crowds."

Never really felt "safe" in crowds, thieves all around and no police to be seen.

Bottom line, give us all a reliable test for infection, another for anti-bodies, prove survivors are immune, give us all a reliable vaccine.... and then let's talk about CCW, then I'd finally feel safe in public crowds. As it is, I feel quite safe at home, as does my family and any friends who have visited in the past.


 +   8 people like this
Posted by the trump pandemic response, a resident of Palo Alto Orchards,
on Apr 18, 2020 at 11:37 am

Geez, the very vocal fringe is for opening up and exposing everyone (and our medical infrastructure and staff) to a rebound. A rebound that will lead to a secondary closure that will be a death knell to the economy.

Normal folk understand the facts. Look at all the state polls over the last couple weeks.

here's a national poll suggesting that 75% of Aericans understand Stay-At-Home.

75% of REPUBLICANS get it.

Web Link

Instead, we get: "That's not my point. I never pretended to answer the question"


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