Jason Furman, a Harvard economics professor and former economic adviser to President Barack Obama, has a very simple plan to both stimulate the economy and slow the spread of coronavirus.
“ ‘A fiscal stimulus plan that would have incredibly high bang for the buck would be for the government to print up masks … and mail them out to every American and tell every American to wear them.’ ”
Furman made the comment Thursday on CNBC’s “Closing Bell.”
By his estimation, there’s not a lot that fiscal policy can do to stop a virus. But the small cost of mailing a mask to everyone would — assuming the vast majority of people wore them — slow the spread of COVID-19 and make it possible to actually reopen the economy successfully.
“It’s really not hard,” he said. “A mask is one of the steps that can control that virus,” adding that the masks could even say “Thank you, Donald Trump” on them if that did the trick.
Furman’s not alone in preaching the economic power of masks. Goldman Sachs analysts earlier this week said that a national face-mask mandate could save the U.S. economy from a 5% hit to GDP.
That’s not to say fiscal stimulus doesn’t also have its place.
Furman noted that the massive amount of stimulus from the Fed and Congress has definitely helped, but that “it’s really important that we continue action.”
“We had an extraordinary amount of support,” he said. “Over the last two months, over $1 trillion went out. That was more than any given year in the financial crisis.”
“So this is something that protected us from seeing an even larger second-wave recession as the people that got shut out of their jobs didn’t have to cut back on their spending nearly as much as they would have otherwise,” he told CNBC.
Furman also warned that the economic recovery will likely be much slower than previously expected, as many companies will take the opportunity to cut costs — and jobs. “A lot of employers will use this as an opportunity to downsize,” he said.