For most of the last month — it seems like years — there has been a single national narrative, which has been the COVID-19 pandemic and its almost biblical wave of destruction, both in loss of life and loss of economic health, of which we’re reminded each passing minute. As humans, we’re not built for nuance; we think the world is about to end, or that we’re impervious to all threats, nothing in between.
We’re also a bunch of Monday morning quarterbacks, ready to pounce on decision makers who suggest anything that might carry even a minimal amount of risk.
That’s something we need to talk about as the pandemic’s curve is beginning to flatten and the nation’s economy continues its free fall. We have to figure out ways to reopen the economy without triggering a relapse in the contagion. But reopen the economy, we must and the conversation needs to start now.
That’s as true in Vermont, as anywhere else. Perhaps more so here since a high percentage of our businesses are small, the very ones who cannot afford an extended shut down. And, yes, there is stimulus money available for small businesses, but not nearly enough, and Congress is stumbling in its efforts to appropriate more.
Most of our local businesses can’t endure weeks upon weeks of no cash flow. Information from the JP Morgan Chase Institute shows the median small business has about 27 days cash in reserve. That’s the median. Twenty five percent of our small businesses have 13 days cash or less. Within those groupings, restaurants average 16 days, retail 19 days, high-tech manufacturing 32 days and real estate 47 days. Even health care services [excluding hospitals] have only about 30 days cash on hand.
If the federal stimulus money is held up through bureaucratic delays, or if it disappears before it makes its way to all who need it, that could be catastrophic. It’s infinitely more difficult to restart a business than it is to maintain it. There are also more of them than you might imagine. Take a ride down Main Street and think about the people who are running each one of those businesses. Think about how difficult it would be to replace them, and the time required.
It’s daunting that we’re even having this discussion, considering our economy was hitting on all six cylinders eight weeks ago.
In Vermont, Gov. Phil Scott he has the public’s safety foremost in his mind. He’s also made it clear it’s foolish to reopen things if we’re not prepared, only to have to close things down again. He has the public’s trust, which should allow him the necessary leeway to push forward.
What needs to happen now is a very strategic reopening of businesses in a way that does not expose the public or the workforce, but in a way that allows the engine of commerce to edge forward. What happens in one community doesn’t necessarily happen in another, but there has to be a strategy to the purpose. The public needs to know the state has a plan.
One example, locally, could be the reopening of Northwestern Medical Center on a limited basis. The hospital had to shut down all its elective surgery as it geared up to deal with the virus. That wholesale change in operation reportedly cost the hospital about a million dollars a week in lost business. The hospital, because of its preparedness, did not experience the peak load that was expected, thankfully. If properly scheduled, could the hospital not resume some of its elective surgery without endangering the patients or NMC’s staff? These are the sorts of things that will need to be discussed. These are the sorts of things that need to happen to avoid an even deeper recession than we’re in.
Ideas like this also need to be addressed in the same apolitical way they’ve been handled thus far. We need to maintain the trust that’s been on display. That’s what will ultimately get us to a better place.
by Emerson Lynn