 I'm very pleased to welcome today's speaker, Joe Stiglitz, Nobel Laureate in Economics in 2001, University Professor of Economics at Columbia University and author of several books including his most recent, People, Power, and Profits, Progressive Capitalism for an Age of Discontent. Joe has been involved with INET for many years and is co-chair with Mike Spence of our Commission on Global Economic Transformation. Joe will be talking to us today about re-evaluating the policy response to the pandemic. We currently find ourselves in an unprecedented economic situation because unlike previous economic crises where we were faced with either a supply side shock or a demand side shock, we are in a situation now where we are going to have to deal with both and the standard policies that economists rely on in recessions may not be up to the task. We have seen an unprecedented response from the government in response to the pandemic, but there are real questions as to whether it has been sufficient or efficient. Joe has been tracking this response closely and we are delighted that he can share some of his insights with us here today. A few words about the structure of the webinar. After INET's President Rob Johnson says a few words, Joe will present for about half an hour and we will then open it up for questions. At the bottom of your Zoom screen you will see a Q&A icon. You can type in your questions there and we will get to as many as we can in the time we have. Rob, over to you. Can you hear me? Yes. Can you hear me now? Good. Thank you, Peo, and welcome everyone. I guess I just wanted to bear witness to the depth and duration that Joe Stiglitz has been an influence at INET. I met Joe in the fall of 1980 when I was a graduate student at Princeton. Bob Solo and Charles Kindard Berger told me that's the place I had to go to graduate school because he was going to come there and he was the most creative person in the discipline. Within two years I got a taste of that because I took his course in advanced theory with three other students and we all walked home and I remember they said this course is amazing. We derive everything every day. We don't study papers, we build them together. And then Joe tricked us all at the end of a year with a general exam where he said what you really should do is recognize that you've been studying economics for a long time but after tomorrow when you finish your general exams you're going to start creating economics. So let's get a head start for the next three hours. Tell me what's not in the literature that you would like to see. And I remember when we turned that paper over and we all looked at each other we just like it was almost like that's exactly what I should have thought Joe Stiglitz would ask. Afterwards I remember talking with my colleagues and we made a statement which I repeated at a celebration of Joe's 50th year of teaching and that is that Joe Stiglitz doesn't teach economics. He teaches courage and creativity and he applies it brilliantly as an economist in many many different places but he's breaking the walls down and rebuilding with a different vision in ways that have nourished us all many many times. Thanks for doing this today Joe and I look forward to listening and continuing to learn from you as I have now for almost 40 years. Well thank you Rob very much and for those very kind words. The subject of the policy response to COVID-19 is obviously absolutely fascinating. So many lessons to learn about economics and so many ideas about what we've done, what we need to do. So I've prepared a PowerPoint and let me try to share it with all of you. Let me begin by making a few introductory marks about what we needed to have thought about as we were designing the policy response. What is very distinctive about this crisis. Then go on to a brief description of why the US was in such a bad position for responding to the crisis. Then I'll talk about the objectives of what we had in mind and why we failed in achieving those and then finally come to talk about what we should be doing next. So in terms of what we should have been in our minds as the crisis struck we're about four basic ideas. The first is there's a very high level of uncertainty about the course of the disease and its economic implications and that implies that we need to have flexibility and adaptability. At the beginning many people thought it was going to be a short interruption, maybe at most a 10-week interruption and there would be a quick v-shaped recovery. That was a fantasy then and it's clear now that it's a fantasy. It's going to be long at best a U-shaped recovery and when we structured the program we didn't really take that into account. So we allocated almost three trillion dollars but it is now clear that we're going to have to spend a lot more if we're going to address the economic consequences of the disease. One of the aspects that one should have taken into account in designing a program is in terms of this uncertainty is index programs where expenditures are linked to outcomes to the evolution of the economy and this is much better than repeatedly having to go to the trough, repeatedly going to Congress. Particularly important in America's dirty politics is every time you go to the trough the special interests come in and need to be bribed in order to get it through Congress. But it's also important because one of the real issues now is extreme precautionary behavior is going to emerge out of this crisis. We want people when the pandemic is put under control to spend but if there's uncertainty as there will be about whether the economy is going to have a robust recovery people are going to harbor their resources they're not going to spend and we will emerge with the deficiency of aggregate demand. It will be an extreme version of what you might call Keynesian liquidity trap and that's the direction we're going to go. Right now there's a big fight going on in Congress about indexing where the Democrats are saying they ought to have indexing and Republicans say no. The second important point relates to this fact that we are not going to have this v-shaped recovery and that we're going to need much more assistance and that means the money has to be targeted. It has to be as well targeted as possible because there will inevitably be reluctance about the amounts of money that we're going to spend. The CBO already is talking about by September we'll have a debt-GDP ratio of 101% but it's actually going to be much higher than that. That was a somewhat rosy scenario. The third important thing to keep in mind is that there's a key role of implementability. What you can implement depends on the institutional infrastructure that's already in place and the contrast between the United States and many other countries has become very evident. Argentina was able to make a decision that children ought to be getting funds and make that decision on a Tuesday and the funds were out there on a Friday. The United States has said for the poorest Americans those who didn't fill out tax returns in 2019 it may be September before they're able to get their $1,200 check and that means that they're left to fend for themselves for months on end. Another example of the limitations of our implementability is that there are limitations in our ability to expand the unemployment insurance program rapidly. That means for instance that as the tens of millions of people have applied for unemployment the program has been overwhelmed and we're likely to have similar problems in the case context of Medicaid. The government in some sense recognized those limitations and it turned to the banks as the implementing agency but that was fundamentally flawed. There were conflicts of interest, there were limited capacities and we'll see some of the problems in our programs are exactly related to the choice of the banks as part of the implementation process. As an example of an alternative we could have turned to the COVID to the data processes agencies which had greater capacities. The final preliminary mark I wanted to make is that the COVID-19 revealed weaknesses in our markets and government and society. Multiple market failures but also in terms of lack of resilience, short-sightedness and ability to respond quickly really quite shocking that a market economy like the United States couldn't even make masks. A lot of people have found it absolutely revealing about the limitations of markets but obviously we've watched government failures but I want to emphasize the government failures are a link to the long-standing attempt to denigrate the role of collective action of science and you know those attempts beginning in the Reagan administration actually work to debilitate the government and we're seeing part of the consequences of that. The crisis also revealed weaknesses in our society the massive inequalities and income wealth and health COVID-19 has shown itself not to be an opportunity disease it goes after those with health problems and many of the frontline workers who are the most essential were both the lowest paid and the most exposed. Again government didn't do what it should have done OSHA which is our government agency for safety and health didn't protect them and employers remarkably were too short-sighted and greedy to protect them. The final introductory remark I want to make is that the decisions about who gets money and what terms may shape and distort the economy for years to come. In many cases they are life and death decisions we didn't have a vision of what kind of an economic society we wanted to see emerge from the crisis and as we were putting out trillions of dollars we didn't think about as I say what kind of society economy we want and once you recognize that crises in their aftermath tend to be moments of intense distributive conflict we should expect nothing less and how they resolve will have profound effects on our society. In fact what we've seen is that in the battle for the structuring of program we're seeing the existing power structure the existing power conflicts manifesting themselves very dramatically and that again I'll come to more clearly. Well again as background the US was ill-prepared for the crisis. We had a weak health status United States declining life expectancy and life expectancy lower than in other advanced countries weak systems of social protection. All of this is related to the high level of inequality the absence of public provision of health care and particularly relevant as I said before because of the nature of COVID-19 and as ill-prepared as we were say in 2016 over the last three years things have gotten much worse as the Trump administration's got funding to CDC not replenish the national stockpile of needed medical supplies not maintain ventilators to polish the White House office on pandemics. So I'm going to go through very quickly some charts that show the data in a very dramatic way. The death rates in the United States in virtually every core category that you think of are much worse than in other countries and that's true both for younger people and for older people. Health insurance life expectancy in the United States is markedly lower and declining. Health insurance coverage is lower than in other advanced countries it's partly because other countries provide health insurance. The number of people with no health insurance obviously declined dramatically when we provided Obamacare but now since Trump has gotten elected that number has increased. One of the things I mentioned earlier is that has been revealed is that we created a system that was not very resilient we were very short-sighted and one aspect of our short-sightedness was to say we don't need to have spare tires in our cars we don't want to have empty bags because that's a waste of resources and one of the problems of having no empty bags is when you have a surge in demand like in a pandemic you're are ill-prepared and so this compares the number of hospital bags per thousand in the United States with the OECD all the shows very dramatically that we were less prepared. Now let me now turn to the government programs. There were three key objectives maintain health protect the vulnerable and then to ensure the preconditions of a robust recovery and that includes preventing bankruptcy cascades and protecting the balance sheet for recovery I'll come back to that in spite of the huge magnitude of expenditures by some accounts three trillion others seven trillion it looks like the programs have failed on all three accounts now there's next stage that we're going to be coming to which once the pandemic is under control we want to ensure robust recovery and this is unlikely to happen on its own and there will be a need for a large well-designed fiscal stimulus and it's very interesting that the chairman of the federal reserve made that very clear in his speech yesterday so let me go through each of those categories first maintaining health an example of what we mean by maintaining health is it's preventing contagion we don't want those who are sick to go to work but the U.S. among the advanced countries has the poorest provision of paid sick leave and especially poor among low paid workers only lowers only 30 have it in the low in the lowest exile the interesting thing congress recognized the importance and they passed a law of mandating paid sick leave for COVID-19 very limited but just for COVID-19 but then under pressure from our largest corporation they exempted 80 percent of workers and that of course means that since they are living hand to mouth close to half you know half or more of our workers live paycheck to paycheck have less than $500 in the bank account if they get sick they go to work if they possibly can and that of course leads to more spreading of the disease on this particular slide I've given a lot of other examples of what we should have done to maintain better health like OSHA imposing health standards but it has refused to do that there's a very simple underlying economics here and I think it really is important to emphasize this there are large externalities individuals employers incentives are not aligned with those of society because they don't take into account the cost they impose on others by this spread of disease it's just a classic example of an externality and workers don't have bargaining power if they had bargaining power they would have insisted and you know I know people here in New York who were being exposed went to the union the union demanded said if you don't provide it will go on strike they got the mask but most people in the United States are not protected by unions and so they were left to defend for themselves government didn't step in there's a little point here that not a little point but I want to emphasize it's more of a broader issue the intellectual property regime doesn't promote access to medicines vaccines and other products it may actually play a role in the lack of access and this is going to become even more important when we go to the next stage of developing retrovirals and and vaccines it's something that we really ought to be focusing more on the second objective was protecting the vulnerable and maintaining the workers link with the workplace maintaining workers link with the workplace place was important for two reasons it it would enable the economy to start back again once the pandemic is put under control but it's also important because it's the most cost effective way of providing assistance it avoids the cost of rehiring displacements are associated with hysteresis effects lower productivity and it's especially important in the United States where the majority of our citizens depend on employer provided health care and in this respect the US performance has been quite frankly dismal 33 3.5 million newly unemployed we didn't keep that link and the unemployment rate probably measured in what is called u6 a broader measure is somewhere between 20 and 25 plus percent so the the we obviously didn't maintain the kind of link that we had hoped this shows that the US provides the low levels of unemployment insurance compared to other countries and it's particularly low for those who are unemployed for more than six months and the replacement rate in the United States is also low compared to other countries the projected increase in the unemployment rate by the IMF is much lower higher in the United States than in other countries a demonstration that we've done a much poorer job than other countries explaining their failure is actually not that hard their programs were not comprehensive they are not well targeted they were shaped more by lobbying than economic analysis they largely left out important sectors of the economy like state and local governments research institutions higher education large NGOs the PPP program which is the particular program designed for small businesses was particularly badly designed with high administrative costs in the billions of dollars with banks as intermediaries and the result is that money money went to the good customers of the banks construction firms which were not listed as the most vulnerable to large firms it didn't go to the most vulnerable so four percent of the loans accounted for 43 percent of the dollars even though there were a lot of small loans most of the money went to the very big companies there were a whole set of other problems there was a provision to encourage people to keep their workers and it said if you keep keeper workers your loan would be forgiven but there was a total lack of trust nobody believed that government would honor that provision and so what happened is many used the money to build up capital buffers but didn't pay any attention to the provisions that were designed to keep workers on the job there was a lack of transparency a lack of prioritization it didn't we didn't identify where money would be most effective the analytics of trying to identify where money was most of central in a complex network the economy is actually a very difficult question and I've recently done a couple of papers where we've tried to look at figuring out what the answer to that let me emphasize that when I say we did badly we did badly relative to others and relative to alternatives that were available I was trying to push Congress to look at these alternatives other countries Denmark and New Zealand took an alternative tack of giving money directly to employers who maintained employment now there are in Congress now both in the House of Representative and in the Senate proposals along these lines the costs are a fraction of the PPP program it's a comprehensive program and even though you might say it's too late it's not too late because unfortunately this crisis is U-shaped not a V-shaped and it's going to be worth doing now the pandemic is going to last a lot longer than June 1st which is what the program was designed for and to reiterate although 2.7 billion seems like a lot of money it's so badly designed and so badly targeted it's not going to suffice and that's why it's really important as we go into the next stage to think more carefully about where we want to go so the third point was establishing the preconditions for a strong and quick recovery part of that was providing liquidity and and that's where the massive money from the Federal Reserve has played an important role but it only went to corporations there was a big lacuna was households there was a stay on government-insured mortgages stay on student loans but not on other mortgages not on student other student loans not on credit card debt not on car loans in a way you can think about what happened is the rest of the country was put on hold and yet the banks will continue to collect interest it's even worse than that because in our credit card debts there's basically usurious interest rates fees and the implication for the recovery is the balance sheet effects are going to be disastrous there are already symptoms the failure pay ranks is up from 18 percent a year ago to 31 percent of the tenants so we are facing a problem now there are as we think about the recovery three critical tasks first we need to stimulate the economy and the standard macro model multipliers could act in reverse with a vengeance that is to say as people cut their spending because of lack of balance sheet and precautionary behavior it will weaken the economy strongly second we want to avoid debt spirals I come to talk about that and third we want to manage supply chain problems the macro model model multipliers are very familiar we saw those in 2008 the point that this began differently from any other crisis is important but it will morph into some of the manifestations of a traditional crisis the balance sheet affirms households and banks are being hurt badly there's an increase in uncertainty greater than normal and that will induce precautionary behavior and both will contribute to significant reductions in aggregate demand and we know from the 2008 crisis that multipliers and deep downturns are large and therefore this may be unless we do something along and deep downturn the second thing is debt spirals are the kind of thing that I saw so vividly in the 1997 global east Asia financial crisis where 70 percent of the firms in Indonesia 50 percent of those in Korea and almost 50 percent in Thailand went into default or financial stress financial group is easy to describe bankruptcy cascade a doesn't pay b b can't pay c c can't repay a you get what is called systemic bankruptcy these are extraordinarily hard to resolve a lot of the money is trying that the Fed is putting out is trying to prevent that but given the big holes in our system and given the high level of debt that the low interest rates and the lack of oversight have resulted before COVID-19 means that we are will be seeing I think high levels of debt and in the context of the 1970s Asia crisis Marcus Miller and I made a proposal for a super chapter 11 but of course even more important is providing money in a way which doesn't require bankruptcy easy to do with for publicly listed companies but it's a lot harder for privately held companies the third issue is the supply chain problems as we said in the beginning it's not just a demand problem for now a stimulus of misnomer but there's a lack of supply shocked out of production and that of course will create its own lack of demand and there could eventually see shortages and important products including medicine and certain foods and this will be especially important with the interruption of global supply chains and especially in some countries worried about shortages impose export restraints and there's also going to be large changes in the structure of demand at least in the short run less demand for air travel more demand for zoom and markets on their own don't manage such changes well so we are going to need to think more carefully about what we do about these problems now some people seeing this enormous increase in liquidity have become worried about inflation I think that there will be problems as I said before in particular goods and we will need to consider government interventions in the production distribution of certain essential goods but at the macro level it's I think my judgment is more likely the more likely outcome is there's going to be deficiency of aggregate demand as a result of the balance sheet effects combined with precautionary behavior it will require careful monitoring but I think as I say the the weight of evidence right now is that we're going to be facing a deficiency in demand so let me finally come to talk about what are some of the key elements in the next package I began by talking about the paramount importance of health we aren't going to go back to a normal economy until we get the pandemic under control and that's why the key health provisions are essential the second is extending unemployment insurance with triggers a particular point on this that has not gotten a lot of attention although it's in one of the bills before congress is that new insurance to the labor force won't be covered by unemployment they're going to be facing a very hard labor market and we need a comprehensive program along the lines of something that europe has done in the 2000 euro uh eight ten euro prices every young person should be in a job in school or in a training program um the third thing is rather than the ppp go to the paycheck guarantee program the new zealand denmark program where you get money directed to companies to pay workers the fourth thing is comprehensive support including aid to states and localities really important next slide we'll talk about that aid to higher education so all the programs need to be accompanied by conditions and priorities corresponding to our vision the post pandemic economy which includes a green economy with more transparency better governance better treatment of workers fewer abuses of corporate governance and so finally let me say uh the importance of the uh essential role for support of state and local government uh i'm emphasizing this it should be obvious but it is right now turning out to be one of the big controversies in congress um in the 2008 crisis tax revenues declines were twice that of gdp uh and because the stakes have balanced budget frameworks expenditures declines uh have to be uh decrease in tandem um and because these are uh labor intensive uh the employment decrease will be even greater so the bottom line is that uh if we don't provide support for state and local government we will have built in automatic austerity uh austerity not coming from the top we've obviously spent money but austerity coming from below and that will impede recovery if you look at the numbers that alone will make sure that we uh will have elevated levels of unemployment uh the fed has uh talked about lending facilities for the stakes that's not the problem the stakes have a balanced budget framework and if the revenues go down they have to cut back on their expenditures uh the uh mich mcconnell uh has said they should go into bankruptcy actually uh he should know better than that because uh there is no provision in our bankruptcy law for stakes to go into uh uh bankruptcy governor komo said uh challenged him and said uh uh why doesn't congress try to pass a bankruptcy law and see what the consequences to be it's really important uh it's a key to education welfare social production and health so this is the health crisis undermining states and local governments will be undermining health well i've tried to go through uh very quickly uh some of the elements of um what we should have done what we need to be doing there's a lot more uh that i could have gone into i focused on the united stakes the problems are parallel in other countries but united stakes has provided a good pedagogic tool because it's done things so badly but uh there is a global problem there are is going to be a a cascade of global bankruptcies unless we do something uh internationally and i haven't been able to talk about that but in the question period we uh welcome uh some discussion of those issues so thank you and let's open up to questions joe thank you that was an amazing uh talk because it covered so many different issues and gave us some real insight on what's actually happening in the moment uh we have a number of questions uh we actually have participants from all over the world so some of them are um questions having to do with the global economy but i had a question that was um related actually to the us uh one of the points that you made which i think is critically important is that the packages that we've had so far have been very badly designed and very badly targeted um i'm sitting in silicon valley and there's a lot of there has been a lot of discussion for several years now about whether or not a ubi would be the right way to go specifically to talk about issues around automation uh and many people feel like this what's happening now is a vindication of some of these ideas because we're seeing what in some ways looks like a ubi um given your point about how badly targeted uh the money that has gone out already has been what does this imply for thinking about a ubi for for the future does this really look like a ubi is this telling us that we should be thinking about ubi or is in fact telling us that we need to be going in exactly the opposite direction well uh the 1200 dollar uh payment that we uh was part of the uh uh package uh is a kind of ubi not quite universal because there were income limits but it went to uh the vast majority of americans it was necessary because we recognized we couldn't do a better job of targeting although the paycheck guarantee program i talked about does actually uh a much better job than uh brings things to the ppp program but uh when we uh recovered from the pandemic uh there's still one of the reasons i i've not been a big fan of ubi is when i look at uh the world for the next 30 years i see uh huge needs uh we have to make a green transition we need huge investments to make that green transition uh we have to care for the aged they're going to be uh we have inadequacies and in our infrastructure uh in our education system uh in our research so i think of all the needs that our society has and uh so i believe that for the next 30 years if we can organize ourselves we should be uh committed to making sure that everybody who wants a job can get a job we need uh uh to use those labor services and for most people work as an important part of their life so they want to work so they want to work we need their their efforts and so rather than ubi i'd like to move in that uh direction and fulfill the commitment we made in 1948 uh we made a commitment in 1948 that we would provide jobs for everybody in the full employment act so we made the commitment we unfortunately haven't always honored it finally let me say that uh the challenge of maintaining full employment is going to be made more difficult by covid 19 and the reason i say that is that um the cost of labor will go up significantly because the organization of labor is going to have to embed social distancing and as we think of that extra cost and that extra risk uh some firms are it's going to till firms to move into more capital intensive processes so i think that we are going to see that for instance uh one of the things that has been exposed by covid 19 is the lack of resilience of our global supply chains there's going to be some insourcing but when it comes back into the united states it'll be done by robots not by humans so i think uh the labor market is going to be facing uh to put it euphemistically challenges uh in coming years yeah definitely thank you uh i'm going to shift now to some of the questions we have coming in um we have a question here from geordi velasco that says us our modern modern monetary theory theory recipe is good enough to tackle this particular crisis yeah let me try to explain uh the origins of modern modern monetary theory and uh why uh it actually raises the questions that uh should be a warning the idea of modern monetary theory is stimulated by the fact that in the 2008 crisis the federal reserve expanded its balance sheet from roughly 800 billion to 4 trillion and there was no inflation and so people say well uh why don't we just print money and that will enable us to finance anything we want uh of course there's some limit but clearly we can do a lot more than we've done in the past the reason that the expansion of the fixed balance sheet from 800 billion to 4 trillion didn't have an inflationary price consequences was the money just went into banks balance sheets it just went into the banks and wasn't lent out so it didn't work to stimulate the economy so because it didn't stimulate the economy it didn't put any inflationary pressure if the banks had lent the money then it would have led to an increase in aggregate demand and an increase in aggregate demand of that magnitude might have been inflationary now we're going through exactly the same thing right now and i mentioned that very briefly in my talk uh i worried that what is going to happen you know the 2.7 uh trillion dollars uh much of that is not going to show up translate into a sustained increase in aggregate demand a lot of it is going to be held not now just by banks but by firms uh who get that money uh as precautionary balances they're extremely nervous and they'll just hold on it now some of them will take that money and put it into the stock market uh into assets so we'll see some asset price increases one of the reasons why the stock market is doing very well is the Fed is putting out money and some of that money is going to be held in those forms and um because banks are paying sexual low interest rates but it's not going to go into an increase in aggregate demand so modern monetary theory can't be used for saying let's use that for financing real investments by government if you increase government spending in real terms not in transfer payments but by building roads say by a few trillion dollars that would uh start in a once we get back to normal not not now but once we get back to normal that would have uh could have inflationary pressures i have a question here from Anisa noichiku what is the potential of recent initiatives like the technology access partnership just announced by the un to increase access to critical ip and build capacity in multiple countries and regions to support highly concentrated global supply chains of critical goods well i don't know the details of that particular uh program but uh obviously uh um one of the concerns i mentioned again very briefly in my talk was intellectual property uh one has to have access to intellectual property um one of the lack of access to intellectual property uh leads to market concentration inequality and uh puts at emerging markets in developing countries at a disadvantage and i've long been engaged in discussions of uh trying to create what we call a development oriented intellectual property regime trips was not development oriented it was very much a intellectual property regime uh written for and by the vex countries and particularly by uh intellectual property interest in those countries that were not really interested in maximizing even growth in the united states it was really maximizing rents for uh the owners of the intellectual property in the united states and in europe yeah uh we have a number of questions about inequality i'm going to read one of them from mohammad badran which says in the post-covid 19 era what is the tentative idea on what would happen or could happen to inequality between and within countries well i think within countries it's very clear that uh it seems to be exacerbating those inequalities and you're certainly in united states i mentioned uh that it is not an equal opportunity disease that is going after those at the bottom uh those at the bottom are uh uh uh being you know laid off uh facing more economic pressure uh those at the top can continue doing what they're doing on zoom uh and work remotely those at the bottom actually have to have physical pressings and so the disease itself is uh affecting uh differentially those at the top and the bottom but this is going to then uh have multiple uh multiplier effects coming out of the pandemic the balance sheet of those at the bottom is going to be much more devastated there is increasing worry about foreclosures will they be able to pay back will they lose their homes will they lose their cars so unless we do something i think it will be it will exacerbate the wealth inequalities uh across uh the economy and especially true in economies like the united states so reason why i say that is for instance a lot of individuals have borrowed money uh to pay for their education very uh american uh problem two trillion dollars of student death uh doesn't exist in most other countries a few other countries have it um uh if you don't have a job you're not able to pay back your student debt uh interest accumulates and so uh again uh is going to uh affect those inequalities now across countries uh we don't yet know uh how this is going to play out the less developed countries the emerging markets obviously have less capacity to handle uh the disease to respond uh health conditions are worse uh people live in greater proximity so there are many reasons to be uh very worried about the disease and its economic impact impact on less developed countries an interesting aspect of this disease that we don't fully understand is it seems to have affected some countries much worse than others and some of the developing countries about who one would be about which one would be most worried have only had a limited attack um some uh emerging markets have managed it very well like argentina has done a very good job at managing the disease but at some economic cost so uh there is if you look across countries there are very varying uh impacts both the disease directly i am in the economic impact and of course that is means that some of the countries are going to be much more uh uh much weaker uh one of the big uncertainties is going into the crisis many countries were uh overburdened by debt financial markets had overalent a lot of us said after uh uh the jubilee 2000 debt restructuring we should keep debt down uh but you know it's been 20 years and debt has now uh risen uh banks rushed in in many cases into many countries and uh there are there is our worries about debt crises uh the IMF has had a large number of applications for assistance and uh making things even more difficult is of course the crash of the oil price for oil exporting countries uh and commodity prices also are not doing very well and there's a flood of money out of emerging markets money is if we say is rushing uphill uh like it has never done before so there are many reasons to believe that the crisis will aggravate disparities between uh the richest in the uh countries and the rest uh a lot of this will depend again on how we manage that i've been advocating for instance uh very strongly we need um a 500 billion s dr issues special drawing right issue with the IMF uh and the head of the IMF has advocated that but so far it's not been forthcoming uh i'm going to go to one more question which is actually a difficult one you've laid out some really important um ideas for how we should think about solutions um a number of people have asked including a question here by nick butchersky what are the odds of getting something like this passed through congress uh i think we will get something passed through congress it will have some of the ingredients that i've talked about um unfortunately we have a very polarized uh congress uh and uh with a lot of ideology playing out on the republican party um so uh until november until we elect a new congress in november if we get a democratic congress in uh november a democratic senate the democratic house and democratic administration i believe we will get something along the lines that i've outlined if not um what i see is uh the ingredients of a political compromise emerging as the following uh the business interest in the republican party their number one priority right now is uh immunity from liability uh the uh they've sent their workers if i can the meatpacking planks into work without protective gear without masks i gave the example uh in new york uh where you know simple product book sure they want them to go in to work without masks union stepped in and stopped that and said you have to have masks and the employer did it but in much of the country we don't have unions we government hasn't stepped forward and uh the employers want immunity to be able to do whatever they want um that's number one and a lot of them are really afraid of suit it seems to me not unreasonable to say if we adopt strong guidelines protective guidelines and you comply with those guidelines then and not not just good faith effort i mean really comply with those guidelines if you can't provide masks you don't ask them to show up for work and if you don't you know protective gear if you don't if you need social distancing and you tell them to be very crowded then you redesign the workplace but if you really do the things that are now recognized to be necessary for uh health then you should be protected from suit so that kind of a deal combined with aid to state local governments not the amount that they need but some compromise amount is likely uh to emerge i'm not so confident that the paycheck guarantee scheme that i described uh before as being really a key ingredient that's worked so well in so many other countries i i think it really should be i i i not that optimistic i do think that this that the imperative of providing uh uh some security for unemployment is sufficiently great that something will be done about that but probably uh whether we'll get the automatic stabilizers that we need to give people the confidence that our economy needs that's a little bit still up in the air so i the answer is the nature of politics it'll be a compromise it won't be what we need and the result of that is uh we won't be going back any anything like a v shape we won't see that upper part of the u shape uh during the trump minister during this year and uh whether it'll be 2021 or 2022 or 2023 will really depend on the policies that we're going to embark on and unfortunately it won't be into 2021 before we will have a chance to really get the policies that we need thank you joe that was really interesting and um very instructive and i really wish that we could find a way to make sure that our policymakers could um hear all of these wonderful points that you've made to us today i think it's critically important um so thank you for taking the time to speak with us today i'd also like to thank all our participants from all over the world um one of the few silver linings of this pandemic has been that we can directly reach out to so many people through webinars um and actually connect with our inad community all around the world much more than we had been doing before uh we actually have two more webinars next week so on wednesday at 11 30 eastern we're going to have a round table on the impact of the crisis on the eurozone with marise chilleric uh laurence bone adam twos and it's going to be moderated by jillian tet of the financial times and on thursday at noon we're going to have nobel prize winning economist michael spence joining us to discuss strategies for reopening the global economy so i very much hope you will join us for those events too and you can register on the inad website and i want to thank you all and thank you jo