- GDP estimates show the U.S. economy will be harder hit than China’s by coronavirus.
- China’s stricter government controls and differing industries make it easier for the country to weather the coronavirus storm.
- The latest projections show U.S. politicians are heading into the crisis without a road map.
At the forefront of the coronavirus pandemic is how to minimize the loss of human life. But the economy has played a starring role in this tragedy as well. Many are looking to China, where life is starting to return to normal, for clues about the coronavirus’ economic impact.
America Will Suffer More than China
Estimates show that China’s economy will decline 10% in the first quarter. With coronavirus under greater control and the Chinese economy restarting, the nation is even expected to show a slight uptick in activity at the end of March.
By all accounts in the absence of another outbreak, China’s economy could see a V-shaped recovery.
America’s prospects look far worse. Estimates of how much U.S. GDP will fall in the second quarter range from 14% to 50%. Unemployment is seen rising to historic highs.
All of the predictions, no matter how optimistic, expect the U.S. to be hit harder than China.
Here’s a look at why China’s economy will fare better than America’s during the coronavirus pandemic.
Government Controls Helped China Slow Coronavirus Spread
In China, government control is the norm—so when coronavirus broke out police had the power to forcibly quarantine citizens and seal off entire towns. Those drastic measures are likely responsible for the nation’s relatively short-lived outbreak.
In the U.S., the government asked people to self-quarantine when they were ill. They advised social distancing but many balked in the face of those requests.
Even now, as entire states go into lockdown mode, the government and the police…