The debate over opening New Zealand during Covid-19 is picking up. A year on, tempers and patience are fraying and the government so far displays no indications of longer-term planning.
Two states in the US have recorded contrasting experiences and results.
New York’s Democrat governor, Andrew Cuomo, shut down the state straight away and many of his rigid policies remain in place. Down south in Florida, Republican Governor Ron DeSantis took the opposite position.
Agreed, New Zealand and the US are vastly different, but the comparisons between the states of New York and Florida demonstrate how returning to an open economy has brought economic advantage.
Andrew Cuomo is something of a raconteur at home centre-stage. He became a national hero with his daily media conferences urging New Yorkers to double down, bear the costs and consequences. He was also the most voluble and consistent critic of President Donald Trump who, in the early days, maintained the virus would be gone by spring, or something.
DeSantis was the very opposite. Reticent, not a convincing public speaker, he was among the first to lift his state lockdown, adopting a strategy of protecting the vulnerable while keeping businesses and schools open. Significantly, he was close to Trump who by that time had moved his residence to the Sunshine state away from New York.
A study by the Wall Street Journal presents an interesting contrast. Cuomo’s standing has crashed following allegations he concealed Covid-19 deaths in rest homes, followed by a cluster of allegations of misconduct with female staff. On the other hand, DeSantis’s star is rising. His state has weathered the pandemic better than others like New York and California, which stayed locked down harder and longer.
Florida’s death rate is in the middle of the pack and only slightly higher than in California, which has a much younger population.
Florida’s death rate among seniors is about 20% lower than California’s and 50% lower than New York’s, based on data from the Centers for Disease Control and Prevention.
Many Democratic governors, including Cuomo and Phil Murphy in neighbouring New Jersey, early in the pandemic required nursing homes to accept Covid patients discharged from hospitals, though many were short-staffed and unable to care for them properly. The New York investigation by Attorney General Letitia James estimated that the state’s nursing home deaths were 50% higher than Cuomo’s official figures.
The WSJ reported how Cuomo’s aides rewrote a report by state health officials in June to omit the number of New York nursing-home residents who had died in hospitals during the pandemic.
DeSantis took a smarter approach. His administration halted outside visitations to nursing homes and bolstered their stockpile of personal protective equipment.
It set up 23 Covid-dedicated nursing centres for elderly patients discharged from hospitals. Nursing-home residents who tested positive and couldn’t be isolated in their facilities were sent to these Covid-only wards. Florida set up field hospitals to handle a surge in cases that models predicted in the spring, although it never materialized.
Mortality data bear out this conclusion. The Covid death risk increases enormously with each decade of age. More than 80% of Covid deaths in the US have occurred among seniors over 65. They make up a larger share of Florida’s population than any other state except Maine.
Based on demographics, Florida’s per-capita Covid death rate would be expected to be one of the highest in the country.
DeSantis says the models about hospital overcrowding never came close to bearing out forecast problems.
“Some of those policies that were done in other states were motivated by those models. And those models did do a lot of damage.”
He shut down most businesses when President Trump issued guidelines for a national lockdown on March 16 with 15 days to slow the spread. He kept restrictions on nonessential businesses for several more weeks, but let more places stay open than other states, including child-care facilities, construction sites, hotels and beaches.
Florida’s infection rate during April remained similar to California’s, where most beaches and residential construction were restricted.
Florida began a phased reopening in early May, allowing restaurants, barbershops, nail salons, gyms and other retailers to operate initially at 50% capacity provided they follow social-distancing and sanitary protocols. Bars were later allowed to open at 50% capacity and limits for other businesses were increased.
Florida’s theme parks—important employers and tourist attractions—reopened at reduced capacity. Florida’s cases climbed in June as people socialised more, including at graduation parties, summer cookouts and on Father’s Day.
Cases rose across the Sun Belt, including in California, which maintained much stricter business restrictions. Still, political pressure intensified on DeSantis to shut down his state again.
He ordered more-frequent testing for nursing-home workers and deployed more personnel to hard-hit hospitals. In late July, cases in Florida and across the Sun Belt began to fall.
In September DeSantis lifted capacity restrictions on restaurants and bars. He also overrode local jurisdictions that tried to keep them closed. Every business has the right to operate; you cannot close anything, he says.
Local school districts had to offer in-person instruction five days a week in the autumn, although parents could choose remote learning instead. Teacher unions took the state to court but the government won.
In California, the teachers’ unions in large school districts have refused to return to classrooms. They claim schools are unsafe. Per capita Covid cases among children are about the same in Florida and California.
Employment declined by 4.6% in Florida in 2020, compared with 8% in California and 10.4% in New York. Leisure and hospitality jobs fell 15% in Florida, vs. 30% in California and 39% in New York.
Florida’s freedom has drawn people and economic activity to the state. Airlines are adding flights and DeSantis says there has been an acceleration of business interest. At least 35 large businesses have moved to the state since the pandemic began.
According to Census Bureau data, Florida’s per capita business formation between April 2020 and January 2021 was twice as high as California’s and 75% higher than New York’s.
Real estate across the state is booming. Home sales increased 20% in the last six months of 2020 compared with 2019, while the median sales price rose 14.4%. Construction wages and salaries during the third quarter were 3.2% higher in Florida year over year but 4.8% lower in California and 9.3% lower in New York.
“We’ve shown people that you can have a good time, you can be safe, and you can make the decision that’s best for you.”
Lessons here for New Zealand? Open the economy and look what happens.