Who Will Recover Faster From the Virus? Europe or the U.S.?

The main reason America did well was the rapid response of the government and the flexible nature of the American economy, quick both to fire workers but also to hire them again. Already the different approaches are yielding different outcomes, not only in terms of infections and deaths — where the United States leads the world — but also jobs, with unemployment soaring in U.S. while it remains largely stable in Europe. European governments, faced with an artificial shutdown, rather than a traditional fiscal crisis, have chosen to try to “freeze” their economies, in the hope of resuming them quickly.Already, said Mr. Pisani-Ferry, “everyone is pulling back a bit.” Some plans were very generous and “there is a question of balance — you want to avoid fraud and avoid companies keeping people on furlough if there’s no chance of rehiring them.’’ Many European countries have adopted what is known in Germany as ‘‘kurzarbeit,’’ in which firms promise not to lay anyone off but to share the work, while the government makes up much of the lost income.

Read more at: https://www.nytimes.com/2020/07/01/world/europe/coronavirus-europe-usa.html