Historian explains why Donald Trump’s COVID-19
response is remarkably similar to Herbert Hoover’s
failed crisis leadership

I HAVE MADE THIS SAME COMPARISON HERE

 April 14, 2020 By Robert Rupp  History News Network - Commentary


On April 9, the New York Times reported more than 6 million new unemployment claims for the previous week, and nearly 17 million over the previous three weeks. As this massive unemployment has followed the coronavirus crisis, a comparison between Presidents Donald Trump and Herbert Hoover becomes more apt than ever. For both presidents failed to project candor or show leadership during an unprecedented national crisis.

President Hoover during his first year in office confronted an economic collapse. Unemployment soared to a record 25% at time when most Americans did not have access to unemployment benefits let alone health care. But as the nation sank into the Great Depression of the 1930s, Hoover radiated confidence. He was fond of saying that prosperity was just around the corner.

Hoover allegedly explained his optimistic proclamations by saying that “A doctor does not tell his patient how sick he is.” His lack of openness prompted a pushback as opponents during his administration labelled the slums built outside major cities as “Hoovervilles,” and encouraged people to call an empty pocket turned inside out as a “Hoover Flag.”

Like Hoover, Trump leans toward overconfidence rather than openness. According to the Washington Post, he had sought to downplay the coronavirus threat 33 times in February and March. At the start of the pandemic Trump appeared to dismiss the threat by highlighting low numbers (only 5 deaths and 15 cases). In the following months he repeatedly ignored Winston Churchill’s observation that “ There is no worse mistake in public leadership than to hold out false hope soon to be swept away.” On April 3, President Trump did warn Americans that this week “there’s going to be a lot of death.” But then he talked about “the light at the end of the tunnel.”

Another characteristic shared by the two presidents is an avoidance of strong presidential action; each proved reluctant to use the full power of the federal government.

Any discussion of presidential leadership must first recognize that Hoover was not a laissez-faire bystander as the depression worsened. Over the objections of his Secretary of Treasury, Andrew Mellon, who fought any federal action, Hoover pushed for historic initiatives such a Reconstruction Finance Corporation, which provided loans to banks and other major businesses and a Home Loan Bank to help the construction sector. He also undertook “jawboning” to convince certain industries not to reduce wages and promoted a direct loan to state governments for spending on relief for the unemployed.

However, Hoover’s initiatives were constrained by his conservative political philosophy. He had strong ideological resistance to excessive federal intervention—a profound belief that such action would undermine initiative and responsibility. He expressed his strong views in his 1922 book American Individualism, which highlighted the danger of collectivism and a reliance too much on the federal government. In this regard he believed that assistance should be handled on a local, voluntary basis rather than on the federal level.

The American public would have to wait until President Franklin Roosevelt initiation of the New Deal and mobilization efforts during the World War II to witness dramatic model of full government intervention.

Like his overconfident pronouncements, Hoover’s principled resistance to extensive federal intervention did not serve him well as president and may have undermined his political future. Hoover was elected with 444 electoral votes winning all but 8 states in 1928. Four years later he received 59 electoral votes and carried just 6 states. Today no politician mentions him, except to compare their political opponent to him.

If history shows Hoover followed the wrong path for principled reasons, what will it say about Donald Trump, who has several tools that were not available to Hoover? Unlike Hoover, Trump could use such tools as War Production act and Defense Production act that date to World War II and the Korean War era, plus he has the precedent of the New Deal. All of these things happened after Hoover was president, and although available to Trump, he nonetheless is choosing not to use them as part of his action plan.

Armed with these tools Trump’s response has been confusing and impotent. While Hoover refused to initiate such action for ideological reasons, Trump has expressed no ideological justification. Trump apparently does not adhere to set of policies and ideology that would explain his reluctance to show strong presidential leadership.

Instead the man who just last year was making extraordinary claims about the unlimited power of a president has become the champion of federalism as he hands off to the states the decisions about the pandemic. He asserts that the federal government is only a backstop and that it is the responsibility of the state governors to set up the rules. The result is a patchwork of required action across the nation as fifty governors must fight each other for aid the President could implement as one nation.

As the United States faces the oncoming surge in victims, America does not have a uniform policy on stay-at-home-only suggestions and recommendations. States rights appear to trump federal action as we await future dissertations on the failure to allocate effectively ventilators, hospital beds and medical personnel during this pandemic emergency.

This lack of action and unified policy reminds one of the Articles of Confederation- that failed form of government replaced by the Constitution as our leaders realized the importance of strong federal government in times of crisis. As Alexander Hamilton wrote to James Duane on September 3, 1780, the danger was that the people “cannot long respect a Government which is too feeble to protect their interest.”

To flatten the curve of the coronavirus we need to be ahead in our planning and in our action. For delay is an ally of the coronavirus. As hockey star Wayne Gretzky said “skate to where the puck is going to be, not where it is.” As we await the pandemic’s impact on the nation, Presidents Hoover and Trump have provided negative role models.

Robert Rupp is a professor of history and political science at West Virginia Wesleyan College.

This article was originally published at History News Network

SEE
https://plawiuk.blogspot.com/search?q=HOOVERVILLE

https://plawiuk.blogspot.com/search?q=HOOVER+DEPRESSION

Bruising global recession forecast as countries mull lifting virus lockdowns
April 14, 2020 By Agence France-Presse


The coronavirus is poised to spark a bruising global recession not seen in a century, the IMF warned Tuesday, as countries considered lifting sweeping lockdowns that have crippled economies and kept billions confined to their homes.

The deadly pandemic has already killed more than 120,000 people and infected close to two million around the world since it first emerged in China late last year.

 

AFP / Simon MALFATTO Global spread of coronavirus

It has upended lives from New York to New Delhi to Naples as governments imposed unprecedented lockdown measures to contain the virus’s devastating march across the globe, sparking fears of tipping the world economy into a slump not seen since the Great Depression.

But with deaths and infections possibly starting to plateau in some of the hardest-hit countries, debate is mounting about when — and how — to lift lockdown measures that have kept half of humanity hemmed into their homes for weeks on end.
Some shops in Austria reopened Tuesday, a day after Spain allowed construction and factory workers to return to their jobs.
 

AFP / Arun SANKAR 

India exteded national lockdown orders for its 1.3 billion people until the beginning of May

In the US, President Donald Trump said numbers were levelling off as the governor of hardest-hit New York state looked ahead to a return to normalcy.

But the picture was patchy across the globe.

France extended its nationwide stay-at-home orders for another month, and while Italy said some bookshops and launderettes could reopen Tuesday, many stayed closed with stringent lockdown orders still in place.

France extended its nationwide lockdown orders for another month, and while Italy allowed some bookshops and launderettes to reopen Tuesday, many nevertheless stayed closed with stringent stay-at-home orders kept in place for most of the country’s 60 million citizens.

“People are going to lose jobs, businesses are going to shut down, unemployment is going to rise and hungry people are going to die,” a businessman, Manoj, told AFP on the deserted streets of New Delhi.

– ‘The Great Lockdown’ –

Dire economic warnings poured in from the International Monetary Fund Tuesday, which predicted the worst global downturn in a century.

It forecast a three-percent cut world in output this year and a 7.5-percent dive for the eurozone economy.

The US economy, the world’s biggest, is expected to contract by 5.9 percent.
 

AFP / Gal ROMA

 COVID-19: growth forecasts for most affected countries


“Much worse growth outcomes are possible and maybe even likely,” according to the IMF’s latest World Economic Outlook.




“If the pandemic and containment measures last longer, emerging and developing economies are even more severely hit,” it warned, calling the global downturn “The Great Lockdown”.

But if the virus is contained and economies can begin operating again, 2021 should see a rebound of 5.8 percent, it added.

France on Tuesday said its economy was expected to shrink by eight percent, worse than previous projections, while in Britain the Office for Budget Responsibility fiscal watchdog said GDP could plummet by 13 percent.

– ‘Afraid of virus’ –




But some countries showed signs of setting off the long road back to normalcy.

Vienna’s popular Favoriten district drew mask-clad shoppers after the government allowed some small shops as well as hardware and gardening stores to reopen across the country.
AFP / Hector RETAMAL More than 120,000 people have died around the world from the virus which first emerged in Wuhan China late last year

Social distancing rules remained in place, however: queues were staggered and one tobacco shop only served customers on the street.

“(I’m) afraid of the virus”, said Fatih Altun, who runs a laptop repair shop.

He was relieved to be able to get back to work after losing some 6,000 euros ($6,600) since closing his business last month.

“I had to fire my only employee,” he said.

Austria has been spared the worst of the virus with some 14,000 cases and over 300 deaths.

Badly affected Spain on Monday allowed construction and factory employees back to work, and police handed out face masks in Madrid metro stations.

The country’s daily death toll saw a slight rise Tuesday, though new infections dropped to the lowest level since Spain imposed its nationwide lockdown last month.

 

AFP / Johannes EISELE 

New York Governor Andrew Cuomo said the “worst is over” in his state

Italy’s death toll is now above 20,000 — second worst after the US — but deaths and infections have eased off.

And Denmark planned to open some of its schools on Wednesday after a month-long shutdown.

World Health Organization chief Tedros Adhanom Ghebreyesus warned Monday that control measures “must be lifted slowly”, noting that the coronavirus was 10 times deadlier than the 2009-10 swine flu outbreak.

– ‘Worst is over’ –

In Washington, Trump said US numbers could be steadying as 1,509 new daily deaths were reported — almost identical to the previous day.

AFP / Johannes EISELE

In New York, where the virus has killed more than 10,000 people — almost half of the US total — and seen unclaimed victims buried in unmarked mass graves, Governor Andrew Cuomo said the nightmare might be coming to an end.

“The worst is over if we continue to be smart going forward. I believe we can now start on the path to normalcy,” Cuomo told reporters.

But he said restrictions would only be eased gradually. “It’s not going to be, we flip the switch, and everybody comes out of their house, gets in their car, waves and hugs each other, and the economy will start.”

In France, one of Europe’s worst-hit countries, President Emmanuel Macron said in a televised address Monday night the epidemic there was “beginning to steady… (and) hope is returning”.
 

AFP / Simon MALFATTO 

Do lockdowns affect the number of coronavirus deaths?


But a strict lockdown in force since March 17 would continue until May 11 — after which schools and businesses could gradually reopen at a “progressive” rate.

Nigerian President Muhammadu Buhari told his citizens they must “endure a little longer” as he also extended a lockdown in key cities saying: “We must not lose the gains achieved thus far.”

And in Britain, where Prime Minister Boris Johnson is recovering after a week in hospital with the virus, officials warned the peak was still to come and the lockdown there was likely to continue.

There were cautionary tales that the virus is not easily defeated.

In China, where the outbreak first reared its head and the government says it has largely curbed the spread of the virus, officials announced scores of new imported infections.

burs-jv/jj

POST FORDISM

GM, Ventec say they started "mass production" of ventilators

Published: April 14, 2020

General Motors Co. GM, -1.02% said Tuesday it has begun "mass production" of ventilators alongside Ventec Life Systems under a 30,000-unit contract with the U.S. Department of Health and Human Services. "The effort involved sourcing hundreds of parts and assemblies from suppliers; the design of a new manufacturing process; the transformation of GM's Kokomo factory; the ongoing hiring of more than 1,000 manufacturing team members; and the implementation of extensive health and safety protocols in the workplace," GM said. More than 600 ventilators will be shipped this month, almost half the order will be filled by the end of June and the full order will be completed by the end of August, the company said. "GM has the capacity to build more ventilators after August if needed," it said.

Here’s what Pope Francis said about the global economy that drew a ‘wow’ from a former presidential candidate

UNIVERSAL BASIC INCOME UBI

Published: April 13, 2020 By Shawn Langlois MARKETWATCH

Pope Francis. CTV via Reuters

‘This may be the time to consider a universal basic wage which would acknowledge and dignify the noble, essential tasks you carry out. It would ensure and concretely achieve the ideal, at once so human and so Christian, of no worker without rights.’

That’s Pope Francis showing support for an idea many countries are at least temporarily experimenting with amid the economic disruption sparked by the coronavirus pandemic.

“I know that you have been excluded from the benefits of globalization. ... The ills that afflict everyone hit you twice as hard,” Pope Francis wrote in a letter. “Street vendors, recyclers, carnies, small farmers, construction workers, dressmakers, the different kinds of caregivers: you who are informal, working on your own or in the grassroots economy, you have no steady income to get you through this hard time... and the lockdowns are becoming unbearable.”

The letter drew praise on Twitter TWTR, +3.14% from Andrew Yang, who spent much of his failed campaign for the presidency pushing universal basic income:


Andrew Yang
✔@AndrewYang

Wow. Pope Francis today: “This may be the time to consider a universal basic wage.” Game-changing. .@pontifex https://www.americamagazine.org/politics-society/2020/04/12/pope-just-proposed-universal-basic-income-united-states-ready-it …

The pope just proposed a universal basic income. Is the United States ready for it?

“This may be the time,” he said, “to consider a universal basic wage.” This points unmistakably to what is usually known as universal basic income—a regular, substantial cash payment to people just...americamagazine.org
9:30 AM - Apr 12, 2020

Yang ran on the idea echoed in the letter that free cash for everyone would go a long way toward helping to solve economic inequality by providing a financial safety net for all, including those, like stay-at-home moms and caregivers, who aren’t getting adequately compensated.

Beyond the call for considering a universal basic income, the pope also made the case for a lasting change in the global culture in a postpandemic world.

“Our civilization — so competitive, so individualistic, with its frenetic rhythms of production and consumption, its extravagant luxuries, its disproportionate profits for just a few — needs to downshift, take stock, and renew itself,” he wrote.

America magazine, a publication of the Jesuit order, from which the Argentinian Jorge Bergoglio is the first pontiff, traced the roots of the pope’s call to consider UBI to an 1891 encyclical in which Pope Leo XIII sought to address the Gilded Age’s widening economic inequality.

Pope Francis on Sunday also delivered a speech for evening mass held at a mostly empty St. Peter’s Basilica, with Italy still on lockdown due to the coronavirus, which has now infected more than 1.8 million people around the world, according to Johns Hopkins University.

Why this screenshot of CNBC’s ‘Mad Money’ host Jim Cramer is ‘everything that is wrong with America’

Published: April 14, 2020 By Shawn Langlois MARKETWATCH 

In many ways, last week was one of the darkest stretches in American history.

The coronavirus death toll in the U.S. — now topping 23,000 — skyrocketed as families continued to huddle in their homes uncertain of what’s next, while an unthinkable number of more than 16 million people have now filed for unemployment amid an economy grappling with the shutdown.

Yet, somehow, the stock market has managed to push higher. In other words, at least those fortunate enough to own stocks had something to smile about. Democratic strategist Justin Horwitz summed up the disconnect with this tweet that went viral across Twitter TWTR, +3.71% :

As you can see, that’s CNBC’s Jim Cramer talking about the rally in the market while the chyron points out the grim reality of the historic job losses.

One commenter captured much of the response on social media by saying, “The Dow is not the economy. It is a giant government sanctioned Ponzi scheme for the wealthy.”

Another pointed to the fact that, according to Federal Reserve data, 84% of stocks owned by U.S. households are held by the wealthiest 10% of Americans — essentially Wall Street vs. Main Street.

Cramer later followed up with this tweet in which he said he’ll offer an explainer:

There’s some history to back the rally. In an analysis published Thursday, investor Ned Davis pointed out that stocks do better than average when unemployment spikes. Davis’s research shows that a jobless rate over 6% correlates with the market rising 13.7% per annum.

“How can this be?” Davis wrote. “It defies logic. My explanation would be that this news is widely followed, and the market tends to look ahead. So it is probably priced in.”

Of course, the Federal Reserve has a lot to do with that, as well.

“When you remove near term bankruptcy risk from every publicly held company regardless of credit rating or near-term financial condition, asset prices should rise,” DataTrek’s Nicholas Colas wrote in a note published on Friday. “Markets know that no matter how bad cash flow might be there is a Fed loan backstop waiting in the wings if needed.”

Read:16 million people just got laid off but U.S. stocks had their best week in 45 years

The stock market was rallying in a big way on Tuesday, with the Dow DJIA, 2.30% up more than 600 points. The S&P SPX, 3.02% and Nasdaq COMP, 3.98% were also firmly higher.

PICKING WINNERS & LOSERS  
 Trump’s Big Oil Deal Hinges on Weakest of Shale Going Bust

Stephen Cunningham Bloomberg April 13, 2020


(Bloomberg) -- President Donald Trump said the “big Oil Deal” he brokered will save hundreds of thousands of American jobs. But the agreement hinges on a shale bust that could spell the end for some explorers drowning in debt, bringing a wave of bankruptcies and job losses.

On Sunday, the OPEC+ group agreed to pare production by 9.7 million barrels a day, ending a devastating price war between Saudi Arabia and Russia. Trump, meanwhile, is counting on market forces to shave some 2 million barrels a day of overall U.S. output by the end of the year.

U.S.-focused oil producers have already slashed more than $27 billion from drilling budgets this year and are starting to shut in production. And almost 40% of oil and natural gas producers face insolvency within the year if crude prices remain near $30 a barrel, according to a survey by the Federal Reserve Bank of Kansas City.

“Trump’s strategy seems to rely on the free market forcing production down and implicit in that is some companies going under,” said Dan Eberhart, a Trump donor and chief executive of drilling services company Canary Drilling Services.

Explorers idled 10% of the U.S. oil-drilling fleet, with more than half of the losses in the Permian Basin of West Texas and New Mexico, the heart of America’s shale industry, while Concho Resources Inc. said that it and other producers are shutting in output. Oil producer Whiting Petroleum Corp. and service provider Hornbeck Offshore Services Inc. headed for bankruptcy.

The deal, reached after days of urgent negotiations, ended a standoff between Saudi Arabia and Russia and belatedly tackled a plunge in demand caused by the coronavirus outbreak. The lockdowns enacted across much of the world to slow its spread have caused consumption to crater by as much as 35 million barrels a day.

After the deal, Goldman Sachs Group Inc. analysts called the deal “too little, too late”, and said they expect inland U.S. crude prices to decline further in coming weeks as storage fills up. Prices fell below $10 a barrel in some areas of the U.S. during March due to the collapse in demand, with at least one grade bid at negative prices.

Oil futures in New York were up 3.2% to $23.48 a barrel Monday, but well off their initial surge following the deal.

Scott Sheffield, chief executive officer of shale driller Pioneer Natural Resources Co., said he’ll testify at a meeting of Texas regulators on Tuesday to argue for a 20% cut to the state’s oil production in May. The OPEC+ deal to lower output is “not enough” and more is needed from non-OPEC nations including the U.S. to stabilize crude prices, Sheffield said in an interview with Bloomberg Television. Texas should tie cuts to more reductions from G-20 nations, he said.

Oil giants Exxon Mobil Corp. and Chevron Corp., along with most of the other prominent Texas shale explorers, oppose mandated cuts.

Meanwhile, refiners, running out of places to store fuel they can’t sell, are cutting back production and turning away crude they don’t need, adding to pressure on smaller producers.

Scaling Back

Trump’s strategy in pressing the Saudis and Russians to agree to sweeping cuts hinged on his oft-repeated claim that U.S. drillers were already scaling back of their own accord in response to the downturn. Some senators from oil-producing states previously raised the prospect of cutting off aid to Saudi Arabia or slapping tariffs on its crude if the kingdom didn’t pare output.

Trump has pointed out that the oil could be pumped later. “Well, there’s no real cost because we’re agreeing to produce a little bit less,” he said at a press conference Friday. “It’s staying in the ground. You have it. You have it for another day.”

Two of the biggest industry trade groups, which opposed the idea of tariffs, expressed support for the deal. The American Petroleum Institute welcomed the “announcement of an agreement by other producing nations to follow the lead of the global marketplace – and U.S. producers – to reduce supply to align with lower energy demand as result of the pandemic.” The American Fuel & Petrochemical Manufacturers was pleased that a deal was reached that “helps U.S. producers and avoids imposing added costs on U.S. refiners.”

With demand destruction outstripping the pledged cuts by a long way, the agreement isn’t so much about balancing markets so much as buying time to prevent stockpiles from overflowing, said Kevin Book, managing director at ClearView Energy Partners LLC in Washington.


Russia hails oil deal it says will save millions of U.S.jobs

IF RUSSIA LIKES IT YOU KNOW ITS BAD FOR AMERICA



FILE PHOTO: Kirill Dmitriev, chief executive of the Russian Direct Investment Fund, attends a session of the St. Petersburg International Economic Forum
By Katya Golubkova and Olesya Astakhova Reuters April 13, 2020

MOSCOW (Reuters) - The global oil production deal clinched at the weekend will help establish a price floor and save millions of jobs in the United States, senior Russian officials said on Monday.

Having been in a stand-off with western nations - most notably the United States - from 2014 on everything from Crimea's annexation from Ukraine to allegations of election meddling, Moscow has sought to rebuild ties since the coronavirus outbreak.

It sent medical support to Italy and the United States to fight the pandemic and has supported the historic oil supply pact, which could have negative implications for its own economy.

The planned supply cuts represent a complete reversal by Russia and Saudi Arabia, which had both threatened to ramp up output in a battle for market share after the previous deal between the Organization of the Petroleum Exporting Countries (OPEC) and other producers fell apart in early March.

Combined with G20 input, the leaders of Russia, the United States and Saudi Arabia engaged in a series of phone calls last week to help to iron out the deal that could remove as much as 20 million barrels per day (bpd) of oil from the market - roughly a quarter of all supplies.

"(Russia's) President (Vladimir) Putin had as many calls with (U.S.) President (Donald) Trump last week as he had for the whole of last year," Kirill Dmitriev, head of Russia's sovereign wealth fund RDIF, told CNBC on Monday.

Trump has said he helped to broker the deal. The United States also agreed to make extra cuts on behalf of Mexico, helping to save the accord after four days of talks.

Russian Energy Minister Alexander Novak, speaking to Russian Rossiya-1 TV station, also praised Putin, saying that total output cuts were seen at between 15 and 20 million bpd, including by the United States, Norway and Canada.

He also said he had met heads of domestic oil producers, who had supported the deal.

'WORKING TOGETHER'

Dmitriev, one of Moscow's top negotiators, and whose fund shared the cost of Russia's medical help for Washington, believes that the oil deal would help to save more than 2 million U.S. jobs, he told CNBC.

"This is an example of us working together for the best of our nations," Dmitriev said.

Without the deal, oil prices might have collapsed to less than $10 a barrel from more than $30 now, he added.

Kremlin spokesman Dmitry Peskov on Monday described the deal as important and that it would help to keep oil prices from collapsing.

Russian oil output has already started to decline, falling to 11.24 million bpd this month, from 11.29 million bpd in March, an oil industry source said.

Moscow's obligations under the deal are to cut its output to 8.5 million bpd from May to June, bringing it to the lowest level since 2003.

The resulting economic impact could be as much as 1.2 percentage points from Russia's gross domestic product, said Kirill Tremasov, head of investment research at Loko-Invest.

Producers will slowly relax curbs after June, though production reductions will remain in place until April 2022 under the terms of the deal.

(Additional reporting by Dmitry Zhdannikov in London; Darya Korsunskaya, Elena Fabrichnaya, Tom Balmforth, Maxim Rodionov, Maria Kiselyova and Vladimir Soldatkin in Moscow; Writing by Katya Golubkova; Editing by David Goodman and Catherine Evans)

Trump's oil-production pact may do little to help U.S. producers or drivers amid coronavirus

Don Lee LA Times April 13, 2020

An oil rig and pump jack work in Midland, Texas, the nation's top oil-producing state. (Jacob Ford / Odessa American)

The agreement announced Sunday by Russia, Saudi Arabia and other oil-producing countries to cut back output is unlikely to raise fuel prices much for American consumers in the weeks and months ahead.

That should be good news for the American economy and for President Trump. But these are not normal times.

The coronavirus pandemic has created a painful bind for Trump and for the United States: Plunging oil prices, coupled with a huge glut in global oil inventories, are savaging the petroleum industry at a time when the U.S. has become the world’s largest oil producer.

Long before he was elected president and continuing after he entered the White House, Trump lambasted attempts by OPEC, the oil cartel, to prop up petroleum prices by limiting production.

That’s been a politically rewarding stance because lower oil prices are the equivalent of a tax cut for drivers, homeowners and many businesses: They put more spending money in people’s pockets and generate goodwill toward leaders who take the credit.

That has generally been true even if the decline hurt the U.S. oil industry.

But not so in the age of COVID-19. State and local governments have ordered lockdowns, stay-home orders and social distancing policies that experts say are necessary to reduce the pandemic’s toll.

“This is a fairly new situation,” said Antoine Rostand, president of Kayrros, an energy research and consulting firm. “Those who could enjoy low prices are stuck at home,” he said, and U.S. oil producers are suffering the downside of depressed prices.

Gasoline prices are certainly falling. The national average for regular gas dropped to $1.92 per gallon in the week ending April 6, below $2 for the first time in more than four years and down 50 cents from just a month earlier. It's dropped a similar amount in California to $2.87 a gallon.

Experts see fuel prices sliding further, possibly to record lows on an inflation-adjusted basis.

The new agreement to lower oil production is unlikely to have much effect at a time when the world is already awash in surplus oil and most major economies, including the U.S., are plunging into recession.

Analysts say the cutback, unprecedented as it was, is too little and too late.

The agreement by 23 oil-producing countries pledges to remove 9.7 million barrels of oil a day from world markets. But amid the pandemic, global demand for oil has fallen by at least 20 million barrels, some say as much as 30 million, a day.

Moreover, it’s not enough to erase the existing glut in oil inventories around the world anytime soon.

“Every available pipeline and storage terminal is about to be completely full, so you have to stop production or you've got to pay someone to take your production away,” said Bobby Tudor, chairman of Tudor, Pickering, Holt & Co., an investment banking firm based in Houston, the nation’s oil capital.

“If 16% of oil demand is people just driving to and from work globally, how quickly does that come back?” he asked. “How quickly will we all be willing to get back on an airplane?”

For Trump, the new reality has meant flip-flopping on his long-standing aversion to deals to reduce oil output.

Before the 2018 midterm elections, when the price of gasoline was rising to nearly $3 per gallon, Trump jawboned Saudi Arabia to boost its production to get prices down.

As recently as March 9, days before the spreading coronavirus drove Trump to embrace social distancing restrictions, he cheered a silver lining in the one-two punch of the pandemic and the Russia-Saudi price war.

“Good for the consumer, gasoline prices coming down,” the president tweeted.

But just two weeks later Trump tweeted that “Our great Oil & Gas industry” is under siege. And since then the president has reached out to Russia while U.S. lawmakers have pressured Saudi Arabia in no uncertain terms to halt their disastrous battle for market share.

Trump's about-face comes as U.S. producers are indeed under siege.

Texas, North Dakota, Oklahoma, New Mexico and other oil-producing states are feeling the first waves of shutdowns and company bankruptcies. That is further aggravating the overall plunge in employment and economic activity nationwide.

Tudor said he is already seeing significant layoffs at Houston’s oil firms and spillover to ancillary businesses.

“A collapse to this industry would be a really bad thing ultimately, not just for Houston but for the broader economy in the country,” he said.

In the last month, there’s been a 50% reduction of crews working in America’s shale oil basins, according to an analysis of satellite images and other calculations by Kayrros.

“That’s really unprecedented,” said Kayrros’ Rostand. “It really reflects the reality on the ground: that there’s a very dramatic imbalance between supply and demand.”

Things have gotten so worrisome in Texas, by far the nation's leading oil producer, that state authorities are considering imposing production caps for the first time in a century.

In the face of falling demand and the existing supply glut, the new cutback agreement is not nearly large enough to reverse the situation anytime soon.

At the end of 2015, the world had 593 million barrels of surplus oil inventory. And with the global economy growing about 3.5%, it still took two years to work off the supplies, said Amy Myers Jaffe, senior fellow for energy and the environment at the Council on Foreign Relations.

The cutback deal Sunday may avert what Jaffe called a worst-case scenario in which oil stockpiles would fill up well above 2015 levels at a time when the world economy is in recession.

Still, she said, “Oil prices are bound to stay low.”

Certainly, the mismatch between supply and demand was exacerbated by the price war between Russia and Saudi Arabia, two of the biggest oil producers. They sought to gobble up a larger share of the oil market by producing more and swallowing the resulting price declines.

The combination of the coronavirus and the Saudi-Russia feud saw the U.S. benchmark price of crude tumble from more than $61 a barrel at the start of the year to a low of $19.27 on March 30. Despite the agreement, it was down 1.5% on Monday to $22.41 a barrel.

That price is barely half of the break-even level for many producers in the United States, and so companies have begun to reduce the flow.

Giant oil firms, such as Chevron and Exxon, are in relatively good financial shape to weather the downturn. In addition to size, those producing shale oil will be better off. Shale beds can be turned off and on with less risk of damage compared with conventional wells.

A lot of smaller and independent drillers, however, could fold or be eaten up by larger firms. And this time, investors won’t be running back to the oil industry to supply capital as in the past. Not only have they been repeatedly burned by disappointing performance, now they see a very uncertain outlook.

As both the biggest producer and the biggest user of oil, accounting for about 20% of the 100 million barrels a day consumed worldwide, the U.S. is taking hits on both sides of the equation.

Daniel Yergin, the energy expert who is vice chairman of IHS Markit, a research and consulting firm, wrote recently that U.S. production could drop by almost 3 million barrels per day by year's end. That could knock the U.S. below the Saudis and Russians as the top producer. It could also mean rising oil imports.

“The economic costs will be high, given the importance of the shale revolution to the overall U.S. economy — accounting altogether, according to analysis by IHS Markit, for about 2.5 million jobs,” Yergin said in an article in Foreign Affairs.

She’s The First Coronavirus Case On Her Native Reservation. She’s Been Banished From Her Home.

The decision to ban the woman and her husband, both of whom are non-Native, has proved controversial.

 "As Lakota people, this is not our way to be hurtful and angry," one resident said.

Clarissa-Jan LimBuzz Feed News Reporter April 14, 2020

Courtesy Juliana and Christopher

Christopher was on his way home on April 7 to pick up a few things for his wife, Juliana, who had just been admitted to the hospital with COVID-19, when he received a phone call telling him he could not return to the Pine Ridge Indian Reservation in South Dakota where the couple lived and worked.

Juliana was the reservation’s first confirmed coronavirus case. And they would soon learn that her diagnosis, coupled with their recent trip out-of-state for Juliana’s surgery as state and city governments were taking aggressive measures to restrict movement over the virus, would cause them to be kicked out of their home.

Juliana and Christopher, who asked to be identified by their first names only, had plans to visit California, but they never actually made it there, according to Christopher. On March 26, the couple was in Denver, en route to California, when they found out the procedure was canceled. They returned home the next day, when the tribal council’s stay-at-home order was issued, they said, and immediately quarantined themselves.

Juliana fell ill within the week and was tested for the coronavirus. Days later, as she lay in a Rapid City hospital battling COVID-19, the disease caused by the new coronavirus, the Oglala Sioux Tribal Council voted to banish the couple from the reservation.

"We had none of our belongings," Christopher told BuzzFeed News. "When you get kicked out of your house, you don't have — all the things that you need: toothbrush, clothes, medication, CPAC machine — things that you need to live. We had to replace all those items."

Juliana is originally from Brazil, and neither she or her husband is Native American. They moved to the reservation in 2019 to teach at the Red Cloud Indian School, a private Jesuit institution. Christopher said they felt welcomed by the Lakota people in Pine Ridge and grew close to their colleagues. The students, Christopher said, were well-behaved and came to school "with such sweet spirits."

So when Christopher got a call from the school superintendent en route from the hospital to the reservation, he did not expect to be told not to come back, and that the school president had sealed off the couple's house on the Red Cloud campus in Pineapple, South Dakota.

The next day, by a 10–9 vote — with President Julian Bear Runner acting as tie-breaker — the Oglala Sioux Tribal Council, the reservation's governing body, voted to banish them from Pine Ridge.

"That was a really hard decision to make," Bear Runner said in an interview with KILI radio Wednesday, April 8. "Our members, the people that elected us to come into office put us in those positions to protect our health and our general welfare. And for me, it was negligent that this individual would still leave after laws were already in place."


Courtesy Christopher
Juliana's medication. Fruit and canned goods the couple bought after being banished.

The Oglala Sioux Tribe had been bracing for weeks for the coronavirus to hit the reservation. Chase Iron Eyes, a spokesperson for Bear Runner's office and an activist, told BuzzFeed News that Pine Ridge has been in something of a nonstop emergency mode, barely being able to recover from one disaster before another hits.

With support from the federal government lacking and levels of bureaucracy to overcome, many Native American tribes, already struggling with historical oppression and economic challenges, face the daunting task of protecting themselves from a global pandemic.

"It's almost like we live in a constant state of crisis," Iron Eyes said about Pine Ridge.

In early March, Bear Runner declared a state of emergency on the reservation and requested help from the federal government to prepare for a coronavirus outbreak. On March 27, a shelter-in-place ordinance was issued, with exemptions for medical travel.

Days later, tribal leaders put into place a curfew and a border ordinance banning nonresidents from entering the reservation on nonessential business.

When the council got word on April 7 that Juliana was the reservation's first person to contract the coronavirus, and that she recently purportedly traveled to California, a virus hotspot, they acted fast to banish the couple.

Banishment is a severe, but rare form of punishment that can apply to tribal members and nonmembers alike. The last non-Native person to be banished from Pine Ridge Reservation was South Dakota Gov. Kristi Noem, Iron Eyes said, over her support for legislation cracking down on Keystone XL Pipeline protesters.

The punishment is permanent, though the Oglala Sioux Tribal Council can rescind the ban, and the person banished can appeal.

For Christopher, finding out Juliana's COVID-19 diagnosis then being told they weren't allowed to go home in the span of a couple of days was a difficult pill to swallow.

"This was very hurtful," he said. "Especially in this economy. And especially when you just want to recover from being sick."


Courtesy Juliana and Christopher

Christopher said the tribal council got several details wrong in making their decision. The couple did not set foot in California for the surgery, he said; they made it as far as Denver when they found out the procedure was canceled, then flew back. He also said they traveled out of state on March 26, one day before the shelter-in-place ordinance was issued, and the school had approved their travel.

When they came back from Denver, Christopher said they followed the school's travel guidelines and self-quarantined for what was supposed to be 14 days. But Juliana started feeling unwell, and once she checked all the boxes for COVID-19 symptoms, she went to get tested.

Juliana and Christopher were caught off-guard by the tribal council's decision to banish them, partly because they weren't interviewed or contacted by tribal leaders before the vote.

"They have not spoken to us at all. They never asked our side of the story or spoke to us directly," he said.

"Even though we did everything we were asked to do and technically did not break any rules," Christopher said, "we apologize that we traveled at this time and ask the community for forgiveness in not taking this more seriously."

Their banishment has proved controversial. Many tribal members on and off the reservation have expressed their support for the council, praising the leaders for protecting their community. But they've also been criticized by those who say the decision is too harsh.

Anne Eagle Bull, an enrolled member of the Oglala Sioux tribe whose children attend Our Lady of Lourdes Elementary, the K–8 school that’s part of the Red Cloud Indian School system where Juliana works, said the negative comments about Juliana and her husband have really bothered her.

"As Lakota people, this is not our way to be hurtful and angry," she told BuzzFeed News. "If somebody's taking the time to come to our reservation, which is — you know, often looked at as a Third World country, that says a lot about that person. That that person has passion. That that person is willing to sacrifice some things to come here."

Iron Eyes acknowledged that the banishment "doesn't appear to be very welcoming of us."

"It's caused division right down the middle," he said. Though Iron Eyes said he would have liked to see the couple's case handled differently, he believes the vote has caused others on the reservation to take safety measures more seriously.

For now, Christopher said he's grateful for the support they've received from the Lakota community and the Red Cloud faculty. Protestant churches in Rapid City have been "of great help" too, he said, sending them food, toiletries, and other essentials that they couldn't go home to collect.

After banishing the couple, tribal leaders put the reservation on lockdown for 48 hours until April 10. It was reinstated for 14 days beginning April 11.

On Tuesday, April 14, the South Dakota Health Department sent Juliana a letter, which the couple shared with BuzzFeed News, informing her that she “successfully completed a period of isolation and is no longer considered able to transmit the novel coronavirus.”

Bear Runner said the couple is welcome to appeal the council's decision.

"We tried to understand both sides of the story," he explained in his April 8 interview. "But if you really think about it, if this person had accidentally come into contact with one of your loved ones...you would be upset."

He also addressed concerns about whether Juliana's banishment sets a precedent for non-Natives on the reservation who test positive for the coronavirus, saying the council won't banish them if they follow the rules.

"Just don't act negligent. You know that it says shelter in place. You know the precautions that need to take place," he said.

Christopher said they know the council is only trying to protect their people, and they don't have any bad feelings toward them for the decision. He believes that in trying to make sure everyone follows the ordinances, the council "had to make an example out of someone."

"Unfortunately," he said, "that was us."

Clarissa-Jan Lim is a reporter and editor at BuzzFeed News. She is based in New York.

Why The Coronavirus Is Killing Black Americans At Outsize Rates Across The US

“You can’t drive a bus or wash dishes on Zoom,” said one doctor. “These are people we count on to do essential jobs, and they are going unprotected.”

Dan VerganoBuzzFeed News Reporter

Kadia GobaBuzzFeed News Reporter
Posted on April 10, 2020

Brendan Mcdermid / Reuters
Pallbearers exit with a family member during a funeral at Jurek Park Slope Funeral Home during the outbreak of the coronavirus disease in Brooklyn, April 8.
In Milwaukee, Chicago, New Orleans, and all over the nation, the coronavirus pandemic has thrown the long-running racial divide in the health of Americans into stark relief, seen in the outsize numbers of deaths among black populations in hard-hit cities and regions.

“Health disparities have always existed for the African American community,” Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, said at the White House on Tuesday, responding to a flurry of news reports of black patients dying in larger-than-expected numbers. “Here again with the crisis, how it’s shining a bright light on how unacceptable that is because, yet again, when you have a situation like the coronavirus, they are suffering disproportionately.”


Jeremy Singer-Vine / BuzzFeed News / Sources: State and local agencies, collected Apr. 9 (deaths); American Community Survey (population).

For a variety of reasons, including a greater likelihood of working jobs that put them on the frontline, decreased access to health care that starts them out with more illness, and crowded living conditions that facilitates the virus spread, the coronavirus has been especially brutal in black communities.

Lawmakers from both parties are now calling on US health officials to release racial data on novel coronavirus cases and deaths nationwide, pointing to dramatic differences in hotspots across the country. On Wednesday, the heads of the Congressional Hispanic Caucus, Congressional Asian Pacific American Caucus, and Congressional Black Caucus, called on Health and Human Services Secretary Alex Azar and CDC Director Robert Redfield to release and analyze such data. That followed Sen. Tim Scott, a South Carolina Republican, making a similar request on Tuesday. “In recent days, a number of concerning reports have emerged, suggesting COVID-19 has had a particularly harmful impact on communities of color,” Scott wrote in his letter

A week earlier, a group of House Democrats made a similar request, spurred by reports of more than a third of cases in Milwaukee striking black residents.

“It’s hard to tease apart all the threads, and ultimately they all come down to the same thing,” physician Janet Seabrook of Community HealthNet Health Centers in Gary, Indiana, told BuzzFeed News. “What we are seeing is not surprising, and it really comes down to a lack of resources and lack of health care delivering the numbers we are seeing right now.”


Peter Aldhous / BuzzFeed News

As of Thursday, there have been more than 454,000 confirmed cases of the novel coronavirus across the US and almost 16,000 deaths. The racial disparity accompanying the US outbreak of the pandemic illuminates the medical challenges that black communities, and other communities of color, including Latinos and Native Americans, face every day:

Dangerous Jobs

“You can’t drive a bus or wash dishes on Zoom,” Oscar Alleyne, a public health expert with the National Association of County and City Health Officials told BuzzFeed News. “These are people we count on to do essential jobs, and they are going unprotected.”

A lot of the people most at risk for catching the novel coronavirus are the ones in service jobs who can’t avoid contact with the public, exemplified by Detroit bus driver Jason Hargove, who died this month from coronavirus complications after he made a video that went viral in March discussing people coughing on his bus.

“People of color are often working in service jobs, cashiers, nursing, home health aides. These aren’t jobs you can phone in,” said Seabrook.

Bureau of Labor Statistics data shows black people work a disproportionate number of jobs as health care and personal care assistants, for example. Such jobs lead to exposure with potentially sick people, which is even more risky for people who aren’t wearing hospital-grade protective gear.

Black Workers By Area Of Employment

The percentage share (%), shown across occupational groups.

Share

 of black workers

Share

 of total workers

Office and administrative support

13.8%

11.7%

Transportation and material moving

9.5%

6.1%

Management

7.2%

11.5%

Food preparation and serving-related

6.5%

5.6%

Production

6.1%

5.6%

Health care support

5.4%

2.3%

Personal care and service

5.1%

3.8%

Chart: BuzFeed News / Vergano  Source: U.S. Bureau of Labor Statistics, Current Population Survey.

z

“Someone has to do these jobs, but people in service jobs just have a higher risk,” said Seabrook. These are people more likely to take cold medicine to knock down a fever and head to a job they can’t afford to lose.

Even before social distancing orders in states nationwide led to the staggering unemployment claims with millions now out of work, the unemployment rate for blacks was already higher, at 6.7%, against 4% for whites in March, which means they have less freedom to just quit their job.

And black people have less savings, with the median worker having only 9.5% of the median wealth that whites did in 2016, which means they have little to survive on if they did quit. That means putting off a doctor’s visit if paying for food or rent comes first, said Alleyne. “We’d really like to see more [coronavirus] data from more cities overall, but poverty is generally a risk factor in health care.”

“They are far more likely to be taking mass transit to get to work because they are less likely to have a car,” said Alleyne. “That’s also a risk.”

Worse Health

At the White House briefing, Fauci worried about greater rates of high-risk illnesses among black people, saying, “The diabetes, hypertension, the obesity, the asthma — those are the kinds of things that wind them up in the ICU and ultimately give him a higher death rate.”

Health experts say such preexisting conditions are widely linked to reduced access to health care among black people, with 11% uninsured against the national rate of 7% in 2017, as well as higher rates of obesity.

“I am worried about the Deep South when I look at where this is going and where we will be looking next,” said Seabrook. Many black Americans in the South live in states that did not expand insurance after the passage of Obamacare at the start of the last decade. The region coincides with the “Stroke Belt” across the southeastern US, where there is a 50% higher risk of a deadly stroke, compared to the rest of the country, and an even higher risk for black people living there. The observation is linked in studies to higher rates of diabetes, heart disease, and smoking, as well as less access to health care in general.

Physicians in Virginia have already complained about a lack of coronavirus testing in black communities during the pandemic, where missing a few cases in states that have cut public health agencies’ budgets for decades could lead to an unchecked outbreak. For example: Albany, Georgia, is still struggling with an outbreak tied to a single infected person attending a funeral. In the city, 1 in 90 people have been infected. Approximately 90% of the fatalities in Albany by March 30 had been in the city’s black community, according to the New York Times.
Xinhua News Agency / Getty Images
Medical workers transfer bodies of victims who died of COVID-19 

at a hospital in New York, the United States, April 6.
Worse Housing

“I’m seeing patients who live with grandparents, who sleep in rooms with bunk beds,” said Seabrook. “If you get sick, they don’t have a guest room to isolate you in. It’s very difficult.”

Black and Latino families live in crowded multigenerational homes at much higher rates (26% and 27%, respectively) than white families (16%), according to the Pew Research Center. More than 60 million Americans live in multigenerational homes, where young asymptomatic people might put their older relatives at risk. Worries about this scenario drove a lot of school closings, despite the lower risk to the young from the coronavirus.



Jimmy Vielkind@JimmyVielkind
.@NYGovCuomo says the racial disparities in who has died from the coronavirus raises lots of questions. "It always seems like the poorest people pay the highest price. Why? Why is that?” One question is whether essential workers are disproportionately non-white.04:46 PM - 08 Apr 2020
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As well, black and Latino homes are more likely to be in communities with worse air quality, according to the American Lung Association, driving up rates of asthma, another risk factor for severe cases of COVID-19. A Harvard University study released on Sunday suggests that counties with worse air quality standard would see an increased coronavirus death rate.

“It really is a matter of priorities,” said Alleyne. “Are we going to take care of vulnerable people, especially the ones on the front lines?”


MORE ON THIS
Michigan Gov. Gretchen Whitmer Weighed In On Why So Many Black Americans Are Dying Of COVID-19Julia Reinstein · April 8, 2020

Doctors Want The Government To Give More Racial Data About Who Is Dying And Sick From The CoronavirusNidhi Prakash · April 6, 2020

These Updating Charts Show How The Coronavirus Is Spreading Across The USPeter Aldhous · March 9, 2020

Dan Vergano is a science reporter for BuzzFeed News and is based in Washington, DC.

Kadia Goba is a political reporter for BuzzFeed News and is based in Washington, DC.