How U.S. coronavirus testing stalled: Flawed tests, red tape and resistance to using the millions of tests produced by the WHO

Peter Whoriskey, Neena Satija


When Olfert Landt heard about the novel coronavirus, he got busy.

© Joshua Roberts/Reuters Robert Redfield, director of the 

Centers for Disease Control and Prevention, testifies about

 coronavirus preparedness on Capitol Hill on March 12.

Founder of a small Berlin-based company, the ponytailed 54-year-old first raced to help German researchers come up with a diagnostic test and then spurred his company to produce and ship more than 1.4 million tests by the end of February for the World Health Organization.

“My wife and I have been working 16 hours a day, seven days a week, ever since,” Landt said by phone about 1 a.m. Friday, Berlin time. “Our days are full.”

By contrast, over the same critical period, U.S. efforts to distribute tests ground nearly to a halt, and the country’s inability to produce them left public health officials with limited means to determine where and how fast the virus was spreading. From mid-January until Feb. 28, fewer than 4,000 tests from the U.S. Centers for Disease Control and Prevention were used out of more 160,000 produced.

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The United States’ struggles, in Landt’s view, stemmed from the fact the country took too long to use private companies to develop the tests. The coronavirus pandemic was too big and moving too fast for the CDC to develop its own tests in time, he said.

“There are 10 companies in the U.S. who could have developed the tests for them," Landt said. “Commercial companies will run to an opportunity like this.”

As the coronavirus continues to spread across the United States, causing more than 80 deaths and over 4,000 confirmed cases, the struggles that overwhelmed the nation’s testing are becoming clearer.

First, the CDC moved too slowly to tap into the expertise of academia and private companies such as Landt’s, experts said. For example, it wasn’t until last week that large companies such as Roche and Thermo Fisher won approval from the Food and Drug Administration to produce their own tests.

Moreover, while FDA and CDC officials have attributed some of the testing delays to their determination to meet exacting scientific standards they said were needed to protect public health, the government effort was nevertheless marred by a widespread manufacturing problem that stalled U.S. testing for most of February.

The CDC has yet to fully explain the nature of the manufacturing problem but told The Washington Post on Monday that the design could also have resulted in flawed tests.

The U.S. Department of Health and Human Services, which oversees the CDC, said earlier this month that it is investigating the defect in many of the initial coronavirus test kits.

It has been long-standing practice for CDC scientists in emergencies to develop the first diagnostic tests, in part because the CDC has access to samples of the virus before others, officials said. Later, private companies that win FDA authorization can scale up efforts to meet demand.

In responses for this story, CDC spokesman Benjamin Haynes said in a statement: “This process has not gone as smoothly as we would have liked. ... CDC has a responsibility to ensure that all CDC laboratory research and development activities, testing processes, and data are the highest possible quality and are traceable, reproducible, and documented with appropriate rigor.”

He said the manufacturing problem may have arisen because of the test’s design or because of contamination.

Finally, acknowledging that there “is a great need for test manufacturers to rapidly make testing available,” the statement said that “commercial labs are working to develop their own tests and hopefully will be available soon for clinical settings throughout the country.”

But critics say government officials should have moved much more quickly to bring on expertise from outside the CDC.

“The CDC has good scientists and they are proud,” Landt said. “But in this situation, they took the wrong approach.”
‘We can be proud. ... We moved quickly’

At the very beginning, U.S. efforts to develop a diagnostic test for the coronavirus kept pace with the rest of the world.

Shortly after publication of the virus’s genome in early January, German researchers announced they had designed a diagnostic test. Then, within days, scientists at the CDC said they’d developed one, too, and even used it detect the first U.S. case.

“We actually do have laboratory diagnostics here at CDC that are stood up,” Nancy Messonnier, the CDC’s director of the National Center for Immunization and Respiratory Diseases, told reporters on Jan. 17.

From there, however, U.S. efforts fell quickly behind, especially when compared with the efforts of the WHO, which has distributed more than 1 million tests to countries around the world based in part on the method developed by the German researchers.

As early as Feb. 6, four weeks after the genome of the virus was published, the WHO had shipped 250,000 diagnostic tests to 70 laboratories around the world, the agency said.

By comparison, the CDC at that time was shipping about 160,000 tests to labs across the nation — but then the manufacturing troubles were discovered, and most would be deemed unusable because they produced confusing results. Over the next three weeks, only about 200 of those tests sent to labs would be used, according to CDC statistics.

In fact, the U.S. efforts to distribute a working test stalled until Feb. 28, when federal officials revised the CDC test and began loosening up FDA rules that had limited who could develop coronavirus diagnostic tests.

During that critical interval, the CDC repeatedly assured the public that progress was being made, even as public health officials around the country began to raise alarms about the shortage of tests.

In January, CDC officials boasted during the coronavirus briefings that the United States has “one of the strongest public health systems in the world.”

At briefing on Feb. 12, Messonnier said “rapid development of a diagnostic and rapid deployment to the states” is “clearly a success.”

On Feb. 14, she said: “We can be proud. … We moved quickly.”

On Feb. 21, Messonnier acknowledged problems with the testing kits, but described the issues as “normal.”

But by that point, public health labs around the nation had run very few of the CDC tests, according to the agency. Health officials across the country began pleading for a test that worked, or at least the authorization to use another test.

© John Moore/AFP/Getty Images Flowers adorn trees outside the Life Care Center in Kirkland, Wash. As of March 15, 29 covid-19 deaths had been associated with the home.
‘You can’t track what you don’t see’

In the absence of tests, the calls for the United States to tap into the expertise of academia, hospitals and private companies, such as Landt’s, grew more insistent.

“It took [the CDC] a while to come up with the test, honestly,” said Alex Greninger of the University of Washington.

His lab had developed its own test and began seeking approval to use it on patients on Feb. 18. But that test, along with others that had been developed in various academic centers and hospitals, could not be used on patients until the FDA relaxed its testing rules on Feb 29.

He noted that many of the state public health labs had also figured out how to use the CDC test properly — by tossing one of its components — but were not allowed to actually do so until the FDA approved the workaround that same day.

“We had all these state public health labs that had a perfectly good [test] on their hands, and they knew it, they were upset,” Greninger said.

“What surprised me the most was to hear how much emphasis there is at CDC on quality control — to the point where, in my opinion, it really compromised surveillance,” said Michelle Mello, a professor of law and medicine and Stanford who recently wrote a paper about the delays in testing for coronavirus in the United States. “You can’t track what you don’t see.”

On March 7, FDA Commissioner Stephen M. Hahn stressed the importance of quality, noting that diagnostic tests in some other countries have been flawed. He did not specify which countries he meant, but China’s test may have produced lots of false positives, according to a recent publication by Chinese researchers.

“What’s important here is that we have a test that the American people can trust," Hahn said.

But even a small firm, like Landt’s, is capable of producing a lot of high-quality tests and could have helped the efforts in the U.S., Landt said. His company, known as TIB for TIB Molbiol Syntheselabor GmbH, based their tests on the methods the German researchers published in January.

Though it has just 55 employees globally, TIB had experience in developing tests for SARS and the swine flu. It began producing the coronavirus tests in mid-January, just days after the Chinese researchers posted the virus’s genome, Landt said. It can produce about a million of them a week.

As wearying as his schedule has been, Landt said, “I like the feedback from people.”

© Krisztian Bocsi/Bloomberg Olfert Landt, founder of TIB 

Molbiol Syntheselabor GmbH, poses for a photograph 

with a coronavirus diagnostic test kit at his production 

facility in Berlin on March 6.

Labs waited weeks after tests malfunctioned

Exactly what went wrong with the CDC’s first tests in the first critical weeks hasn’t been fully explained by the agency, aside from the possibility that the design was flawed or that the tests were contaminated.

While such diagnostic tests can vary in the specifics, they typically involve trying to match the genetics of a patient sample, taken from nasal and throat swabs, against those of the virus.

In the case of the CDC method, the test consisted of attempts to match a patient sample against three distinct pieces of the virus’s genetic code. A patient was declared to have coronavirus if each of those three attempts came back as a match.

The trouble with the CDC test arose because the third attempt at a match, known as the N3 component, produced an inconclusive result even on known samples of the coronavirus.

While the cause of the problem in the CDC test may yet be unknown, it meant that in the weeks before Feb. 28, the public health labs were left waiting for a usable test.

By Feb. 8, public health labs were notifying the CDC of troubles with the test, and four days later, about a week after the first CDC tests had shipped, officials acknowledged the problem during a news conference.

“Some of the states identified some inconclusive laboratory results,” Messonnier said Feb. 12. “We are working closely with them to correct the issues and as we’ve said all along, speed is important, but equally or more important in this situation is making sure that the laboratory results are correct.”

In the following weeks, CDC officials repeatedly said that they were working to resolve the manufacturing problem. Then on Feb. 28, the agency announced that it would just scrap the N3 component of the test that had been causing trouble. Officials also contacted a private company called Integrated DNA Technologies and asked it to make new test kits, the company said.

While the problems with the CDC test persisted, the vast majority of testing had to be done at the CDC’s Atlanta lab, and the numbers being tested were woefully below what experts said was needed.

As late as Feb. 27, only 203 specimen tests had been run out of state labs; another 3,125 had been run out of the CDC.

James Lawler, director of the global center for health security and an epidemiologist at the University of Nebraska Medical Center, was one of the infectious disease specialists who flew out to meet the Diamond Princess cruise ship passengers in Japan and flew back with them to the United States. Lawler said the problem was not just in the manufacturing of the test but in the design.

In his view, the test has design problems that make it too difficult for many labs to make it work unless they have perfect conditions.

He said that even though the University of Nebraska Medical Center — a world renowned infectious disease institution that houses the state’s public health lab — was able to get the CDC version of the test to work, the Nebraska center developed its own test based on the German lab design published by the WHO.

“It’s very nuanced and complicated to make a diagnostic test,” Lawler said. "If you don’t go back and fix things ... and realize, ‘Hey, maybe I should try a different target,’ that’s when you can run into problems. ... Everything down to the details of the humidity and temperature in some people’s laboratories is going to be different. "

If the design of the test is flawed, he said, "all of those conditions may come into play. Some people have been able to get reproducibly good results and others haven’t.”


Concerns about scarce testing continue

Shortly after Feb. 28, when CDC officials announced the decision to reconfigure the CDC test, the number of those tests run by public health labs soared, from roughly 25 or fewer per day to as many as 1,500. At the same time, authorities were allowing other facilities to use their own tests — including Cleveland Clinic, Stanford and Greninger’s at the University of Washington.

Even so, complaints of testing scarcity continued to roll in last week. And even as tests become more widely available, experts and officials have cautioned that a backlog will continue because of critical shortages: swabs to collect patient samples, machines to extract the genetic material from the swabs, workers qualified to run the tests.

Even if those problems are resolved, however, those critical early delays, when the CDC was struggling to issue tests to the states, significantly damaged efforts to contain the spread of the coronavirus, experts said.

In a CDC tele-briefing on Feb. 29 that included some local and state public health directors, local officials lamented the initial inability to test. A reporter asked: “Did the lack of testing capabilities delay finding out who these cases were, particularly the person who died?”

In answering, Jeff Duchin, the public health chief in King County, Washington, where 37 deaths have been reported, suggested the lack of tests was critical, in addition to the fact that authorities had limited who could be tested. Initially, they had said tests would only be used for those who had traveled in affected regions of the globe or had otherwise been in contact with an infected person.

“So, you know, if we had the ability to test earlier, I’m sure we would have identified patients earlier in the community, possibly at hospitals, but we were also looking at not only availability of testing but whether patients met criteria for testing,” Duchin said.” So, given the fact that we just recently acquired our availability of testing and new criteria were published, this person was brought to our attention.”

Thomas Frieden, an infectious disease physician who served as CDC director under former president Barack Obama, called on Sunday for an “independent group” to investigate what went wrong with the CDC’s testing process. He said in the past, the CDC moved quickly to produce tests for diseases such as H1N1, or swine flu.

“We were able to get test kits out fast,” Frieden said on CNN. “Something went wrong here. We have to find out why so we can prevent that in the future.”

Frieden said the agency has been muzzled under President Trump and despite the multitude of problems with the rollout of testing, “the CDC is still the greatest public health institution in the world.”

Climate report warns "time is fast running out" to avoid worst

CBS 3/10/2020 

The United Nations' weather and climate agency is out with its annual State of the Climate report, and it says "the tell-tale physical signs of climate change" are everywhere. The report documents unprecedented heat waves, fires and floods over the past year, and warns that there is likely more to come.

© Getty Images / iStockphoto heat wave

In the report, the UN's World Meteorological Organization (WMO) cited the historic fires in Australia and the Amazon, record-shattering heat waves in Europe, and soaring levels of carbon dioxide in the atmosphere. In a statement released with the report, the leader of the United Nations calls climate change "the defining challenge of our time" and said "time is fast running out for us to avert the worst impacts of climate disruption."

"We are currently way off track to meeting either the 1.5°C or 2°C targets that the Paris Agreement calls for," said UN Secretary-General Antonio Guterres, referring to the goal of limiting the rise in global temperatures to no more than 1.5 or 2 degrees Celsius above the pre-industrial average. "This report outlines the latest science and illustrates the urgency for far-reaching climate action."

10 common myths about climate change — and what science really says

In order to reach those targets the world would have to rein in our dependence on burning fossil fuels, which release heat-trapping greenhouse gases. However, carbon dioxide (CO2) levels once again hit a record in 2019 — nearly 40% higher now than before the Industrial Revolution and the highest levels in 3 million years.

More than 90% of the heat from these excess greenhouse gases is trapped in the oceans, and that has resulted in another record-breaking year for ocean heat content. Even though there was no El Nino, a climate pattern which allows ocean heat to escape into the atmosphere, 2019 still ended up being the globe's second-warmest year on record. In fact, the five warmest years on record worldwide occurred over the most recent five years.

The impact on humans is growing, with climate variability and extreme weather "among the key drivers of the recent rise in global hunger," the UN said in a press statement.

The report also highlighted the most consequential climate-change-driven events over the past year.

Historic fires

If there's one thing most of the planet will remember about 2019, it's the out-of-control fires. From Australia to the Amazon to California, devastating fires dominated news headlines for weeks.

As shown in the recent CBSN Originals documentary "Complicit: The Amazon Fires," slash-and-burn techniques for deforestation are rapidly fracturing the vital rainforest. Scientists warn it may be only a few years before the ecosystem reaches a tipping point and transitions into a more open savanna, with vastly less ability to absorb greenhouse gases and buffer the Earth against climate change.

In Australia's worst fire season on record, 46 million acres were burned, more than 1 billion animals died and the estimated price tag is in the tens of billions of dollars. A international study recently concluded that the Australian bushfires were made much more likely and more intense due to human-caused climate change.
Heat waves

The same mechanism that set the stage for the historic bushfire season in Australia also supercharged the heat wave which helped fuel those fires. A phenomenon called the Indian Ocean Dipole, with cool waters near Australia and warm waters near east Africa, combined with a climate system spiked by human heating to cause a record-shattering heat wave in Australia.

The WMO report notes that Australia experienced the entire country's hottest day on record at 107 degrees Fahrenheit in December, with 2019 featuring the 7 hottest days on record for the nation.

Europe also experienced two historic heat waves this past summer, in late June and late July. In France, a national record high temperature of 115 degrees Fahrenheit shattered the old record by 3.5 degrees. National records were also set in Germany, the Netherlands, Belgium, Luxembourg and the United Kingdom.

Not even Antarctica was spared from record breaking heat, with temperatures of 69 and 65 degrees Fahrenheit reported on two separate days in February. The unusual warmth is rapidly melting ice and fracturing ice shelves.
Ocean heat

As mentioned above, ocean heat content (the amount of heat stored in the ocean) set a new record in 2019. While ocean waters help absorb heat and buffer the atmosphere from a rapidly warming climate, that heating takes its toll on the oceans. The report notes that 84% of oceans experienced a marine heat wave in 2019.
© Provided by CBS News

During this past summer a huge ocean heat blob extended from Alaska to California to Hawaii, making for sweltering summer heat in Hawaii with hundreds of record hot temperatures set.

Currently, ocean heat is building up over Australia's Great Barrier Reef, where NOAA Reef Watch predicts that a mass bleaching event, perhaps the most widespread ever, is now underway. The WMO report says that the world's coral reefs are projected to decline to as low as 10% of their former cover when the Earth reaches 1.5° Celsius of global warming, and to less than 1% of their former extent at 2° Celsius of warming.

So far the Earth's atmosphere has warmed by 1.1° Celsius since pre-industrial times. We will likely reach 1.5° of warming in just the next couple of decades.
© Provided by CBS News


Massive floods

While Australia was searing in heat, drought and fire, the other side of the Indian Ocean was suffering from the opposite: torrential rains and flooding in east Africa. Also related to the extreme Indian Ocean Dipole, enhanced by a warmer climate, the unusually heavy rain in late 2019 contributed to the worst desert locust outbreak in the Horn of Africa region in 25 years and the most serious in 70 years for Kenya. This locust outbreak is expected to spread further through June, destroying crops and posing a severe threat to food security.

As the climate continues to warm, the atmosphere can hold more moisture. This results in more extreme rain events — and the United States has not been spared. 2019 was one of the wettest years on record for the U.S. with historic floods plaguing the middle of the nation for months last spring. Total economic losses from flooding in the United States in 2019 were estimated at $20 billion.
Tropical cyclones and displacement

There were 105 named tropical systems worldwide in 2019. The strongest storms of the year were Typhoon Halong in the western Pacific with winds of 190 mph and the now infamous Hurricane Dorian, which struck the Bahamas with winds of 185 mph.

Recent research shows that the extra heat being stored by the oceans is powering stronger tropical cyclones with heavier rainfalls. That trend is expected to continue in the coming decades.

As a direct result of cyclones, especially a select few major disasters, the WMO report says 6.7 million people were displaced just between January and June of 2019.

For the full year, the number was forecast to reach close to 22 million, up from 17.2 million in 2018.

The biggest impact events were Cyclone Idai in Southeast Africa, Cyclone Fani in South Asia and Hurricane Dorian in the Bahamas. CBS News' "60 Minutes" recently revisited the hard-hit Abaco Islands in the Bahamas to see how residents are recovering.

Climate scientists are in clear consensus that the devastating climate events of 2019 are in part driven by human-caused climate change, and they say such disasters will only get worse until humanity manages to decarbonize our economies and reduce excess greenhouse gases in the atmosphere. This climate challenge is herculean, but one that is necessary to preserve Earth's fragile life systems.


Floods and fires show 'time is fast running out' to address climate change

Denise Chow
3/10/2020
The world is significantly falling short when it comes to efforts to curb climate change, according to a new report released Tuesday by the World Meteorological Organization.

© Johannes Eisele Image: TOP SHOT-US-WEATHER-CLIMATE-HEATWAVE

The intergovernmental organization's assessment evaluated a range of so-called global climate indicators in 2019, including land temperatures, ocean temperatures, greenhouse gas emissions, sea-level rise and melting ice. The report finds that most of these indicators are increasing, which means the planet is veering way off track in trying to control the pace of global warming.


"Climate change is the defining challenge of our time," United Nations Secretary-General Antonio Guterres said in a statement. "Time is fast running out for us to avert the worst impacts of climate disruption and protect our societies from the inevitable impacts to come."

And there were plenty of disruptions and impacts last year. The report, which linked events such as heat waves, flooding and extreme weather to climate change, highlighted how these disruptions have affected human health and security.

Two severe heat waves in Europe last summer, for example, led to 1,462 deaths in the affected regions, according to the report. The study also estimated that 22 million people were displaced by flooding and other extreme weather events in 2019, up from 17.2 million in 2018.

The report also confirmed that 2019 was the second warmest year on record. Global average temperatures last year were 1.1 degrees Celsius above pre-industrial levels. Last year fell shy of the record held by 2016, but the report noted that 2015 to 2019 are the five warmest years in recorded history. And since the 1980s, each subsequent decade has been warmer than any preceding decade since 1850.

© Sean Gallup Image: Western Greenland Hit By Unseasonably Warm Weather

The meteorological organization highlighted that emissions of heat-trapping greenhouse gases continued to rise last year, with early projections based on the first three quarters of 2019 indicating that global carbon dioxide emissions likely increased by 0.6 percent.

"Given that greenhouse gas levels continue to increase, the warming will continue," WMO Secretary-General Petteri Taalas, said in a statement. "A recent decadal forecast indicates that a new annual global temperature record is likely in the next five years. It is a matter of time."

The report outlined the impacts of human-caused warming on the world's oceans, which play a crucial role in the planet's carbon cycle by storing carbon and absorbing heat. According to the meteorological organization, oceans absorb about 90 percent of the heat trapped in the atmosphere from increasing greenhouse gas emissions. Last year, the report found, oceans hit their warmest level in recorded history.

Warmer land and ocean temperatures also drive the melting of sea ice and glaciers, which can speed sea level rise around the globe. Both Antarctica and the Arctic recorded low sea ice extents in 2019, and sea levels continue to rise at an accelerated pace, according to the report.

"This is exposing coastal areas and islands to a greater risk of flooding and the submersion of low-lying areas," Taalas said in the statement.

The trends highlighted in the report indicate that the world is failing to meet the goal set out by the Paris Agreement, which aims to keep global warming below 2 degrees Celsius (3.6 degrees Fahrenheit) by the end of the century.

"We are currently way off track to meeting either the 1.5 degrees C or 2 degrees C targets that the Paris Agreement calls for," Guterres said in the statement. "This report outlines the latest science and illustrates the urgency for far-reaching climate action."

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Displaced by fire, Amazon's migrants fight to rebuild their homes 

 

was destroyed by fire, tents and makeshift homes are all

 that is left of Lima, Peru’s only indigenous community, Cantagallo.
 

Artist and community leader, Olinda Silvano migrated to Lima from Peru’s

 Amazon as a child. She says she will not stop fighting for her destroyed community.
 

More than 2,000 Shipibo migrants from Peru’s Amazon remain displaced

 after a fire tore through their Lima community in 2016.

Once home to 238 families, displaced indigenous Shipibos dig up rocks 

and debris to erect tarp huts in their Lima slum of Cantagallo.

Juan Agustin, a political and spiritual leader for his tribe,

 has advocated for his adopted home in Cantagallo for decades.

In recent months, native migrants from Peru’s Amazon have returned 

to their destroyed Lima slum to demand housing justice from the state.

Cantagallo, once a thriving Amazonian slum in the capital,

 Lima, has become a squatter camp in recent months.

 © Neil Giardino for ABC News

After it

Olinda Silvano lives with the painful memory of her father’s blood-stained shirt and his dying message, "Fight for Cantagallo."

"He opened the door thinking it was a neighbor from the community," Silvano recalled, "But it was a group of men sent in to kick us out. They hit him until he was bleeding."

Seeking escape from dire poverty and an education for their children, a group of Shipibo-Konibo people came to the capital in the 1990s, where they settled atop a landfill along the polluted Rimac River, mere blocks from central Lima’s government palace.

Far from home in the sweltering jungle surrounding the Ucayali River, and despite the hardship of rural to urban migration, their community grew. The tribe built a bilingual Spanish-Shipibo school and displayed their art, cuisine, and traditional medicine in this sprawling coastal city of nine million.

But in 2016, their home was destroyed by a massive fire. Today, Cantagallo’s 238 Shipibo families are displaced and embittered after government promises to rebuild have stagnated for years. Cantagallo residents and advocates say the delays underscore the vulnerability of indigenous communities throughout Latin America, which often lack title to their land.

Despite pledges by two Peruvian presidents and lapsed commitment from the nation’s top housing authority to rebuild Cantagallo, indigenous residents here are leery of promises, which they say are too often hobbled by entrenched corruption and turbulent politics.

In recent months over a thousand Shipibos have returned to their razed community to demand action from the state, which they say has misled them about the project’s fate for too long.

MORE: Catching illegal loggers deep in the Amazon with ‘Guardians of the Amazon’: Part 1

"Politicians deceive us and lie to us. Presidents and mayors have come and gone, each with promises," said 50-year-old Silvano, who serves as Cantagallo’s culture secretary.

Political corruption is systemic in this South American nation of 30 million. Soon after Peru’s former president Pedro Pablo Kuczynski and Lima’s former mayor Luis Castañeda made promises to rebuild Cantagallo after the 2016 fire, both politicians were separately accused of accepting illegal campaign funds from the Brazilian construction giant Odebrecht.

Infrastructure and housing projects have stalled in Peru as a result of the international corruption scandal, which has incriminated four Peruvian presidents and dozens of leaders across Latin America.

But in 2017, Peru’s Ministry of Housing announced the $6 million investment in a new Shipibo-Konibo housing project, which would consist of single-family homes, a new bilingual school, and a fairground for the sale of the tribe’s well-known art.

Residents, still living amid the charred wreckage of the fire, were given a monthly stipend for temporary housing. But their impatience grew as the plan stalled throughout 2018 and housing stipends ran dry. Delays extended well into 2019, when the project was officially postponed.

MORE: Indigenous ‘Guardians’ targeted after trying to protect their land: Part 2

Furious residents returned in protest, demanding answers from Peru’s embattled president, Martin Vizcarra, whose decision to dissolve congress last September resulted in the loss of vital cabinet ministers and a weakened government.

Once a proud and tumbledown hillside slum adorned with murals of ancestral Shipibo artwork called kené, Cantagallo is now a squatter camp, lacking water and sanitation.

On a recent evening, dispossessed residents put up makeshift homes of wooden stakes and plastic.

Like many of her Shipibo neighbors, Fidelia Ahuanari, 42, was searching for a plot of land to assemble a tent. She stopped and motioned toward the Shipibo elementary school, now stripped of its roof, doors and windows.

"I was the first teacher in this school," she said. "I’m proud to teach my culture. But I’m angry about how the state treats indigenous people. Now is the time to fight."

Down the street, in one of the few Shipibo homes spared from the fire, Juan Agustin performed an indigenous healing ceremony with ayahuasca, a psychoactive vine native to the Amazon.

"Cantagallo is a little piece of the Amazon in the heart of Lima. It’s a living culture," he said.

Agustin, 50, is a professor of the Shipibo language and has held various leadership positions in Cantagallo over the past two decades.

"Lima is a strong acculturating force. It westernizes and pressures ethnic groups to leave their cultures behind," he said. "The most important way to ensure this doesn’t happen is through territory."

Over a million residents dispersed throughout Lima identify as indigenous, or of ethnic origin predating Spanish colonization, though Cantagallo is the city’s only cohesive indigenous community.

The Shipibo-Konibo are the third-largest tribe in the Peruvian Amazon. Numbering nearly 30,000, most live in riverine communities bordering Brazil.

Though they hold no legal title to Cantagallo, under international law, the Shipibo’s current housing crisis in Lima affords them unique rights as a displaced indigenous community, argued Mar Perez, an attorney with the National Coordinator for Human Rights.

"They’ve suffered financial and cultural consequences because of their displacement. The state should recognize this," Perez told ABC News. Peru’s Ministry of Housing declined interview requests for this article. But in a bid to conciliate residents, the agency recently released new details of a housing project, slated to begin at the end of 2020.

Many here, including Olinda Silvano, remain doubtful of the state. But the memory of her father -- and his dying message to fight for Cantagallo -- gives her strength to continue fighting.

"His blood was spilled on this land. So, come what may, I’ll stay here," she said.

What winter? Earth just had its second-warmest December-February on record


Doyle Rice, USA TODAY


What winter?
The months of December, January and February – which meteorologists define as winter here in the Northern Hemisphere – were the second-warmest on record, federal scientists announced Friday.

Only the El Niño-fueled winter of 2015-16 was warmer, the National Oceanic and Atmospheric Administration said. El Niño, a natural warming of sea water in the tropical Pacific Ocean, acts to boost global temperatures.


Global temperature records for the Earth go back to 1880.

Some of the most extreme warmth was in Russia, which smashed its record for warmest winter. Temperatures there were as much as a whopping 12 degrees above average, according to the country's weather service.

All the weird warmth messed with the region’s flora and fauna, as Gizmodo noted. Flowers started to bloom early in the winter, and some bears even awoke from hibernation at the Bolsherechensky Zoo, the Washington Post said.

In Europe, France had its warmest winter on record, while both Austria and the Netherlands had their second-warmest winter. Austria has a long history of keeping weather data: temperature records there go back to 1767, when Mozart was 11 years old.

"Record-warm December to February temperatures were observed across much of the western half of Russia and parts of Europe, eastern Asia, northern Australia and across the Atlantic, Indian and western Pacific oceans," NOAA said. "However, no land or ocean areas had record-cold December to February temperatures."

10 years to save planet Earth: Here are 6 imaginative climate change solutions

Consider this: A heat wave melted 20% of an Antarctic island's snow in only 9 days

Of course, in the Southern Hemisphere, it was summer, where the extreme warmth of Australia's second-warmest summer on record fueled devastating and deadly wildfires there.

The USA had its sixth-warmest winter on record. Every state except Alaska was warmer-than-average during the December – February months.

According to a statistical analysis done by NOAA scientists, the year 2020 is "very likely to rank among the five-warmest years on record," NOAA said.

NASA, which also tracks global temperatures, also said that the winter of 2019-20 was the second-warmest on record.

The warm winter comes on the heels of the second warmest year on record (2019) and the fact that the 2010s was the warmest decade ever recorded.

Thanks to human-caused global warming, "this period is now the warmest in the history of modern civilization," according to the National Climate Assessment. "Human activities, especially emissions of greenhouse gases, are the dominant cause of the observed warming since the mid-20th century," the assessment said.

UN report: Planet is 'way off track' in dealing with climate change

This article originally appeared on USA TODAY: What winter? Earth just had its second-warmest December-February on record

Warmest winter on record gives way to extra-early signs of spring






© Provided by CBS News

If this winter season was not very wintery where you live, you're certainly not alone — that was the experience for most of the people in the Northern Hemisphere. According to NOAA, the winter of 2019-2020 was the warmest on record across all continents north of the equator.


With an average temperature 4 degrees Fahrenheit above the 20th century average, this winter ranks first among the warmest winters on land in the Northern Hemisphere, beating the very mild winter of 2015-2016.

Up until now the 2015-2016 winter was the clear winner for warmth, but now it must split that distinction with this season. When you factor in the ocean surface in addition to land temperatures, 2015-2016 still holds the record. That's because that winter, the Earth experienced a super El Niño, overheating the surface waters of the equatorial Pacific and radiating heat into the atmosphere. It's years like that where record warmth is expected. But there was no El Niño to be found this winter, and yet, at least over land, it impressively still managed to exceed a super El Niño year.

As a result of the unusually warm weather this winter, seasonal rhythms have been thrown off kilter. As CBS News reported earlier this week, in places from Moscow to the U.S. bears have been seen coming out of hibernation early. Connecticut's Beardsley Zoo says its native black bears emerged in early March — almost a month earlier than usual.

In much of the eastern United States, spring "leaf out" — the season's first blossoming of several plant species — has sprung more than 20 days early. In parts of the Southeast, this year's spring bloom is the earliest in the 39-year record, according to the National Phenology Network, an organization that studies the impact of climate on nature's cycles.

CBS News asked Dr. Theresa Crimmins, director of the USA National Phenology Network, if such a widespread early arrival of spring is unusual. "Yes," she replied, "this year stands out, because so much of the country is showing such an early spring. Huge swaths of the Southeast have had the start of spring arrive 2-3 weeks and more early."

And the reason behind it? "Climate change is certainly at play — there is a clear trend toward an earlier start to spring," Crimmins said.
10 common myths about climate change — and what science really says

A 2015 study led by Cornell University's Dr. Toby Ault found a regional trend in earlier "leaf out," indicated by the orange colors in the map below, by up to 1.6 days per decade due to a warming climate on top of natural fluctuations.

With recent temperatures reaching in the low 70s — 25 degrees above normal — flowers are starting to appear in New York's Central Park weeks early.

The early spring is getting a boost from a winter with very little cold and snow in most of the country and around the world. In the U.S., the winter was nearly 4 degrees Fahrenheit above the 20th century average, ranking as 6th warmest since the late 1800s. Washington D.C.'s snowfall was measly — less than an inch — and Boston registered its second-lowest snow total on record.

In the image below, the color brown indicates places that have seen less snow than normal.

The warmth has been even more astonishing in Europe. According to the Copernicus Climate Change Service, Europe just experienced its warmest winter on record by far — 6 degrees Fahrenheit above normal — shattering the old record by 2.5 degrees Fahrenheit.

The warmth caused difficulties for reindeer herding in northern Sweden, the failure of the ice-wine harvest in Germany, and forced organizers to import snow for sporting events in Sweden and Russia. Parts of Russia near Moscow experienced a winter of 10 degrees Fahrenheit above normal.

When viewed over a longer period of time, Europe's record warm winter stands out even more starkly. Compared to normal conditions at the beginning of the Industrial Revolution (1850-1900), before human-caused greenhouse gases started to warm the planet, this winter was a remarkable 8 degrees Fahrenheit above normal across the whole continent.

Some of the warmer weather in the mid-latitudes of the U.S. and Europe can be explained by abnormally strong polar vortex winds in the Arctic, which lassoed cold air, trapping it far north. These sporadic strong polar vortex patterns are most likely part of a natural cycle.

However, the broad scale and intensity of overall warmth across the Northern Hemisphere cannot be explained without climate change. Each year more signs emerge that human-caused climate change is playing a bigger role. A peer-reviewed paper published March 10 in the journal Geophysical Research Letters shows the climate-warming signal is becoming more apparent, with "many regions already experiencing a climate which would be 'unknown' by late 19th century standards."

"The speed of climate change is accelerating" says Dr. Peter Gleick, a climate scientist and founder of the Pacific Institute, a sustainability nonprofit in Oakland, California.

"Sadly, it is not a surprise to most climate scientists. We've seen this coming for literally decades and now it's upon us," said Gleick, "I expect there will be new, hotter temperature records broken over and over again in the future along with increasingly severe droughts and floods, rising sea levels, and worsening fire risks. There's no 'normal' anymore. And still our politicians dither. It's sad and disturbing to me."

India's hot climate got hotter in the past decade

Sahana Ghosh
3/6/2020

© Provided by Quartz

As India gears up for warmer than normal summer temperatures in 2020, climate scientists say large parts of India, except for the Indo-Gangetic plains, have experienced significant warming in the last 60 years due to human-induced climate change. A climatic shift has also been noted with a pronounced increase in frequency of hot days in the last four decades, scientists said.

The India Meteorological Department recently said the March-April-May (MAM) season average temperatures are likely to be warmer than normal over most of the meteorological subdivisions of northwest, west and central India and some subdivisions from south India. Near normal temperatures are likely in the remaining subdivisions.

The World Meteorological Organisation in a statement on State of the Global Climate 2019 released on March 10, said 2015-2019 are the five warmest years on record, and 2010-2019 the warmest decade on record. Since the 1980s, each successive decade has been warmer than any preceding decade since 1850.


“We find that more than 60% of India has experienced significant warming during the 1951-2015 observed record. The rise in summer temperature is already more than one degree in the last 60 or so years,” said Vimal Mishra of the Water and Climate Lab at Indian Institute of Technology (IIT)-Gandhinagar, referring to his latest study that taps into India Meteorological Department’s observed data as well long-term simulations of 2,000 years that helps understand the future changes.

Mishra and colleagues identified the hottest summer in the observed record (1951 to 2015) across five climatic regions in India.

“The hottest summers in the observed record occurred once in 60 or so years and had lasting impacts on public health, water availability, agriculture, and labour efficiency. Due to anthropogenic warming, we will witness the summers like the hottest summer more often, which will affect various aspects of socio-economic well being,” explained Mishra.

For instance, a study of health impacts on construction workers in Gandhinagar, Gujarat, showed that heat stress levels were higher than those prescribed by international standards, highlighting the need for revision of work practices, increased protective measures, and possible development of indigenous work safety standards for heat exposure.

Expanding on his latest study, Mishra said the five regions classified in the study are: arid regions, which includes both arid and semi-arid regions in the northwestern parts of India and rain shadow regions in the Indian peninsula; cold regions, which encompass all the Himalayan states of the country; tropical monsoon forest regions that includes the western coast of India and the southern parts of the northeastern states where the southwest monsoon hits the earliest in the country.

The tropical Savannah regions that comprise the tropical regions in India; and temperate dry summer regions, which encompass the Gangetic and Brahmaputra plains and the narrow belt in Punjab-Haryana plains that receives moderate rainfall during the summer monsoon season are the other two regions.

“Hottest summers in different climatic regions can be linked to natural climate variability as well as anthropogenic climate change. The hottest summers of 1979 and 1973 are not linked with anthropogenic warming rather those were caused by natural climate variability,” noted Mishra.

However, the study identifies the summer of 2010 as the hottest summer in the arid, cold, and temperate regions during the observed record period and it was found to be directly associated with warming linked to human actions.

© Provided by Quartz

India experienced one of the worst heatwave spells in the last several decades.

“Further, our analysis shows that if the global mean temperature increases to two degrees from the pre-industrial level (1861-1890), the chances of getting the summers like the observed hottest summer will increase by about seven times,” said Mishra, adding that climate change mitigation can help reduce the rise in global mean temperature but it is unlikely to limit the warming under two degrees by the end of the 21st century using the best possible mitigation measures.

The observed cooling over the Indo-Gangetic Plain in IMD data can be attributed to irrigation and the presence of atmospheric aerosols. Intensive irrigation over the Indo-Gangetic plain results in cooling of the surface as well as air temperature as reported in the previous studies, the authors said.

Mishra said said adaptation and mitigation will play a crucial role in reducing the adverse impacts of climate change in the short and long-term.

Agreeing with the study findings, Krishna AchutaRao, professor, centre for atmospheric sciences at Indian Institute of Technology Delhi, who was not associated with the research, said the increases in risk ratio are not uniform across the country.

“So the action required will have to take this into account and produce specific plans for specific regions. This will definitely help policymakers,” he said AchutaRao in response to a query on research feeding into policy.

Another study suggesting a climatic shift has shown that most of India, except the Indo-Gangetic plains, has experienced more frequent hot days having higher temperatures in recent years (1976 to 2018).

“Our results provide compelling evidence that large parts of India, except the Indo-Gangetic plains, have experienced more occurrences of hot days (upsurge by 24.7%) having higher temperatures in the recent period (1976–2018), compared to the past (1951–1975), which suggests a shift in climate,” said corresponding author MK Joshi of the Indian Institute of Tropical Meteorology (IITM), Pune.

Joshi and colleagues Archana Rai (IITM), Ashwini Kulkarni (IITM), and Fred Kucharski, at International Center for Theoretical Physics, Trieste, Italy, diagnosed the change in characteristics (ie, frequency and intensity) of hot extremes over India before and after the 1976 climate shift.

The scientists used IMD dataset (gridded temperature data) developed using the daily maximum temperature of 395 quality control stations all over India. Because grids in extreme north and northeast regions have inconsistent data, these grids are excluded from the analysis and set to as missing values.

The study indicated a geographical shift in the uptick in the frequency of hot days.

“Before the 1976 climate shift (ie, during 1951-1975) the eastern and southern parts of India experienced marked rise in the frequency of hot days; whereas, after the 1976 climate shift (ie, during 1976-2018) hot days have significantly increased over the northwestern parts and along the western coast indicating a spatial shift of significant increasing trends in frequency of hot days,” Joshi said.

They also explored the driving mechanisms (including atmospheric patterns, local factors, and natural variability associated with El Nino/Southern Oscillation) responsible for such hot extremes that can help in mitigation and adaptation.

El Nino and the Southern Oscillation, also known as ENSO is a periodic fluctuation in sea surface temperature (El Niño) and the air pressure of the overlying atmosphere (Southern Oscillation) across the equatorial Pacific Ocean.

“Based on preceding ENSO, the periodic fluctuation in sea surface temperature and the air pressure of the overlying atmosphere across the equatorial Pacific Ocean, hot extremes over India can be potentially anticipated in advance and this will help society to prepare for such extremes,” Joshi told Mongabay-India in an email in response to questions.

Joshi said since soil moisture also has a role in controlling severely hot days, practices such as those involving the selection of environment-friendly building materials and expansion of vegetation, can help maintain soil water levels.

“Planting more trees for shade will prevent solar radiation from reaching surfaces that absorb heat.” “The building materials used in urban spaces are water-resistant surfaces and don’ allow water to flow through surfaces. So, without the cycle of flowing and evaporating water, these surfaces can’t cool automatically. Planting more trees for shade will prevent solar radiation from reaching surfaces that absorb heat. In addition to this, evapotranspiration from plants cools the air around it,” Joshi added.
Local weather labs

Stepping up climate change education is also a key mitigation tool and the UNESCO states education is an essential element of the global response to climate change. One such educational initiative that has unfolded in the cold Himalayan states involves setting up school weather labs.

In Sikkim, which has recently seen harsh summers and has introduced climate change studies in its school curriculum, efforts are on to train students into maintaining and monitoring school-based local weather stations, set up under a climate change initiative run by Indian Institute of Public Administration (IIPA) and SEEDS, in collaboration with Sikkim State Disaster Management Authority (SSDMA). The lab builds on pilots in Leh, Chamoli, and Gangtok.

At the recent launch of the Sunny Weather Lab, in a government-run school in Soreng, West Sikkim, eight-year-old Nancy Rai, who is from a school in East Sikkim enthusiastically explained the equipment that measure atmospheric pressure, temperature and several other parameters, to students who would be running the weather station in Soreng. Rai is experienced with the weather lab in her school, a laboratory set-up installed in schools for children to record daily weather conditions.

“In the weather lab set up at our school, we are learning to measure and document daily weather through six parameters. They are temperature, humidity, atmospheric pressure, wind speed, wind direction, and rainfall. The weather changes from valley to valley in Sikkim and a dense network of stations are needed,” said Rai during the launch of the weather lab in this month.

© Provided by Quartz
School students discuss the working of a weather station in Sikkim.

According to Vinod Sharma, a senior professor of disaster management at IIPA and vice-chairperson, SSDMA, extreme weather events are common in Sikkim.

“Summers are very harsh since the last few years. Rainfall has not changed but rainy days have reduced. The size of the rain droplets has expanded. More thunderstorms, hailstorms, cloudbursts are observed each year which increases the frequency of landslides,” Sharma told Mongabay-India, adding that crops such as cardamom and oranges have been hit by climate change. A recent study on the Teesta river basin in Sikkim shows a clear sign of an increase in rainfall and temperature in the 21st century.

IITM’s Joshi believes such school weather stations can help in data gathering for documenting a changing climate but data has to be collected for the long-term for a climate change perspective and maintenance of equipment should be ensured.

India experienced a prolonged heatwave in 2019. According to a McKinsey Global Institute report released in January, most of the increase in direct impact from climate hazards to date has come from greater exposure to hazards rather than from increases in the mean and tail intensity of hazards. In the future, hazard intensification will likely assume a greater role. Outdoor labour productivity is also expected to be impacted, reducing the effective number of hours that can be worked outdoors, the report states. By 2030, the average number of lost daylight working hours in India could increase to the point where between 2.5 and 4.5% of GDP could be at risk annually, according to the report estimates.
This post first appeared on Mongabay-India. We welcome your comments at ideas.india@qz.com.

Venice's canal water looks clearer as coronavirus keeps visitors away

By Jack Guy and Valentina Di Donato, CNN
As the world continues to grapple with coronavirus, the pandemic is having some unexpected side effects.  

 

© NurPhoto/NurPhoto/NurPhoto via Getty Images Venice' famous canals have become clearer due to the coronavirus lockdown.

Take Venice, one of Italy's biggest tourist attractions, which is usually heaving with visitors throughout the year.

Right now, though, the whole country is under lockdown as coronavirus continues to spread, and locals in Venice have noticed that the water in the city's canals has become much clearer, with small fish visible swimming around.

© Courtesy Marco Capovilla Locals have noticed a big difference in the clarity of the water.

Several people have uploaded photos to a Facebook group called Venezia Pulita (Clean Venice), attracting comments from other users.


"Nature resumes it's life....how beautiful," wrote Maria Lanaro.

Another user, Villa Lory, said they wished the water was always this clear.

"Marvelous there are even fish that we have the opportunity to see," they wrote.

Others saw it as a spot of light in the darkness of the pandemic.

"What a marvel this Venice was; this virus brought something....beautiful," said Katia Fameli.

But while it may look pretty, the Venice mayor's office told CNN that the change is not actually due to improved water quality.

"The water now looks clearer because there is less traffic on the canals, allowing the sediment to stay at the bottom," a spokesman said.

"It's because there is less boat traffic that usually brings sediment to the top of the water's surface."

While water pollution may not have decreased, air quality has improved, according to the spokesman.

"The air, however, is less polluted since there are less vaporetti and boat traffic than usual because of the restricted movement of residents," he said.

The coronavirus shutdown is the latest in a string of problems Venice has had to confront recently.

In November, it was hit by its worst flooding in 50 years, resulting in damage worth hundreds of millions of euros. It is also struggling with unsustainable overtourism, the sinking of its historical buildings into the water and a dwindling population.

With unprecedented force and speed, a global recession is likely taking hold 

A man wearing a protective mask walks on a Manhattan 

street on Saturday. (JEENNAH MOON/Washington Post )

By David J. Lynch and Heather Long March 14, 2020

The United States is suffering the most abrupt and widespread cessation of economic activity in its history, hurtling toward a recession that could mean lost jobs, income and wealth for millions of Americans.

Across the country, consumer spending — which supports 70 percent of the economy — is grinding to a halt as fears of the escalating coronavirus pandemic keep people from stores, restaurants, movie theaters and workplaces.

The rapid national shutdown already has caused layoffs and reverberated on Wall Street, driving stocks into their first bear market in 11 years. Amid panic selling, unusual strains have appeared in less visible market niches that are critical to the ability of businesses to operate normally.

For millions of workers, consumers and investors, the economy’s sudden stop comes as memories of the 2008 global financial crisis remain fresh. Less than 12 years ago, the economy sank into a painful recession after risky Wall Street investments tied to real estate went sour. The number of jobless workers more than doubled in the aftermath while the stock market lost more than half its value.

One store’s effort to keep shelves stocked during coronavirus rush

Sniders Super Foods in Silver Spring, Md., tries to keep up with the demand as the community makes coronavirus preparations. (Jon Gerberg, Zoeann Murphy/The Washington Post)

Some veterans of that tailspin — the worst since the Great Depression — say today’s epidemic is hammering the economy in complex ways that could prove even more difficult to combat.

“The problem is everyone in America is cutting back their consumption,” said Jason Furman, who led the Council of Economic Advisers during the Obama administration. “A lot of sectors are being hit, especially the services sector. A lot of income and spending is being reduced. That’s just an enormous shock to the economy.”

The economy has weathered numerous painful recessions and previous shocks, including natural disasters and terrorist attacks. But what’s different this time is the speed of decline and the comprehensive economic hit caused by an unpredictable health scare that interferes with Americans’ ability to produce and consume.

By the end of this month, the global economy probably will have shrunk by 1.2 percent — “not far short of the 1.6 percent drop in world output seen at the depth of the global final crisis” in the fourth quarter of 2008, according to Capital Economics in London. As the United States reels, Europe and Japan are also probably in recession.

“This is like a hurricane happening everywhere simultaneously for months and months on end,” Furman said.

The companies that feed America brace for labor shortages and worry about restocking stores as coronavirus pandemic intensifies

President Trump supports the cruise industry amid coronavirus outbreak


President Trump voices his support of the cruise industry and commends Vice president Pence for how he handled the Grand Princess in Northern California. (Video: Monica Rodman/Photo: Jabin Botsford/The Washington Post)

The economic costs in the United States are mounting quickly. Apple chief executive Tim Cook said Saturday that the company is closing all stores outside China until March 27.

In Las Vegas, MGM Resorts — where several employees have tested positive for the virus — said late Friday that it would begin layoffs and furloughs in the coming week. “Business demand has decreased significantly,” CEO Bill Hornbuckle wrote in a letter to employees, which was first reported by the Las Vegas Review-Journal.

As Americans hunker down at home because of the health scare, restaurants are among the hardest hit. Within three weeks of the first reported coronavirus death in a Seattle suburb, restaurant reservations in the city fell nearly 60 percent, according to OpenTable, the online service.

In Boston, Ayr Muir, who runs Clover Food Lab, a 12-restaurant chain, said he expects “a very serious drop-off” in sales. Several of his restaurants are on, or near, college campuses that are closing. Others are in business districts that have become ghost towns as workers telecommute.

Muir said he knows of restaurants that have closed rather than risk incurring additional debt riding out an extended business interruption.

“I think it’s less about people choosing not to go out and more that they’re not there,” he said. “I think this is going to end up being a pretty dramatic period, certainly for smaller businesses, but some larger ones, too.”

On the corporate front, the Big Three automakers and their suppliers pleaded with the Trump administration for a delay in the planned June 1 scheduled implementation of a new North American trade deal.

“We are in the midst of a global pandemic that is significantly disrupting our supply chains, and the industry is throwing all available resources into managing production through this crisis,” an industry statement said.

The eventual economic damage could be massive. More than 18 million Americans work in industries that are being hurt by the initial efforts to contain the virus: travel and tourism; spectator sports; museums; hotels; railways; and the performing arts, according to economist Michael Feroli of JPMorgan Chase.

Activity in this roughly $2 trillion slice of the economy will be significantly depressed for three months, he wrote in a note to clients Thursday, longer if the virus does not dissipate in the summer.

A sign of what’s ahead came Friday, when Delta Air Lines said it is slashing flights by 40 percent, the largest reduction in its history, surpassing even that executed after the Sept. 11 terrorist attacks. “The speed of the demand falloff is unlike anything we’ve seen — and we’ve seen a lot in our business,” Ed Bastian, Delta’s chief executive, wrote in a note to employees.

Airports empty out as coronavirus fears slam airline industry

Across the globe, flights were canceled and travelers stayed home as the novel coronavirus outbreak became a pandemic. (The Washington Post)

The U.S. economy that President Trump hailed in January as “the best it has ever been” will be smaller at the end of June than it was on New Year’s Day, according to Feroli. And it will shrink in the second quarter at an annual rate that exceeds the decline at the time the failure of the investment bank Lehman Brothers turned the 2008 downturn into a cataclysm.

“If we don’t change the trajectory, we are certainly headed for a worse outcome than officials are indicating,” said Simon Johnson, who was the International Monetary Fund’s chief economist in 2008. “We’ve never experienced a shock like this.”

Still, many economists, including Feroli, anticipate an economic rebound in the second half. That assumes that the coronavirus outbreak ebbs, perhaps because of warmer weather. But amid tremendous uncertainty about the disease, all such forecasts are tentative.

On Friday, Treasury Secretary Steven Mnuchin said the president was moving quickly to counter the epidemic and ensure that the economy rebounds before year’s end. The House early Saturday passed legislation, backed by Trump, that would spend billions of dollars on medical tests, paid sick leave for affected workers and unemployment insurance.

Trump urged Mnuchin to pressure Fed’s Powell on economic stimulus in explosive tirade about coronavirus

“This isn’t like the financial crisis. We have a medical situation that has shut down and will shut down parts of the economy like we’ve never seen,” Mnuchin told CNBC. “But then they’re going to open back up and I think there’s going to be a lot of demand.”

Factory closings in Reading, Pa., contributed to the highest 

percentage of residents living in poverty for cities over 65,000 in 2009. 

(Michael S. Williamson/WASHINGTON POST)

In 2008, the economy felt the effects of problems that originated in the financial markets. This time, the virus-induced paralysis of real activity is putting key financial channels at risk of seizing up.

A key worry is the ability of businesses to access sufficient cash to fund their routine operations. As companies from Main Street to the oil patch fret about paying their bills, many are drawing down their bank credit lines.

Leaders of the largest U.S. banks told Trump on Wednesday that — thanks to deeper reserves and years of Federal Reserve stress tests — they are financially sound. But banks will face enormous pressure to keep funds flowing to businesses that are struggling to keep their doors open.

The toilet paper shortage is real. But it should be brief.

Minutes after the president’s prime-time coronavirus speech Wednesday, Linda Schreiber, owner of travel agency Starship Travel outside Chicago, started hunting for a financial lifeline.

Virus fears have resulted in numerous cancellations of spring break trips, graduations and destination weddings that account for most spring bookings. “It’s horrible timing for this to happen,” she said. “People are canceling left and right.”

The next day she secured a small-business loan to cover two months of overhead and salaries for 29 employees. If the downturn continues past the two-month window her loan covers, she plans to close one location and reduce her staff to part time.

“I’ve been through 9/11, Zika, MERS, SARS; I’ve been through it all over 34 years,” she said. “With this, the timing couldn’t have been worse.”

Surge in coronavirus patients threatens to swamp U.S. hospitals

The resulting pressure has been most evident in bond markets. Typically, as stocks plummet, investors buy U.S. government bonds, which are widely viewed as a haven. But last week, both stocks and bonds sold off.

As stock prices plunged, some hedge funds sold Treasury bonds to raise cash to repay borrowings they had used to make risky investments. Cash-strapped energy companies likewise sought to turn their government securities into cash. And banks that needed cash to fund their business customers did the same.

“Bank treasurers are faced with a choice: Support their corporate customers who want a line of credit or deploy capital to markets. It’s clear which one they’re choosing: their customers,” said Guy LeBas, chief fixed income strategist at Janney Capital Management.

In the trading frenzy, bond sellers demanded much higher prices than the handful of ready buyers would accept — an extraordinary sign of dysfunction in a market that is usually the epitome of order.

“What happened is the Treasury market became one-sided: everyone is selling and not many people are buying,” said Roberto Perli, a former Fed official in 2008 and now a partner at Cornerstone Macro.

The Fed stepped in twice in recent days to inject extra cash to grease bond market operations. That came on top of the Fed’s March 3 interest rate cut of half a percentage point, which did little to calm the market. More aid might be needed and could come on or before the central bank’s next rate-setting meeting scheduled for Wednesday.

Further complicating the economic outlook is an intensifying oil price war involving Saudi Arabia and Russia.

Oil prices face a one-two punch. The coronavirus is idling people, trucks and ships, causing a collapse in demand. And after price-setting talks between the Organization of the Petroleum Exporting Countries and Russia broke down this month, the Saudis opted to increase production. That flooded the market with oil and sent prices spiraling toward levels not seen since the late 1990s.

“We’ll see a huge surge in oil supply over the next few weeks and no demand for it. We think the price will dip into the $20 range and could even touch the teens,” said Francisco Blanch, head of commodities and derivatives research at Bank of America.

At those prices, the United States’ shale oil and gas boom is in trouble. Most U.S. and European companies can’t survive for long with oil below $40 a barrel, many analysts say. On Friday, the president announced that the government will buy oil on the open market to fill the nation’s strategic reserves.

The news nudged oil up a few dollars per barrel, but prices remain well below the break-even point for most producers. Goldman Sachs predicts that nearly one-third of the oil and oil services companies in the country will vanish, acquired by rivals or driven out of business.

Traders are watching for signs that energy companies may default on their debts, a development that would batter regional banks in Texas and Oklahoma and could cascade through the $10 trillion corporate bond market.

For now, analysts say the financial pain is unlikely to be as widespread as in 2008 because fewer financial products are linked to these securities in the way that mortgages were used to create complex derivatives during the housing bubble.

Even so, investors are nervous. Overall financial conditions — a measure of access to credit that takes into account interest rates, currency values and bond yields — are tighter than they have been in nearly a decade, since a 2011 scare over a potential sudden slowdown in China.

And when Wall Street opens Monday, analysts will be watching potential trouble spots such as risky corporate borrowings called leveraged loans and exchange-traded funds, a popular consumer investment, for any hint of bottlenecks.

Mark Guarino in Chicago and Karen Weintraub in Boston contributed to this report.

The coronavirus outbreak is a ‘different kind of crisis,’ says Nobel laureate Joseph Stiglitz

PUBLISHED TUE, MAR 17 2020 Huileng Tan@HUILENG_TAN


KEY POINTS

On Sunday, the Fed slashed interest rates to near-zero and announced a $750 billion asset-purchasing program to shelter the economy from the impact of the virus.

“This is a different kind of crisis than normal crises. It’s just not a problem of aggregate demand,” said Joseph Stiglitz, former chief economist at the World Bank.

The spread of the coronavirus disease, formally known as COVID-19, has disrupted the global economy and supply chains as countries implement strict border controls, massive city-wide lockdowns and quarantines in order to contain the virus.



Aggressive policy action by the Federal Reserve is “obviously not” enough to help the U.S. avert a downturn caused by the coronavirus outbreak, said Joseph Stiglitz, a Nobel laureate in economics.

“Given the nature of the uncertainties, given the nature of the collapsing incomes of so many people, it can help stabilize financial markets at best and it’s clear that it didn’t do that,” Stiglitz told CNBC on Tuesday.

On Sunday, the Fed slashed interest rates to near-zero and announced a $750 billion asset-purchasing program to shelter the economy from the impact of the virus. Despite that, the markets crashed Monday — with the Dow suffering its worst day since the “Black Monday” market crash in 1987 and its third-worst day ever.


While the situation might have been worse without the Fed’s moves, “clearly it didn’t stabilize the stock markets,” said Stiglitz, who is a former chief economist at the World Bank.

The problem is that “this is a different kind of crisis than normal crises. It’s just not a problem of aggregate demand,” he said.

“Because of the disease, people are shutting down their businesses. In the United States, restaurants in New York City have been closed,” said Stiglitz. “More demand is not going to save that particular problem.”

The spread of the coronavirus disease, formally known as COVID-19, has disrupted the global economy and supply chains as countries implement strict border controls, massive city-wide lockdowns and quarantines in order to contain the virus.


There are now at least 168,019 cases of the coronavirus worldwide, according to data from the World Health Organization. At least 6,610 have died from the disease.

Even though financial institutions have assured that their positions are strong amid the market rout, Stiglitz said no bank would be spared from the impact of a major economic downturn even if it is adequately capitalized.

“People wouldn’t be able to repay their loans, people wouldn’t be taking out new loans, businesses wouldn’t be taking out new loans. The business model of banks is very sensitive to the business cycle,” he said.
Give help to targeted segments


Stiglitz advocated for targeted assistance to help people and sectors weather the public health emergency.

“It is clearly a case where targeted fiscal policy is what is needed. It’s been true for a long while that monetary policies has had only have limited efficacy,” said the Columbia University professor, who is also chief economist at the Roosevelt Institute.

The support should focus on those who will be “facing enormous stress,” strengthening the capacity of the healthcare system and encouraging people to not interact, as well as get tested and not show up at work if they are sick, said Stiglitz.

“We are going to need to get large amounts of money — you might call it ‘helicopter money’ — to those people who are going to be under enormous stress,” he said, citing the example of Hong Kong, which announced a 10,000 Hong Kong dollar ($1,287) cash payout to all permanent residents above 18 years old.

In fact, large government spending in today’s pressing circumstances while paying no attention to deficit “is correct,” he said.

“The deficit is something that we will have to deal with in the future. When we went to World War II, we didn’t ask ‘could we afford it,’” said Stiglitz. “We spent the money as we needed it.”

“We had to make sure that we weren’t overspending in the sense that we had inflation. We had to manage the economy.”

WATCH NOW VIDEO 02:55
Trump had ‘no idea’ about the seriousness of coronavirus crisis: Stiglitz

‘I don’t see how we’re going to avoid having a recession,’ says former Fed advisor as coronavirus outbreak persists
PUBLISHED TUE, MAR 17 2020
Abigail Ng@ABIGAILNGWY

KEY POINTS

Even if every American is given $1,000 to ride out the coronavirus crisis, it’s still going to be difficult for the U.S. economy to stay afloat, said Andrew Levin, a former special advisor to the Federal Reserve Board.

“The problem for the U.S. economy is a lot of cities are shutting down, and people staying home, not going out to restaurants, not going out shopping, not buying cars,” he said.

The economy could recover “fairly quickly” if things improve from a public health standpoint, but more decisive fiscal policy measures may be required if the recession drags on.


A man walks while wearing a protective face mask is seen as coronavirus continues to spread across the United States on March 16, 2020 in New York City.
Cindy Ord | Getty Images


Even if every American is given $1,000 to ride out the coronavirus crisis, it’s still going to be difficult for the U.S. economy to stay afloat in the coronavirus crisis, says a former special advisor to the Federal Reserve Board.

Such a move can help individuals to pay the bills, but consumer spending, which makes up around two thirds of economic activity in America, will still take a hit, said Andrew Levin, who is also a professor of economics at Dartmouth College.

“The problem for the U.S. economy is a lot of cities are shutting down, and people staying home, not going out to restaurants, not going out shopping, not buying cars,” he told CNBC’s “Capital Connection” on Tuesday.

“I don’t see how we’re going to avoid having a recession.”

The novel coronavirus was first detected in the Chinese city of Wuhan, in late 2019, but the pandemic has escalated in recent weeks, with confirmed cases soaring in Europe and the United States. It has infected more than 168,000 people worldwide and killed at least 6,600.

In the U.S., state and city leaders have taken action in a bid to contain the virus. That includes closing schools, restaurants and banning large public gatherings.



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Levin said consumer spending will probably slow down for the next few months, but it’s important to “keep money in people’s pockets” and make sure there aren’t too many layoffs so that the fundamentals are “as strong as possible.”

He said it’s “critical” for the Fed and the Treasury to find a way to provide liquidity to small and medium enterprises. That will help to ensure small businesses that are “fundamentally sound don’t all go bankrupt.”

“We don’t want to have a great depression where there’s a slump in business … and all those workers are out of jobs permanently,” he added. “We need to get through this and I think there’s ways to do it with the right combination of monetary and fiscal policy.”
Possible scenarios

Levin said the “best case scenario” at this point is one where things go “reasonably well from a public health standpoint.”

If, by July or August, people can get back to work, go out and spend money they’ve saved in the meantime, the economy could have a “fairly quick” recovery, he said.

A “less ideal” scenario is one where the health crisis drags on, cases continue to be reported and it’s unclear when people can return to work, he added.

Some airlines, for example, have asked employees to take unpaid leave as the demand for travel evaporates due to the virus outbreak.

“In that scenario, the recession could drag on a lot further and maybe more decisive fiscal policy measures would be required sometime mid-to-later this year.”

CNBC’s Tucker Higgins, Dan Mangan, Dawn Kopecki, William Feuer, Noah Higgins-Dunn, Berkeley Lovelace Jr., Greg Iacurci and Leslie Josephs contributed to this report.