President Trump on Monday said he will take "major" steps to protect the U.S. economy against losses tied to the coronavirus epidemic, such as working with Congress to cut payroll taxes.
Trump's announcement came after U.S. stock markets saw major declines on Monday, and officials throughout the world implemented strict measures to prevent the new virus' spread.
Epidemic sparks strict containment measures
Reports of the new coronavirus, which causes the disease known as COVID-19, first surfaced in early December 2019 in Wuhan, China. As of Tuesday, officials reported more than 116,200 cases of the virus globally. Officials said as of Tuesday there had been at least 4,082 deaths linked to the virus, and all but 946 occurred in mainland China.
In China, the number of newly reported cases of COVID-19 has slowed. Chinese officials on Tuesday reported a total of 19 new cases of the virus, which is the lowest number of new cases the country has reported since officials first started releasing such data on Jan. 20.
But the number of newly reported cases outside of China has tripled over the past week, causing some countries to implement harsher containment measures.
For instance, Italy's Prime Minister Giuseppe Conte on Monday announced strict travel restrictions throughout the entire country, essentially locking down the country's 60 million residents. Italy as of Tuesday reported more than 9,172 cases of COVID-19 and more than 463 related deaths. The new travel restrictions took effect Tuesday morning and are scheduled to last until April 3.
According to the Los Angeles Times, the "unprecedented" restrictions mean Italy's residents are allowed to travel only for work, emergencies, or medical reasons, and they could face fines or jail time if they travel for other reasons. Italy's government also encouraged workers to take vacation and remain at home, prohibited nearly all public gatherings, and mandated that restaurants and bars close at 6:00 p.m., the Wall Street Journal reports.
In the United States, state and federal officials as of Tuesday morning reported 747 confirmed or presumed positive cases of COVID-19, up from 231 on Friday. So far, 26 U.S. deaths have been linked to the virus.
CDC as of Tuesday said at least 36 of the cases stemmed from human-to-human transmission of the virus in the United States. In order to curb the virus' spread, some local officials throughout the country already have taken steps to mitigate outbreaks.
For example, officials in San Francisco and Seattle have shut down schools because of students' possible exposure to the virus, and officials in California's Santa Clara County have banned public gatherings with more than 1,000 attendees—marking one of "the most sweeping preventive measure[s] yet taken in California," according to The Mercury News. San Francisco has banned group events with 50 or more attendees at some city facilities and postponed several public events, including the city's St. Patrick's Day Parade and San Francisco Symphony concerts.
Stock markets plummet amid coronavirus fears
The increase in global COVID-19 cases and resulting travel restrictions spurred continued financial turmoil in the global economy this week.
According to the Washington Post, oil markets declined 25% on Monday, which was the largest daily decrease in the markets since the 1991 Gulf War. The Post reports that fuel demand has decreased as manufacturing has declined and countries have implemented travel restrictions because of the coronavirus epidemic.
In addition, the Dow Jones industrial average was down 7.8%, or 2,014 points, on Monday, marking the largest decline the average has seen since the Great Recession. The S&P 500 opened down nearly 7% on Monday, triggering a 15-minute halt in trading for the first time since 1997. However, as of Tuesday morning, U.S. stock markets appeared to be rebounding, the New York Times reports. The S&P 500 was about 3% early Tuesday, while the Dow was up about 1%, according to the New York Times.
Some experts have warned that reduced manufacturing and spending stemming from the coronavirus epidemic could lead to a global economic recession, the Post reports.
Mark Zandi, chief economist at Moody's Analytics, said, "A global recession is more likely than not." He explained, "The line between an expanding economy and recession is crossed when investors, businesses and—most important—consumers lose faith. Faith that they will have a job, that they will receive a paycheck, and that their retirement nest egg is safe."
Claudia Sahm, director of macroeconomic policy at the Washington Center for Equitable Growth, said, "People who really don't have a buffer are going to spend less on everything. We could see this soon. And if we start to see consumer spending slip, then we have a big problem." She added, "I'm worried about a recession. I really am."
Trump promises 'major' steps to protect US economy
Amid the losses, Trump on Monday said he would take "major" steps to protect the U.S. economy from effects tied to COVID-19.
Trump said he work with Congress to implement a "very substantial" cut to payroll taxes, offer relief for hourly workers who might miss work because of the coronavirus, and potentially implement targeted measures to assist the airline, cruise, and hotel industries and small businesses.
"We are going to take care of and have been taking care of the American public and the American economy," Trump said, adding that his administration will hold a news conference on the matter on Tuesday (Holland/Alper, Reuters, 3/9; Long et al., Washington Post, 3/9; New York Times, 3/10; McDonell, BBC News, 3/10; Axios, 3/9; Kington, Los Angeles Times, 3/9; Sylvers/Legorano, Wall Street Journal, 3/9; Smith et al., New York Times, 3/10; CDC website, 3/10; Angst/Green, The Mercury News, 3/10; Lin, Los Angeles Times, 3/9; Baker et al., New York Times, 3/10; Axios, 3/10; New York Times, 3/10).