Plunging Oil, Coronavirus Vs. the Economy: What Does the Future Hold?

Surge Summary: Plunging oil prices and the ongoing coronavirus threat are roiling the world and American economy. The President is taking some prudent steps, but his popularity and election chances could be imperiled if the economy tanks. Meanwhile, these brewing crises are exposing the fecklessness of progressive policies.

Things may change dramatically by the time you receive this, but as of early this morning, it was apparent that the world’s financial markets are in the grips of a panic.

American stock futures plummeted and world oil prices dropped 25 percent amid a price war between Saudi Arabia and Russia and growing uncertainty over the COVID-19 coronavirus.

This means that if oil prices continue to decline, one of the strongest areas of the U.S. economy over the last decade – our oil and gas industries – will suffer a major shake-up that will likely drive many small and medium-sized drillers out of business. That may very well lead to significant job losses in states like Pennsylvania and Texas and could, in turn, affect the elections this November.

The Green New Deal crowd on the left has been demanding a shutdown of America’s energy industry for years. Some leftists on social media are even celebrating the panic in our energy sector this morning.

Meanwhile, we conservatives have warned that such a shock to our energy industry could cost millions of jobs and cause untold human suffering.

If the coronavirus crisis plays out the way it looks, it will provide a window into what it would look like if we got rid of our oil and gas industries. It won’t be a pretty picture.

The markets seem to be panicking at the moment, but there’s no reason for the public to follow suit. While there is still a lot we don’t know about coronavirus, much of what we do know is reassuring.

• Children seem to be particularly protected from the virus. There have been virtually no deaths among kids under the age of 10.

• It appears that more than 80 percent of people who are infected with the coronavirus either make a full recovery or don’t even realize they have had it to begin with. People over the age of 70 and people who have underlying health conditions such as diabetes or congestive heart failure seem to be most at risk.

• The media are breathlessly reporting each new case and every death. But virtually no outlets are reporting the number of people every day who are pronounced fully recovered from the virus. More than 62,000 people worldwide have fully recovered after contracting the virus. Scientists at Johns Hopkins have put together a helpful map showing how many people have been infected in different regions and how many have recovered.

• While it has not been proven yet, there is some evidence that as temperatures warm, the coronavirus will have a much more difficult time spreading and may die out the way the flu virus does each season. Given its proximity to Asia, you might think Hawaii would have seen many cases of coronavirus. But apparently it has not, and it might be because of the warmer temperatures there.

Even in a best-case scenario, it is going to take at least another 30 to 45 days to know with greater certainty the degree of damage done to the economy and to those infected by this virus.

But there’s one thing we know for certain right now. President Trump has been warning for years about the dangers of rampant globalism and the risks of transferring our manufacturing base to other countries like China. Trump was right, and coronavirus is proving that once again.

This virus could deal a body blow to globalism. Let’s hope it hastens the return of U.S. companies who decades ago left for China, even if it means slightly higher prices or lower corporate profits here. I think this virus will bolster political populism on both the right and the left.

It’s hard to sort out what any of this might mean for a Trump-Biden presidential campaign. But consider this: In Trump, you have a president who was ahead of the curve in warning about the dangers of unbridled globalism. His entire presidency was predicated on growing the economy and withdrawing from our engagement with China. Trump wants to make the economic pie bigger so that all Americans can benefit. He wants less regulation and lower taxes. We’ve seen the fruits of those policies throughout Trump’s three years in office. Just last Friday, the government reported that 273,000 new jobs were created in February, smashing economists’ predictions of 175,000 new jobs.

On the other side you have Joe Biden, who’s been soft on China and who’s running for the nomination of a party that’s been all in on globalism, that’s at war with the energy industry and that’s completely devoid of ideas for growing the economy. Their only ideas involve more government regulation, higher taxes and a slippery slope to government control of virtually every aspect of America’s economy. They’ve also been at war with the health care industry, which is doing its best to save us from an even worse situation on coronavirus. Imagine if our entire health care system were government-run: Do you think we’d be better off right now?

Today’s economic panic may hurt President Trump in the polls a little, as it would any president. But I think the longer-term effect will be to expose how out of touch the progressive movement is in addressing the fiscal and health challenges that America faces.

The views here are those of the author and not necessarily Daily Surge.

Originally posted here. 

Image by Gerd Altmann from Pixabay 

Gary Lee Bauer is an American politician and activist, who served in the Reagan administration. He later became president of the Family Research Council and a senior vice president of Focus on the Family. In 2000, he participated in the Republican presidential contest.