Let me give you a little peek at the book business.
Right now, people are hunkering down in their houses. They’re still buying things online, even if they aren’t venturing outside as much. In theory, this would be a great time for an online retailer.
It’s not. It’s not a devastating time; orders are still coming in. But the fact is that many people who might otherwise purchase books are worried about their income as their jobs either shut down or scale back hours. As bars, movie theaters, museums, and all the rest shut down, all of their workers – many of whom don’t have significant savings – start worrying about the food they’re going to put on the table and whether they’ll be able to make their mortgage or rent and the basic bills. Books become a secondary concern, even to collectors and avid readers.
The same scene is playing out, I expect, in the homes and small stores of thousands of businesses across the country. JFK said, and Reagan reminded us, that a rising tide lifts all boats. While they may have meant it in different ways… JFK about governmental largesse, Reagan about general economic growth… it is nonetheless a truism. As the economy grows or shrinks, all areas of the economy are eventually affected.
In addition to the threat to jobs, individual investors are watching thousands of dollars of their wealth disappear due to the stock market.
We’re not worried at my house. As I said, some orders are still coming in, and we are configured to weather a full six months with absolutely no income whatsoever before concerns begin to mount. This is the type of scenario which sunk a few bookstores after the 9/11 hit, and I was prepared for it.
Many stores aren’t, and many people aren’t. My wife is getting texts from businesses touting their heightened cleanliness standards. Some of them may be able to weather the severe lull: places like paint-your-own pottery stores, where they can distance customers or sell drop-off kits for people to make at home and then return for firing, or the cafe and gaming store which has a person designated to fully sanitize each game as it is returned from use. Others are facing long odds for survival, like gyms and child play zones centered around giant inflatables and trampolines.
Two weeks of little to no receipts can be devastating for a business. Eight or more can be a death knell.
The answer from the government is bailouts. This is the wrong answer, because it’s not addressing the underlying problem. This is not to say they won’t be helpful in some cases, but they will also cause long-term damage to the economic structure of our country. A key reason the stock losses have been so grave, so quickly is because we had drifted away from the fundamentals of stocks being valued proportionately to the productive output of their companies. A combination of politically-grounded optimism and expectations of free money infusions from the government had sapped the importance of reasonable valuation for more than a decade.
What the answer needs to be is testing. Only when we know the extent of the problem can we take proper corrective action. That data needs to be matched with an acceptance of reality by a majority of Americans – that we may need to take a significant loss for a little while if we’re to move forward again, and that we may need to pull together (yes, even through governmental distributions to the most needy) to weather the economic storm.
This needs to happen as soon as possible, and no dissembling, bailouts or political maneuvering should impede it. Any such actions need to be remembered at the ballot box, because the politicians who are delaying the testing (through rejection of offers for test kits or sheer incompetence in getting them to the needed locations) should be removed from office.
