The firm’s economic team reached that conclusion by estimating that a federal mask requirement would boost their use by 15 percent and cut the daily rise in cases a full percentage point to 0.6 percent. Reducing the spread by that seemingly small increment “could potentially substitute for lockdowns that would otherwise subtract nearly 5% from GDP,” the team led by chief economist Jan Hatzius writes.
“Other teams of public health researchers have reached similar conclusions about the efficacy of masks,” Christopher Ingraham notes. “A recent peer-reviewed study in the journal Health Affairs found that state-level face mask mandates caused steep drops in the daily infection rate and probably averted hundreds of thousands of additional coronavirus cases by June. A Lancet review of 172 studies also concluded that masks were beneficial in slowing the spread of the virus.”
The United States is on the looser side of the developed world when it comes to mask rules.
But a relatively high percentage of Americans — 70 percent — report wearing them in public. That’s less than the 90 percent rate in East Asia, or 80 percent in southern Europe, but far ahead of the United Kingdom, for example, where less than a third of people say they don the coverings outside their homes, Goldman notes.
Yet within the United States, the practice varies widely by region. More people wear masks in the Northeast, where case counts are subsiding; people are less observant in some southern and southwestern states home to new hot spots. “For example, only about 40% of respondents in Arizona say that they ‘always’ wear face masks in public, compared with nearly 80% in Massachusetts,” per the firm.
Goldman economists conclude a national mandate would help close the gap. They estimate statewide mandates boost usage by about 25 percent in the month after they take effect — and the boost would be especially pronounced “in states such as Florida and Texas that currently don’t have a comprehensive mandate and are seeing some of the worst outbreaks.”
Depoliticizing the issue couldn’t hurt, either.
Trump, who still refuses to wear a mask in public and has made fun of those who do, has transformed the safety precaution into a cultural lighting rod. Wearing a mask, in Trump’s formulation, means bowing to political correctness.
With infections spiking in mostly Republican strongholds, other GOP leaders now are urging people to mask up before heading outside.
“The last Republican vice president, Richard B. Cheney, and his Wyoming congresswoman daughter, Liz, say wearing masks is manly,” Philip Rucker and Seung Min Kim report. “Senate Majority Leader Mitch McConnell (R-Ky.) says there should be no stigma associated with covering one’s face as public health experts advise, and House Minority Leader Kevin McCarthy (R-Calif.) says doing so is essential to fully reopening the economy.”
From CNN's Daniel Dale:
And the Republican mayor of Jacksonville, Fla., which will host the Republican National Convention in August, on Monday imposed a citywide mandate — though it is not yet clear whether it will still be in place by the time of the convention or enforced for the event.
“The recent shift on the political right has left Trump isolated, with the president and his White House staff openly resisting the calls for mask wearing,” Phil and Seung Min write. The dynamic was on display Tuesday on Capitol Hill, when Federal Reserve Chair Jerome Powell and Treasury Secretary Steven Mnuchin appeared before the House Financial Services Committee. Both officials turned up for the hearing in masks. Once they were seated and began testifying, Mnuchin removed his.
From the NYT's Jeanna Smialek:
Former vice president Joe Biden, the presumptive Democratic presidential nominee, last week said if he were president, he would “do everything possible to make it required that people had to wear masks in public.” The practice draws broad popular support: A recent Pew Research poll found about seven in 10 Americans say people should wear masks most or all of the time in public if they may be near others. Only 12 percent said they should be worn rarely or never.
Stocks close out best quarter in decades.
The market clawed back most losses from when the pandemic first struck: “Stocks overcame weeks of uncertainty, social unrest and a resurgence in infections to finish one of Wall Street’s best quarters in history,” Thomas Heath and Hamza Shaban report.
“The Dow Jones industrial average jumped 216 points, or about 0.9 percent, to close at 25,812.34. The Dow sealed a 16 percent comeback in the second quarter, leaving the blue chips 10 percent short of breaking even for the year. Apple, Home Depot, Dow and Microsoft muscled the index higher in the quarter. The Standard & Poor’s 500 index jumped 1.5 percent during the session to cap its best quarter since the fourth quarter of 1998 — in the midst of the dot-com bubble — with a 19 percent gain. Energy, technology and discretionary spending — all industries tied to a broad economic recovery — led the S&P 500 for the quarter. The index closed at 3,100.29 and is down 4 percent on the year.”
- Nasdaq is doing even better: “Led by a handful of technology powerhouses — [the index] is up more than 11 percent on the year. Stay-at-home stocks such as Zoom, payments firm PayPal Holdings, online marketplace MercadoLibre and electric-car maker Tesla powered the index to a 30 percent surge for the quarter. The index ended the day at 10,058.76, ahead 1.9 percent.”
Trump is touting the results:
Latest on the federal response
Powell warns lawmakers against becoming complacent.
The Fed chair and Treasury Secretary Steven Mnuchin continued their routine of contrasting outlooks: “Powell said that the path ahead for the U.S. economy remains ‘extraordinarily uncertain’ and that the recovery will largely depend on containing the pandemic and reassuring Americans that it is safe to resume their former lives,” Rachel Siegel and Jeff Stein report.
“Powell’s cautious assessment of the U.S. economy comes as senior Trump administration officials enthusiastically tout the rebound. At the same hearing, [Mnuchin] pointed to an 18 percent increase in retail sales and cited U.S. Chamber of Commerce data showing close to 80 percent of small businesses are ‘at least partially’ open… ‘We are seeing additional signs that conditions will improve significantly in the third and fourth quarters of this year’ Mnuchin said in his opening statement.”
- Mnuchin suggested support for crisis loans to hotels and restaurants: “[He] has said the administration will look to provide targeted financial support for particularly affected industries — likely tourism, travel and other sectors hit hard by the pandemic.”
- Powell dodged offering specific guidance on fiscal policy: But he said lending to businesses, the Fed's primary tool, may lose its utility for debt-laden companies, which suggests Congress should step in instead.
The Senate reached a deal to extend PPP: “The Senate reached a surprise last-minute deal late Tuesday to extend the small-business Paycheck Protection Program through Aug. 8, passing it just hours before the lending program was set to shut down at midnight,” Jonathan O'Connell, Erica Werner and Aaron Gregg report. “Prospects for the legislation in the House, however, were uncertain. Both chambers are set to adjourn for a two-week recess by week’s end.”
“The Senate acted by unanimous consent to extend the midnight deadline for when the PPP can accept applications for forgivable loans for an additional five weeks. It came as the program was poised to shut down to new users with more than $130 billion left untapped. Lawmakers were working on legislation to redirect the remaining funding to additional businesses, but no such deal was expected to be reached until late July, and meanwhile the money left in the program would be sitting unspent.”
- The future remains murky: “Thorny questions still remain unresolved about how to repurpose the funds left in the program. Demand for the remaining money has slowed to a trickle, a dramatic change since the program was launched in April and immediately overwhelmed by demand.”
Workers are getting laid off a second time as some businesses close down again.
The whiplash is becoming real for many Americans: “Stores, restaurants, gyms and other businesses that reopened weeks ago are shuttering once more, and this time Congress appears less inclined to provide additional aid. Other companies that had banked on customers returning and restrictions lifting — such as hotel chains, construction firms and movie theaters — are seeing hours cut and reopening dates pushed back indefinitely as consumer demand stalls,” Eli Rosenberg and Abha Bhattarai report.
Workers caught in the churn "say the past few months have been jarring: navigating unemployment in March, preparing to go back to work in April or May, and now confronting the prospect of another long stretch without a paycheck.”
Pay cuts are also worsening the pain for millions: “At least 4 million private-sector workers have had their pay cut during the pandemic, according to data provided to The Washington Post by economists who worked on a labor market analysis for the University of Chicago’s Becker Friedman Institute,” Heather Long and Andrew Van Dam report.
“Workers are twice as likely to get a pay cut now than they were during the Great Recession, according to the group’s analysis of data from the payroll processor ADP. Salary cuts are spreading most rapidly in white-collar industries, which suggests a deep recession and slow recovery since white-collar workers are usually the last to feel financial pain. Companies have also trimmed employee hours, leaving many hourly wage workers with leaner paychecks as well. More than 6 million workers have been forced to work part time during the pandemic even though they want full-time work, Labor Department data show.”
More from the U.S.:
- Fauci says there could be 100,000 cases a day: “Anthony S. Fauci, the government’s top infectious-disease specialist, warned that the United States could soon have 100,000 new coronavirus cases a day ‘if this does not turn around’ — a surge that would be more than twice as many as the record so far and three times as many as the original peak this spring,” Amy Goldstein reports.
- FDA will require vaccine to be at least 50 percent effective: “The Food and Drug Administration said that to win regulatory approval, any covid-19 vaccine will have to prevent disease, or decrease its severity, in at least 50 percent of the people who receive it,” Laurie McGinley reports. “The standards apply to full approvals. But the agency didn’t rule out temporary approvals, called emergency use authorizations, which typically are based on less stringent requirements.”
- Biden escalates criticism of Trump: “[Biden] seized a moment when the coronavirus is resurging to stress how poorly he says [Trump] has handled the pandemic and to promise that as president he would take a different path,” Annie Linskey reports from Wilmington, Del.
From the corporate front:
- Shell takes $22 billion write-down: “The write-down follows one by BP PLC on a similar scale earlier this month. Lower oil and gas prices brought on by the pandemic and uncertainty over the pace of the transition to lower-carbon energy have caused major oil companies to question the value of their reserves. Exxon Mobil Corp. has resisted pressure from accountants to write down its assets,” the Wall Street Journal's Sarah McFarlane reports.
- Insurers resist payouts for companies hit by pandemic: “A cavalcade of restaurateurs, retailers and others hurt by pandemic shutdowns have sued to force their insurers to cover billions in business losses. A video berating the industry ran for most of June on a giant screen in New York’s Times Square, four times each hour around the clock,” WSJ's Leslie Scism reports. “But insurance companies have largely refused to pay … citing a standard requirement for physical damage. That is a legacy of its origins in the early 1900s as part of property insurance protecting manufacturers from broken boilers or other failing equipment that closed factories.”
Around the world:
- U.S. travelers to remain barred from the E.U.: “Travelers from a list of 15 nations will be allowed entry to the European Union starting [today],” CNBC's Silvia Amaro reports. “European Union governments decided Tuesday to open their external borders to Algeria, Tunisia, Australia, Canada, New Zealand, Georgia, Japan, Montenegro, Morocco, Rwanda, Serbia, South Korea, Thailand and Uruguay. Chinese travelers will also be allowed in the EU, but only if China announces that it will also accept European visitors.”
Goldman may have to enter a guilty plea for the first time in its history.
The firm is taking its efforts to DOJ's highest rungs: “To avert such a penalty over its work for a Malaysian sovereign fund, Goldman has appealed to the Justice Department’s highest ranks. Attorney General William Barr began overseeing the case after obtaining a waiver because his former law firm represents Goldman. The department’s No. 2 official has also been directly involved,” Bloomberg's Greg Farrell reports.
“Now, a deal may be near. Prosecutors were emboldened to press Goldman for a guilty plea after a high-ranking Goldman banker pleaded guilty in 2018 and described a secretive corporate culture that sidelined compliance staff … Since then, Goldman has pushed back on that narrative and elevated its case to the nation’s top law enforcement officers. If Goldman escapes without a guilty plea, it will be a big victory for the bank. If not, [Karen Seymour, who leads the company's defense] may still be able to soften the blow by bartering over what details are included -- and not included -- in a statement of facts outlining Goldman’s conduct in Malaysia.”
The Business Roundtable is endorsing police reform.
The lobby representing top CEOs says Congress should ban chokeholds. The group is also endorsing a national police misconduct registry and urging Congress to act before its August recess. “The set of recommendations represent a first step by business leaders to engage on police reform,” Jena McGregor reports.
AT&T CEO Randall Stephenson, who is heading up the BRT's effort, tells Jena, “We recognize that we’re outside of our traditional area of expertise… But this is a big deal. It’s affecting our communities. It’s affecting our economy. It’s affecting our employees in a really, really big way.”
Adidas HR chief to retire amid criticism from black employees: “A group of employees at Adidas had called on the company’s supervisory board in a letter earlier in June to investigate whether [Karen Parkin, the global head of human resources at Adidas AG] had taken the right approach to address racial issues in the workplace. At the time, Adidas said, ‘we strongly reject all statements made in the letter to the supervisory board,’” WSJ's Khadeeja Safdar reports.
“At an all-employee meeting last year at the Boston headquarters of Reebok, which is owned by Adidas, Parkin said racism was ‘noise’ that is only discussed in America, and that she didn’t believe the brand had an issue with racism, the Journal has reported.”
Amazon passes 1,000 hires for its Arlington headquarters: “The Seattle-based company, which opened its first office in Arlington a year ago, has hired systems engineers, data scientists, designers, lawyers, technology support personnel and human resource employees, officials told The Washington Post in advance of the announcement. The average pay for those employees is above $150,000, the level required for the company to get $750 million in subsidies from Virginia,” Patricia Sullivan reports.
“The new employees will work on several Amazon businesses, including Fire TV, Amazon Web Services, Amazon Prime and Alexa. (Amazon founder and chief executive Jeff Bezos owns The Post.) Another 400 who work for contractors at Amazon’s headquarters have also been hired, but none of the new workers, whether engineers or security guards, have yet shown up to work. That’s because Amazon’s offices, including the company’s temporary space in Crystal City, are shut down until Oct. 2 because of the pandemic.”
- Macy's, General Mills and Constellation Brands are among the notable companies reporting their earnings
- The Labor Department releases the June jobs report
- The markets are closed to observe Independence Day