86 Hospitality

Today marks the first full day of the ban on bars and restaurants in much of the country. Colorado was the 9th state to completely ban bars and restaurants from opening, effective at 8am this morning. North Carolina, Florida, and Wisconsin also announced that they are closing all bars and restaurants for at least 30 days.

As we have spoken of before, it appears that we are headed toward a nationwide shutdown of the hospitality industry. The political will seems to be unstoppable at this point, particularly as the CDC is recommending that there be no gatherings larger than 50 for the next 8 weeks.

President Trump, for his part, has encouraged people to avoid congregating in groups larger than 10. Amid all of this, the city of San Francisco has taken the most extreme measures in the country, essentially declaring martial law for the next three weeks. However, the order to stay in place is entirely unenforceable and allows for people to make trips to the grocery store, pharmacy, and uber and lyft drivers to continue operating. You can still even get take-out.

Be that as it may, it is still one of the most frightening headlines you will see this week. However, as we saw with the closure of hospitality, San Francisco may have been the first, but they are likely the start of a trend if this keeps going further.

In economic news, president Trump is saying that he wants $1.2 Trillion in economic stimulus which would include checks of $1,000 to be delivered to all Americans. If you listened to the podcast which was published yesterday, you will remember that Senator Mitt Romney suggested exactly this during the weekend.

Governor Andrew Cuomo is calling for the nationalization of certain processes to address the crisis. In an open letter to the President, he stated that a national response was the only way that the situation could be properly addressed, citing issues with disparate local government responses to the crisis as the reason there needs to be a national policy.

This would support our theory that these 30 day bans on bars and restaurants could go national. So far, there is no indication that Washington is seeking that course of action.

Opinion

There is going to be a national shutdown of the hospitality industry. The disease is highly contagious–because nobody has any natural immunity to it–but it is not particularly lethal, at least, not to anyone who isn’t already sick or elderly. In an effort to protect those communities, we should voluntarily stay away from those who are most at risk. That doesn’t seem to be happening, which is why these measures are being put in place.

We aren’t voluntarily confining ourselves because–in my humble opinion–we don’t have any visual evidence of how severe the illness is. For most people, the World Health Organization is saying that, if you are infected, your symptoms will be “mild.” The reason that they declared a pandemic is because they lost track of who was infected and who wasn’t.

They lost track, because there weren’t enough testing kits, but also, the symptoms aren’t severe enough for anyone to suspect that they are infected with the disease, so they don’t seek testing. All of this is bolstered by the fact that these extreme social distancing measures are being strongly suggested at first and then mandated when people fail to comply.

That being said, there are probably tens of thousands more cases that we don’t know about because they haven’t been tested. There will probably be thousands of people who, get infected; get sick; and get better; without their even knowing that they had Coronavirus.

If that is the case, we will keep seeing infections until there is a vaccine. Or, we all isolate until those who are carriers get better. Sometimes, that even means forcing isolation. Obviously, the world is taking the second option. However, the second option is causing a lot of economic damage. Our way of life can’t continue through 8 weeks of isolation. Eight weeks without work, or places to spend money, is going to take a massive toll.

Property owners, in particular, are going to have to figure out whether they are more concerned about short-term money, or if they can think long term. If they think short-term, they are going to continue to demand rent payments from people who are being told they can’t work. They will also throw people out on the street for failing to somehow come up with the money to pay rent without working.

Everything gets way more difficult if you throw a homeless issue into the mix of this thing. Therefore, governments aren’t going to let it happen. They will take control over the ability to charge rent if they have to. Already, there are multiple copies of a petition to have the government “suspend rent, mortgages and utilities” during the crisis. This is being circulated by the “Rose Caucus” of the Democratic party.

While we identify as a socialist caucus, it is important to clarify that our membership is made up of Democratic Socialists, Socialists, and even those who consider themselves “further left“. 

–Rose Caucus website

If property owners can think long term, they will forego 2 months of rent (1/6 of the year) and simply let people stay in place, they will be able to maintain the status quo when this is all over.

A government take over of the housing industry sounds all well and good right now, but I don’t think it will be good in the long term. It all remains to be seen, but if this 8 week isolation idea gets implemented at the federal level, we are going to see this become the next big issue.

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