WASHINGTON (BLOOMBERG) - The America First presidency collided with a global pandemic on Wednesday night (March 11). The result did not appear to reassure skittish markets or a nervous nation.
US President Donald Trump relied on a familiar playbook as he spoke in a prime-time address from the Oval Office, announcing sweeping new restrictions on travel from Europe and scattered executive actions to help workers and businesses rocked by what he labelled a "foreign virus".
He blamed allies for not adopting tough immigration measures that he said had prevented a wider outbreak in the US. But the combative approach and small-bore measures seemed only to highlight the President's struggles to confront the most consequential moment of his presidency.
And even in a 10-minute address, Mr Trump couldn't stick to the facts.
He overstated the European travel restrictions, saying he was "suspending all travel" from the continent, and suggested they would also apply to trade. He tweeted later that trade wouldn't be affected, and the Department of Homeland Security clarified that the restriction applies generally to foreigners who have been in Europe within 14 days.
He said US health insurers had agreed to waive co-payments for coronavirus treatment. A spokesman for America's Health Insurance Plans, a trade group, said its members had agreed only to waive co-payments for testing.
Mr Trump also announced that the government would give individuals and small and mid-sized businesses a three-month tax holiday to try to fight the economic impact of the virus, and give affected companies US$50 billion (S$69 billion) more in low-interest loan.
It clearly underwhelmed investors, who have been waiting for a "major" economic plan the President promised on Monday and has yet to put to paper.
Futures on the benchmark S&P 500 index steadily deteriorated as details of Mr Trump's plan leaked out over the dinnertime hours in New York. Down about 0.8 per cent when his remarks began, the loss extended to 2 per cent by the time the President finished speaking, and got worse from there.
"Investors are looking for bold government stimulus. So far, we haven't seen a lot of detail and there isn't much confidence it will happen quick enough," said Mr Nathan Thooft, Manulife Investment Management's head of global asset allocation.
The White House had earlier floated a suspension of US payroll taxes. But both Democrats and Republicans have expressed reticence about a payroll tax cut, and about three hours after his address, House Democrats released their own plan to fight economic fallout from the virus that served to highlight how modest Mr Trump's offering sounded.
The Democratic plan includes free coronavirus testing, paid emergency leave for workers, food security assistance and other measures to help ordinary Americans weather the outbreak.
Mr Robert Carnell, chief economist for Asia Pacific at ING Groep in Singapore, said: "Mr Trump's hands are tied, he can't come up with any meaningful spending on the virus without Congressional support, and that is difficult to achieve with the current political backdrop.
"The deferment of tax payments does help the cash flow for firms, and isn't meaningless, but I think markets will be looking at the claim that 'This is the most aggressive and comprehensive effort to confront a foreign virus in modern history', and rolling their eyes.
"The travel ban for Europe will have economic consequences, both in Europe and the US, and it may help to lower the eventual peak of the virus in the US. That is a highly debatable premise though without the widespread testing for the virus in the US."
The address demonstrated that for the President, the coronavirus remains a foreign problem that can be resolved with a characteristically Trump approach: Closing US borders. He hardly acknowledged the spread of the virus within the country, where there are now more than 1,300 cases and 38 people have died.
Mr Stephen Innes, global chief markets strategist at AxiCorp, said: "By criticising Europe and not announcing stricter domestic travel measures in the US, President Trump is treating Covid-19 as a European and Asian problem. Clearly, the market doesn't like this."
Announcing stricter containment efforts in the US could have cushioned the sell-off, he said. "Now the 'no endgame in sight' risk-off trade takes over as traders are hammering the sell button now thinking the US government has fallen well behind the curve in its Covid-19 response."
Mr Shaun Roache, S&P's Asia-Pacific chief economist in Singapore, said: "Markets had hoped Mr Trump would provide the circuit breaker to this vicious cycle we've seen in markets - but he just didn't deliver.
"If you're a country that's going to do a big fiscal stimulus, but the biggest economy in the world isn't, what might happen is that your currency appreciates against the dollar. In this sense, we need to see a globally coordinated response.
"The danger is risk premiums continuing to rise and the economic downturn will be more severe than thought if the US doesn't give more concrete details."
Mr Trump also said in his speech, "we are moving very quickly, and for the vast majority of Americans, the risk is very, very low", once again describing the threat in more optimistic language than US health authorities use. "Young and healthy people can expect to recover fully and quickly if they should get the virus," he added.
He appealed to Americans to wash their hands and stay home if they're ill. He said nothing about the US delay in testing potentially infected people that has left public health authorities blind to the spread of the disease. "Testing and testing capabilities are expanding rapidly, day by day," the President said.
But within minutes of Mr Trump's address, events rapidly demonstrated the extent of the crisis. The American movie star Tom Hanks and his wife, the actress Rita Wilson, announced they were infected, and the National Basketball Association suspended its season after Utah Jazz star Rudy Gobert tested positive for the virus. Twitter told all of its employees to work from home. Senator Maria Cantwell, a Washington State Democrat, said a staff member in her Washington, DC office had tested positive for the virus.
The White House said after his speech that Mr Trump had cancelled plans to travel this week to Nevada and Colorado, and his campaign said an event with Roman Catholics planned for Milwaukee - announced just a day earlier - has also been cancelled.
The crisis has gone to the heart of core, unresolved questions about Mr Trump's presidency: whether his streak of economic growth could be maintained through election day, if he could suppress his penchant for bold proclamations and political warfare as experts issued dire warnings about the disease, and how a West Wing staffed by novices and defiant outsiders would navigate the complexities of a true crisis.