Cheers and fears as economies begin to reopen: Hot-spot states press ahead with reopening

NEW MEXICO • Facing budget shortfalls and double-digit unemployment, governors of American states that are Covid-19 hot spots pressed ahead with reopenings that have raised fears of a second wave of infections.

The moves by the governors of states such as Florida and Arizona on Thursday came as Treasury Secretary Steven Mnuchin said the United States could not afford to let the coronavirus shut its economy again and global stocks tanked on worries of a pandemic resurgence.

Asian bourses were down for the second day running yesterday after another dismal showing on Wall Street overnight, where the three major indices fell more than 5 per cent - their worst day since mid-March.

As Florida reported its highest daily tally of new cases on Thursday, Governor Ron DeSantis unveiled a plan to restart public schools at "full capacity" in the autumn, arguing that the state's economy depended on it.

North Carolina reported record hospitalisations for a fifth straight day on Thursday, a day after legislators passed a Bill to reopen gyms, fitness centres and bars in a state where more than one in 10 workers are unemployed.

Governors of hot-spot states face pressure to fire up economies facing fiscal year 2021 budget shortfalls of up to 30 per cent below pre-pandemic projections, as in the case of New Mexico, according to the Centre on Budget and Policy Priorities think-tank.

Nevada, which has seen cases increase by nearly a third in the past two weeks, is suffering 28 per cent unemployment, based on US Bureau of Labour statistics.

"This is about saving lives, this is also about livelihoods in the state of Arizona," said Governor Doug Ducey. He added that a second shutdown was "not under discussion" despite official figures showing a 211 per cent rise in cases over the past 14 days.

About half a dozen states, including Texas and Arizona, are grappling with rising numbers of Covid-19 patients filling hospital beds.

Mr Ducey and Texas Governor Greg Abbott said their hospitals have the capacity to avoid the experiences of New York, where the system was stretched to near breaking point as some patients were treated in hallways and exhausted workers stacked bodies in refrigerated trailers.

The US is the worst hit in the world, with over two million cases and more than 116,000 deaths.

A second wave of deaths is expected to begin in September, the Institute for Health Metrics and Evaluation said on Thursday, citing a surge in mobility since April.

It projects 170,000 deaths by Oct 1, with a possible range between 133,000 and 290,000.

In Utah, Governor Gary Herbert said most of the state would pause its reopening after a 126 per cent rise in cases over the past two weeks.

Austin, in Texas, is also likely to extend stay-at-home and mask orders past June 15 after the state reported its highest new case count.

Health officials blamed this on the easing of business restrictions and Memorial Day gatherings.

REUTERS, BLOOMBERG