Economic system

The coronavirus crisis highlights the weak points of the American economic system

“We went from 0 to 60 in five seconds,” said Kim Guadagno, CEO and Chairman of Fulfill. Hurricane Sandy in 2012 was devastating, she said, but it’s made worse because “the need is widespread, with no end in sight.”

Last year, before the pandemic, Feeding America, the nation’s largest food bank network, fed 40 million people, many of them children, said Claire Babineaux-Fontenot, the chief executive. “It highlights the fact that so many people in our country are living on a precipice,” she said.

Housing also seems less secure. A recent survey by SurveyMonkey and Apartment List, a San Francisco-based online rental marketplace, showed that a quarter of renters paid only part or nothing of their rent this month.

“These numbers are extremely worrying,” said Igor Popov, chief economist at Apartment List. “In a typical economic downturn, when incomes are hit, many families may downsize or move in together to minimize their rent payments. In a time when we are sheltering in place, even moves to derelict housing are difficult.

Those who have been in the most rush can expect to be even more rushed.

Prior to the coronavirus outbreak, Destination: Home, a Silicon Valley nonprofit that works to prevent homelessness, was on track to provide $7 million in financial relief to approximately 1,000 families. In March, the organization raised an additional $11 million for coronavirus relief, but was overwhelmed by demand – 4,500 requests in three days – and stopped accepting applications. The waiting list has nearly 10,000 people and is growing every day.

“I thought there was nothing I hadn’t been involved in when it came to homelessness, said Jennifer Loving, executive director of Destination: Home, “but it’s incomprehensibly dire.”

In a report on the economic impact of the coronavirus, the Federal Reserve Bank of Richmond warns that the greatest burdens will fall on those who are already the most vulnerable – those in low-paying and precarious jobs.