Newsom: California Now in ‘Pandemic-Induced Recession’

In a matter of a month, California has gone from a nearly $20 billion rainy-day fund to a full-blown fiscal emergency.

A police officer walks up the entry bridge at closed Santa Monica Pier as part of measures to combat the spread of the coronavirus . If California Gov. Gavin Newsom’s so-called roadmap to ease coronavirus restrictions hinted at a return to a normal Californians could appreciate – a summer trip in the car – it quickly became apparent they wouldn’t be leaving home soon. (AP Photo/Marcio Jose Sanchez, File)

SACRAMENTO, Calif. (CN) — Ramping up for a “pandemic-induced recession,” California Governor Gavin Newsom said Friday he’s assembled a prominent cast of business leaders and advisers — including the heads of Apple and Disney, former governors and recent presidential candidate Tom Steyer — to reignite the state’s economy. 

Newsom says the 80-member task force will collaborate on a “safe restart” plan focused on boosting regions most directly impacted by the pandemic. Steyer and Newsom’s chief of staff Ann O’Leary will chair the “Task Force on Business and Jobs Recovery” with other members to include Disney Chairman Bob Iger, Apple CEO Tim Cook, former Federal Reserve Chair Janet Yellen and four former governors.

“What I have done is asked and tasked some of the best and brightest minds that we could source,” Newsom said. “We are blessed to have the kind of human resources that only a nation-state could be afforded.”

The announcement comes one week after Newsom’s top financial adviser resigned unceremoniously, and one day after the state’s legislative analyst warned lawmakers that recession had already arrived to the nation’s most populous state.

In a matter of weeks California has moved from the safety net of a $17 billion surplus to a full-blown financial emergency. More than 3 million people have filed for unemployment over the last month, ending the state’s impressive 120-month stretch of job growth and causing financial experts to predict the economic downturn could take several years to recover from.

Fresh off an upstart bid for the Democratic presidential nomination, Steyer will slide in as the face of Newsom’s economic task force. The billionaire businessman from San Francisco said he will scour community groups, environmental activists, philanthropists and labor unions for advice.

“We will try to come up with a recovery plan that is worthy of California’s past, pushes us to a better future and remedies some of the injustices this Covid-19 pandemic has revealed in our society,” said Steyer, who won’t be paid for his new role.

A bipartisan group of living former governors — Pete Wilson, Gray Davis, Arnold Schwarzenegger and Jerry Brown — are also among the leaders who have agreed to guide the reopening of the state’s $3 trillion economy. Newsom said he’s talked with his predecessors throughout the crisis and they’ve advised him to “do the right thing and don’t play politics.”

“They get it because they’ve been in these positions and they want to see something good happen for the state of California,” Newsom said.

Friday’s announcement builds on a six-point reopening plan Newsom outlined earlier in the week. The reopening strategy hinges on improved testing and tracing capabilities, the development of therapeutics or vaccines and the reshaping of businesses and schools to conform to the era of social distancing.

Newsom tempered the excitement of the new task force by noting that 95 Californians died Thursday from the novel coronavirus, the highest daily death toll yet. So far 985 Californians have died from the virus, though the number of patients in intensive care dropped slightly over the last day.

“We have bent the curve, it has begun to flatten, but again it’s not moving in the direction that we are ready to ultimately celebrate,” Newsom said.

In Los Angeles County, health officials said Friday that nearly 500 people have died and over 11,000 have been infected by the virus since the outbreak began.

Among the latest dead are five health care workers, according to county officials. Nurses and other health care workers at hospitals, nursing homes and assisted living facilities are falling ill at an increasing rate, with a total of 1,441 health care workers who have at some point been infected.

About half of all health care workers say they were exposed to the virus at some point. Of those, 36% say exposure came from either another health care worker or patient showing symptoms.

Often referred to as the front line in treating the ill, health care workers are becoming sick at a rapid pace said LA County Public Health Director Dr. Barbara Ferrer.

This week’s update shows 36% of all infections among health care personnel worked at hospitals and 31% worked at nursing homes, up from just 19% last week said Ferrer. Nurses account for 38% of all infected health care workers in LA County, followed by just 6% of physicians.

“These workers, all of them, help all of us when we’re sick. And they’re our heroes,” said Ferrer. “We can’t thank our health care workers and front-line workers enough.”

With 40 new deaths and 567 new confirmed cases of the novel coronavirus announced Friday, the total dead in LA County stands at 495. There have been 11,391 confirmed cases so far.

Public health officials are investigating infections at seven homeless shelters where 10 people staying at those locations tested positive for the virus.

In the last month, health officials built a network of 30 testing sites with a capacity of conducting 11,000 tests per day to detect the Covid-19 infection. Wait times for results vary from 4 to 10 days.

Aiming to relieve workers on the forefront of the crisis, California lawmakers on Friday called for new workplace protections and enhanced medical benefits for health care workers and emergency responders.

Under Assembly Bill 664, eligible employees who are infected with the novel coronavirus wouldn’t have to pay hospital bills and additionally qualify for disability indemnity and death benefits.  As of Thursday, health care workers made up over 10% of the state’s confirmed cases.

“These workers not only show up to protect us, but they are asked to go toward the risk while most of us are asked to stay away from it,” said Assemblyman and former law enforcement officer Jim Cooper. “They are heroes and should have the peace of mind that they will be taken care of if they fall ill while providing their vital services to the public.”

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