What will education look like this fall as public and private schools work to teach kids while also keeping the public safe? How will the economy recover from the losses of Q2? And when can we expect a vaccine? To discuss these questions and many more, Scott Gottlieb, Rick Hess, and Michael Strain all join in this special episode of Political Economy.
Scott Gottlieb is a resident fellow at AEI, and he is also the former commissioner of the Food and Drug Administration. Rick Hess is a resident scholar and the director of Education Policy Studies at AEI, and he is the author of several books, including “Letters to a Young Education Reformer” and “Breakthrough Leadership in the Digital Age: Using Learning Science to Reboot Schooling.” And Michael Strain is the John G. Searle Scholar and director of economic policy studies at AEI. He is also the author of “The American Dream Is Not Dead: (But Populism Could Kill It).”
What follows is a lightly edited transcript of our conversation. You can download the episode here, and don’t forget to subscribe to my podcast on iTunes or Stitcher. Tell your friends, leave a review.
Pethokoukis: Let’s start with you, Rick. How prepared are schools
to go fully remote and online this fall? It seems like more and more every day
are. Are they ready?
Hess: None of the 15 biggest school systems have said they’re
going fully remote when school starts. Most of them are not ready. There’s
little reason to think that anything is going to be much better than it was in
How did it go in the spring?
Hess: Pretty poorly. The Census Bureau reported that the average
student got about 3.8 to four hours of instruction a week. Parents reported
feeling overwhelmed. 30 percent of adolescents reported feeling depressed,
isolated. We saw huge problems in terms of children’s general wellbeing. The
estimates are that we saw unprecedented fall-offs in reading and math
attainment. And that was after students had spent six months in school with
their peers and getting to know their teachers. When kids show up for fourth
grade or tenth grade this fall, they’re going to know their teachers — and
their teachers are only going to know them — as pixels and an email address,
leading to some grave concerns about how it’s actually going to play out.
All right. Here in Northern Virginia when one of the counties
announced they were going online they said, “Don’t worry, parents. We’re
creating a robust online learning platform.” Is that just a phrase that
means “more Zoom”?
Hess: It would be better if that was a word for Zoom. The LA
agreement, for instance, that the district and the teachers’ union struck at
the spring expressly barred the district from asking teachers to do Zoom. It
prohibited the district from asking teachers to do live instruction. In fact,
it barred the district from asking teachers to actually do work during the
school day, so that if they found it more conducive to work at three or four
hours in evening, then that passed muster.
Another example: Arlington, Virginia last spring explicitly told
teachers not to teach any new content, because they couldn’t figure out how to
deliver it universally or uniformly. So the reality is that a lot of these
emails and notes being sent home from schools about their “robust, rigorous,
highly articulated online presence” basically just say, “We’ve got
some stuff online. How about it?”
What is your best guess, over the course of this year, of what
share of children will be going to school in person in the United States?
Hess: Hugely hard to guess. I’ll be curious to hear what Scott has
to say about the path of the coronavirus during this year. It looks like we’re
going to start with — right now, we have really ugly, incomplete numbers — maybe
20, 30 percent of kids are going to be showing up this fall for at least a
hybrid, a part time in-person experience. Depending on the course things take,
you could imagine that being over half of students by spring. You could also
imagine it going the other direction.
Scott, about the path of the virus: Just before we started the
event I went and I checked one of the more accurate computer models and it
predicted between now and November 1 another maybe 25 million infected in this
country, maybe another 75,000 fatalities. It still seems like it’s pretty bad.
Are those numbers sort of baked in or is there anything we can do?
Gottlieb: I think it’s really hard to predict beyond really a
month on any of these models, because there’s so much there’s so much
variability and so many things that are going to happen behaviorally that are
going to impact the epidemic. I think over the next month what we’re likely to
see is a slowing in the Sunbelt states. Texas and Arizona are already showing
signs of slowing. Florida and California will probably show more unmistakable
signs of slowing in terms of number of new cases. Maybe the hospitalizations
will start to decline. You’re seeing that already in Arizona and Texas,
although the reporting on hospitalizations is very spotty right now. Now that HHS
has changed the reporting requirements, a lot of states haven’t been able to
report accurately. But the problem is that you’re going to see other states
heating up as the Sunbelt starts to cool down.
So it’s similar to what happened with New York. When you looked at
the national trends as New York was coming down in its epidemic curve, it
looked like nationally the epidemic was slowing at first, and then sort of
plateauing at around 20,000 infections a day. But New York was such a big
initial component of the overall infection in the country that when you backed
out, you actually saw an epidemic that was accelerating around the country. But
New York was declining faster than the rest of the country was reseeding up,
and so overall it looked like there was a flat trend line.
I think you’ll likely see something similar here, where we sort of
peaked at 70,000 infections. We’ll maybe come down to 45–50,000 infections a
day as the southern states start to decline, but what you’ll see is infections
picking up in other parts of the country. And so we’ll never really get below
45,000–50,000 infections. We’ll kind of get down there, touch that bottom, and
then make a new high — similar to what happened with the first wave of this
epidemic, where you sort of got up to 45,000 or 40,000 infections, it came down
to 20,000, plateaued there, and then went back up to 60,000. We’ll make new
highs and higher lows, if you will, in terms of where we are with the
infection. I think that’s the risk right now.
And when you look around the country, Kentucky has a very big
epidemic. Missouri, Ohio, Illinois, Tennessee — it looks like they have a big
epidemic underway. Alabama, Louisiana, and South Carolina never really got out
of it. Obviously the overall contribution of small states is smaller than
something like Texas and Florida and California simultaneously. But when you
start to add them up, the Midwest looks like it’s in trouble.
You mentioned that infections dropped down, maybe around 20,000,
now they’re back up, and people are trying to know what happened. Is it just
that we reopened too soon? Was it protests? Whatever the reason was, it sounds
like as long as infections are that high, you’re just asking for another
outbreak somewhere. There’s too much virus out there, and people are just too
mobile, and unless you really tamped down those numbers, other flare-ups are
Gottlieb: I think that’s right. I think we just have a lot of
infection around the country and it’s inevitable that there’s going to be
reseeding. As much as some states think that they can create restrictions on
travel in and out of state, you’re never going to really effectively be able to
do that. And the states that right now have brought their infection way down are
getting reseeded. They just don’t know it right now. And those chains of
transmission are being lit and some of them will end up being outbreaks within
a month or so. You’re going to start to see outbreaks emerge in some of the
states that have been relatively quiescent — that either had good control of
this all the way through or got good control of it, like Connecticut, the state
So we just have too much infection around this country. And we
don’t really have a uniform approach, so you can’t simultaneously snuff it out.
We have state-led efforts, state policies that are disparate. And so you’re
having state-led policy efforts with regional effects in this country, as
opposed to a more consistent approach. And I don’t know you’re ever going to
get to a more consistent approach at this point. I think that there’s an
inevitability to the situation we’re in right now, just from a sort of policy
and political and practical standpoint.
Those reopenings might have played a role in the virus sort of
popping back up here, but it also helped the economy hopefully down the road.
Gottlieb: It wasn’t really the timing of reopenings. People said
we reopened too early, and maybe there’s some truth in that. But I think the
issue is more the speed of the reopening and how you reopened. You could have
reopened early but reopened more deliberately and left certain things shut
along a period of time. And so I wouldn’t say it was the timing of the
reopening, that we reopened too early.
It’s the manner in which we did it.
Gottlieb: Yeah, exactly. And maybe that’s sort of baked in. When
people say, “Well, we opened too early,” what they really mean is we
reopened too quickly. But I think we should tease that out when we talk about
it, because it’s important from a policy standpoint. Like, should we have
reopened bars? No, we shouldn’t have. We should keep certain indoor congress
settings that are purely for entertainment closed in perpetuity until we can
figure out whether we have control. The priority should be trying to open the
schools and do other things that are more important from a social standpoint.
Here in Connecticut, they’ve kept the casinos closed. They just
don’t see a practical way to reopen those safely and not have those be a source
of spread. And so you can make those decisions. It’s hard on the venues that
ultimately are objectified and sort of carved out from the general reopening,
but you do have to make those decisions. And the things that are the highest
risk are indoor congress settings and confined spaces where you have a lot of
mixing. And the ones that probably are the most suspect are the ones that are
the indoor congress settings. We have a lot of mixing where it’s done just
purely for entertainment purposes of individuals, is not really a sort of
economic benefit that’s being derived societally, other than to the business
that’s operating that space.
So when we decided to open the way we did, and you could say, when
we decided to open bars, then it was sort of automatic that a lot of school
districts were going to have some very difficult decisions to make this fall,
because we are not going to just have 5,000 cases a day. We are going to have
10 times that.
Gottlieb: Look, I think we need to start making those hard choices
and looking a month or two down the road about where we think we want to be.
And certainly, as I said at the outset, I think you can make predictions a
month or six weeks out in terms of how this is going to spread. And so we
should have been more cautious about what we reopened to try to get more runway
to reopen schools. Here in Connecticut — and again, I am working with the
governor so I’m close to situation — they should be able to reopen schools for
in-class learning. They’ll sort of give a flexible option to parents, but I
think that the infection is under control.
They may not be able to keep schools open. There may be a point in
time where there are outbreaks and infection picks up at a pace that you want
to close the schools because you’re worried about children being exposed on a
wide basis. But I think that you’ll have that opportunity at the outset, and
the state took a lot of steps and incurred a lot of hardship to earn the right
to have that optionality.
At the end of the day, as important it is to open schools, I think
we do need to be mindful not to let this become epidemic in children because
while I think that the clinical literature that says that this is less of a
risk in kids is right (there are a lot of studies now that sort of affirm that),
the information about whether or not kids can be conduits of spread is mixed. They’re
less likely to get infected and less likely to become symptomatic. But when
they do become symptomatic, they’re just as likely to transmit the virus, maybe
more so because they compensate in behavior what they sort of lack in biology
in terms of their ability to transmit it. So maybe they’re less biologically
able to transmit it, but their behavior compensates for that. They’re more
likely to come into contact with adults, and you’re more likely to hug and kiss
your children when they’re sick. So they can be conduits to spread when they
And then there’s the question of whether or not they develop severe disease: Certainly, there’s not as much evidence that they get can get as sick as adults and older adults. Certainly, the morbidity skews heavily towards older adults, but remember that not a lot of kids have had this. If you look at the CDC’s data — and I tweeted this out two days ago and I might get it wrong off the top of my head — I think they documented about 250,000 cases of kids developing symptomatic illness that was diagnosed. Not all of them were symptomatic, but most of them were because kids generally don’t get tested unless they’re symptomatic.
You have to put that against about 11.8 million kids in 2018–2019
that were projected to have symptomatic flu. Probably another three, four
million at least had asymptomatic flu. And of that 11.8 million, that was a
projection, but about 6.5 million actually showed up at the doctor’s office and
got tested. So whatever way you want to cut it, whether you want to put the
250,000 against the 6.5 million or the 250,000 against 11.8 million, it’s an
order of magnitude different in terms of the number of kids who got symptomatic
flu and symptomatic COVID. And when you look at the data, there are 76 pediatric
fatalities with COVID. That’s about the number of pediatric fatalities you see
with flu. So people who say, “Well, this isn’t serious in kids, and flu is
far more serious.” Flu grimly claimed a small number, an increment more
lives in 2018–2019 in the pediatric population. But in effect with COVID, an
order of magnitude more kids — I don’t think we want to see what it would look
like. We should do everything we can to prevent an outcome where 11.8 million
kids develop symptomatic COVID or even 6.5 million kids develop symptomatic
COVID. I think that you will see some morbidity.
And just a final point on this: The one study — there are not a lot of good studies that look prospectively at the outcomes in kids — but the one study that CDC cites, and they have it on their website, is a study of 2,100 kids in China who developed symptomatic COVID. So they actually developed symptoms, most of them did. And they showed about 5 percent develop severe disease that created central hypoxia. They basically needed to be hospitalized and get oxygen. And 0.6 percent developed either shock or acute respiratory stress syndrome and multiorgan system dysfunction. So they were in the ICU, critically ill.
That’s a high percentage. It’s not nearly as high as you’d see in
an adult population, but it’s still a high percentage, and still should give us
caution about, again, just making sure we reopen schools with precautions in
place so that this doesn’t become epidemic in children.
Mike, I want you to put the school reopenings in an economic context. But before you do, just briefly, how’s the economy doing? We had a really bad GDP report today, which everyone expected for the second quarter. There’s been some talk among economists that the V-shaped economic recovery is not happening, that the economy is sputtering. How do you see things?
Strain: Well, the economy is in very, very bad shape. Today’s GDP
report shows the economy contracted by about one third on an annualized basis
in the second quarter, which shows just how deep and how severe the recession
was. That represents the worst quarter of economic performance since the US
began keeping records in the 1940s. It’s surely the worst economic performance
we’ve seen since the Great Depression. And it’s devastating. We’ve seen nothing
like it in our lifetimes. The month that got the most weight in the second
quarter GDP statistic is April, and April was a terrible, terrible month. The
economy in June was already considerably outperforming the second quarter
average. So the economy is much better than it was at its low point. The recession
probably lasted two months.
The recession is probably over. But so much damage was inflicted
in the months of March and April that, even though we climbed quite a bit —
quite quickly in the months of May and June — we’re still in a very deep hole.
We’re going to enter into a period this summer where we continue to see rapid
improvement. But it’s going to take months and months and months and months and
months of sustained rapid improvement until we’re finally back to where we were
Is there much risk of slipping back into a recession? Certainly
some economists, including the folks at Moody’s, have talked about that.
Strain: There’s some risk of slipping back into a recession. I
think there’s real risk of having a “two or three steps forward, one step back”
type of economy. That doesn’t get you a recession, but it does slow the rate of
progress. I think my view at this point is that we’re going to have really
rapid growth in the third quarter of the year — July, August, and September — that
we’re going to have solid growth in the fourth quarter of the year, and then
we’re going to end calendar year 2020 in a much better place than we were in in
the second quarter. But given how bad the second quarter was, even if the second
half of the year goes really, really well, it’s inconceivable to me that the
economy at the end of 2020 won’t be in much worse shape than the economy was at
the end of 2019.
How much of that relatively upbeat forecast for the second half of
the year is dependent on what happens in Congress with this phase four support
and stimulus package?
Strain: It sounds like a relatively upbeat forecast, but really
what drives that forecast is just how bad the economy was in March and April.
All of these quarterly growth rates are relative. And so progress in the third
quarter is measured relative to the second quarter. And it doesn’t take much
for the economy to improve relative to the second quarter, given how bad the
second quarter was. So while I do think we will see significant improvement in
the second half of 2020, that shouldn’t be confused for a statement that we
won’t still be in terrible shape. And we’re going to be in bad, bad shape for
quite some time. If you look at where we were in June and assume that we have
no economic improvement in July, August, and September relative to where we
were in June, we’re still going to see significant growth in the third quarter
relative to the second quarter.
So as long as we don’t actually slide backward in a sustained way,
we’re going to have a good summer and we’re going to go into the fall in good
shape. If Congress does even the bare minimum, which I expect they will, that
will still be true. Having said that, we really need another significant piece
of economic recovery legislation in order to have the kind of recovery that we
should be having from where we were in the spring with the lockdowns.
What is the trade-off of having kids not go to school in person?
What is the economic trade-off both as far as the lifetime impact on those
kids, as well as the impact on their parents as workers?
Strain: Well, I think it’s really significant. And I think as a
society we haven’t really given this enough weight. I’ve been surprised and
disappointed at the extent to which the conversation around schools really
treats schools as if they’re just daycare centers or as if there’s some sort of
a weird credentialing institute that doesn’t actually do anything in terms of
kids’ intellectual skill or social and emotional development. If the schools
don’t open in September, it’s hard to understand why they would open in
January. And so if we’re talking about a year of virtual learning — I think the
school districts that are deciding not to open in September are deciding to be
closed for the entire academic year — that’s a significant loss for those
Conventional economic estimates suggest that an additional year of
schooling increases your wages as an adult by 9 percent per year. When you
factor in that there was virtual learning taking place in the spring, you’re
talking about lowering the wages of these kids, once these kids reach adulthood,
by double digits — by 10 percent, 12 percent, something like that. Again,
according to the conventional economic estimates, that’s going to hit lower
income kids the hardest. Lower income kids are going to see earnings, wage, and
income losses that are greater than that average estimate. And that’s really
significant. That’s a significant, significant cost to those kids. It’s also a
major cost to the longer term performance of the economy as a whole. And that’s
to say nothing of what the impact is on the economy of today of having schools
closed, by making it so hard for parents to go to work.
We really, I think, should be closing schools as a last resort. If
we look back on this episode and we see that we let bars and tattoo parlors
stay open, but we didn’t let kids go to school, then as a society we will have
failed to deal with this crisis in a very fundamental and profound way. Right
now the Washington, DC. Public schools, as of this morning, I believe, are
planning to do only virtual learning. At the same time, you can still eat
indoors at a restaurant. And this just represents a complete mis-ordering of
what society’s priorities should be.
I want Rick to jump in, and then Scott.
Hess: First off, I think that is elegantly said. Part of what’s going on here is that the most vocal and
influential interests in education have been saying, “Hey, let’s put our
thumb on the scale of not opening.” So the teacher unions, for instance,
have said, “Look, we want schools to reopen as long as they’re safe. But
that’s going to cost hundreds of billions. It’s going to require extraordinary
efforts. If there is any doubt in how we weigh this out, let’s not open.”
You’ve heard the same thing from superintendents’ associations. Parents
themselves are justifiably nervous.
So I think one of
the things that’s happened in the calculation around schools, which has not
happened with commercial enterprises, is we have had a lot of active, vocal
interests raising all of the legitimate concerns, and there’s really not
been any visible or organized or forceful push to say, “Well, wait a
minute. We need to think about what it means for kids to not be in
school.” So that’s part of that. When we think about what’s going to
change in the decision process in December or in March, it’s not clear how that
is going to evolve.
Look, the thing to
keep in mind about virtual schooling is, in theory, it makes a heck of a lot of
sense, especially as students get older. The opportunity for them to connect
with expertise and with mentors who aren’t just the adult in their high school
— all of this stuff makes a lot of sense in theory. The problem is it turns out
to be really hard to design virtual education well under any circumstances.
Most of what districts were offering in the spring and will be rolling out in
the fall is duct-taped, stuck together, whatever they can get their hands on,
with faculty who don’t know what they’re doing, operating under collective
bargaining agreements that are highly restrictive in the things you need to do
to make this work. And it turns out that while virtual learning environments
work really well for some learners, for lots of students (especially young
students) it’s the human dimension of schooling that makes it all work. They go
to school and they kind of sit in class because they like to see their friends,
because they like their teacher, because of all the other tissue that’s wrapped
Here’s a real simple
example: About a decade ago, there was an explosion in higher education of
these things called MOOCs. They were offered by faculty at places like Stanford
and MIT. They were free online courses where you got to watch the video and
take it. These are adult learners who are choosing voluntarily to take these
courses. Tens of thousands of people signed up for some of the courses taught
by the leading authority in the entire world. Generally speaking, when Harvard
did an evaluation of its MOOCs, about 5 percent of students actually completed
the courses. So even for motivated, interested, adult learners, the rate at
which people are actually able to lock in and benefit from virtual learning is
quite limited and hugely dependent on design. Now we are asking schools in a
helter-skelter fashion to do this for tens of millions of kids with teachers
who aren’t actually trained in it and may not be comfortable. I think when we
think about the educational implications, for all the happy talk that folks are
going to get from their local superintendents and their local teachers, I think
they should be very concerned about how this plays out in practice.
When you’re talking
about groups pushing for online schooling, keeping the schools at least
partially closed, where is that potential counterweight, which we have not
heard from, going to come from? Is it just an organic parents’ uprising? Is it
just politicians taking the lead? Where does that energy emerge from?
Hess: It’s a great question. You know, President Trump
obviously saw — his pollsters presumably saw — an opening here in July when he
suddenly started demanding that we send kids back to school. But in classic
Trump fashion he did this in a reckless, unhinged way and was openly dismissive
of the health concerns, in a way presenting the folks nervous about going back
to school with the perfect foil. You’ve seen relatively few politicians stand
up. Governor Polis in Colorado, I think, handled this really nicely, talking
very deliberately in a disciplined fashion about, “Look, we can’t be
scared out of doing what we need to do for kids, but we have to be cognizant of
all the risks.” We’ve seen very little of that kind of political
Parents themselves are
deeply split. Depending on how you ask the question, it’s really 50/50 between
parents who want to send their kids back to school and parents who
absolutely don’t want to send their kids back to school. So you haven’t
seen a lot of energy there.
The advocacy and
reform community is, right now, very caught up in questions of social justice,
which turns out to play out very weirdly on this. On the one hand, as Mike
mentioned, the kids who are suffering most from this are the kids who are in
homes where they don’t have highly educated parents, where you don’t have a lot
of resources to pay for supplemental materials, and that are in small
homes without good learning space. These are exactly the kids on the wrong side
of the opportunity gaps. But these are also parents who in many cases are the
most nervous about sending kids to school. So the reformers and the advocates
are on the sidelines.
And then you’ve got a
mass culture, you have these pods emerging, especially in affluent, wealthy
communities, where parents are getting together and figuring out how to pay
money to hire tutors, to get their kids together. But instead of this being
greeted as American ingenuity and parents being eager to stand up and find a
way for their kids, what you’re generally seeing in The New York Times and NPR,
is these parents lambasted as selfish examples of everything that’s wrong with
privileged culture. So it’s right now really hard to see where that leading
edge on making sure we’re being fully cognizant of what kids need is going to
Gottlieb: Well, Rick made a lot of good points. I think that the
issue of who’s pushing back on trying to get schools open — first of all, I
think you’re seeing a lot of parents want schools to reopen in some fashion. I
think parents are appropriately nervous about the risk of outbreaks and
epidemics in the school. And I think they should be nervous about that. But I
think you are seeing some organized effort among the political class, certain
elements of political class, and that was touched on, to try to get schools
reopened for a variety of reasons. I think that push was not done in a
thoughtful fashion. And I think it sort of stoked the kinds of anxieties that
people, I think, legitimately should have, which is, how are we going to
prevent outbreaks and epidemics in school? Because the reality is when we push to
reopen schools, we should do it with the goal first and foremost to prevent
outbreaks in the schools and prevent kids from getting infected, and prevent
teachers from getting infected. And the two goals aren’t in conflict with each
I think that there’s a lot you can do to create a safer
environment in the school for children, even in the setting of some spread in
the community. First of all, you’ve got to get the major epidemics under
control. It’s going to be hard to open schools against the backdrop of
uncontrolled spread. But you keep the students in defined cohorts. You retrofit
the HVAC systems. You try to move classes outdoors where you can. You open
windows rather than run the air conditioning systems. You can have students
wear masks. You certainly give proper PPE to the teachers. You can stagger the
start time of the school day. You can go to hybrid models and have in-class and
online learning to try to create more distance within the school. There’s a lot
of things you can do to create a safer environment in a school.
And the dialogue was, “We have to reopen schools five days a
week, mandated indoor learning 9:00am to 5:00pm. No hybrid model. Grin and bear
it.” And that was the wrong approach. And, I think, the wrong message. And
when you have the spectrum of CDC putting out guidance on how to safely reopen
schools, and they do gymnastics to avoid having to make mention of what you
would do to actually close the schools if the situation arose, that also
doesn’t inspire confidence. And if you read that CDC guidance, there’s no
mention of the circumstances under which you might consider closing the
schools, how you would close the schools, what the threshold would be. The
document literally says that in the setting of uncontrolled community spread of
the virus or situations where the school itself is this source of the local
epidemic, you should have a discussion about whether you might consider closing
schools. I’m not quite quoting the document.
But I think we’ve got to address these issues. And the absence of
addressing them actually is going to push more districts over the edge of
closing their schools because of the uncertainty around it and the concerns.
And so I think if we took these issues head on and acknowledged the fact that
there need to be measures in place to protect the children, that some element
of hybrid approaches may be appropriate in certain communities. And we need to
more clearly define circumstances under which you might consider closing the
schools. I think we’d have a more confident environment in which school
districts would take the risk of going forward rather than the default position
would be to close them because of the pervasive uncertainty.
Hess: Although I think it’s just an interesting piece. I think Scott is right. I agree. John Bailey and I rallied about two dozen former superintendents and state chiefs and Obama and Bush office holders to sketch a framework for thinking about these issues back in early May. And one of the things that was frustrating through May and June is, rather than seeing a really disciplined effort in the education space to start figuring out how to do the things Scott was talking about, it frequently felt like we were planning a version of the Washington monument strategy. You had superintendents in Los Angeles and San Francisco and San Diego signing letters saying, “Look, we can’t really figure out how to reopen until we get a promise of $200 billion in federal aid for schools.” And so what you saw was a huge amount of energy, it felt like, invested, not in saying, “How do we make this work two days a week right now?” but in saying, “Well, we don’t want to get ahead of ourselves until the checks start showing up.”
So for instance, Scott mentioned the possibility of starting school earlier. We’ve talked over the last several months about running split school shifts. You run a 9:00am to noon. So kids get time to teach. You clean the building for a couple hours, and then you run from 2:00 to 5:00. You run six days a week so you can have more space. So there’s a lot of this. But one of the things that’s happened is districts have been loath to ask employees to actually modify the terms of their collective bargaining agreements. And you’ve seen little indication from the teacher associations that they’re open to even temporarily working around any of the existing provisions.
In fact, what you’ve seen, for instance, was the Democratic
Socialists of America — along with the Boston teachers, the LA teachers, the
Chicago teachers, the Milwaukee teachers, the St Paul teachers, and the Oakland
teachers — have now formed a coalition, which says, “Look, if we want to
reopen schools, we need to raise taxes on the rich. We need to have a
moratorium on evictions. We need to stop charter schools in standardized
testing.” Flexible virtual learning has in many cases in the education
space gotten caught up with regular wish list agendas and power politics that
have shifted the ball entirely from kind of the practical problem solving that Scott
Scott, you mentioned a number of things that could be done to make
going to school in person safer. I’m not sure if you mentioned having the kids
wear masks. I’m not sure, maybe you mentioned that. But if you did all those
things and maybe wear a mask, would you be comfortable having schools open? If
they did all those things, but the level of outbreak was what we see right now
in Florida and Texas and Arizona and Georgia and California? Pretty
Gottlieb: Look, I think that these decisions should be made by
local districts because every local district faces a different circumstance in
terms of what it can do with respect to the measures I talked about. And,
unfortunately, a lot of districts that are already disadvantaged have the least
opportunity to implement some of the measures. And so you have students that
are already facing disadvantages in getting access to education being the ones
who are in a position where their districts can open. So we need to try to
address that. But I do think we need to leave discretion to the districts, and
that’s not what’s happening.
You’re seeing states stepping in and saying, “You’re opening
five days a week for in-class learning, regardless.” In states that have
major epidemics underway — so if you took Southern California right now,
Florida right now, parts of Texas right now — I’ve said all along I think it’s
going to be very hard to open against the backdrop of an out of control
epidemic. I don’t think the measures that I outlined can feasibly prevent
outbreaks from happening in the schools. And so you can be one of those who
says, “Well, there have been outbreaks of schools. Kids will be fine. They
can get sick. It won’t worsen the epidemic and the kids won’t have bad
outcomes.” I’m not in that camp. I think that if there are outbreaks in
schools, it’s going to seed the community and the kids are going to be at risk.
I don’t want to see outbreaks in schools. And I don’t think that you can
prevent that in the setting of major epidemics.
I think in states that have a measure of control over their spread
— and you don’t have to have perfect control over your spread, but a measure of
control of your spread so you don’t have sustained community transmission — I
think you can open the schools against the backdrop of some transmission. We’re
never going to get transmission down to exceedingly low levels like you’ve seen
in some other countries where you have a handful of cases being reported a day.
Even New York has 500 cases a day. Connecticut still has 100 cases a day, and
it’s going to probably go up. But in those states, I think that there’s an
opportunity to open the schools. In states that are challenged, but not out of
control, I think there’s an opportunity to open the schools. I think in the
states where you see an out of control epidemic, you see a positivity rate
above 10, those are going to be very difficult circumstances. And even a
positivity rate above five is challenging. But there’s about, probably 15
states right now with a positivity rate above 10. And those are challenging
circumstances for those states.
Mike, even in those kinds of situations, where we have high
positivity rates and a lot of spread… do you think that the economic
downsides are so significant that even in those situations schools need to
reopen? Get the kids some masks, open windows, have class outside, but there’s such
an overwhelming case about the potential damage that we just need to get our
Strain: I think I would be willing to tolerate a greater degree of
risk and a greater degree of infection than it sounds like Scott would. The
point that we need the public health community to understand is that there are more
considerations than just medical advice in play here. But I think we need to
think of that as really an extreme thing to do. Shutting down schools for a
year after they were already closed for the spring semester: That’s a very
serious thing to do.
But I don’t think we should be having that conversation in
isolation. We should all be wearing masks every day when we leave our houses.
We should be doing that because doing that would help get kids back in the
classrooms. When we’re deciding whether or not bars and tattoo parlors should
be open, we should be thinking about the effect that will have on allowing kids
to go into classrooms. Schools should be one of the very last things that we
shut down. And we certainly shouldn’t be shutting down schools because we don’t
want to issue orders about wearing masks in public.
I think a lot of people are asking, “How much infection would
you tolerate? How much spread would you tolerate in order to keep the schools
open?” I think that is a useful question because that trade-off — the
trade-off between more infection and a more normal life — is something that we
should be grappling with more explicitly than we currently are. The reason not
to frame the question in that way is because these options don’t exist in a
vacuum. There are a whole bunch of other things that we can and should be doing
that would both reduce the spread of the virus and allow kids to go back
into classrooms. And I do think a root cause of the challenge here is a lack of
appreciation for the real value that schools have for kids. When your kid is in
sixth, seventh, eighth, ninth, or 10th grade, school is not just daycare. It’s
not just a mechanism to allow you to go to work. It is really doing something
for your ability to function in society as an adult and to function in the
economy as an adult.
Hess: And I’ll just say, Jim, that if I was in Florida as a
parent, I wouldn’t want the schools to open. When you think about frameworks
and you think about conditions, it’s the scaffolding Scott is talking about. So
look, there’s got to be a continuum here. But I think there are lots of places.
We were talking about Northern Virginia a couple of months ago, where we both
live. It seems to me that public health situation in Northern Virginia is such
that it should be entirely feasible to open schools in a hybrid fashion. And
whether or not kids go five days a week is one question. I think it’s vital to
understand, though, how hugely important it is for kids to get into school
buildings on a semi-regular basis. Whether that’s two days a week and that
makes it feasible to socially distance and to have time to deep clean, or whether
that’s half days.
Look, the thing we’ve got to remember is that for huge numbers of
children — especially millions of kids who were on the wrong side of the
opportunity gaps — this is where they have stable adults in their lives. This
is where they have friendship networks. There’s the human piece that actually
connects them to what they’re learning. They actually need to know their
teacher as something other than an occasional square on a Zoom screen. To ask
kids to show up for school and spend the fall semester or an entire year as
eight-year-olds or 14-year-olds learning from somebody whom they have never
actually interacted with in person is to be profoundly unrealistic about how
kids learn and how teachers do their job.
And Rick, on the question of whether kids can catch up if they
miss a considerable amount of time in school?
Hess: We have this phenomenon called summer learning loss. We
still got this a lot in the early no child left behind. It’s one of the reasons
that you see these huge gaps by race or by income. During the academic year,
there’s less spread than you would imagine. But what happens typically during
the summer is kids from middle class and affluent families hold or increase
their performance because they get to go to enrichment opportunities and they
have resources. And kids from low income families are stuck in smaller homes
without enrichment opportunities and they go down. So basically, what you’ve
done is you’ve now created that phenomenon for six months, potentially for 15
What we are talking about is a massive lift to try to get the kids
who are losing out here back where they need to be. Can it be done?
Hypothetically, sure. With enough intensive tutoring, enough supports. Are we
willing to fund that? Are we able to figure out how to deliver it? It’s an open
Scott, why are we sitting here with 65,000–70,000 cases a day?
We’re a rich country. We have an advanced medical system. We have great biotech
companies. States are relatively well-run. Why are we still sitting here with
60,000 plus cases a day while Western European countries are opening schools
and they have 5,000 cases a day? What explains that gap, to the best of your
Gottlieb: There’s the decentralized nature of our country in terms
of how decisions get made at a state level and local level, rather than at a
federal level. And I think the individualism of this nation, our aversion to
regulation — while all those elements are normally the ingredients of the
dynamism of this nation, I think they have worked against us in this setting. I
think that we weren’t able to implement a coordinated strategy. We weren’t able
to get uniform adherence to it. Our individualism caused splits over things
like wearing masks, where there should have been, I think, more collective acceptance
and collective action. So all of the things that make this nation great, I
think that make us dynamic, also make it hard to respond to a public health
crisis in an intensive, coordinated fashion.
Strain: Some of the things that make us great as a nation have
caused us to do poorly. Some of the things that make us bad as a nation have
caused us to do poorly.
Scott, do you think we should have mask mandates everywhere and people who violate them should be fined? There was an op-ed in the Washington Post today calling for that exact thing. There are mask mandates, but there’s really very little downside other than public scorn for not wearing a mask. Should people be fined or even jailed?
Gottlieb: Well, I think we should be implementing a mask mandate,
and I think there needs to be enforcement. You can give people a warning and
then give them a fine. Look, we require people to wear seatbelts, and we give
them tickets if they don’t have a seatbelt on. And that’s largely to protect
them and lower insurance premiums. You wearing a seatbelt isn’t necessarily
protecting other people from you. But this is a situation where you’re not only
protecting yourself, you’re providing a protection to society as a whole. I
don’t know why we can mandate and enforce seatbelt requirements and people
comply with them largely, but there’s this sort of political aversion to the
mask, other than for the fact that the masks got sort of pitched in a political
context in the outset, unfortunately, and got equated with people’s exercise of
And it’s uncomfortable to wear a mask. So I understand people not
wanting to be told they have to wear a mask when it’s 95 degrees in Phoenix,
but the masks should be enforced in the settings in which the masks provide
protection: indoor congregate settings. If you’re walking on the street and you’re
distanced from everyone, that’s not a setting where you necessarily need to
enforce a mask mandate. Inside, yeah, absolutely. I’ll just say, Jim, I’m
talking to a lot of CEOs, and I think you’re going to see more of a mask
mandate in the country driven by the private sector as more and more businesses
require masks inside their establishment, that effectively requires people to
have a mask when they go out of their home and put it on largely in the highest
risk settings, which is when you’re in an indoor congregate space.
Mike, what absolutely needs to be in this next congressional phase
for economic support bill?
Strain: Well, some key provisions of the CARES Act that were
passed in March are expiring. So we need to address expiring provisions,
including insurance benefits. Schools that are planning on reopening that need
money to retrofit classrooms and get better HVAC systems and those sorts of
things — we need to provide them with that money. But general support to state
and local governments are going to be critically important. The next phase of
the small business support program is going to be important. The good news is
the Congress is talking about all the things that need to be in there. Whether
or not Congress is going to execute it is the question.
Rick, are these colleges with big, giant endowments going to get
away with having college kids go to school online and still charging them full
Hess: It looks that way. It’s unbelievable. Mostly what they’re
selling is access to the post-graduation job market and prestige. And the idea
that you’re paying $40,000 to $60,000 to sit in your parents’ basement and
watch YouTube videos is mind blowing, but it seems to be happening.
Scott, are we being too optimistic about vaccines? It seems like
we hear the best case scenario and we assume that should be our baseline
expectation. Or, might we get a vaccine in early 2021, which seems to be the
Gottlieb: Yeah. So I’m on a board of Pfizer, I’ll just mention
that, which obviously has one of the vaccines that’s in advanced development
right now, in phase three clinical trials. I think a reasonable base case is
that we could have a vaccine in early 2021. That’s an optimistic scenario, but
it’s not an unreasonable scenario if things go right, if the clinical trials
demonstrate that the vaccines are safe and effective. If manufacturing is
scaled — and it’s currently being scaled, these companies are manufacturing at
risk right now — but if they’re able to successfully manufacture these
products, you could have a situation where you have a vaccine in early 2021
that’s licensed by the FDA for general use or use in large, select populations,
maybe older populations.
I think having a vaccine available before that is… I wouldn’t say
unlikely, but if it’s going to be available before that, it would be available
under an emergency use authorization for a very select population. So you could
see a scenario where the pivotal trials read out sometime in October or
November, because the trials might go quickly because we have so much infection
around this country. They’ll enroll quickly. They’ll read out quickly because
you’ll have a lot of events in the trials. You learn that the vaccines are
effective. You don’t have longer term follow-up data, but you might authorize
the use of the vaccines under an emergency use authorization for, let’s say,
frontline healthcare workers, maybe in the context of a large registry where
you give it to healthcare workers, but you enroll them in a registry where you
continue to follow them and collect safety information, as well as efficacy
That might be a path that we have. Right now, these vaccine trials
are 30,000 patients each. A lot of vaccine trials are 70,000 — sometimes 80,000
— patients or more, but only a portion of it is a prospectively randomized
trial. The other arm of the trial will be just a large prospective enrollment
registry, where you’re just trying to gather more data. You’re trying to expose
more people to the product, get more information about long term safety. So you
could see those large scale registries roll out after the pivotal trials are
unveiled in October or November as a way to both provide access, as well as
continue to collect information in advance of licensing and for general use.
But getting back to your original question, I think that an optimistic scenario
is you’d have a vaccine licensed for general use or authorized for more
widespread use in early 2021. That’s an optimistic sort of base.
And then how long to get everybody vaccinated?
Gottlieb: Well, I think it would go quick. I don’t think that
there’s going to be a logistical problem. We’ll have enough glass and syringes
to vaccinate people. In 2009, we were able to vaccinate people with a trivalent
flu vaccine, and then a month later turn around and vaccinate the entire
population with a monovalent vaccine for H1N1. So everyone effectively got two
flu vaccines that season. If we were able to do it in 2009, we’re going to be
capable of doing it now, especially with all the best planning that we’ve put
into this. I think that the question is, how quickly would people take up the
vaccine? And that’s going to turn on how effective the data is, how much
confidence people have in the process, how we approach it politically in terms
of whether people have confidence that the process was objective and rigorous.
But I think that there would be a sort of pent up demand. I think
there would be enough people who would want to go out and get vaccinated that
you’d get a sufficient number who got the vaccine, that it would provide the
sort of societal benefit. You don’t need to vaccinate everyone. A lot of people
will have had coronavirus by then. So if you can get 30–40 percent vaccination
rates, that’s pretty good. And that probably is sufficient to sort of quell
Strain: Scott, what kind of a signal is it when a vaccine makes it
to the phase three trial? Does that mean that it’s very likely that it’s going
to work? Does that mean that they don’t know? All these vaccines that are at
the phase three, should I be thinking, “Okay, they’re going to work”?
Gottlieb: There are data on what the rate of success is once
something has progressed to phase three clinical trials. I’d have look back,
but probably a higher proportion of vaccines that are progressed into phase two
clinical trials have succeeded relative to drugs. And a high proportion overall
of products that get into a pivotal trial ultimately succeed.
I think probably you’d have to assign lower odds in this setting —
in part because the development programs were accelerated, in part because
there are a lot of unknowns about this virus, and in part because the phase one
and phase two programs for the most part (and this isn’t uniform across all the
sponsors but for some of the companies) were smaller. And so they didn’t test
as many doses. They didn’t test as many vaccine constructs in an effort to try
to advance these quickly, and so you’d have to impute a little bit more
uncertainty going into the phase three as a result of that.
Rick, this is a question from Twitter. What about private or parochial schools that want to stay open
but they’re in districts or counties where they’re just doing
distance learning? Will they be allowed to open their schools and have
kids come in person?
Hess: It depends on
the state. It’s going to be an executive power kind of, statutory kind of
question. Because there are two dimensions. It’s what the school feels
comfortable doing and what families want. And there are also the larger public
One of the policy
pieces of all this is this: There are about 35,000 private schools in the US, and
folks sometimes have this picture in their mind of the famous ones, the St.
Albans or the Exeters, these places that have hundreds of millions of dollars
in endowments and they charge a ton of money. These are a tiny fingernail
fragment of the 35,000. The vast majority of private schools charge less per
year than the local public schools spend. Public schools across the US spend
about $14,000 per year. Most private schools generally charge tuition that’s
less than half of that. So these are schools that don’t have endowments and are
running pretty thin margins. If these schools don’t open this fall, there is a
huge chance that hundreds or thousands of them won’t be around to reopen in
fall 2021. And that would be a devastating blow to these communities and
So I think part of
the conversation about federal education aid, as we think about the bill
that Congress is debating, is it’s really gotten framed as privates vs.
publics. The point is that a small fraction of the money that we are talking about
putting into public education — maybe $5 billion a year, $8 billion a year —
could be a life saver for hundreds or thousands of these incredibly valuable
community institutions that don’t have the wherewithal to figure out how
to use PPP, that won’t be sufficient to see them through. But we’ve really got
to be thinking about what, are the long-term implications for education in
Scott, do face shields work? What do we know? Are they effective?
Gottlieb: I wouldn’t wear a face shield in place of a mask. The
mask is definitely the most effective tool. Most of the transmission is through
respiratory droplets, but you can get transmission by having respiratory
droplets land on your conjunctiva. And that’s been demonstrated in other
studies. And so wearing sunglasses and a mask is pretty good protection.
Typically, when I was on a plane, that’s what I was doing: wearing a mask but
also wearing sunglasses.
Mike, could you
explain the economic logic of reducing jobless bonus benefits? The $600.
increased generosity of unemployment insurance benefits has two main effects on
the economy. One is to spur the economy by increasing consumer spending, by
increasing the amount of income households have. And the other effect is
weakening the economy by keeping people out of paid employment and on the
unemployment insurance rolls. And so the question at any given time is, which
of those two effects is stronger?
I think in the
months of April, May, June, and July, the evidence strongly suggests that
the former effect was stronger — that these unemployment benefits have really
helped the economy by supporting consumer spending and have not slowed the
economy down by increasing the unemployment rate. That’s because the reason the
unemployment rate is elevated is because there just aren’t jobs right now to
get. So if you reduced the generosity of the benefit, you wouldn’t see people
flood back to work. There are no jobs for them to flood back into. You would see
a drop in consumer spending.
Of course, the
policy question facing Congress is not whether we should have had benefits over
the last few months. It’s whether we should continue to have them through the
end of the year. And I think that if we were to continue to have them through
the end of the year, that second effect would end up dominating. We would end
up seeing benefits that generous slow the pace of recovery because they would
keep people out of paid employment, even as they still serve to support consumer
And so the question
is, is there a way to support consumer spending in a way that these benefits
have been doing while also not having these incentives not to go to work? And
the answer is yes. The debate around these benefits has kind of a false-choice
character. We should be trying to figure out how we can reduce disincentives to
employment while also supporting vulnerable households, strengthening the
safety net, and making sure that consumer spending is supported. And it’s
possible to do those things.
So I’m in favor of
cutting the $600 pretty significantly and then putting it on a glide path to
zero by the end of the year, provided that we can also find ways to help
support households and workers in the economy that don’t have those troubling
All right. Thanks a lot, Mike. That’s our webinar. Thanks for watching.