Current Events in May 2020

Just a day after reopening, Ford temporarily closed one of its assembly plants in Chicago after two workers tested positive for COVID-19. 

The plant closed for part of Tuesday while the facility was deep cleaned and disinfected. Workers who had been in contact with the two infected employees were instructed to self-quarantine for 14 days. 

A Ford spokesperson said it’s important to note that the employees didn’t contract COVID-19 while at work “due to the incubation time” of the virus. 

"Our protocols are in place to help stop the spread of the virus,” the spokesperson added. 

Workers still have concerns

Ford, along with GM and Fiat Chysler, announced this week that they would begin gradually reopening U.S. facilities after nearly two months of closures due to the pandemic. 

The automakers said they would implement a number of measures to keep workers healthy, including requiring temperature checks and putting up plastic barriers to promote physical distancing between workstations and in common areas. 

However, some employees said they still had reservations about returning to work. In an interview with CBS Chicago, Ford employee Michael Hopper said the facility where he is employed is “crowded” and people are “on top of each other.” 

“How our jobs are set up, if one person gets in the hole that would affect the person behind him,” said Hopper, who added that he recently lost a brother to COVID-19.

The Chicago facility that was shuttered after workers tested positive was reopened Tuesday night after being thoroughly cleaned, according to local news reports. 

Coronavirus (COVID-19) tally as compiled by Johns Hopkins University. (Previous numbers in parentheses.)

Total U.S. confirmed cases: 1,532,212 (1,510,988)

Total U.S. deaths: 92,128 (90,432)

Total global cases: 4,931,057 (4,836,329)

Total global deaths: 324,240 (319,213)

CDC issues guidance for reopening economy

The Centers for Disease Control and Prevention (CDC), without fanfare, has issued its 60-page guidance for reopening schools and businesses shut down by the coronavirus (COVID-19). 

The document calls for a “three-phased approach” for reducing social distancing measures and suggests six “gating” indicators to determine when enough progress has been made to move on to the next phase. Topping the list of gating indicators is a downward trend in new cases. The CDC says jurisdictions must also be ready to act if things take a turn for the worse.

“Given the potential for a rebound in the number of cases or level of community transmission, a low threshold for reinstating more stringent mitigation standards will be essential,” the CDC said.

United Airlines teams with Clorox to clean up

As airlines struggle to win back customers, United Airlines is boosting its cleaning protocols by introducing what it calls United CleanPlus. To deliver what it terms “an industry-leading standard of cleanliness” aboard its aircraft, United will work with Clorox and Cleveland Clinic to inform and guide the effort.

The cleaning, safety, and social distancing steps will include touchless kiosks in select locations for baggage check-in, sneeze guards, mandatory face coverings for crew and customers, and giving customers options when flights are more full. 

Clorox products will be used at United's hub airports, and medical experts from the Cleveland Clinic will advise on new technologies, training development, and quality assurance programming.

Highway death rate increases in March

With fewer cars on the nation’s highways because of the coronavirus shutdown, it was generally expected that highway deaths would go down. In fact, insurance companies rebated premiums to customers based on that belief.

Preliminary estimates from the National Safety Council suggest that the number of deaths did fall, but the death rate per miles driven went up by 14 percent year-over-year. That suggests the drivers who were still on the road were more likely to be in a fatal accident.

The actual number of miles driven fell by nearly 19 percent compared to the same time period last year. The mileage death rate per 100 million vehicle miles driven was 1.22 in March compared to 1.07 in March 2019.

Scientists: Some coronavirus patients don’t spread the disease

From the beginning of the pandemic, doctors have warned that the coronavirus is extremely contagious and have stressed the need for social distancing and enhanced hygiene. And it is -- in some cases.

But Science Magazine reports that scientists who have been studying the data now believe that most people who get the virus aren’t contagious at all. The data also seems to indicate that the virus is most likely to spread when people are together in large in-door groups and is less likely to spread when two or three individuals are together outdoors.

Jamie Lloyd-Smith, a researcher at UCLA, says most people with the virus don’t spread it. Other scientists agree. “Probably about 10 percent of cases lead to 80 percent of the spread,” said Adam Kucharski, a researcher at the London School of Hygiene & Tropical Medicine.

Reopening businesses fear lawsuits

The coronavirus may open up an entirely new line for personal injury lawyers, who normally focus on traffic accidents. As businesses begin to reopen in most states, small businesses are especially worried about lawsuits if employees or customers get sick.

“There is no playbook for this,” Harold Kim, president of the U.S. Chamber Institute for Legal Reform, told CNBC. “Litigation is particularly damaging to Main Street because the level of potential damages can close down your doors.” 

Kim said businesses all over the country have expressed liability concerns. He thinks there could be a surge in worker liability lawsuits if coronavirus infection rates continue to rise.

Around the nation

• New York: Gov. Andrew Cuomo reports that the state’s infection and death rate has gone from the worst in the nation to about average. At a news briefing, Cuomo said there were 105 deaths in the last 24 hours. At the height of the outbreak in April, more than 800 people a day died from the virus.

• New Mexico: Officials at the University of New Mexico are telling students to be ready for just about anything this fall. Some may be on campus and some may take classes online, with school now scheduled to begin August 17. “We are planning for a hybrid in-person and online model for the fall,” said Cinnamon Blair, the chief marketing and communication officer at UNM. 

• South Carolina: South Carolina was among the first states to reopen, but Gov. Henry McMaster says another shutdown is not out of the question. “What would have to happen is we would have to see a spike in the numbers. We would have to understand (that) we would have to do more,” the governor said in an interview with WYFF-TV in Columbia.

Besides devastating entire industries and throwing millions of people out of work, the coronavirus (COVID-19) has quickly slammed young families with increased debt loads.

A study by LendingTree found that 56 percent of parents with school-aged children have increased their personal debt as a direct result of the pandemic. Four in 10 respondents have had to increase credit card balances while 15 percent took out personal loans to meet virus-related expenses.

Single parents appear to be struggling the most to pay bills during stay-at-home orders and the economic shutdown. Nearly 20 percent said they couldn’t pay their credit card bill last month. Fifteen percent said they couldn’t pay their rent or mortgage in full.

To make ends meet, just over a third of parents said they were forced to tap their child’s college savings account because of the financial strain they were facing. But they may have been the lucky ones. Fifteen percent of parents said they had no college fund to tap into.

School closings turned out to be a significant source of unexpected expense. Sixty percent of parents said they had to come up with money to pay costs associated with their child’s online classes. On average, parents spent $1,000 for electronic devices, such as iPads, and office furniture.

Tiny margin for error

All in all, parents said the financial tension was made worse by the stress of working from home while trying to manage their children’s online education.

"The truth is that even before the outbreak hit, most Americans' financial margin for error was tiny," said Matt Schulz, chief industry analyst at LendingTree and parent of an 8th-grade son. "That means that even minor changes can have a major impact on the family budget.”

Additionally, many families are dealing with reduced incomes, whether from job losses or pay cuts. Families with members who have contracted the virus have also faced additional medical expenses.

The survey found that some of the parents’ financial pressures have come from trying to keep their children entertained and occupied while staying at home. Seventy-five percent say they have purchased amusements they might not have bought otherwise. 

Coincidentally, gaming systems like the Nintendo Switch, which retails for around $300, have been big sellers during the pandemic.

Consumers who haven’t yet received their coronavirus stimulus check could receive one in the form of a prepaid Visa debit card. 

The Treasury Department announced Monday that, instead of sending checks, it’s sending out roughly 4 million debit cards preloaded with stimulus money to individuals who haven’t given the IRS their direct deposit information. The cards will start going out this week. 

“Prepaid debit cards are secure, easy to use and allow us to deliver Americans their money quickly,” Treasury Secretary Steve Mnuchin said in a statement. “Recipients can immediately activate and use the cards safely.”

Beware of scams

The amount on each card, which the Treasury has dubbed “Economic Impact Payment cards,”  will depend on the number of people in a household. Individuals will receive up to $1,200 and couples will receive $2,400 plus $500 for each dependent. 

Funds on the prepaid card can be spent online and at brick-and-mortar stores. Consumers can also transfer funds between bank accounts and withdrawal cash from the AllPoint network of ATMs. 

Consumers are warned to be wary of scammers who may use this opportunity to try to steal money. The card will come in a plain envelope from “Money Network Cardholder Services” and should be activated upon arrival. 

While it’s no secret that being more active can boost consumers’ health, researchers have found that incorporating physical activity into the daily commute can also benefit consumers. 

Now, researchers from Imperial College London found that those who opt to walk or bike to work could reduce their risk of early death or illness. 

“As large numbers of people begin to return to work as the COVID-19 lockdown eases, it is a good time for everyone to rethink their transport choices,” said researcher Dr. Richard Patterson. “With severe and prolonged limits in public transport capacity likely, switching to private car use would be disastrous for our health and the environment. Encouraging more people to walk and cycle will help limit the longer-term consequences of the pandemic.” 

Building in exercise

To understand the health benefits associated with walking or biking to work, the researchers evaluated data from over 300,000 commuters, including data from those who chose more active modes of transport and those who drove or took public transportation to work. 

The study revealed that just 15 percent of the participants chose an active form of transportation to get to and from work each day, while the majority of participants -- over 65 percent -- drove. 

However, the researchers found that incorporating this kind of exercise into the daily routine was found to be beneficial to the participants’ health. The team learned that walking or cycling to work lowered the risk for cancer, cardiovascular disease, and early death. 

While walking and cycling yielded the greatest health benefits, the study also revealed that those who commuted by train fared better than those who drove. The researchers hypothesized that train commuters’ had lower instances of cancer, cardiovascular disease, and premature death because their trips typically have more physical activity than those who just get into and out of their cars. 

Active commuting benefits

Previous studies have highlighted the popularity of active commuting. With the right infrastructure in place, more and more consumers can opt to add more physical activity to their days. 

“While not everyone is able to cycle or walk to work, the government can support people to ensure that beneficial shifts in travel behaviour are sustained in the longer term,” said researcher Dr. Anthony Laverty. “Additional benefits include better air quality which has improved during lockdown and reduced carbon emissions which is crucial to address the climate emergency.”

McDonald's workers in Chicago filed a coronavirus-related class action lawsuit against the fast-food chain on Tuesday. The plaintiffs blame the company for forsaking its duty to adopt government safety guidelines and, as an extent of that, putting the lives of both employees and their families at risk.

The suit alleges that McDonald's failed to supply a reasonable amount of hand sanitizer, gloves, and masks to employees. Furthermore, according to Reuters, management failed to alert its staff when an employee became infected with the coronavirus.

Monetary compensation doesn't seem to be part of the lawsuit. Rather, workers are angling for a court injunction -- one that forces McDonald's not to require workers to reuse masks, to inform employees if a coworker is tested positive, and make it imperative that customers wear face coverings.

Meanwhile, in California…

In separate instances, McDonald's workers in Los Angeles, Monterey Park, and San Jose also filed reports against the company for unsafe working conditions related to the pandemic. 

The California report has a slightly different wrinkle than the Chicago one. The California workers say that CAL/OSHA failed to act on their behalf after employees filed a grievance that McDonald's mishandled safety concerns and put workers in "imminent danger."

The filing with the California Labor & Workforce Development Agency and CAL/OSHA, and served on McDonald's, gave the chain 33 days to rectify the situation. If the company fails to comply, both the state of California and the workers could sue McDonald's for each violation perpetrated against each employee.

McDonald's side of the story

Interestingly enough, McDonald's corporate office published a post called "Our Goal: Safety First on the same day the Chicago lawsuit was filed.

"We're doing our part while keeping employees and customers safe," the chain says. "Since the start of the pandemic, we have made nearly 50 process changes in our restaurants in accordance with guidance from the CDC and state and local health experts."

Contrary to what workers in both situations claim, the company-mandated changes include “providing wellness and temperature checks, masks and gloves, social distancing guidelines, increased cleanings and installing protective barriers."

"In addition, as reopening begins in states across the country, we are implementing a 59-page "playbook" that outlines the precautions we are requiring before restaurants reopen dining rooms. And we are confident that employees impacted by the virus are receiving sick pay to tend to their healthcare needs,” the company said.

Facebook added another touchpoint to its users on Tuesday when it unveiled Facebook Shops. The new platform will allow small businesses and individuals with side hustles to hawk their wares inside the Facebook framework rather than sending them to a separate site.

In Facebook CEO Mark Zuckerberg's opinion, it couldn't come at a better time because of the headlock that the pandemic has put on small businesses.

"I think this is particularly important right now because so many small businesses are moving online to deal with the economic fallout from Covid-19," Zuckerberg wrote in a post. 

"As people are being told to stay home, physical storefronts are having a hard time staying open and millions of people are losing their jobs. I've been personally working with our teams on Facebook Shops every day for the last couple of months so we could accelerate launching it to small businesses who could use tools like this now."

Making partnerships

One of the chief advantages Facebook wants to claim for Shops is its simplicity to set up and manage. When a user sets up shop, it automatically appears on their Facebook and Instagram accounts and, eventually, on Messenger and WhatsApp. 

The social media giant also made a deft move by partnering with shop integrators like Shopify, BigCommerce, and WooCommerce so they're part of the ecosystem and not in the enemy camp.

"All of these tools are open for business, even when your physical storefront can't be," Zuckerberg said. "Hopefully this helps relieve some of the pressure that small businesses are facing right now and helps them prepare for a more online future."

Did someone say free?

Just like Facebook's other e-commerce hallmarks, Shops will be free for businesses to create and use. While that might sound like Facebook is leaving potential money on the table, Zuckerberg's hope is that the platform addition will hike up consumer engagement and especially ad sales.

"Our business model here is ads," Zuckerberg said. "So rather than charge businesses for Shops, we know that Shops are valuable for businesses. They're going to in general bid more for ads and we'll eventually make money that way."

Facebook's announcement was met with enthusiasm, to say the least. ConsumerAffairs gave the 302,000 comments to Zuckerberg's post a quick once-over. They were loaded with thumbs-ups, hearts, and care emojis. Many of the comments applauded the timing of the move, sensing that the future of the direct-to-consumer business model is pretty bright.

Walmart has announced that it’s shuttering Jet.com, which it purchased in 2016 for $3 billion.

The retailer said in its first-quarter earnings report that the acquisition of Jet.com “was critical to accelerating our omni strategy.” However, Walmart will be discontinuing the online marketplace “due to the continued strength of the Walmart.com brand.” 

Since acquiring Jet.com, Walmart -- like many other retailers who have attempted to grow their online sales -- has faced competition from e-commerce giant Amazon. 

Walmart’s recent efforts to head off competition from Amazon have included expanding its two-hour Express Delivery service to nearly 2,000 stores across the U.S. through the end of May. It’s also been reported that Walmart may be gearing up to test a subscription service similar to Amazon Prime. 

Looking ahead 

In its earnings report, Walmart said online sales increased by 74 percent year-over-year “with strong results for grocery pickup and delivery services, walmart.com and marketplace,” in part due to the sudden increase in consumers shopping online due to the coronavirus pandemic. 

Despite the current boom in online sales, Walmart appears to be focusing on a path to long-term success. In 2019, the Wall Street Journal reported that Walmart’s online division lost roughly $2 billion in one fiscal year. Axing Jet.com is likely a bid at avoiding future uncertainty after the pandemic is over. 

“Our business fundamentals are strong, and our financial position is excellent. Customers trust us to deliver on our brand promise, and I’m confident in our ability to perform well in most any environment,” said Brett Biggs, Walmart Inc. chief financial officer. “While the short-term environment will be challenging, we’re positioned well for long-term success in an increasingly omni world.” 

Coronavirus (COVID-19) tally as compiled by Johns Hopkins University. (Previous numbers in parentheses.)

Total U.S. confirmed cases: 1,510,988 (1,491,547)

Total U.S. deaths: 90,432 (89,666)

Total global cases: 4,836,329 (4,748,937)

Total global deaths: 319,213 (316,277)

Southwest sees clearer skies

Southwest Airlines has struck a hopeful note, reporting that for the first time since the pandemic began, bookings have outnumbered flight cancellations. The news comes at a good time, as the airline has previously said it expects 2020 revenue to be down 90 percent over 2019.

Southwest isn’t alone in that regard, as all airlines are seeing a huge drop in passengers over the last two months. The Transportation Security Administration (TSA) reports that the number of people passing through TSA checkpoints at the nation’s airports was down 92 percent in the first 18 days of May.

But carriers are already planning for better days. Delta Air Lines has pledged to add flights when business picks up so that no plane flies with more than 60 percent capacity.

Housing starts collapse

As predicted, the coronavirus (COVID-19) brought homebuilding activity to a near standstill. The Commerce Department reports that housing starts in April plunged more than 30 percent to a seasonally adjusted annual rate of 891,000 units, the lowest level since early 2015.

While many homebuilders remained on the job last month, their hands were tied in some cases. Builders reported widespread disruptions in the supply chain, which made it difficult to get all of the building materials they needed.

Meanwhile, April’s home sales also appeared to fall off a cliff. RE/MAX reports that sales in the 53 top markets in which it operates were down more than 20 percent last month.

Going out again

As states began lifting coronavirus restrictions at the end of April, Darden Restaurants, the parent company of Olive Garden, began reopening dining rooms at reduced capacity. The company says it’s boosted business.

In a business update today, the company’s CEO, Gene Lee, said early signs suggest that consumers are grateful for the opportunity to dine out again.

“At the same time, our To Go business remains strong,” Lee said. “I am pleased that we are able to return some team members from furlough to support these phased openings, and we look forward to safely serving more guests as more communities begin to reopen."

Companies warned about their claims

Federal regulators continue their crackdown on merchants who they say are misleading consumers about their products and businesses. The Federal Trade Commission (FTC) and Small Business Administration (SBA) have sent warning letters to two companies that may be misleading small businesses seeking SBA loans as a result of the coronavirus pandemic.

The warnings went to ITMedia Solutions, LLC and Lendio, Inc. The agencies contend the companies’ marketing could lead consumers to believe they are affiliated with the SBA, or that consumers can apply on their site for loans through the Paycheck Protection Program (PPP) or other programs authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

The letters warn the companies to take immediate action to ensure all deceptive claims are removed and to remediate any harm to small business consumers as a result of the claims.

Safety first

The National Safety Council has issued a set of guidelines for reopening businesses to help protect the health of returning employees. The group said it identified the “10 universal actions” every employer must consider before reopening.

The actions range from phasing in operations to training supervisors on the fundamentals of safety. They also include screenings, enhanced hygiene, and tracing.

“Protecting our workers means coalescing around sets of safety principles and ensuring those principles guide our decisions," said Lorraine M. Martin, president and CEO of the National Safety Council. "Employers are asking for help, and we've brought together leading safety experts to deliver in this time of need.”

Around the nation

• Oregon: A state court judge has struck down statewide restrictions on activity, put in place by Gov. Kate Brown. The judge ruled that the governor exceeded her authority because she did not seek the state legislator’s approval to extend her order.

• Texas: When large gatherings were banned during the shutdown, it was churches that were the most vocal in their opposition. Now that some of those restrictions have been lifted, Holy Ghost Catholic Church in Houston is closing again after five church leaders tested positive for the coronavirus.

• Illinois: Gun shop owners say they have never experienced an upsurge in business like the once taking place during the coronavirus shutdown. Shop owners say regular customers have been joined by newcomers who are buying weapons and ammunition and enrolling in classes.

A significant amount of the government’s $2.2 trillion coronavirus relief package remains unspent amid the COVID-19 crisis, and companies and cities have continued to wait for the disbursement of unspent bailout funds, according to the Washington Post.

This week, President Trump told restaurant executives at the White House that he was open to giving businesses more flexibility in how they use taxpayer funds, with the ultimate goal of delaying rehiring workers as quickly as initially required. 

The Congressional Oversight Commission released a report on Monday which found that the Treasury Department had not spent much of a $500 billion fund it created through the CARES Act in March to help businesses and local governments. 

In Tuesday’s hearing, senators are expected to bring up the fact that the Treasury Department has spent little from the fund, even though many businesses have asked for immediate help from Treasury Secretary Steven Mnuchin and Federal Reserve Chair Jerome H. Powell.

“If it doesn’t get out in a timely fashion, it’s not going to achieve the goal behind its creation,” said Sen. Patrick J. Toomey (R-Pa.).

Not much money dispersed

Powell plans to say on Tuesday that the U.S. is in the midst of an economic crisis “worse than any recession since World War II” and that the Fed’s “bold steps” have helped ensure American families and businesses can borrow cheaply so they don’t go bankrupt before the economy can safely reopen.

Powell also said Tuesday that the Fed will disclose amounts borrowed and interest rates levied under programs to provide credit for large corporations, state and local governments, and medium-sized businesses. In prepared remarks, Powell said he and other officials “recognize that the need for transparency is heightened when we are called upon to use our emergency powers.” 

The $500 billion Treasury fund includes $46 billion to make loans and loan guarantees to the airline industry, which has significantly impacted by the pandemic. 

“The Treasury has not disbursed any of the $46 billion it can use to provide loans and loan guarantees to the airline industry and businesses critical to maintaining national security,” the report said.

Mnuchin and Powell are set to testify on Tuesday before the Senate Banking Committee to discuss the matter.

Massuachusetts and Connecticut will begin partially reopening this week after being shut down for nearly two months due to COVID-19. The states are the last to begin reopening in the wake of closures due to the pandemic. 

Restrictions will be put in place to prevent the spread of the virus. Massachusetts Gov. Charlie Baker said virus mitigation efforts will be a multi-phase process. Manufacturing facilities, construction sites, and places of worship will open with certain restrictions beginning Monday.

"As I've said before, we've all been doing our jobs to fight back, and as a result, positive case rates are moving in the right direction and hospitalizations are down," Baker said. 

Curbside pickup will be available at retail establishments starting May 25, and office spaces will be permitted to open at 25 percent capacity. Other facilities will be permitted to reopen if they follow the new guidelines. 

People who want to use public transportation will be required to wear face coverings and maintain distance between themselves and other passengers. 

The number of confirmed COVID-19 cases have been declining since late April, according to data compiled by Johns Hopkins University. Connecticut announced its reopening plan May 9 and is set to allow restaurants, offices, retail stores, and outdoor museums and zoos to reopen with certain restrictions on Wednesday.