Announced that the epicenter of coronavirus is now South America. Interesting that they said South America, not Latin America. So, Mexico, where the cases are increasing and not close to peak yet, and also badly mishandling this, not a part of South America. I'm kind of wondering if there were some behind the scenes politics from the WHO.
As economies reopen, what is the update with the pandemic?
We're no longer epicenter here in the United States or New York, it's now South America. It still feels like the epicenter is New York but no, we're moving along. Big challenges in terms of how those economies are going to respond to lockdowns as they move towards peak, are going to be much more impactful economically on those countries. They're going to need a lot more international support. It's going to be challenging for them to get it. In particular, Brazil, which is the new epicenter taking over from the United States. Has had some of the worst governance of any democracy in responding to this crisis. Massive infighting domestically between the president and governors, the blue state-red state issue, the president wanting to open up and cheerleading, and the governors who in Brazil are much more responsible for health care than they are for the economy in the eyes of the voters, they particularly, they want to actually keep lockdowns. The impact of all of this on individuals in Brazil is because they have a president who is saying this is all fake news, is they're not engaging in social distancing. That's led to a lot more people dying in Brazil. In fact, larger numbers of daily death count now in Brazil than the United States. It's why the US put the travel ban on non-Americans, of non-citizens, non-permanent residents coming back from Brazil.
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What is going on between the WHO, the US and China?
We need someone to blame for this virus crisis, right? Trump will be elected or not in November on the back of well over 100,000 deaths, horrible economic performance and unemployment. No real bounce seen before November. Probably a second wave just before elections, given the seasonality of the virus. Which means you've got to blame China, the World Health Organization. And that means the Americans threatening to pull out of the organization as a whole, saying that they're doing lifting for China and also demanding investigation, as are other countries, of China for how they handled the initial outbreak of the disease. I am much more sympathetic to calls about Chinese responsibility because it's clear they did mishandle and did cover up the early days of this virus. The Chinese are saying they're only prepared to accept an investigation after the crisis is over. The WHO is saying that's three to five years from now. I agree on the time frame. Don't agree that that would be an appropriate way to handling it. A lot of countries around the world, particularly allies of the United States, are increasingly putting pressure on China. Big trade dust-up between the Chinese and the Australians as a consequence. Not directed by the United States, which is interesting. Australia did that all by themselves.
Even before the coronavirus pandemic, many Latin American countries were struggling with low prices for their commodities exports, a Venezuelan refugee crisis, and a surge of street protests across the region.
Then came the worst global public health crisis in a hundred years.
So far, there are about half a million confirmed cases in Latin America and about 25,000 deaths, but spotty testing and reporting mean both figures are too low.
What is going on in Brazil? Is it at a tipping point?
I'm not sure it's tipping point for Brazil, but it's a tipping point for Bolsonaro. When he came in, it was after years of political scandal, Lava Jato. You had impeachments, ministers getting thrown out of office. Former President Lula in jail. Dilma Rousseff impeached. Finally, somebody clean who has the former federal justice who helped put away a lot of these ministers as the new minister of justice. Now, a president that mishandled coronavirus, attacked the governors as fake news, you can't have shut downs, and cases in Brazil are spiraling much higher per capita than in other major Latin American economies; now he's gotten rid of his minister of justice. He's resigned, said Bolsonaro is interfering with investigations, getting too close to his family. That is the opposite of what you want in the midst of the worst economic contraction, maybe in Brazil's democratic history. His approval ratings are dropping, down in the low 30s. He might end up getting impeached. He'd have to lose more support. But, the idea that he governs effectively in Congress with a reformist coalition is off the table. He is in a lot of trouble. This is the beginning of what I suspect will eventually be the end of Bolsonaro. It's much harder to imagine him getting another term. Even lasting the full term.