SAN FRANCISCO - Companies will be the first line of defense in the U.S. response to the new coronavirus. The White House is downplaying the global disease, perhaps to calm markets. If there’s an outbreak in the United States, it may be up to corporate chiefs to take steps to minimize the damage.

President Donald Trump’s inadequate $2.5 billion request to fight the Covid-19 disease reflects his priorities. The Barack Obama administration asked Congress for $6 billion to fight the 2014 Ebola outbreak and got $5.4 billion. Trump said on Wednesday that the risk to Americans is “very low,” contradicting a warning from the Centers for Disease Control and Prevention that American communities should start preparing for the disease to spread. He also announced he was putting Vice President Mike Pence in charge of the government's response.

A presidency that combines an undue focus on what stock markets are doing with a habit of hollowing out government agencies is likely to be ill prepared for a pandemic. The White House has moved to cut the budgets of critical health agencies by about 10% to 20% each year. Congress has defied most of those requests. But most of the CDC’s global health staff was laid off in 2019. A similar team at the National Security Council was disbanded in 2018.

That’s why it could be up to companies to order factory shutdowns and force employees to work from home to stem the potential spread. China has made several such moves at the expense of GDP growth, but Trump's frequent focus on U.S. economic growth numbers may stand in the way of decisive containment measures. Moody’s Analytics said the virus could curb U.S. economic expansion by 0.2 percentage points this year and that a recession was possible.

Corporate chiefs have stepped up before. While the federal minimum wage has stagnated, companies like Bank of America and Amazon have raised pay anyway. While the Trump administration has pulled out of the Paris climate accord, Microsoft and other companies pledged to reduce their carbon footprint. Coronavirus may see U.S. firms voluntarily sacrificing growth, or sharing technology and capital in new ways to tackle the spread of the disease and treat stricken workforces. It would just be another example of corporations filling the void left by government.

CONTEXT NEWS

- U.S. President Donald Trump said on Feb. 26 that he was putting Vice President Mike Pence in charge of the government’s response to Covid-19, the disease caused by the new coronavirus.

- Officials from the U.S. Centers for Disease Control and Prevention on Feb. 25 said American communities should start preparing for the spread of the disease. Dr. Nancy Messonnier said that recent data increased expectations of transmission in the United States and that “disruption to everyday life might be severe.”

- Separately, White House economic director Larry Kudlow told CNBC that the potential for a domestic outbreak has been “contained.” He also said long-term investors should consider buying stocks given the recent drop in markets.

- There are 15 confirmed U.S. cases of Covid-19, along with 45 Americans evacuated from a cruise ship in Japan and from Wuhan, China.

(Editing by John Foley and Katrina Hamlin)

© Reuters News 2020