It’s impossible to predict what economy will look like 6 months from now in coronavirus-era

In preparing our traditional mid-year economic review and outlook, we thought it might be useful to take a quick look at this column’s evaluation of the state of the economy as published in late December 2019:

“Making a call on this region’s and state’s economic performance in 2020 was already a dicey proposition. Between elections at every level (and the general repulsiveness of the candidates and policies presented to voters), trade disputes, restiveness in the energy markets, clashes of the tech titans, signs of weaknesses in some global economies and long-term disruption in sectors like retailing, there were too many variables and moving parts to feel confident about any prediction.

“And then along came Boeing.

“Or, more properly, along came Boeing’s current miseries.

“When we know how Boeing’s situation is resolved, and when, or if, then we’ll know what kind of year it’s going to be.”

Upon further review, we would like to, ahem, revise and extend those comments.

It wasn’t so much that that analysis was wrong. It was just incomplete.

The missing element in the outlook was the coronavirus, which in the space of less than five months (the “abandon ship” orders didn’t really take hold until mid-March) went from “what’s that?” status to the most significant news story and influence on the economy not just for this year but for this decade – and maybe even longer, once we get a full accounting of the financial cost of the pandemic.

It’s a bill we may be reluctant to open, knowing without looking at the bottom line that it’s going to be horrifically expensive, one which we’ll be paying for years, in lost jobs, lost opportunities, failed companies and stagnant economies.

Too pessimistic? There are the anecdotal signs that the economy is trying to crawl its way back to some sort of normality. As stores reopen, some retailers are reporting encouraging levels of consumer traffic and spending. Airline flights are getting a little fuller. And everyone is noticing the highways are getting more congested.

But let’s not get carried away. This isn’t over. It may not even be the end of the beginning:

■ The problems we already had aren’t resolved. Had there been no coronavirus, Boeing would still be in the soup (one of its own making). Retailers would still be closing. Covid-19 didn’t create those problems, it merely amplified them and shortened the timeline on which many companies were operating as they tried to figure out turnaround solutions.

■ Covid-19 has added to the problems we’ve got. The travel & tourism, convention & meetings and hospitality & restaurant sectors weren’t in trouble last December. They’re in so much trouble now that it’s likely many establishments within them won’t have the financial resources to reopen or operate at limited capacity. Those may be the most extreme examples — but name a sector that hasn’t been affected, even if it’s “merely” through the increased costs of sending everyone home from the office.

■ We’re not done with Covid-19 itself. We’ve been told repeatedly to listen to the experts and believe the science. But which experts, and what science? The proclaimed knowledge of last month, sometimes last week, is reversed and revised regularly, and that’s when there’s any answer at all. Among the huge, so-far-unanswerable questions: What countermeasures are truly effective for containing the spread of the virus? Does this thing have waves, and if so can they be dampened or thwarted?

The world has embarked on a great experiment, the thesis being that protective gear such as facemasks and social-distancing protocols are sufficient to allow a reopening of society. But this experiment seems to be based as much on hope, guesswork and the public’s frustration with being in shut-down and shut-in mode as it does science. If the theory proves faulty, and the recent surge in cases isn’t encouraging, the damage to the economy will be even worse than what we’ve experienced to date — which is saying something.

■ We’re just getting started with Covid-19’s aftereffects. The city of Tacoma is facing a $40 million hole in its budget that wasn’t there six months ago. The state has gone from wondering how it could spend above-estimate revenue collections to wondering how to plug a $4.5 billion hole in its budget.

For Tacoma and the state and every other governmental entity in Washington, those budget gaps will be patched with job cuts. Add those to the cuts, many of them ominously listed as “permanent,” in the Employment Security Department’s running table of layoff warning notices.

Those represent not just billions of dollars in income not going to Washington residents to be spent in the community, but thousands of families and households weighed down by the financial strain of dealing with expenses that don’t stop just because the income has, and by the emotional strain of trying to find work.

By calendar, reckoning December 2019 was six months ago; in economic terms it was a lifetime ago. December 2020 is six short months away, but in predicting what it will look like economically you might have a better chance of accuracy in predicting the economy of December 2025.

When we know how, when or if Covid-19’s situation is resolved, then we’ll know what kind of rest-of-the-year 2020 turned out to be.