While the coronavirus has affected Americans, the suffering is not shared equally. The worst affected are the 167,000 victims and the over 5 million infected who might endure the difficult effects of the crisis. Also hard hit are the more than 20 million workers who lost jobs amidst the economic downturn, some of which might have now vanished forever.
More coronavirus losers are growing in number. Le Tote, which owns Lord and Taylor, plus Tailored Brands, which owns Mens Wearhouse, have each filed for bankruptcy, joining more than 40 other retailers that have filed so far this year, reported Standard and Poors Global Market Intelligence. The list contains icons such as Neiman Marcus and the Gap, as more retailers have filed for bankruptcy this year than in the last eight years.
There are some surprising coronavirus winners that have benefited, some dramatically, from the pandemic. Consider pets. Never before have dogs enjoyed such undivided attention from their owners. Vet Success, which monitors the financial health of about 2,800 veterinary clinics across the country, estimated that revenues rose 18 percent above last year. Further, Trupanion, a pet insurance provider, had a 28 percent increase in second quarter revenues over last year, reported the New York Times.
The American Society for the Prevention of Cruelty to Animals recorded a 70 percent increase in pet adoptions in March over the same time period last year in New York and Los Angeles. Applications for pets at the start of the pandemic rose 200 percent. Not all pets are thrilled by this. Trupanion noted a 14 percent increase in cat urinary obstructions, often attributable to what one veterinarian deemed feline stress, or as she told the New York Times, “humans hanging around more than cats would like.”
Other financial beneficiaries are makers of masks and health protective gear such as Honeywell and Prestige Ameritech. Mask orders increased from 45 million a month last year to 180 million a month this year, while orders could still rise because of fears from a second wave.
Amazon and its chief executive Jeff Bezos are also winners. According to its most recent earnings, average shares of the company have increased 90 percent since the pandemic started. Amazon had posted earnings of $89 billion, up 40 percent from the same quarter last year, with its profit far surpassing Wall Street expectations of around $5 billion.
Bezos, estimated to be worth around $189 billion, will continue benefiting even after the pandemic if Amazon remains the place for online shopping. Many customers appear addicted to the speed of its efficient website and fast delivery. An indirect beneficiary of the boom is Blue Origin, his space travel and exploration company. Bezos sold roughly $3 billion of Amazon stock this month, according to Geek Wire. While neither company would comment, Blue Origin could be gaining a chunk of the funds.
Netflix has enjoyed spectacular effects in the pandemic, but this has been mostly unreflected with its swinging stock price. With the second quarter, the “Cadillac of Streaming” had a surge of 10 million new customers, way more than the 7 million new customers which industry analysts predicted. Netflix, they say, could peak with about 300 million viewers.
Thanks partly to billions of dollars in subsidies from President Trump, who is desperate for an available vaccine to increase his election chances, the pharmaceutical industry is also betting heavily for becoming coronavirus winners. Five major pharmaceutical executives told the House Energy and Commerce Committee in a hearing they hoped that both the country and their firms would benefit from their efforts to develop a safe and effective vaccine in record time. Only Astra Zeneca and Johnson and Johnson both vowed to produce the vaccine at no profit. Merck, Pfizer, and Moderna, in contrast, declared they would not sell their vaccine at cost, meaning that they are seeking to turn a profit in battling the coronavirus.
One of the significant results of the pandemic already seems evident. The rich will become richer, and the poor will become poorer. With rewarding the wealthy and further damaging the vulnerable, the coronavirus is likely to accelerate not only the growing concentration of economic power, but widen income inequality which has destroyed the American dream for so many. “If past pandemics are the guide,” the International Monetary Fund noted this spring, “the toll on poorer and vulnerable segments of society will be several times worse.” The coronavirus may be novel, but the likely financial effects are predictable, and even more depressing.
This piece originally appeared at The Hill
Judith Miller is an adjunct fellow at the Manhattan Institute, a contributing editor of City Journal, and Fox News contributor.
Douglas Schoen is a political consultant who served as campaign adviser to Bill Clinton and Michael Bloomberg.
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