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The Economic Impact of Coronavirus

The Economic Impact of Coronavirus

Criminals cash in on COVID-19 relief funds to stock up on guns and drugs: How the pandemic has been a boon for crime.

ROME (Thomson Reuters Foundation) — The coronavirus pandemic is unleashing a wave of desperate, desperate people looking for money and drugs, and making them vulnerable, in a way rarely seen since the Great Depression, criminologist Michael Bailey said.

While other countries have dealt with the coronavirus pandemic by distributing cash payments, as well as by issuing government-guaranteed loans for small businesses, countries including the United States and Spain have been dealing with the virus’s economic impact by handing out money and tax relief.

“So far, the money has been paid out, in effect, in terms of cash grants, but the pandemic has opened up this much wider channel for economic stimulus,” Bailey told the Thomson Reuters Foundation. “This is a new mechanism of stimulus being opened up that nobody is using, and that’s what makes it so risky to use, as governments are desperate to make sure there is enough money to deal with every aspect of the economic recovery, including, as we’ll talk about soon, the need for people to find jobs.”

While governments around the world have used cash payments and loans to support businesses and small businesses, Bailey said it wasn’t clear at the moment whether there was going to be a need for the government to act with another economic stimulus to help keep consumers — including people who have lost their jobs as a result of the pandemic and people who find themselves out of work — from losing their savings and their credit cards as a result of the economic downturn.

“We don’t have any real visibility into what the economy is going to look like at the end of this year, and I think that there is a real danger of panic on the part of people who may have had their savings in their bank accounts wiped out,” Bailey said.

“One of the problems that we have seen throughout the last five or six

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