JUDY WOODRUFF: Once again,
the hemorrhaging of American
jobs was in the millions last

week. The official unemployment
rate is likely to spike to 20
percent by June, if that is

not already the
case unofficially.

And Federal Reserve Chair Jay
Powell warns that we could be
facing a prolonged recession

that could damage growth
for years to come.

Everyone wants to restart the
economy. The question is how.

Paul Solman gets the views of a
Nobel Prize-winning economist.

It's part of our
series Making Sense.

PAUL ROMER, Nobel Laureate in
Economics: Right now, this week,
there is a choice about getting

some more activity going
vs. protecting lives.

PAUL SOLMAN: Paul Romer, who won
a Nobel Prize in 2018 for his
work on technology and economic

growth.

These days, he's focused on how
to avoid an economic depression.

PAUL ROMER: Really, the only
way to get back to a healthy
economy is to stop the death

and make people feel safe.

PAUL SOLMAN: And ending
the lockdowns won't
do that, he says.

PAUL ROMER: We're going to have
a kind of a seesaw pattern,
I think, of trying to open

up, realize that we haven't
done anything to protect
against the spread of the virus,

and then pulling back.

And what we're going to just
have to do is find a sustainable
way to contain this virus.

PAUL SOLMAN: That way, he's
been arguing, is mass testing,
everyone in the U.S. every

two weeks.

PAUL ROMER: If you don't know
who's infectious, the only way
to lock down and isolate the

people who are infectious
is to lock down everybody.

I think if we just test
everybody and isolate
the people who are
infectious, we can easily

suppress it, and we can do it
without causing a depression.

PAUL SOLMAN: But how can we
do that, given the well-known
shortages of test supplies,

personal protective equipment,
laboratory capacity?

Says Romer, how can we not?
Just look at his model.

PAUL ROMER: Each additional
unit of testing frees up about
eight or nine people who can

go back to work.

What's the value of the work
the eight or nine people can
do? Man, the test is really

cheap compared to what the
people can do. And for people
who say, well, we can't get

a lot of them right now, I'm
OK with that. Let's just get
as many as we can right now

and start to get some
people back to work.

PAUL SOLMAN: Economics
is fundamentally about
costs vs. benefits.

PAUL ROMER: Yes.

PAUL SOLMAN: So all this
testing costs how much vs. how
much is added to the economy

when the nine people
that you were talking
about go back to work.

PAUL ROMER: If we can get the
cost of a test down to $10,
so one unit of testing per day

will cost us about $3,600 per
year, if that frees up nine
people, then that means, at

a median income of,
say, $50,000, nine times
$50,000 would be $450,000.

It's like a hundred-fold
increase on your
investment. There aren't
very many investments

where you get a 100-X return
pretty much guaranteed.

PAUL SOLMAN: The latest
relief bill did include
$25 billion for testing.

So, is $25 billion enough?

PAUL ROMER: No.

We need to commit about $100
billion a year to expenditures
on testing. That's enough

to get us this 23 million tests
per day, or test everybody
every 14 days in the United

States. The $25 billion is
enough to get going. It'll give
us some demonstration projects.

I think we should be testing
and reopen, you know, for TV,
Major League Baseball. I think

we should be testing everybody
in nursing homes. I think we
should be testing frequently

everybody who's a
health care provider.

PAUL SOLMAN: Are you
condemning the country for
not having had the tests?

PAUL ROMER: No, no, no. Bygones
are bygones. I think it's a
horrible mistake to worry about,

you know, who do we blame, who
are we going to punish, or to
be thinking about, oh, would

have, could have, should have.

PAUL SOLMAN: Romer does,
however, fault the Food
and Drug Administration.

MILES O'BRIEN: The FDA
application was 28 pages' long.

PAUL SOLMAN: Miles O'Brien's
recent "Frontline" documentary
described the challenges faced

by a University of Washington
researcher in the early days
of the pandemic, when he raced

to get a new test approved.

DR. ALEX GRENINGER, University
of Washington: One of the things
is, they needed a document

FedExed across the
country before they could
look at the document.

MILES O'BRIEN: You couldn't
electronically transmit it?

DR. ALEX GRENINGER: I could
electronically transmit it,
but they couldn't look at it

until it was FedExed.

MILES O'BRIEN: The FDA
told me it did review
Greninger's application,
but it was incomplete.

They also said they were
balancing the need for tests
with concerns about accuracy.

PAUL ROMER: I understand why
they have to be very careful.
But they're making people

who are innovating, finding
better ways to do the tests,
jump through these extraordinary

hoops. And it's taking months
to just get simple things done.

PAUL SOLMAN: Case in point,
says Romer, the saliva
test approved last week.

PAUL ROMER: You just
spit in a tube, much
better than those swabs.

WOMAN: I'm sorry, but I
have to get in there, OK?

PAUL ROMER: But it took almost
a month for the FDA to say,
OK, well, somebody can spit

in the tube without being
physically present in front of
a health care professional who

watches them while they do it.

PAUL SOLMAN: Right.

PAUL ROMER: I mean, if it takes
a month to make a decision
like that, we're never going

to get to the faster, cheaper,
better tests that we need.

PAUL SOLMAN: What about
people who've gotten the
blood test that shows
that they have antibodies,

so they must have had the
virus? Are they then OK
just go back into the world?

PAUL ROMER: So you can't restart
an economy with just the 5
percent who've got antibodies.

You have got to let the virus
run through the community and
get to 60, 70 percent with

antibodies. But it's a horrific
path to get there, because
a million people are going

to die along the way. And it'll
take a year for that kind of
process to work through the

whole economy.

PAUL SOLMAN: What's your biggest
fear right now, economically?

PAUL ROMER: The biggest
risk we face is that the
economic turmoil is going
to lead to political

turmoil.

We can rebuild. We can recover
income. But if we damage our
institutions of rule of law,

democracy, basic
freedoms, that can take
a lot longer to rebuild.

PAUL SOLMAN: Are we moving
towards the kind of investment
you think we have to make?

PAUL ROMER: I am actually very
confident that it's going to
happen, because there are no

good alternatives. We're
losing $500 billion a month.

It's eventually going to dawn
on people that we can't afford
to keep doing that. And compared

to that, $100 billion a
year is really pretty cheap.

PAUL SOLMAN: In fact, Romer is
sure enough that testing will
soon be everywhere, he offered

to put his money where
his heart is, $500 of it.

PAUL ROMER: I'm so confident
that testing will be the way
out of this crisis that I

will bet you that, in
six months, we will be
doing 20 million tests
a day in the United

States.

PAUL SOLMAN: So, I'm betting
against you now that we're not
going to hit 20 million a day,

tests, in six months?

PAUL ROMER: Yes.

PAUL SOLMAN: And I pay
your charity if you win,
and you pay my charity?

PAUL ROMER: That's a deal.

PAUL SOLMAN: I
will take that bet.

PAUL ROMER: OK. Have me back,
and we will see how it goes.

PAUL SOLMAN: For the "PBS
NewsHour," the ever-skeptical
Paul Solman, now with
some skin in the game.