Business & Development

A World of Difference

What will the “new normal” look like in the COVID-19 era?
Baltmag Joemaccarone Cmyk

Matt Hornbeck, the principal of Hampstead Hill Academy, a pre-K to 8th grade public school next to Patterson Park, found out Maryland schools were closing at the same time everyone else did—after Gov. Larry Hogan’s afternoon press conference on Thursday, March 12. It meant he and his staff had less than 24 hours to prepare 859 students for a transition to online “school,” which would last for the remainder of the academic year due to the COVID-19 outbreak.

Hornbeck’s staff got as many learning packets to the kids as they could. They spent the next few weeks safely distributing Chromebooks. Teachers began posting assignments, reading books to students online, and creating homemade instructional videos. They provided sample schedules to parents and organized “coach” classes—where kids could log-on in a live setting and ask their teacher questions.

Given the city’s gaping digital divide, hoping that a class of 25 city school children would start showing up in daily 8 a.m. Google classrooms was never an option. Many Baltimore kids simply don’t have WiFi at home. Others don’t have a parent in the house during the school day to help navigate the process. Even at Hampstead Hill, the highest performing school in the city, the staff still hadn’t heard from 55 students—and that was after six weeks of diligently whittling down their “hardest to reach” list.

Schools, like Hampstead Hill, are more than sources of neighborhood pride. They are hubs providing breakfasts, lunches, after-school activities, and childcare. It’s where kids make friends and connect, and parents do, too.

“It doesn’t look anything like school used to look,” Hornbeck says. “It’s hard to even call it school.”

It’s a statement that applies to almost everything at the moment.

Restaurants, barbershops, bars, churches, libraries, gyms, movie theaters, museums, festivals, music venues, sporting events, and the state legislature shuttered all at once in mid-March. As did all “non-essential” workplaces. The entire economic fabric of the state, not to mention the natural, vibrant social life of Baltimore, was quickly torn asunder by the stay-at-home orders that were issued.

It wasn’t just in Maryland, of course. By the end of May, nearly 41 million people—one in four workers nationally—were filing for unemployment each week. One Federal Reserve model projected a gross domestic product drop of more than 50 percent in the second quarter—both figures representing the worst economic contraction since the Great Depression. That Maryland, with its large number of federal workers, has fared better than most states hardly serves as consolation. Unemployment in the state, which tripled in a matter of weeks and remains at levels unseen since the 1930s, overwhelmed the system to the point where out-of-work Marylanders failed to get checks for weeks. Meanwhile, hospital intensive care units attempted to keep pace with coronavirus patients and food banks struggled to meet the demand from suddenly unemployed families.

One can only hope that lessons will be learned about preparing for future pandemics, including the need to manufacture and stockpile personal protective gear and testing equipment. But how do you measure and address the full impact of the COVID-19 virus in Maryland or a city like Baltimore? Is it a simple calculation of deaths and illnesses, plus job and tax revenue losses? What about addressing the hugely disproportionate impact on low-income and Black and Latino communities? Other questions arise, too, about building more resilience into our healthcare and economic systems. How long, for example, will U.S. citizens, the tens of millions of whom lost their livelihoods and insurance benefits in the middle of the pandemic, accept a system that ties their family’s healthcare to their job? Will the coronavirus crisis, in combination with the massive protests following the police killing of an unarmed George Floyd, spark any kind of reckoning of our ever-widening racial, health, and economic inequality?

It’s too early to know the answers to any of these questions. As we keep our fingers crossed for a vaccine, and social and economic life return to some kind of new normal, everything remains up in the air. It’s not even clear yet if Maryland schools will fully reopen on August 31, officially the first day of 2020-2021 school year.

The global spread of the novel coronavirus, while a first in our lifetimes, isn’t unprecedented. Our great-grandparents experienced a similarly terrifying pandemic. From 1918 to early 1920, the so-called “Spanish flu” ravaged the globe. The new influenza killed at least 50 million people worldwide, an estimated 675,000 in the U.S. alone, over three waves. At its height, schools were closed in Baltimore then, too. Theater and baseball games were canceled. Retail, pub, and restaurant hours were restricted. Many stayed home from work out of fear. People were encouraged to wear masks—and many did. At the outset, the World War I defense effort helped stave off a disastrous economic impact. Once the war ended, however, a crippling recession set in. Ultimately, massive technological breakthroughs, including the electrification of the country and mass production innovations—think conveyer belts and Henry Ford’s assembly line—jumpstarted the Roaring ’20s.

So far, the 2020s have been far less promising. Most economists were optimistically predicting a “V”-shaped economic recovery—with a dramatic dip and equally steep rise. But the shutdowns here and elsewhere proved much broader and lengthier than first imagined and that prediction has shifted dramatically.

“Most economists aren’t anticipating a V-shaped recovery anymore, but something like a Nike ‘swoosh’—a significantly longer, more gradual recovery,” says Daraius Irani, vice president of strategic partnerships and applied research at Towson University. “What we are seeing is a slow throttling of the economy as the reopening is phased in over time—and rightly so with the COVID-19 virus still all around us.”

“If people don’t feel safe taking buses and the light rail, they’re not going to work.”

The lynchpin to an economic rebound is the state’s public schools, says Anirban Basu, chairman and CEO of Sage, an economic and policy consulting firm, and a former Baltimore school member. Maryland public schools don’t just teach more than 900,000 students, but in essence also provide free childcare for their working parents. In an interview with Baltimore, Gov. Larry Hogan asserted that schools will reopen this fall and that State Superintendent of Maryland Schools Karen B. Salmon “is working on a childcare plan.”

What that looks like, however, isn’t known. It’s likely to look different depending on the school district. St. Mary’s County, largely unaffected by the COVID-19 virus, may fully reopen, while schools in the Baltimore-Washington corridor might open at a half-day or every-other-day schedule, keeping parents in limbo. It’s a particularly complicated challenge for working women, still the primary caregivers in most households. Growth in the service professions has allowed women to overtake men as a proportion of the U.S. labor force. But it has also made them more vulnerable to job losses in this crisis because sectors with more women, such as education, leisure, and hospitality, have been hardest hit by the social distancing measures.

“An aggressive recovery isn’t possible without schools fully opening,” says Basu. “Unless that happens, you’re just fiddling around the edges. Mass transit is also an overlooked factor. Especially in Baltimore. If people don’t feel safe taking buses, the light rail, the subway, they’re not going to work.”

Local colleges are making tentative plans to accept students this fall as the state braces for flu season and a second COVID-19 wave, which if history is a guide, could be severe. With lower enrollments, fewer students in dorms, more online classes, and clubs and varsity sports cut to the bone—will university life resemble anything like it has in the past?

The other primary concern of economists and politicians: How do local governments manage their budget shortfalls? State revenues are projected to fall 30 percent this fiscal year, which begins July 1. How many teacher, civil servant, firefighter, police officer, and sanitation worker furloughs does that translate into? At best, according to Basu and Irani, we’re looking at a five-year economic recovery from the massive stay-at-home orders, which no doubt saved tens of thousands of lives, but also eliminated the gains made during the entire economic recovery since the 2008-2009 recession. Baltimore City Council president Brandon Scott says the city budget “can’t be balanced on the backs of those who’ve borne the brunt” of the economic crisis this time around.

“We can’t do what we did in the 2008-2009 recession and close rec centers,” Scott says. “The federal government has to help.”

Gov. Hogan, not generally a political ally of the City Council president, has repeatedly made the case for greater federal assistance as well. “I’ve spent my entire political career fighting for less government spending,” Hogan wrote in a June op-ed for The New York Times, pleading for more federal help. “But we’re not in a normal time, and the conventional political arguments just don’t fit this moment.”

Hornbeck, who has been principal at Hampstead Hill for 17 years, is from Baltimore and he’s not just concerned about his students, but their parents, some of whom have lost jobs. He worries about the impact on his students’ family life and stability. At best, Hornbeck thinks it could be the 2021-2022 academic year until everything at his school is back in full swing, even if students return to the building in some form in the fall.

“[Then] we can begin to understand what we’ve all been through,” he says. “There is trauma on so many levels, for staff and students, and families. You go back and forth thinking that things are normal—the weekends can feel slightly normal, but they’re just not. Nothing is normal right now. It’s a weight that adults feel, it’s a weight then that kids feel.”

Just as vital to reestablishing a sense of normalcy—and restoring Maryland’s economy—is the fate of Baltimore’s vital and diverse culinary scene, from the red sauce dining rooms of Little Italy to the gyro joints of Greektown to the scores of neighborhood pubs, trendy hotspots, classic crabhouses, and burgeoning Asian, Latin, and soul food restaurants.

Many restaurants with outdoor capacity began reopening at the start of June with the Governor’s formal “Phase I” easements. Other “non-essential businesses”—retail stores, manufacturers, offices, banks, and auto showrooms—were allowed to reopen later in the month. Fitness centers, malls, and indoor movie theaters remain closed. Churches may only hold services at 50-percent capacity, with face mask and social distancing requirements.

Eating indoors at restaurants remains prohibited and most remain a shell of their former operations. The restaurant business has suffered the most significant sales and job losses of any industry during the COVID-19 outbreak. Sadly, popular establishments, including City Café in Mount Vernon and Ryleigh’s Oyster in Federal Hill, have closed permanently.

In Baltimore, the verdict is still out on who will reopen, who will remain forever closed, and who will continue to find success with the myriad new business models—from high-end restaurants turned ad-hoc grocery stores providing prepared foods and pantry items (La Cuchara, Woodberry Kitchen) to places like Le Comptoir du Vin, which has been functioning as an online bottle shop, to temples of fine-dining such as Charleston in Harbor East and Linwoods in Owings Mills, which have been providing curbside carryout and recently added patio dining to their repertoire.

Even with new business models, not all restaurants will survive. Still, some see it as an opportunity for reinvention.

“People have to go out and socialize. Restaurants provide that space.”

“Out of the Great Depression came The New Deal and a lot of innovation, this is something that my wife, Amy, has brought up,” says Ben Lefenfeld, owner-chef of La Cuchara in Hampden-Woodberry. “I think that out of the coronavirus you’re going to see a little bit of a renaissance. You’re going to see people thinking about different ways to approach the business of owning a restaurant and it’s going to change the overall landscape for the better.”

Despite the difficult days ahead, Le Comptoir du Vin’s owner-chef Will Mester remains bullish on restaurants. “There’s going to be a lot of restaurants that close [including] a lot of restaurants that we love . . . and that’s really sad,” Mester says. “But restaurants are too old, they are too important, they will survive, and things will get back.”

Mester notes that a lot of people are trying to figure out what’s going to happen to restaurants—a kind of canary in the coal mine of city social life and economic activity. “[Restauranteur and author] David Chang thinks that food is going to revert back to the ’80s or ’90s when there weren’t as many options and big chains [ran] things, but I can’t imagine that people in Paris are wondering about the fate of their restaurant culture,” Mester says. “It’s so tied into everyday life. It’s the fabric of those cities and they are just as important here. People have to go out, they have to socialize. Restaurants provide that space. This is what cities are all about.”

Despite the devastation, Sergio Vitale, of Aldo’s Ristorante Italiano, echoes Lefenfeld and Mester’s optimism.

“As rents reset, there will be another opportunity for a [dining] renaissance that we’ve seen in Baltimore recently,” Vitale says. “People will start to see opportunity for small, 500-square-foot, or 1,000-square-foot models, maybe delivery and curbside oriented.”

The economists, Basu and Irani, agree that out of every crisis comes new opportunities. Remote working is likely to continue, which could lead to new innovations in technology—expanded broadband, for example. While its tourism industry is taking a huge hit, Baltimore is well positioned for a bio-medical boom with University of Maryland and Johns Hopkins research campuses in the city.

Hornbeck, the longtime Hampstead Hill principal, certainly expects online education to improve. It may never be a gamechanger for pre-K though grade 8 education, but it will likely continue to develop and assist higher education and professional training curriculums.

Both note that some older businesses, local grocery stores and bicycle shops to name two, have already witnessed huge, unexpected revenue gains. The few drive-in movie theaters left, like Bengies in Middle River, expect a resurgence. Old-school canning and jarred good companies are making a comeback with more people cooking at home. Another encouraging sign: Commercial real estate rents are already falling and interest rates on loans remain low.

“Who will be the person most likely to open a new restaurant?” Irani asks rhetorically. “Someone who has opened a restaurant in the past. Entrepreneurs are dreamers. It may take time, but they find a way. They find a niche that isn’t being served.”

Vitale notes that fine dining is a particularly challenging arena, both because of concerns about the spread of COVID-19 indoors and because the whole model has been under assault for years with razor-thin margins. The current crisis only exacerbates the underlying problems.

But he believes things will percolate up.

“After the initial shock, how the restaurant business will re-engage is small, less expensive and open [air and floor] models,” Vitale continues. “Why do you go to a city except to dine well and to have an opportunity to see some culture in the company of like-minded people? Isn’t it an ancient Greek who said all good things of this earth flow into the city?”