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U.S. economy can 'sustain a 4-6 week lockdown': former NY Governor

Yahoo Finance’s Julie Hyman, Myles Udland, and Brian Sozzi speak with Former New York Governor David Paterson about the U.S. COVID-19 response, the 2020 election outcome, and more.

Video Transcript

MYLES UDLAND: Later today, we will see new restrictions in place as the governor, Governor Cuomo, tries to curb the spread of the coronavirus here in the state. And joining us to talk more about the state of the pandemic, the election, and much more is the former governor of New York, David Paterson. Governor Paterson, thank you so much for joining the program today.

So I'd like to begin, if we could, by talking about the situation here in this state, the response we've seen from the current governor's office, and the measures, I guess, that you believe need to be taken, should be taken, and how you view the current state of the pandemic, as I think concern certainly goes up here in New York City where I'm sitting.

DAVID PATERSON: Well, the governor took these same measures back in the middle of March and took New York, which had 800 deaths a day in the beginning of April, to almost no deaths a day by the beginning of August. So this is definitely the right way to curb the virus is to try to keep people away from each other and try to get the cooperation of the public.

I know people are tiring from this pandemic. But it's going to be with us for a period of time. There was a "New York Times" article in March of this year that leaked a federal document that was preparing for an 18-month reign of this particular virus. So you know, it's frustrating. But we're not out of the woods yet. But I think that the Eastern seaboard states took these actions last spring and really moved the needle.

But what happened was, around the country, for some reason, in the Midwest, in the South, and even in the far West, people did not heed the warnings. They didn't wear masks. They didn't social distance. They brazenly had big rallies with bunches of people not wearing masks. And they paid the price for it, as we now, every day, are setting a new record for infections in the United States.

JULIE HYMAN: Governor, it's Julie here. And you bring up a good point in terms of the fatigue that people have from this situation. And people in the New York area had been enjoying eating outside, for example, and some of them eating inside, as we've seen things loosening. Businesses have also had a lot of fatigue, right. And some of these restaurants had just started things sort of running up again and now are going to have to pull back to some extent.

What kind of economic damage do you think has been done to New York City and the New York region as a result of this? And how hard is it going to be to come back?

DAVID PATERSON: Well, the damage that we had earlier in the year, we may have again. Which is, first of all, people are going to start scrounging for supplies, the shelves of stores are going to be bare, that creates unrest among the shoppers. And so you have a supply shock. And at the same time, you have a demand shock. Because you have a lot of people saving money in this country.

That's why the disposable income went up, even as the unemployment rate was skyrocketing early in the year. So you have a supply shock and a demand shock hitting America for the second time in just six months. And I don't think it's ever happened before. So this is a monumental tragedy.

BRIAN SOZZI: Governor, Brian here. There are some folks in the Biden transition team pondering a four to six week national lockdown because of the rise in infections. Is that something you would support, even though it would come at the expense of the economy?

DAVID PATERSON: I think for four to six weeks, we could sustain it. Money is fungible. You can owe money. You can get into debt. Look, the country's $25 trillion in debt right now. And I think that-- but if it would save lives and it would help to reduce the virus, I would say end of January, early February would be the right time. Because that's when winter is starting to dissipate way. I would support it.

By the way, I think the Biden administration could take advantage of a huge opportunity. President Trump just today has banned investments in anything involving the Chinese military. And while President Trump always talks about China, he put a trillion dollars in the military and can't explain where all of it went. Well, where it went was rash decisions and not really addressing the problem with China, which he says he wanted to do.

The new president, President Biden, could address it right away by not rescinding that-- that executive order by the president. And that actually would change the dynamic. Because as soon as China saw what the president did, they went and called Biden and congratulated him. Because they're looking for help. And they shouldn't get it.

MYLES UDLAND: And, you know, Governor, I wanted to ask you about the election and about the president. Because if you go back to your time as governor of New York, you know all these characters, right. You know Donald Trump from what feels like a different universe. But of course, he was around. The Kushners have been around.

And I suppose as you've watched everything play out in the last five years, have you been, you know, shocked, appalled, not surprised by the way some things went? Because, again, for folks in the New York area, it's been interesting to watch these local figures all of a sudden become part of the national conversation.

DAVID PATERSON: Well, it's really been interesting for me to watch President Trump. Because I've known him since the early '90s. I wrote about him in my book. And he's a character. When I appointed a lieutenant governor, he wrote me a letter. And by the way, when you get a letter from the president, you don't get it on TV. I mean, you don't get it in the mailbox. It's on TV. He never actually sent me the copy of the letter telling me the guy was a jerk, and he was this and he was that.

And then when the lieutenant governor made a mistake one day, Donald Trump called me up to tell me, ah, this guy's terrible. I told you you shouldn't have taken him in the first place. But then he calls the AP and tells them that I agreed with him, that I wish I hadn't taken the guy in the first place. And that caused me a headache. But that's just part of knowing him.

JULIE HYMAN: Yes, that seems to be part of the way he does things. Speaking of which, I want to come back to that China point that you made for just a moment. Because that's really interesting that you think that Joe Biden should keep this order, which prevents investors in the US from investing in Chinese companies that support that country's military.

You know, there's been a lot of debate about how tough Joe Biden is going to be on China in the wake of President Trump's rhetoric on that subject.

DAVID PATERSON: Well, I think--

JULIE HYMAN: What do you think his is going to do? And what do you think he should do?

DAVID PATERSON: I think that a President Biden is going to do a lot of things that will appeal to Democrats who voted for him, 77 million of them, 5 million more than voted for the president. And a lot of them are going to be sort of progressive measures. But I've always thought that you've got to be able to do something for the 72 million people, which is the most that ever voted for-- second most that ever voted for a candidate in an election. They voted for President Trump.

Now China really is a menace that we have to confront over the next couple of centuries. President Xi of China said in 1998 at a communist conference that he wants to have world domination by 2049. He repeated it in 2018 at another forum as president of China. You can read what he said on the internet. It's there.

But you have to register and give personal information to the people who own the internet. And do you know who owns the internet? The Chinese government. So they aren't playing around. They are sending up satellites right now that could disable our satellites. What's important about that is our satellites are what would ignite a nuclear warhead if we ever got into a war.

So they could actually shut down a war before it even started, if we don't get what a danger they are. And it's not about liberal and conservative. They are just a straight out danger.

JULIE HYMAN: So that's one thing that you think that President Biden should be paying attention, David. But when you talk about all of the people who did not vote for Joe Biden, I mean, New York state is a really good encapsulation of that, right. Because you have downstate, you have New York City, although even New York City's bifurcated between the four boroughs and then Staten Island.

So when you look at how this president is going to have to govern the people who did not vote for him, what lessons can you take away from a place like New York State? What does Joe Biden need to do?

DAVID PATERSON: Well, one thing that he's doing right now, even before he becomes president, is he's paying attention to the pandemic. We haven't heard a word out of the president. He has totally gone dark on the issue that we have 70,000 people being infected today. And we're going to go over 300,000 people who've died in this country from the virus, over 11 million cases in the next two weeks. He hasn't said a word.

Right now, it's all about him and these voters who are supposed to overturn an election. He lost Pennsylvania by 55,000 votes. How are you going to document that there was fraud that created that problem?

MYLES UDLAND: All right, former New York Governor David Paterson. Governor Paterson, really great to have you join the show today, a lot of fun. Hopefully, we can have you back soon.

DAVID PATERSON: Thank you so much, all of you.