Will coronavirus destroy the global economy?

As global industry shuts down, so does the economy

Question: Will coronavirus destroy the global economy?
Position‹2 of 4›: The coronavirus will destroy the global economy
Argument1 of 3›: As global industry shuts down, so does the economy

With factories and offices being closed to limit the spread of the virus, global economic collapse is unavoidable.

The argument

China is a major part of the global supply chain. Companies like Apple and Huawei - who rely on trade with China to maintain distribution - have already experienced disruptions in their earnings. China is also one of the largest importers of oil in the world, meaning that global oil demand has decreased significantly. Many of developing or emerging economies are deeply affected, and so are especially vulnerable to change and volatility. China is shutting down major parts of its industry. When Chinese industry shuts down, so does global industry. When global industry shuts down, so does the global economy.

Premises

[P1]China is a central node in the global supply chain and a top importer of commodities like oil. [P2] The coronavirus is forcing China to shut down major parts of its industry, already disrupting major companies' earnings and global demand. [P3] When Chinese industry shuts down, global industry and especially vulnerable emerging economies shut down with it. [C] Therefore, the coronavirus will destroy the global economy.

Counter-arguments

Critics reply that the chain from 'China shuts down' to 'the global economy is destroyed' overstates both the permanence and the magnitude. Supply chains adapted and diversified, and unprecedented fiscal and monetary support cushioned the shock, so disruption to some firms' earnings is not the same as economic destruction. 'Destroy' is far stronger than the severe-but-recoverable recession that actually followed — economies contracted sharply and then rebounded — and the cascading 'when one shuts down, all shut down' reasoning ignores substitution and policy response.

Rejecting the premises

[Rejecting P1] China's centrality is real, but supply chains substitute and diversify, so a shutdown disrupts rather than halts global industry. [Rejecting P2] Disruptions to some firms' earnings are not economic destruction; unprecedented fiscal and monetary support offset much of the shock. [Rejecting P3] The cascading 'when one shuts down, all shut down' chain ignores substitution, stimulus and recovery, which is why the outcome was a deep but recoverable recession. [Rejecting C] Severe disruption did not 'destroy' the global economy, which contracted and then rebounded.