In a Pandemic, Professor Parente Goes to Washington
Tuesday, November 17, 2020
The $2.2 trillion Coronavirus Aid, Relief, and Economic Security Act (CARES Act) is one of the most important pieces of U.S. legislation passed thus far during the COVID-19 pandemic. A Carlson School professor played a major role in determining how to allocate these vital funds to hospitals when the first wave of COVID-19 cases surged across the country.
Stephen T. Parente, the Minnesota Insurance Industry Chair of Health Finance and associate dean of global initiatives, also serves on the White House Council of Economic Advisers (CEA). On the council, Parente and other academic economists advise the President on any and all issues affecting the economic vitality of the United States. A veteran of government service, Parente spoke about the process of distributing the funds and how the pandemic impacted the Carlson Global Institute (CGI).
Q. You were on the Council of Economic Advisers when COVID-19 hit. What was that experience like?
As COVID was unfolding, part of it became a question of not just having a typical report but actually looking at live data tracking metrics. I used a lot of connections that I had, from industry, consulting projects, and alumni to try to get as many live feeds as we could for free to try to understand where COVID was actually going so we could figure out economic activity. We then worked with the Coronavirus Task Force, giving them information and other projections.
Q. How did you come to be involved with distributing the CARES Act funds and how did you go about doing so?
The Department of Health and Human Services approached me and explained that they had just got allocated from Congress $100 billion to basically rescue the hospital industry, and they wanted to hear some of my ideas about how they could distribute that.
Politico stated I was one of the three architects on how we could get that money out. That was not fake news. Our first tranche of money was an overnight direct bank account infusion of $30 billion in early April to over 200,000 hospitals and medical providers in order to keep them operating after all of their normal revenue evaporated in late March from the nationwide shutdown. I felt I had a unique skill set for this process because even though I'm a health economist, I understand by osmosis how banking works, I understand the financial transaction structures, and I understand insurance companies. So, that was a really cool and rewarding rescue mission to the entire health economy to be a part of.
Q. Why is government service important to you? What keeps you coming back?
It’s the people. So many of the folks I work with are dedicated and brilliant. The conversations that I have with people are not very polarized. They are very much focused on problem-solving. Obviously, you’re going to come across some people who may frustrate you, especially when under time pressure to execute a deliverable, but the intense work builds cohesion, and perhaps after a libation or two over months and years of interaction they become akin to an extended family.
Over the years, there are so many things that I’ve thought the government should do. So, being able to bring those ideas to the table, work on them, and then see the impact they have on people’s lives is gratifying.
Q. You had just taken the new role at CGI before the pandemic hit. How did you all navigate our international programs and what’s it looking like now?
Working in Washington, I knew COVID-19 was coming and that we had to prepare. Then, after President Trump gave his speech on March 11, it was obvious that we had to basically airlift our students out very quickly. I think that it was fortunate that I knew a lot of the staff at CGI already. The CGI staff are just tremendous to be able to pull all of that off in such a short amount of time.
Going into the fall semester and with all of our international experiences now done virtually, it’s opened up a lot of options as to where we could take our programs in the future. With our strong partnerships around the world, the possibilities are endless.
This article appeared in the Fall 2020 Discovery magazine
When the COVID-19 pandemic hit, Carlson School faculty experts researched a myriad of aspects of the pandemic in real time. In this edition, you'll see how state and local governments dealt with the economic downturn, how that economic anxiety was worse for some individuals and groups than others, and how the Supply Chain and Operations Department shifted its research agendas and curriculum to help educate policymakers, media, and the public on how to address these issues.