Call it Inauguration Day in the Upside Down.
Thousands of armed, masked soldiers are replacing throngs of cheering spectators outside the U.S. Capitol. Twelve-foot-high fences topped with razor wire are towering over areas where viewing stands once stood. Armored personnel carriers are being deployed where buses filled with witnesses to history would park.
The quadrennial event that brought an estimated $1 billion in revenue to D.C.-area businesses in 2017 now looks to add insult to injury to the pandemic-battered regional economy.
Between coronavirus lockdowns and the deadly insurrection at the Capitol on Jan. 6, the National Mall is closed, indoor dining at restaurants is prohibited and stores are boarded up. Opportunities for an inaugural economic boost have vanished.
“During more normal times, inaugurations present a tremendous opportunity for businesses, especially those in hospitality — restaurants, hotels, catering companies and many others,” Jack McDougle, president and CEO of the Greater Washington Board of Trade, said Tuesday in an email. “Unfortunately, these companies are already amongst those struggling the most due to COVID-19, and heightened security measures this week aren’t helping.”
Inaugurations typically are multiple-day tourist attractions that raise hotel occupancy rates four to six times more than other major events, according to a recent study published in Sage Journals.
The short-term home rental platform Airbnb, which reported its “biggest night ever” for bookings in the District during the 2017 inauguration of President Trump, canceled and blocked all reservations this week because of security concerns.
Maggie Daniels, a professor of tourism and events management at George Mason University, said Tuesday that “with safety and security being the paramount considerations, all tourism sectors are impacted.”
“The loss of income will be felt most severely by hourly employees and gig workers who would generally accrue significant overtime wages as pertaining to the many events surrounding the inauguration,” Ms. Daniels said in an email.
Only 1,000 tickets have been distributed to members of Congress to attend the ceremony, compared with the usual 200,000. Soon-to-be President Joseph R. Biden’s primary audience as he takes the oath of office will be a “Field of Flags” representing Americans who cannot attend because of the pandemic and unprecedented security precautions.
The National Park Service on Tuesday reversed course and said no demonstrations will be permitted at park grounds on Inauguration Day.
Most of the traditional activities, such as the inaugural parade, balls and concerts, have been canceled or restricted by capacity limits or are being conducted virtually.
Road and bridge closures, coupled with public transportation service cuts and various security checkpoints along the city’s roughly 4.6-mile-square security perimeter, are making it difficult for anyone — residents, employees and visitors alike — to enter the city.
In addition, the FBI’s warning of the potential threat of armed demonstrators posing as some of the 25,000 National Guard troops activated for the inauguration has prompted officials to encourage visitors to stay away from Washington, all while the region’s businesses bear the brunt of the impact.
“In years past, the city and federal government spent money on inauguration security; in return, they usually received additional sales tax revenues from all the events associated with the inauguration,” Leah Brooks, associate professor of economics at George Washington University, said in an email Tuesday. “This year, the area is surely spending much more on security, and there is very little spending by the inauguration going into the local economy. In other words, a much worse return on investment.”
Congress approved the District’s initial request last year for $34.9 million to cover inauguration-related expenses. The lawmakers, however, have not greenlighted an additional $10 million sought in recent months for “the heightened number of First Amendment demonstrations we’ve seen,” D.C. Homeland Security Director Christopher Rodriguez said last week.
Mr. Rodriguez noted that Mr. Trump on Jan. 11 authorized a pre-emergency declaration for the city. The authorization means the federal government will foot the bill for any emergency protective measures linked to federal assistance through Jan. 24.
While the loss of revenue from the inauguration will be substantial, it is “tiny compared to the lockdown” overall, Anthony Yezer, a professor of economics at George Washington University, said Tuesday.
“Asking the economic effect of having no crowds for the inauguration on D.C. is like asking about the effect of a splinter in the hand of a person who has been shot with a gun,” Mr. Yezer said in an email. “Yes, the splinter is annoying but the patient is going to die from the gunshot.”
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