It's Wednesday and there are a few topics that caught my attention this week as…
There is no inevitable trade-off between saving the lives of the aged and economic prosperity
Many issues that become ‘hot topics’ in public debates are really non-questions despite the heat they raise. All sorts of experts advance views, television current affairs programs trawl over them with various of these experts making careers for themselves, politicians take up hours of their time and our time discussing them, yet, when you really break the issue down – there is nothing much to see. The seemingly very erudite debates, discussions, opinions are all based on false starting premises, which are assumed and rarely discussed. This sort of charade is all the legacy of living in the fictional world created by my profession, which has distorted public discourse so badly that we now have people saying old people should be allowed to die terrible deaths from COVID so the young people can have jobs. These are old people who worked all their lives to help build our nations, who fought in World Wars to defend our freedom from daunting enemies, old people who cared for us personally, and old people who mostly, probably, have the joy of life before them each day they open their eyes, just like any of us. The problem is that the whole construction is based on a false premise: being that there has to be widespread economic damage if we choose to protect the health of our peoples. That premise is based on the failure to understand that the currency-issuing government can attenuate any economic losses if it chooses to adopt appropriate economic policy interventions. The fact that real GDP and employment has fallen significantly this year is testament to a failure to use fiscal capacity. We should be better informed before we get into elaborate but flawed debates that essentially come down to turning one population cohort against another.
Here is a case in point.
There has been a lot of noise in recent months about the decision by our State and Territory governments to impose lockdowns and close the internal borders within Australia.
The most attacks have been made against Victoria, which is the only jurisdiction that has endured a second-wave, as a result of breaches of quarantine breaking out into wider outbreaks.
Fortunately, that wave is now under control and only 11 new cases were recorded yesterday.
It won’t be long now before our internal borders open again after 6 months of closure (with some exemptions).
It has been a very painful exercise in terms of the way the restrictions have impacted on our lives. My own life has been substantially altered and I haven’t been to my Melbourne office since early June.
The business community, as always, have been vocal in their criticism, claiming that the state/territory governments should be opening up like the rest of the world to allow them to make profits.
The federal government, supporting the business community, has been claiming likewise, but knows that under our Constitution they cannot command the states/territories to reduce the restrictions and open the borders. These powers are assigned to the sub-federal governments as a quirk of our creation.
Interestingly, but not unsurprisingly, the critics offer no solutions to the reality that Europe and the UK are now seeing – that if you open up and allow freer movement of people, without adequate testing and follow-up capacity, then a second-wave follows quickly which is worse than the first.
And the death rates start spiralling again.
They just want profits!
The more sophisticated critics hide behind sophistry and false premises to push the argument that lockdowns are worse than spirally death rates.
There was an article in the media over the weekend (September 19, 2020) –
– Melbourne Uni chief says Victoria must address difficult ethical questions – along these lines.
The Vice-Chancellor of the University of Melbourne is the highest paid University head in Victoria (receiving $1.499 million per year against the average full-time earnings in Australia of $82,436)
You can read about the way the bosses of Australian universities have feathered their own nests in this article (among others) – Overpaid university bosses cry poor as their foreign-student riches evaporate (April 18, 2020).
It is one of the ways in which neoliberalism has undermined the fabric of our higher education sector.
But that is not the point of this blog post.
The Melbourne University VC (who is a microbiologist) claimed that:
The question everyone is skirting around here is what is the appetite in any country for disease and mortality associated with this virus …
Every answer to that question is valid in one way or another. If you were to say we have no appetite whatsoever for any deaths from this virus, that is a perfectly reasonable position to take, but you have to take that position knowing the consequences …
If that decision stops people dying now from the virus, what are the economic consequences of that for people and how will that play out in terms of future mortality?
I discussed these issues in this blog post – Academic freedom requires evidence and knowledge – not a desire for headlines (July 28, 2020).
The VC fell into the ‘economists’ lair by claiming that governments “must consider the role of quality-adjusted life year (QALY), a unit of measurement used by economists to predict and assess the impact of health policies. In simple terms, it assumes that a life near its end, whether because of disease or advanced age, is empirically different to a healthy life closer to its beginning.”
He expressed it in this way:
It boils down to a basic but very hard moral philosophy: What is the value of a 90-year-old’s life versus the value of the continuing livelihood and happiness of a 25-year-old?
The article talks about the Australian response – “broad suspension of commercial, educational and social activity to reduce the spread of the virus” as being in “contrast to the approach being taken by European nations such as France, the UK, the Netherlands and Austria, where governments are resisting a return to lockdown despite facing substantially higher COVID case loads, and deaths, than we are.”
The Melbourne University VC was quoted as saying the European nations have:
… got used to this virus being around and people dying from it.
Apparently, we are all going to die and protecting life has “consequences”.
He claimed it was an “an absolute tragedy that young people’s lives are being disrupted”, which is the line the critics are taking.
It is the line that those who oppose fiscal intervention use also – the debt burdens on our grandkids ruse.
But the whole discussion is based on a false premise that the VC of the University of Melbourne also fails to deal with.
There is the presumption that the choice is between lower Covid death rates and higher economic damage – and the Australian governments have not made a valid case for choosing the former over the latter.
Apparently, the European nations, by resisting further lockdowns, are allowing their citizens to enjoy better economic outcomes as they adjust (become inured) to the result (much) higher death rates.
Well, before we deal with the false premise that underlies all these discussions, we can have a look at some evidence.
The conclusion is that the evidence base doesn’t support any of these arguments.
Lockdown and GDP performance
The University of Oxford has published a very interesting dataset – Coronavirus Government Response Tracker – which, among other indicators provides “stringency and policy indices”, that combine a number of “government response” indicators (17) to come up with a summary measure of tightness of lockdown.
The OECD provides quarterly GDP figures – HERE.
And Our World In Data – provides extensive datasets on coronavirus incidence – Coronavirus Pandemic (COVID-19) – which are updated daily.
The following graph shows the relationship between lockdown stringency (index points – higher tighter lockdown) and the quarter-two 2020 real GDP contraction (in per cent).
The red diamond is the average observation for these OECD observations.
The dotted line is the simple linear trend.
The conclusion is that there doesn’t seem to be any clear relationship between the two series.
Countries like Australia had a similar economic contraction to Sweden, for example, with significantly tighter lockdowns.
Death rates and GDP performance
And what of the relationship between lost GDP and Covid death rates?
The analysis provided by Our World In Data – No sign of a health-economy trade-off, quite the opposite – provides an evidence base to answer the question:
Have the countries experiencing the largest economic decline performed better in protecting the nation’s health, as we would expect if there was a trade-off?
They explore the relationship between GDP loss and confirmed COVID-19 deaths per million people and find that:
… countries which suffered the most severe economic downturns – like Peru, Spain and the UK – are generally among the countries with the highest COVID-19 death rate.
And the reverse is also true: countries where the economic impact has been modest – like Taiwan, South Korea, and Lithuania – have also managed to keep the death rate low.
There are many examples, also of quite varied death rates yet similar economic contractions.
The conclusion, based on the evidence to date, is that there is no visible “trade-off between protecting people’s health and protecting the economy”.
It is possible, they conclude, that “countries controlling the outbreak effectively may have adopted the best economic strategy too.”
In terms of the OECD data set that the first graph (above) was produced, the next graph shows the relationship between real GDP losses in the second-quarter and the death rates per million to date from Covid.
In this restricted set of nations, there is more likely to be a negative (inverse) relationship than no relationship (as indicated by the dotted, negative) trend line.
That line suggests that the deeper the recession the higher the death rate.
I always caution against drawing too much from cross plots like this.
Fortunately, the datasets provided above allow us to do more complicated statistical work, which I am doing at present and will report back if I find anything interesting.
There have been a number of studies to date which have investigated these type of issues.
country-specific Susceptible-Exposed-Infected-Recovered (SEIR) models
Many find, overwhelmingly that the lockdowns saved millions of lives and this depended on timing of the restrictions and the severity of them – “earlier lockdowns would have increased social welfare tremendously” (Source).
Undoubtedly, more evidence will be forthcoming as the datasets improve and the time series extends.
Who will die?
When I was a graduate student, a particularly odious senior academic in the department used to sit in the tea room of mornings waxing lyrical about how all jobs should be open to continuous competition, so that workers should not enjoy any protections from legislation from summary dismissal.
I remember I said to him one morning that given his publication record (virtually zero), his lack of competitive grant success (a key indicator of research capacity), his lack of PhD graduations (another key indicator) and his somewhat dubious teaching record, then I thought if his job was open to competition (rather than being protected by university tenure arrangements enforced by law) that he would be on the unemployment queue immediately.
He huffed and started raving on about experience and respect.
Fraud!
In the same vein, I wonder, as a mental experiment, that if we had a public ballot for those who would have to die, whether these critics would have the same view.
We would not!
The false premise
Finally, the sort of ‘moral’ or ‘ethical’ debate that the Vice Chancellor was proposing and is emerging as a regular discussion topic in the press, is clearly based on the false premise that there is a trade-off that cannot be altered by government policy.
Imagine how we would construct this discussion if everyone understood clearly that national governments could make up any income losses resulting from lockdowns and prohibited behaviour under the health plans.
Would we then be proposing deep ethical discussions about whether the younger members of the population should be allowed to kill off their parents because their on-going lives a damage the children’s futures?
I doubt it.
It is the same sort of syllogistic error that enters discussions about how to deal with mass unemployment or poverty or climate change challenges and all the rest of the issues that get placed within a logic framework constrained by a mistaken belief that the national government cannot afford to purchase anything that is for sale in its own currency and must therefore impose taxation or debt burdens on people that have long-term negative consequences.
We are continually being confronted with the syllogism that:
Premise 1: Lockdowns undermine the capacity of younger people to produce and earn income.
Premise 2: Lockdowns protect the lives of older citizens.
Conclusion: Therefore older people are being kept alive at the expense of younger peoples’ future prosperity.
The argument as it stands is logically sound but inherently incorrect.
Why?
Because Premise 1 is flawed and cannot be taken as an eternal verity that always holds.
The correct first premise is that: Lockdowns undermine the capacity of younger people to produce and earn income, if the currency-issuing government does not use its fiscal capacity to minimise employment and income loss.
So before we get into the deep ethical discussion about whose lives are more ‘valuable’ in our societies, which has been demonstrated to be highly divisive and even promoting aggressive, anti-social behaviour (see Being called ‘bitch’ in the street? Lockdown fatigue is no excuse for this), we need to understand that the premise such arguments are based on may not be valid.
If there are two people isolated on a desert island with just enough water to keep one of them alive until the rescue ship arrives and one is old and the other young, then there is a valid ethical discussion to have about which one gets the water.
But that highly stylised (and unrealistic mostly) argument does not apply in the real world, where there is no shortage of live-preserving goods and services and currency-issuing governments that can purchase them and distribute them according to need.
The whole trade-off argument between prosperity and saving lives is thus just a reflection of a deep ignorance of the capacities of the currency-issuing governments in our nations.
The extent to which economic losses occur as we save lives through the lockdown are just a reflection of how effective the policy intervention has been.
Those governments that have penny-pinched, such as the Australian government, will see deeper losses arising from the lockdown.
Those losses were avoidable and nothing to do with prioritising the lives of the frail and the aged over the future prosperity of the youth.
Indeed, neoliberalism, which biases fiscal policy towards austerity has already done a good job of undermining the prosperity of our children by cutting education and training, allowing go-nowhere gig jobs to proliferate, and not addressing the climate emergency.
Conclusion
The empirics show that the idea that those who had less stringent lockdowns have done better in economic terms is flawed.
Moreover, all the debates that are emerging about valuing one cohort’s lives over another are just reflecting an ignorance about what the national governments are capable of.
This is not the first time this ignorance has distorted the public debate and undermined a progressive response to a crisis.
That is enough for today!
(c) Copyright 2020 William Mitchell. All Rights Reserved.
There is an article in The Conversation today by Tony Makin titled: “Yes government debt is cheap, but that doesn’t mean it comes risk-free”. I would say it is one of the worst I have seen so far on that site. It includes a standard rendition of the loanable funds theory, and uses Italy as an example of the dangers of rising public debt because “when lenders get worried about rising public debt, they demand a risk premium”.
The icing on the cake however is the image behind the title – a big stack of gold bars.
I agree Allan. I could not believe that the Conversation actually published it. Terrible nonsense.
I think this reflects the deluded but profoundly deep-rooted neoliberal mindset that all government intervention is “weakness”, and that any state action directed at assisting regular people must necessarily cause them to become “weak” (saving old people’s lives = “weak”, pushing young people out to work unprotected in a pandemic = “makes them strong”). Yet the reality is, as you show, that those nations which have responded with both i) effective controls on the virus and ii) generosity of spending directed towards ordinary citizens are the ones which are truly “strong” and “resilient”. My goodness, even McKinsey’s are saying that you can’t reboot the economy without getting COVID under control effectively…
https://www.mckinsey.com/industries/healthcare-systems-and-services/our-insights/COVID-19-Saving-thousands-of-lives-and-trillions-in-livelihoods
But it’s been a hallmark of late-stage neoliberalism that authority figures with no expertise in economics (such as University VCs, the inhabitants of research funding bodies, senior doctors, you name it…) feel entitled or even obligated to share their wisdom on economic realities as essential truths. As a health economist myself, the current crop of COVID-related exhortations is especially irritating!
Your point is equally valid but the quicker way there is that objectively, the people in charge in every country want everyone who isn’t a billionaire dead, the quicker the better.
UserFriendly
When all the non billionaires are dead the billionaires will definitely be on borrowed time because most of them would struggle to tie their own shoelaces.
That some lives are worth more than others based on economic, and other grounds, was popular thinking within certain parties in Europe, leading up to and during the second world war, and it would be wise for politicians not to follow in those leaders footsteps in order to appease the like minded who exist today.
The situation on the RMS Titanic springs to mind as well.
That sort of thinking is a non sequitur in the current situation, because we simply don’t know what the long term consequences are for younger people who become infected.
I know of people in their late 20’s and early 30’s who became infected, got very ill, although not life threateningly so, and now, 6 months later, have ongoing neurological and other serious problems, which may well affect their health for life.
So loosening things up to the point were the virus can spread may save businesses in the short term and leave us with legions of health compromised individuals for the longer term.
It looks like we are all in for a rough go the next few years. There are very credible voices among virologists, who, based upon recent research, are suggesting that any immunity surviving an infection brings, may be as short lived as 3-6 months; therefore herd immunity doesn’t seem to exist.
This makes one wonder how long we would have immunity due to a vaccination, should a safe and effective one ever be developed?
No safe and effective vaccine has ever been developed in less than four years; it’s not a matter of how much money governments can throw at the problem.
A strong public health system seems to be the most valued asset for those places that still have one; and masking while indoors or in areas were distance from those not within our own personal “bubble” seems to be the only tool available for minimizing the risk of serious infection.
J Christensen’s honest and perceptive comment further strengthens the compelling case for the implementation of the macroeconomic policies Bill advocates. I would go so far as to say that the ONLY way that humanity will be able to deal responsibly with the Covid pandemic and its socioeconomic repercussions is to use the effective vaccine and treatment already developed and available: the medicine of MMT. The first country to take the MMT approach will become the model for the rest…assuming that reason ultimately prevails. And yes, I know that’s one hell of a big assumption right now, but just wait until the catastrophic long-term consequences of Covid, economically if not medically, become crystal clear to almost everyone. I don’t think we’ve BEGUN to see 21st Century civil unrest in its full, frightening glory.
‘The correct first premise is that: Lockdowns undermine the capacity of younger people to produce and earn income, if the currency-issuing government does not use its fiscal capacity to minimise employment and income loss.’
I get that a currency issuing government can use its fiscal capacity to minimise employment and income loss, but I’m not sure (and you may not be saying this) that that capacity can be used to keep production, even if diverted to other uses (which makes comparative measurement dificult), at the same level. A lockdown which keeps people at home means people who can’t work at home, can’t work, even on a government scheme. They can be paid by the government to stay at home. Seems to me this is completely worthwhile and financially possible, in order to drive virus circulation out so that the economy can carry on before (or preferably with a job guarantee and green agenda), but without a resurge. China, for the moment, is an example of doing lockdown sufficienty so that the economy, schools etc can fully function again. And what rate should the government pay to keep people paid during lockdown. Yes people still have mortgages to pay but not work related and most leisure expenditure, so if everyone is kept on their previous wage/salary level, some simply accrue more savings (which being only a little flippant, then enables them to fly abroad or travel to the beach and pub as soon as restrictions are lifted and increase the potential for a further virus surge).
In the US, it is easier to see what is going on. The people who say this are not to be taken seriously.
USA spends so much on wars and bailouts, you never hear them proposing cutbacks on those.
Complete frauds.
Don’t know about Australia though. What is the biggest parasite there? The banks and then actual capitalists as runner-up?
VC is wrong that USA has always had a plan or that somebody thought about a trade-off. We have never had a plan or could we have carried out anti-viral measures any differently. It is a dumpster fire.
Great data to prove their non-sense about trade-offs. Bravo China.
Thanks for sharing that moment when you stood up to that heartless academic. I wish I was there. =)
In the UK David CaMoron (sic-or maybe ‘sick’?) came out of his financialised bunker to repeat some abominable crap about his presiding over disastrous austerity was proved even more worthwhile given the Covid expenditure,
I’ve not yet seen any significant challenge in the press-it just keeps drearily going on and on.
Being pragmatic, I would say the current situation is more or less like this:
Premise 0: Current government is run by neoliberals voted by the people. People will vote again, in the next elections, for a neoliberal government.
Premise 1: Lockdowns undermine the capacity of younger people to produce and earn income. (Consequence of Premise 0, as neoliberal governments do not use its fiscal capacity to minimise employment and income loss)
Premise 2: Lockdowns protect the lives of older citizens.
Looking at the two graphs, kindly presented and analysed by Bill, I can see that it does not matter how much stringent the lockdowns are, the effects on GDP are quite similar (in the first scattered plot, and drawn line, from the first graph).
But looking at the second graph, I see more of a vertical line running through the scattered plot. Meaning, whether you have high, medium, or low death number, the impact on GDP is similar (-10%, give or take).
Taken the two graphs together, they say that one would prefer a moderate to strict lockdown, less death, and lower GDP, than any other scenarios, I would say.
Thus, this suggests that, the best strategy to handle the economy is the one outlined by Bill which is supported by many commentators on this blog (by relying on the capacity of the currency-issuing government to boost domestic consumption by creating local safe jobs in the affected sectors/areas/groups of population urgently).
Personally, I think the support should be planned for at least 2 years, because we have not seen the light of day yet. The peak is still to come from the look of it. I believe it will take the same amount of time to come down from the peak (based on my assumption) for the pandemic to be tame.
I am curious however, how one supports say, the airlines, which we probably regard as essential infrastructure, but were caught off-guard carrying large debts which I presume are partly in foreign currencies, and/or are owned by foreigners. And is it easier to offer financial support to the 20% of Australians who own a second house, I’d guess usually under mortgage, via rental assistance for their tenants, or force banks to somehow forgive a 12 or 24 month slice of the total loan?
Elsewhere,
https://clubtroppo.com.au/2020/08/20/professor-fosters-cost-benefit-analysis-for-the-victorian-parliament/
the economist Paul Fritjers has tried to justify a cost-benefit analysis of lockdowns in precisely the way Duncan Maskell did in the discussed article. But these are the methods we currently use for deciding on expensive cancer treatments – why are these the standard approach for the Therapeutics Goods Administration, say, but not for decisions about nonpharmaceutical approaches to the coronavirus epidemic? And we do have the problem of real-life failures of application – if there hadn’t been the hotel lockdown failures we in Australia wouldn’t be discussing this.
“The conclusion is that there doesn’t seem to be any clear relationship between the two series”. (Bill)
Which – I suggest – refutes widespread comments (eg from the likes of Elon Musk – who I hope will board his own spacecraft – to Mars, the nearest galaxy, or wherever – and never be seen or (best of all) heard-from again) *but also in some Comments sections of Bill’s blog* although not by Bill himself, to the effect that the efforts of governments through lockdowns etc to protect their populations were wildly out of proportion to the threat posed and an unnecessary restriction on business’s freedom to subject employees (and their families) to risk of infection, severe illness and possible early death.
Even without the evidence Bill presents of the paucity of evidence for direct correlation between relative stringency and GNP-effect of the measures taken, I must say I was always suspicious about the sceptics’ case which – where not patently self-serving (as with Trump, Musk and others) – seemed to me to be more influenced by obsessive rationalism than respect for life.
Surely, it always was better to err on the side of caution? (although in all honesty I must make a disclaimer:- personally. I’m in the age-group subject to the highest risk of death from infection).
“Surely, it always was better to err on the side of caution?”
Very much depends what you mean by caution. Does that include shutting down schools and universities and permanently disadvantaging the young. Removing years of work, from which they develop the skills to move up the tree, meaning they will be permanently short skilled throughout their careers.
There are a million ways to lose a day’s output, but none to gain one.
We can err on the side of caution by stopping absolutely everything and wrapping everybody in a bubble. But that then starts to look remarkably like how they run China. Is that what we want? Some political operators certainly want it to go that way.
Sweden is to Coronavirus what Japan is to neoliberal economics. It shows how the prevailing mindset does not fit the narrative. No sign of the fabled “second wave” there, and no sign of any excess deaths on the EUROMOMO data. In fact it is right at the bottom of the usual range.
Beware the Groupthink. There is hysteresis here and path dependency and we have to be careful we are not sacrificing human capital improvements chasing a ghost.
Hi Neil. You write: ‘There are a million ways to lose a day’s output, but none to gain one’. What output?’ I’d say, during the lockdown in the UK, as everywhere, we gained a whole lot of cleaner air, we’ve had more conversation about the country’s past and our potential future/output (a necessary planning stage) and I personally have put more time into learning Chinese (越来越好). What the UK was producing before lockdown appears to me to have produced ever more crumbling infrastructure, obesity, social division and environmental destruction. It’s true the lockdown and subsequent opening up haven’t resulted in a reset and rethink, but it has exposed the shambles of the present system, which is a start.
You write: ‘We can err on the side of caution by stopping absolutely everything and wrapping everybody in a bubble. But that then starts to look remarkably like how they run China. Is that what we want?’ Had I been in China during the lockdown, I wouldn’t have been able to go out for a daily walk or run. Here I was. And a lot more people got into cycling, which will have future health and output gains. That amount of freedom was entirely sensible. On the other hand, Chinese people (of course not ethnics in Tibet or Xinjiang) have had their everyday freedoms back in place for a while now, with full classes at schools and universities and people back in paid productive and unproductive work. The Swedish model is an alternative, but one British people seem even less likely to be able to adapt to.
Neil, there is a great deal of groupthink in Sweden and I have not seen good enough data to enable me to say what the situation is in Sweden (FT’s recent data is not finely grained enough); and death is not the only consideration regarding how careful one ought to be re covid 19.
“there is a great deal of groupthink in Sweden”
There’s a great deal of groupthink everywhere.
Yes- it is better to err on the side of caution when dealing with a highly infectious disease that has already killed hundreds of thousands.
Flip the scenario Neil- what if the disease killed the young fairly often but had little effect on older adults? Except that they could transmit it to the young. It still makes sense to limit some adult activities that provide pathways for infection. Would we be talking about how unfair it was that adults were having to sacrifice some things in order to save children? I doubt it- we do it all the time anyways.
And nobody is talking about permanently closing schools or universities in any case. And they are open around here in one form or another anyways. What is this irreparable harm being done by trying to be cautious?
“There are a million ways to lose a day’s output, but none to gain one.” Sounds profound. But ever heard about working over the weekend? Cutting a vacation a day short next year? Many ways to regain a day’s worth of output over a lifetime.
“Sweden is to Coronavirus what Japan is to neoliberal economics. It shows how the prevailing mindset does not fit the narrative. No sign of the fabled “second wave” there, and no sign of any excess deaths on the EUROMOMO data. In fact it is right at the bottom of the usual range.”
Isn’t Sweden demographically somewhat different to other European nations, in that they already are to some extent socially distant. At least that’s how their epidemiologist explained it, although he did say they made mistakes in shielding the elderly.
I don’t think Sweden’s stance was repeatable by the UK. The trade off was not so much saving lives versus the economy, as preventing the NHS from being overwhelmed.
The lockdown was pretty much timed down to the limit, another week and as I understand it, and NHS capacity would have been exceeded. (we also got pretty close to running out of mortuary space, and my local airport was requisitioned after the ice rink filled up).
Now we are facing a so called second wave in the UK – it isn’t a second wave, it’s still the first one, which never actually died out, and it’s not like this wasn’t predicted – it’s a virus, it spreads through social contact, wind down your social distancing measures and it just takes off again – I felt the Government in particular with regard to their messaging did not seem to understand this, or or least felt that reopening the economy was more important.
And yes… Bob’s point about the fiscal capacity of the Government is clearly not being heard by balance the budget Rishi Sunak, refusing to extend the furlough scheme while Johnson is increasing restrictions on the hospitality sector. (I think we have the traditional battle for supremecy between no 10, and no 11)
“Sweden is to Coronavirus what Japan is to neoliberal economics.”
There may not have been an official lockdown, although guidelines were issued.
It appears people at large did modify their behaviour and effectively self imposed a lockdown.
The stringency index seems a very difficult concept.
Some measures might prove much more effective than others in containing the
virus or suppressing economic spending than others. Dynamic interconnected
systems resist causality.
Then of cause there is the question of compliance with recomendations or laws.
So much easier to suppress the disease when cases are relatively low .In the UK and much of Europe we seem to be slamming the stable door after the horse
has bolted .
Of course the recognition of monetary sovereignty would cut through the false
dilemma of health vrs economy although practically it might have as much UBI
as JG in its application.
There is a different trade off between quality of life and illness risk.
Take one example in the uk ,those protected in care homes are denied visits
from loved ones who have been central to their care and wellbeing.The extra suffering of the old ,paticualrly patients with dementia I find very distressing and cruel.
I must admit to be getting a little restriction fatigue ,if an effective vaccine is many years away or just not possible for a corona virus and the only way of
suppressing the virus are stringent lockdowns especially in countries which have
failed to suppress viral spread then some discussion of a trade off between and risk and quality of life not least for the most vulnerable is valid
“what if the disease killed the young fairly often but had little effect on older adults? ”
You mean like most infectious disease in history? When did we stop society because those under five died of measles, mumps, diphtheria, etc. etc. We soldiered on, accepted the losses and worked tirelessly to reduce them over time.
The figures doing the rounds today is that only 600 people in the UK under 60 who were previously healthy have died from Covid since February. Yet millions and millions of people have had their lives put on hold. And now fatigue is setting in. The grumbling is getting louder.
We really don’t want the majority in society, who are essentially unaffected by this, to turn around and say “to hell with the sick and the elderly – let them die”. That take us to a very dark place indeed.
We have to remember that the elderly and the infirm are maintained by a delicate social contract. Constantly stitching up the young will eventually lead to a backlash. And there are more young than old. They can go there is they decide to do so.
And there are actors out there pointing this out to GenZ over social media. The elderly and sick are a burden and if there are fewer of them you get your inheritance sooner. Think how that sits with the self centred “anti-work” brigade.
“. What is this irreparable harm being done by trying to be cautious?”
According to education experts they had to remove the option to provide two weeks holiday per year because any interruption caused irreparable harm to children’s education. The move to shrink the summer holiday is because of the amount of learning that is undone in seven weeks that is less so in five.
Why are the education experts wrong about that all of a sudden after years of altering legislation in the other direction?
” Many ways to regain a day’s worth of output over a lifetime.”
For every hour of overtime there is always an hour of undertime. A day lost is always lost forever.
In system thinking we call the attitude that you can recover time after a negative shock a “death march”. It never works. It’s yet another belief that persists despite mountains of project overrun evidence to the contrary.
It’s why we push for a Job Guarantee rather than just a better form of unemployment allowance. Because the long term unemployed suffer skills atrophy while out of the loop.
Once you fall behind you can never catch up in aggregate. That is the “hysteresis effect” in action and shifts us to a permanently lower future.
I don’t think there is really a trade off to be had, economic prosperity versus old people dying… which is not old/infrom people dying, it’s actually old/infirm people dying earlier than they otherwise would have done – this is what these excess deaths figures are.
I don’t think the Government really understands how a virus works… seemed to me they were like “yay we’ve beaten the virus, lets get back to normal,” what was it “back to normal by christmas” from our war metaphor loving PM.
The reason we have increased restrictions is because the Government strategy of local lockdowns, and test and trace have failed – viral infections are increasing exponentially again, which means that withiout action our hospitals, and mortuaries will be overwhelmed, and there would be a high risk of panic driven behaviour which would likely prove counter-productive.
@ Neil Wilson
“According to education experts they had to remove the option to provide two weeks holiday per year because any interruption caused irreparable harm to children’s education. The move to shrink the summer holiday is because of the amount of learning that is undone in seven weeks that is less so in five”.
Finland has consistently been coming at or near the top of the international league-table measuring the quality of countries’ education-systems. For all I know the methodology whereby that result is arrived-at may be flawed, but – flawed or not – it seems to command credence among educators.
Yet the long-standing custom throughout Scandinavia is for all schools to have an eleven-week summer holiday. I find those facts a bit difficult to reconcile with your statement.
“Why are the education experts wrong about that all of a sudden after years of altering legislation in the other direction?”
So, must all “experts” axiomatically be deemed to be right? presumably on the grounds that they’re “experts”? Who bestows that status upon them? Are there no instances where “experts” have subsequently been empirically shown to be completely wrong?
(I’d suggest that the above might be an example of just such a case).
“The move to shrink the summer holiday is because of the amount of learning that is undone in seven weeks that is less so in five”
This won’t be for all children, but there is a marked effect on chidren who receive free meals. During the summer holidays these children seem to go backwards… but this is thought to be caused by nutritional deficiency rather than lack of schooling.
Thank you for the reply Neil. Of course I don’t completely agree with you, but that is not unusual:)
As far as comparing this to infectious disease throughout human history, I would just say that there really wasn’t much of a medical understanding of germ theory until sometime in the 1800’s and viruses were not known to cause disease about until maybe a hundred years ago. Medical knowledge has advanced and it is not relevant to compare what was done about disease throughout most of human history to what can be done today.
There is also a gigantic difference in our economic circumstances today compared to most of human history. In the past, slowing down may have meant starvation or at least extreme economic deprivation for most. That is not the case today. We have options available that were not available previously.
Robert H expresses my view of the education experts better than I would. In the US many social/economic problems that children face are pushed onto school systems to deal with. And if schools were closed then those children suffer more. But those problems need to be dealt with in any event and they can and should be.
And sure, you would be logically correct about losing production time. If people were already working 20 hours a day, seven days a week, then losing a day of production just can’t be made up by working a little harder or longer in the future. But I’m not sure how that applies to the circumstances in most countries most of the time.
I would suggest another subtextual premise to the good VC’s reasoning.
Namely that a reduction in his earning capacity in his preferred field of endeavour necessarily constitutes a reduction in economic activity per se.
I wonder whether devoting even our entire productive output to dealing with COVID 19 could be seen as a reduction in our productive output?
Regarding the need to “pay our mortgages”, why can’t such arrangements simply be suspended completely for the duration? Why is unearned income the most sacred species?