Month: March 2020
Governor Cuomo: Libertarian
NY State Governor Cuomo’s lifting of regulations to deal with the coronavirus emergency may be the most libertarian government document in a generation. Here are a few laws that have been suspended or modified:
Paragraph 1 of Section 6542 of the Education Law and Subdivisions (a) and (b) of Section 94.2 of Title 10 of the NYCRR to the extent necessary to permit a physician assistant to provide medical services appropriate to their education, training and experience without oversight from a supervising physician without civil or criminal penalty related to a lack of oversight by a supervising physician;
Notwithstanding any law or regulation to the contrary, health care providers are relieved of recordkeeping requirements to the extent necessary for health care providers to perform tasks as may be necessary to respond to the COVID-19 outbreak, including, but not limited to, requirements to maintain medical records that accurately reflect the evaluation and treatment of patients, or requirements to assign diagnostic codes or to create or maintain other records for billing purposes. Any person acting reasonably and in good faith under this provision shall be afforded absolute immunity from liability for any failure to comply with any recordkeeping requirement.
Subparagraph (ii) of paragraph (2) of subdivision (g) of 10 N.Y.C.R.R. section 405.4, to the extent necessary to allow graduates of foreign medical schools having at least one year of graduate medical education to provide patient care in hospitals, is modified so as to allow such graduates without licenses to provide patient care in hospitals if they have completed at least one year of graduate medical education;
Sections 3502 and 3505 of the Public Health Law and Part 89 of Title 10 of the NYCRR to the extent necessary to permit radiologic technologists licensed and in current good standing in any state in the United State to practice in New York State without civil or criminal penalty related to lack of licensure;
The only non-libertarian aspect is the word “temporary.”
Thursday assorted links
1. Less Wrong coronavirus database (now upgraded).
2. My 2017 video on The Great Reset. And David Wright podcast on how Covid hits the poor.
3. MIE: In Beijing restaurants “many delivery orders now often include cards listing the names and temperatures of all the staff involved in preparing your food.”
4. The limits of infrastructure stimulus. And the case against airline bailouts. And database of state quarantine regulations.
5. Paul Romer’s simulations for tests and targeted isolation. And more from Romer. And a third Paul Romer simulation: even an eighty percent false negative rate helps fight a pandemic. I’ll be writing more on this soon.
6. Health and pandemics econ working group. And Senegalese music video.
8. Cheap mechanical ventilators?
9. Someone wise once told me that you get into the most trouble/controversy making statements that (pretty much) everyone agrees with. Here is my Bloomberg column on university endowments, which endorses the policies of virtually all elite universities, and by extension their presidents and boards. Or for that matter virtually all businesses that have had to opt for lay-offs.
10. The problems of post-acute care.
11. During the shutdown, the creativity pours forth (Joseph’s Machines).
The coronavirus situation in Japan is probably much worse than you think
I have been corresponding with a working group regarding the covid-19 situation in Japan. They shared a draft of their white paper with me while attempting to circulate their revisionist conclusions in policy circles.
The speed premium is indeed increasing quickly. The white paper has not materially changed since when I first saw it. Since then, the Olympics were postponed and experts in Japan have described the outbreak as “rampant.” The working group feels that society needs to prepare, and that this outweighs the desire to wait for additional official confirmation.
The authors are an international team based in Tokyo. They cannot attach their identities to the white paper at present. They are not medical researchers. They have reviewed their conclusions with a medical researcher and others. You can weigh the evidence of their claims.
Here is the document (no, it is not malware), and here is the opening bit:
The governmental and media consensus is that Japan is weathering covid-19 well. This consensus is wrong. Japan’s true count of covid-19 cases is understated. It may be understated by a factor of 5X or more. Japan is likely seeing transmission rates similar to that experienced in peer nations, not the rates implied by the published infection counts. The cluster containment strategy has already failed. Japan is not presently materially intervening at a social level. Accordingly, Japan will face a national-scale public health crisis within a month, absent immediate and aggressive policy interventions.
There is a great deal of further detail, including the numbers, at the link. Sobering.
Safety Protocols and Zones of Quarantine
Carl Danner writes me:
“Essential activities” has no objective definition. It implies some blanket degree of risk acceptance that can’t be accurate by any underlying calculus, i.e. as if someone has specifically weighed whether we can tolerate these particular activities because they provide enough value to offset the incremental risk of conducting them. But the reality is more likely that those conducting most activities (including “essential” ones) are now undertaking risk mitigation measures intended to reduce the chance of virus transmission to very low or nonexistent levels.
What we need instead — and the logical place for governments to go in unwinding these blanket restrictions — is a recognition that any beneficial economic activity should be allowed if undertaken using a protection protocol appropriate to its particulars and sufficient to prevent virus transmission. This would get government out of the business of choosing which businesses or occupations are essential, vital, important or whatever — including all the problems attendant to making such discretionary determinations across the entire economy for a sustained period. Without that revised approach, we could start to develop occupational licensing/certificate of need type problems as a general feature of the economy.
In other words, this part of the virus response should transition to a health and safety regulatory concern that is important, but handled like most of the others. For example, poor food hygiene can also kill you, but governments generally don’t respond by deciding which cuisines are essential and which are not. Rather, anyone willing to follow the safety rules can put up any menu they want. So it should be for economic activities of all kinds.
We should not lift restrictions until the number of new cases is declining and low and we have enough testing capacity to squash new outbreaks. But we should start to think about what safety protocols may be reasonable in the future. For example, I think we could allow any firm to reopen that does not deal with the public and where all the employees wear masks. Any workplace that disinfects twice a day and checks worker temperatures might be another appropriate allowance. Another possibility is quarantining at work. I don’t see the latter as useful for most workplaces but for say a nuclear energy plant or air traffic controllers it might be appropriate to bring in mobile homes, as they do for fracking workers in North Dakota. Going somewhat farther afield we might use cellphone data to decide on zones of quarantine, e.g. home or work or driving in between. Obviously such systems can be spoofed but the point would be to offer this as a temporary and voluntary system to move towards normalcy.
Hat tip: Michael Higgins.
But *when* will you favor a shift in coronavirus strategy? (no Straussians in a pandemic)
I agree with the numerous sentiments, for instance as expressed here by Ezra Klein, that we are not facing a dollars vs. lives trade-off, rather the better solutions will improve both variables. Also read this Tom Inglesby thread. Furthermore there is a concrete path forward toward general improvement, for instance read Zeke Emanuel (NYT, I don’t agree with every detail but the overall direction yes). And don’t forget these costs cited by Noah.
But we are economists, not mood affiliators, and so we must address the classic question of “at what margin?” At what margin would you favor an actual shift in strategy because the virus already had reached so many people? And yes, such a margin does exist. At that margin we would continue some of our defensive responses, but the overall approach would have to change away from the above links.
Let’s say everyone had been exposed to the coronavirus except yours truly. Should we shut all (non-take out) restaurants just to limit my personal risk? Clearly not. And likely I would end up getting exposed sooner or later in any case. Then you should “let it rip,” and let Tyler decide when he wishes to go outside or not (but of course offer him health care).
So what is the margin of bad outcomes where, after that point, a major change in strategy should set in? Has to set in? That is the question we all need to answer. And what should that strategy change be exactly?
We like to say “speed is of the essence,” but a less frequent spoken corollary of that is “at some point it is too late to stage the defense we had been hoping for.”
What if we made no further progress against Covid-19 after two more weeks? Three more weeks? How about a bit of progress on testing across the next month and a modest increase in mask capacity? How much longer is the cut-off? Given how rapidly the virus spreads, it can’t be that long from now. It cannot honestly be “four months from now.”
(For the record, I am still optimistic, but not at p = 0.8, so this eventuality is by no means purely hypothetical. And it is perfectly correct to note that Trump’s own incompetence is to some extent making the whole dilemma come true, and that itself is deeply unsettling. Agree! We should have “gone Singapore” months ago. But the dilemma is now here nonetheless, noting that we are hardly the only country in this bucket. You can’t just condemn Trump and stop thinking about it.)
Or what if New York and seven other regions are hopeless but the rest of the country is not?
I am fine if you agree with me, Ezra, Tom Inglesby, Zeke Emanuel, and many others, including most of the Democratic Party public health establishment. We all favor “speed is of the essence.”
But the next part of the message never quite gets delivered. And no one wants to talk about what the next strategic stage — if we fail — should look like.
It is imperative that you consider where your line lies — if only mentally — when you would jump ship and indeed…confess a significant degree of defeat and then formulate and push for a new strategy.
Addendum: Straussian Tyler is not entirely comfortable with this post, as he, like his brother Tyrone, prefers to tell the Noble Lie and maintain the illusion that the preexisting struggle must continue across all margins and at all times. But perhaps, these days, there are no Straussians in foxholes. So pick your “no return” point, write it down, and then get back to me. The honesty of our policy response requires this, yes? I’m not even making you say it out loud.
And don’t you find it strange that no one has been willing to raise this point before? Could it be that we are not being told the entire truth? Or are people not telling the entire truth to themselves? Isn’t that the same mistake we’ve been making all along?
German Federalism
NPR: “We have a culture here in Germany that is actually not supporting a centralized diagnostic system,” said Drosten, “so Germany does not have a public health laboratory that would restrict other labs from doing the tests. So we had an open market from the beginning.”
In other words, Germany’s equivalent to the U.S. Centers for Disease Control and Prevention — the Robert Koch Institute — makes recommendations but does not call the shots on testing for the entire country. Germany’s 16 federal states make their own decisions on coronavirus testing because each of them is responsible for their own health care systems.
If only America had a federal system we might have had earlier and faster testing.
Quarantine markets in everything and stimulus at that
As countries in Asia impose stricter entry requirements on foreign visitors amid a new wave of imported coronavirus infections, hotels in the region are seeing unexpected opportunities as quarantine lodgings for travelers and workers seeking self-isolation venues.
Industry players say the unusual proposal of repurposing hotels as quarantine quarters is one way the battered hospitality sector could fill up some rooms and get much-needed revenue during such tough times, while lending a hand to the most affected sectors or communities amid the escalating situation worldwide.
And:
These full-board packages are targeted at Thais or residents who wish to isolate themselves for 14 days. Meals are delivered to the rooms on trolleys, while dishes, cutlery and bedsheets used by guests in self-isolation will be separated for special handling.
A special team will provide daily housekeeping services and help monitor the conditions of the guests under quarantine. Should any of these guests become unwell or develop any coronavirus symptoms during their stay at the hotel, they will immediately be sent to the several hospitals located in the vicinity of the hotel, according to Shah.
“We hope to get at least some customers with these quarantine packages, as standard tourists will not come during this time,” Shah remarked. These packages are priced very competitively with rates slashed by 20 percent, he added.
With the Singapore government making it mandatory for anyone entering the country since March 20, 11.59 p.m. to undergo a 14-day stay-at-home notice, Park Hotel Group Executive Director Shin Hui Tan has already seen an uptick in enquiries from returning residents wanting to check themselves into hotels during the two-week period.
Here is the full story, via Air Genius Gary Leff.
What is in the stimulus bill?
Here is a good rundown from Politico.
Ben Goldacre’s *Bad Pharma*?
As for other “moneyed interests,” no fewer than 30 Big Pharma and small biotech firms are racing for treatments and vaccines. Moderna turned around a vaccine batch in just 42 days. Gilead Sciences is already in Phase 3 trials for its remdesivir treatment for Covid-19. Straight off President Trump’s announcement of FDA approval for antimalarial drugs to treat the disease, Bayer announced it would donate three million chloroquine tablets.
Here is more from Kimberly A. Strassel (WSJ), the rest about other big businesses.
Wednesday assorted links
1. “Variation in skill can explain 44 percent of the variation in diagnostic decisions, and policies that improve skill perform better than uniform decision guidelines.” Not a Covid-19 paper, but relevant of course, link here.
2. Which states are practicing social distancing the most? (NYT)
3. Human challenge studies to accelerate a vaccine.
4. My Bloomberg column on how the macroeconomics of Covid-19 do and do not resemble WWII. Oops, correct link here.
5. The idea of “group testing” actually came from economist Robert Dorfman of Harvard (who taught me history of economic thought way back when). And more on pooled tests. And Nebraska is doing pooling.
6. “Use Surplus Federal Real Property to Expand Medical and Quarantine Capacity for COVID-19.”
7. Why scaling up testing is so hard (New Yorker).
8. We still don’t know the CFR for H1N1.
9. “Overlooked is the possibility that beauty can influence college admissions.” But not for Chinese it seems.
10. Mullainathan and Thaler with some deregulatory suggestions (NYT).
12. Benjamin Yeoh on early vaccine use.
13. James Stock: “The most important conclusion from this exercise is that policy hinges critically on a key unknown
parameter, the fraction of infected who are asymptomatic. Evidence on this parameter is scanty, however
it could readily be estimated by randomized testing.”
14. Two elite factions in tension with each other (nasty stuff, please do not read).
My Conversation with Ross Douthat
We do another CWT, here is the audio and transcript (link corrected), a very good installment in the series. Here is part of the summary:
Ross joined Tyler to discuss why he sees Kanye as a force for anti-decadence, the innovative antiquarianism of the late Sir Roger Scruton, the mediocrity of modern architecture, why it’s no coincidence that Michel Houellebecq comes from France, his predictions for the future trajectory of American decadence — and what could throw us off of it, the question of men’s role in modernity, why he feels Christianity must embrace a kind of futurist optimism, what he sees as the influence of the “Thielian ethos” on conservatism, the plausibility of ghosts and alien UFOs, and more.
A welcome relief from Covid-19 talk, though we did cover Lyme disease. Here is one excerpt:
COWEN: Does the Vatican have too few employees? There’s a Slate article — it claimed in 2012, the Roman Curia has fewer than 3,000 employees. Walmart headquarters at the time had 12,000. If the Church is a quite significant global operation, can it be argued, in fact, that it’s not bureaucratic enough? They don’t actually have state capacity in the sense that state capacity libertarianism might approve of.
DOUTHAT: Right. State capacity libertarianism would disapprove of the Vatican model. And it reflects the reality that media coverage of the Catholic Church doesn’t always reflect, which is that in Catholic ecclesiology and the theory of the institution, bishops are really supposed to be pretty autonomous in governance. And the purpose of Rome is the promotion of missionary work and the protection of doctrine, and it’s not supposed to be micromanaging the governance of the world Church.
Now, I think what we’ve seen over the last 30 years — and it’s been thrown into sharp relief by the sex abuse crisis — is that the modern world may not allow that model to exist; that if you have this global institution that has a celebrity figure at the center of it, who is the focus of endless media attention, you can’t, in effect, get away with saying, “Well, the pope is the pope, but sex abuse is an American problem.”
And to that extent, there is a case that the Church needs more employees and a more efficient and centralized bureaucracy. But then that also coexists with the problem that the model of Catholicism is still a model that was modern in the 16th century. It’s still much more of a court model than a bureaucratic model, and pope after pope has theoretically tried to change this and has not succeeded.
Part of the reality is, as you well know, as a world traveler, the Italians are very good at running courts that exclude outsiders and prevent them from changing the way things are done. Time and again, some Anglo-Saxon or German blunderer gets put in charge of some Vatican dicastery and discovers that, in fact, the reforms he intends are just not quite possible. And you know, in certain ways, that’s a side of decadence that you can bemoan, but in certain ways, you have to respect, too.
Definitely recommended, a very fun CWT with lots of content. And again, here is Ross’s (recommended) book The Decadent Society: How We Became a Victim of Our Own Success.
New York Will Try Convalescent Blood Therapy
On March 17 I wrote: “A simple and medically feasible strategy is available now for treating COVID-19 patients, transfuse blood plasma from recovered patients.” New York, with other states following closely behind, is now trying the idea.
NBC News: Hoping to stem the toll of the state’s surging coronavirus outbreak, New York health officials plan to begin collecting plasma from people who have recovered and injecting the antibody-rich fluid into patients still fighting the virus.
Gov. Andrew Cuomo announced the plans during a news briefing Monday. The treatment, known as convalescent plasma, dates back centuries and was used during the flu epidemic of 1918 — in an era before modern vaccines and antiviral drugs.
Some experts say the treatment, although somewhat primitive, might be the best hope for combating the coronavirus until more sophisticated therapies can be developed, which could take several months.
The FDA acted quickly to approve the therapy on an emergency case-by-case basis, although it’s not clear to me that legally they should be involved at all given the therapy seems more like an off-label use of blood plasma than a new drug.
The Speed Premium in an exponentially growing pandemic world
I’ve blogged a few times in the past about the importance of speed, and speed as an input into productivity and innovation. What many people do not realize is that “the speed premium” is vastly higher when a deadly virus is doubling in reach every five to seven days.
An economic or epidemiological plan from a week ago might be worthless or even misleading today. For instance, some scientists have told me that at some point, if the virus is widespread enough, there is no choice but to let it burn its way through the population (not saying we are there yet, probably not according to the consensus of experts I am seeing).
Have you perused recent newspapers and mentally noted how many of the articles — such as reviews of art exhibitions — obviously were written and planned in The Time Before (can I call it that?). Those articles are now largely worthless, though a few of them may have nostalgia value.
If you are writing commentary, the value is being there is the morning, not the evening. The “commentary cycle” used to stretch at least a day or two, occasionally a full week.
The corporate value of being prepared early with a good telework plan has been especially high.
Ben Thompson writes: “…on January 23, the day that China locked down Wuhan, Taiwan had the capability of producing 2.44 million masks a day; this week Taiwan is expected to exceed 13 million masks a day, a sufficient number for not only medical workers but also the general public.”
If you are seeking to start a business, to deal with the third party vendors that Amazon is (temporarily) abandoning, you cannot just wait a month or two. You have to start now.
The Chinese system has its flaws from an anti-pandemic point of view, most of all low transparency. But their typical rapid speed of response has been astonishing — setting up that hospital in six days — and it is a big reason why they are on a (partial) rebound.
If you are giving philanthropic grants, you have to be ready to give them now. If you give them three months from now, you may well miss the boat in terms of expected impact.
Are you ready for a world where the speed premium is so insanely high?
I wish to thank Daniel Gross for a conversation related to this blog post. We spoke at 3.5x.
Shruti Rajagopalan on India and the coronavirus
Overall, a lockdown in India is a good idea. Its healthcare infrastructure cannot handle even the flattest of curves, so social distancing not only flattens the curve but buys the government and private sector three weeks to increase capacity. In developed countries like the US, where capacity is high, the economic cost of shutdown is also high. But in India, the economic cost of a shutdown is lower, and the cost of a collapse in healthcare capacity because of premature stress is very high. So a lockdown in India makes sense for its conditions.
There are a few things to keep in mind to make this lockdown a success.
First, the Indian government needs to rely on its private sector healthcare infrastructure, which is many times larger in capacity and services than the government provided free/subsidized healthcare. There are 10 times more doctors in India working in the private sector than government hospitals. Especially in urban areas – where the initial outbreaks are most expected and feared – private healthcare functions very well. The government should pay for the testing and treatment of the poor and those who cannot afford, and allow those who can pay to directly get those services. During emergencies, there is a temptation to requisition private capacity, which in this case will only impose stress on the healthcare infrastructure. The government should pump a lot of funds into the health sector, but allow the private sector to provision and increase the number of beds, health workers, ventilators, masks etc. The current allocation of 150 billion rupees (about 2 billion USD) announced by Modi is too little. It’s about $1.5 per Indian. This amount needs to be increased many times over. The returns in terms of saving lives immediately, and improving healthcare infrastructure will be worth it in the long term.
Second, the government must resist the temptation to impose price controls and quantity controls and let the markets work. India has very local supply chains and all essential goods, mainly food and dairy, will be available easily. Price controls during a lockdown will only exacerbate the problem. A price is a signal wrapped up in an incentive. It signals shortages and surpluses and it also incentivizes buyers and sellers to adjust their behavior. Government imposed price controls must be avoided completely. India has banned exports of medical essentials like masks and ventilators, which is currently justified and sufficient. Indian entrepreneurs will respond to the emergency if prices are allowed to function and the dreaded Essential Commodities Act, which has significantly distorted prices in the past, and unintentionally prevented essential goods from reaching people, is kept at bay.
Third, India has lifted hundreds of millions out of poverty, but still has about 275 million living below the poverty line i.e. less than $1.25 a day. In addition to these, another 300 million are highly vulnerable to economic stress. 70% of Indians work in the informal sector, on short contracts, usually daily or weekly wage, and will have no income with a 21-day lockdown. Even after the lockdown is lifted, sectors like construction may not revive immediately. India needs to announce some kind of quasi universal income, or subsidy that is not means tested, for at least 700 million of
its 1.35 billion population. A minimum of at least Rs 2,500 a month (which is the Indian poverty line) to keep these Indians at home, and not desperate, is essential. If this has to be continued for three months, it would amount to ~2.6% of GDP. This is a stimulus which India can, under these circumstances, afford, and without which millions of poor may die because of the lockdown and not the pandemic. Without this, the chances of the success of the lockdown is low. It will also soften the aggregate demand contraction which is inevitable during a 21 day lockdown.
Finally, assume goodwill. There is a tendency to pass draconian measures in an emergency to punish the few hoarders and scamsters in any situation. The problem with bad laws that are only designed to prevent scamsters, whether it is for hospital funding, UBI-like subsidies, or removing price controls, is that it creates bad incentives for others, and discourages provisioning of goods and services by others, mostly operating on good faith. And the cost of punishing the scamsters in this emergency is too high. Assume some small percentage of people will take advantage of all this, and carry on.
The lockdown is the first step. But India must not squander the next 21 days, and prepare on a war footing to increase its healthcare infrastructure.
Lydia Laurenson interviews me
Here is the link, from a few weeks ago, far-ranging, but includes cultural predictions about the coronavirus. And this:
I’d love to see a study measuring the decisions people who identify as rationalist make in their romantic personal lives, for example — how rational those decisions are, compared to other individuals. I suspect they’d come out slightly below average.
And this:
Some people will say, “I’m spiritual but not religious.” I would sooner say, “I’m religious but not spiritual.” My cosmology is maybe agnostic, tending not to believe that there’s a God as commonly understood, but I have this core American idea that you have values, you go out, you build things, you do things. You take on projects, and those projects should help other people. You’re very committed to this, you see it through. I’m a big believer in that…
Obviously each religion is different and contains many strands, but it’s not an accident that those are the stickiest ideas, right? Those are what carry culture more effectively than, say, political philosophy or the great books of the ancients.
There is much more at the link, and at the end I make the case for optimism.