Month: March 2020

A report from the hospital front, from a reliable source

by  Tyler Cowen in

I visited *** Health Center in ***.  They are not a hospital, more like an urgent care clinic funded by the city and state. They act as triage for three area hospitals, take vital signs, can write prescriptions and send serious cases to Hospital ERs.  They have been overwhelmed with people worried about COVID-19…They had been testing people for the virus; they have run out of re-agent so they have stopped that….If they were provided with isolation beds and ventilators, could they take 20 patients?  No, it is not in their license and an application to change their license takes two years. When NYC reaches maximum hospital capacity, this clinic will not be part of the solution.

I visited [underfunded public health consortium] in ***, which was at the forefront of the response to H1N1 in 2009 and Sandy in 2012.  They typically see 150 ER patients a day; during H1N1 they averaged 350 at the peak; they think they will be over 1000 during COVID-19….There is no such thing as a “test kit” which tests for the virus; when people talk about those kits, such as those dropped onto that cruise ship, they are talking about a nasal swab packaged with some reagent, which is then mailed to a facility with a Polymerase Chain Reaction Machine that can look for the RNA from the virus.

You can find PCR machines on eBay for $25,000; such a machine is labor intensive and can do maybe 10 tests a day.  The hospital complex I visited, which has been designated a testing center, has been swabbing about 200 people a day and receiving multiples of that number from other hospitals. The vast majority they are sending off to a federal lab.  Two weeks ago the turnaround time was three days; now it is five to six.

There are much faster machines.  The Roche Cobas 6800 can do 3000 tests a day with very little human interaction; it costs $500k a year to rent, which is way outside a poor hospitals’s budget (while still not providing sufficient testing for the receiving area in the coming months.) Outside their budget until today, when we gave that money (I specified first year only, though they should be sure to ask in a year) as part of a larger check.  We also gave money for 10 transport ventilators with two ports, 20 isolation beds, the money to hire 14 nurses for round the clock coverage of those beds for 6 weeks, and other things that they need.  Overall it was a $1 million check, with a promise to talk to them in a week to cover anything we might have missed and to talk to them whenever they ask during the crisis.  Overall, I was pretty happy with the visit.  They were stunned, they work in a bureaucracy where everything takes 3 years.

One thing that they can’t get enough of is N-95s [face masks]. The first thing that almost every doctor I talked to mentioned was the frustration at having to re-use N-95’s, not for multiple patients, but for multiple days.

Again, here are the Emergent Ventures prizes to encourage work to support work to fight the coronavirus, and please support them if you can.

Robert Browning and Ingmar Bergman in a Bloomberg column

by  Tyler Cowen in

With all those fools going to bars and concerts, or running marathons, it is evident we still need to solve the problem of entertainment, as I argue in my new Bloomberg column.

It is instructive to look back to the days of World War II. The U.S. government played a critical role in encouraging Hollywood to make cheery movies, and it helped by not trying to force every actor into the armed services. Major league baseball, the national pastime of the era, continued to hold a regular season and a World Series, again to distract people from wartime worries. Many top players, such as Ted Williams, were away fighting, but there were adequate replacements. The government knew that wartime drama could not be the only drama on tap.

With Covid-19, the goal is to keep people at home, at least if they are not essential workers. But if staying at home is too boring, cabin fever will take over and people will run out to social gatherings when they ought to be staying put. So solving the entertainment problem is one very real piece of the puzzle for minimizing the effects of the coronavirus and keeping Americans not just in good spirits but healthy.

The very worst scenario is that the coronavirus itself — how it is playing out, how officials and celebrities and neighbors are reacting — becomes our main entertainment. It could become an ongoing horror show that drives us crazy and makes people even more cynical about politics.

To avoid such a mix of frustration and terror, I have a modest proposal: We should restructure a few of our traditional entertainments to be safe from the coronavirus.

As suggested on Twitter, how about inducing a few of the cable providers to offer free streaming for a few months?  The Met has announced a big increase in opera streaming.  And:

Or how about proceeding with some version of the NBA Finals? Take a subset of the best qualifying teams, test every player for coronavirus, isolate them in a remote area with a college gymnasium, and have them proceed with a shortened version of the real thing in front of only a TV crew. With so many other public events closed down, television viewership would probably reach an all-time high, and the sense of drama would be incredible. It would be one NBA Finals we would never forget, and the quality of play would respond to the very high psychological stakes.

Ben Golliver serves up a concrete NBA proposal.  You’ll have to click through to get to the Browning and Bergman parts, the latter being Easter egg.  At least the Candidate’s Tournament still seems to be on in chess, you can all watch that for the next few weeks, starts Tuesday I believe, try www.chessbomb.com.

Lecturing alone won’t work: we really do need to make it more fun for people to stay at home!

Sunday assorted links

by  Tyler Cowen

1. Expose the young.  A version of the UK idea.  Not my cup of tea, but…

2. Martin Gray: “The dirtiest things in restaurants are the menus, the sides of the bottles of condiments on the tables, and the handles on the doors of the bathrooms. This has been repeatedly studied and absolutely proved by scientific studies.”  Here is a related article.  And here is a Tom Lehrer song.

3. GitHub coronavirus resources.

4. Maybe travel restrictions don’t really help.

5. Is Italy worse because so many younger people live with their parents?

6. How to speak to your family and persuade them, an excellent thread.  What love now means.

7. Sam Altman wishes to fund Covid-19 projects, very good to see.

8. Saez and Zucman government as buyer of last resort proposal.

Pay people to quarantine

by  Tyler Cowen in

Once a pool of money has been allocated to a city or region, the people who are paid to quarantine would be determined by auction. There are many options around how to design pricing mechanisms to incentivize consecutive days of quarantine and other types of health improving behaviors. Based on the committed payments for a city, the price of remaining quarantined would be set on a daily basis.

Consider what the cost might be to pay to place 10% of a city’s population into quarantine. I believe that it costs significantly less than minimum wage for those people. The population that would be quarantining would be the young, elderly, the sick, and those for whom working at home is possible. Quarantining a sizable portion of a population dramatically slows the progression of a virus. Even at 30% of the population, I expect the price would remain well below minimum wage. This would have a dramatic impact on the pace of spreading.

That is from Nate Baker, enforcement would be by cyber-surveillance.

How can you best volunteer?

by  Tyler Cowen in

David Brooks writes:

If you know someone who lives alone ask them to join NextDoor, which is Facebook for neighborhoods. It helps them stay in touch with those right around them. Vital in a crisis.

I am not familiar with that project, but I would trust David’s judgment in such matters.  How else can people volunteer usefully, especially if they do not wish to leave their homes?  Keep in mind that useful volunteering is also a good way to keep people occupied and at home!

Please do leave your suggestions in the comments.  if nothing else, even “placebo volunteering” could be highly worthwhile.  I will put up some of the best ideas in a later post.

What US Government should do regarding Covid-19

by  Tyler Cowen in

This is (by far) the best document I have seen on what to do on the medical side.  It is about 3 pp. long and I believe it will be updated periodically.  Excerpt:

  • Consider guaranteeing top tier treatment and ICU beds for people directly working on treatments or vaccines. We need to keep relevant science labs open. (They’re likely to be closed as things stand.)
    • No doubt logistically challenging but may be necessary. Can you get scientists to keep going without this?
  • Announce $10B prizes for first vaccine and for first cure.
    • Think about mechanics. Should there be awards for second place, too? How should collaboration be factored in?
  • Issue $1B of research grants to all competent labs and organizations that could plausibly use them. They just have to report on progress every 30 days and require that they actively share all progress with other labs.
    • Proposed structure: $100M to each of 5 companies.
    • $10M to each of 40 labs.
      • Remainder based on discretion.
    • Take what’s required for treatment cases and make an “open source” version whose bill of materials costs less than $1,000. Commit to purchasing at least 100k. Even if US turns out not to need them, donate to other countries.

The author is anonymous, but I know that he/she has followed the issue very closely from the beginning, and his/her predictions have been largely on the mark.  If you are in USG I am happy to put you in touch, just write me.

Again, here is the document, highly recommended.

A 21st Century Jobs Program

by  Alex Tabarrok in

Sick pay pays sick people to stay home but to defeat the virus we also want lots of healthy people to stay home. We also want to support people who are at home because they can’t find work. We can accomplish these goals by subsidizing work using services like Upwork or Mechanical Turk. Jobs on platforms like Upwork are the shovel-ready work of the 21st century. A 21st century jobs program would pay people to stay home and isolate, support people without work, and produce some useful output all at the same time.

Instead of paying people to dig and then fill ditches we could pay people to help train machine-learning apps, enter data, subtitle videos. take surveys, maybe even fold proteins to disrupt viruses.

More generally, how about paying people to take online courses? i.e. an income support program and a human capital investment program at the same time. Of course, not everyone would do well and people would cheat but think of these programs as a combination of paying people to isolate, maintaining aggregate demand and providing a source of income when low-wage restaurant and other service-jobs are declining but with a work requirement.

Hat tip: Discussion with Nate Baker. See also John Horton and Arindrajit Dube.

*The Seventh Seal*, directed by Ingmar Bergman

by  Tyler Cowen in

We watched this movie the night before, and it struck me as very different this time around, perhaps because it is set during the time of the Crusades with the plague as a major theme. I no longer think the death character is real, and I now view the film as about how much we flirt with the idea of death, and apparitions of death, in order to make life tolerable and to feel in control. Don’t take the opening scene “as is,” but rather contrast it with all the other ways humans use the death theme for their own theatrical purposes (theatrical, both literally and figuratively) over the next 30-40 minutes of the movie, and then later throughout. Perhaps the key line is “All the damn ranting about death. Is that sustenance for modern people?”

https://www.youtube.com/watch?v=f4yXBIigZbg

Recommended, especially the new Blu-Ray edition of Bergman’s complete works.

Should we ration coronavirus testing by price?

by  Tyler Cowen in

This is making the rounds on Twitter:

Just went to Seattle’s UW Medical Center to ask how much patients are being charged for a coronavirus test. $100-$500 if they have insurance. $1,600 if they don’t.

Put your emotions aside and ask the logical question: since the number of tests falls short of current demand, how should we ration those tests?  I would think we most wish to test potential super-spreaders, so they can self-quarantine or otherwise be isolated or avoided.  A priori, I would expect potential super-spreaders to be those who work in service jobs connected to many other people.  Individuals who suspect they already have the disease are also more likely to be super-spreaders, if only because there is a decent chance they actually do carry the disease.

Now at a price say of $500, you will rule out some of the poor, some of the “frivolous testers” (there are people who will try anything that is new), but you don’t rule out many of the middle class people — or wealthier people — who think they might have the coronavirus.

You end up targeting potential superspreaders by “those who think they have it,” but not by “those who work in service jobs where they come in contact with a lot of people.”

An imperfect solution, but not an entirely bad one either.  It is probably better than random allocation.  And still all of the available tests get used.

How about a government price of zero, combined with rationing?  Of course it depends what the principle of rationing would be.  From other countries, “I came into contact with a traced person” seems to be one standard, noting that the United States has nothing close to Singapore’s surveillance mechanism in this regard.  So you would get a very loose version of that standard, with many flu-laden nervous nellies taking the test, claiming they came in contact with a sick person.

That could perform either better or worse than the market solution.  In Singapore it is probably better than the market solution, but I am not sure for the United States.  My intuition would opt for the market prices, but I admit that is not verified by either model or data.

A separate issue, hard to judge from current information, is whether there is any positive supply elasticity at the higher price.  Of course if there is, that will make the higher price look better, but perhaps other regulatory and pipeline restrictions on testing will mean the higher price won’t matter.

And note that as the supply of tests becomes much greater, as is happening right now, the case for those high market prices becomes much, much weaker.  Zero price and no rationing is where we would like to end up, and I think we will.

I find that this problem, and how you tackle it, is a good test for whether or not you think like an economist consistently.

Saturday assorted links

by  Tyler Cowen

1. Penelope Fitzgerald, late bloomer.

2. “And Buggiani’s not joking around either. The penalty for engaging in sexual activity that exceeds two individuals is a fine of €875, or $975.”  {It turns out this link is satirical.]  And Pornhub offers free premium service in Italy, limiting negative externalities?

3. What is being left on the supermarket shelves?  And pop-up stores to help sell coronavirus supplies.

4. LessWrong coronavirus link database.

5. A critique of flattening the curve (speculative, caveat emptor!).

6. William Eden against the British solution.  And here is Taleb.

The Danes wish to know more about the coronavirus

by  Tyler Cowen in

From Martin Permin, for formatting reasons I have imposed no further indentation:

“Thanks for the excellent coverage on MR.

I lead a small team of tech workers in Copenhagen, who are donating our time and money towards building a covid-19 self-reporting tool for those citizens not (yet) in contact with health care services.

As countries shift from containment to “flatten the curve” strategies, authorities lose track of the number of non-critical cases, and to which degree people adhere to social distancing dictums. This makes it hard to predict the number if ICU beds needed a few days into the future. We’re aiming to solve this by asking all Danes for daily status updates.

Denmark is a good testing ground, but we’ll open source everything, and are building with developing countries in mind. We’re aiming to launch Monday — currently working on a green light from local health authorities.

We’re determining which data to collect. We’d love it if you’d help by asking your audience: “What daily self reported measures would you most like to see from the complete population Denmark?” (or some variation thereof).

There is of course a tradeoff between data fidelity and engagement.

What we’re considering:

  • Symptoms
    • Binary
    • Type
    • Severity
  • Whereabouts
    • Degree of social distancing
    • Hygienic measures
  • Moral
    • How concerned are you
    • Do you know anyone who’s been sick”

Are there comparable efforts to do this elsewhere?

What is the inflation rate these days?

by  Tyler Cowen in

Airline tickets are dirt cheap, masks and test kits are super-expensive (have to marry a Prime Minister or qualify for the Utah Jazz), and demand is collapsing for commodities.  Gas should be cheaper too.  A museum visit soon may be infinite in price.

So what will the new overall rate of price inflation be?  What is the quality-adjusted value of “buy a new Toyota plus ??? chance of coronavirus from the floor visit”?

What is the new quality-adjusted value of health care?  It is (one hopes) more likely to save your life, but ?? percent of the staff are carriers themselves.

The new quality-adjusted value of on-line higher education?

How should we think about your rent payment, given how many of the urban amenities are shutting down?  Has living next door to a park and walking trails suddenly escalated in value?

And a lot of the goods out there — if you can buy them — are option values.  I don’t need more toilet paper, but I would pay a few dollars for the continued right to keep on buying toilet paper, which usually I take for granted.  Our stocks of various commodities vary in value much more than they used to — now I treasure those Goya small red beans in the basement.

Is it still meaningful to just take the old price basket averages?  Somehow I don’t think so.

If there is no well-defined rate of price inflation (finally Scott Sumner wins on that one), can there be a well-defined real interest rate?  Is it very high or very low?  Or just “a high variance real interest rate”?  Or is the nominal interest rate the new real interest rate?

Was the nominal interest rate all along the interest rate that mattered and made sense?

Is any of this built into the macro models people are applying to this crisis?  No.