Category: Economics

A Polite Request of the FDA

After the FDA advisory committee voted in favor of Pfizer’s EUA last Thursday–as almost everyone thought they would–the FDA had difficulty finishing the paperwork. The NYTimes reported:

People familiar with the F.D.A.’s situation say that regulators are now racing to complete a fact sheet, information for physicians and other required documents that go with the authorization.

The paperwork delay meant that the FDA was going to wait to issue the EUA until Monday. That’s when Trump called the FDA “a big, old, slow turtle” and yelled at Hahn to “Stop playing games and start saving lives!!!.” The FDA then sped up and issued the EUA on Friday. As a result, the first tranche of vaccines are being delivered today.

The advisory committee for the Moderna vaccine meets this coming Thursday. Here’s a polite request of the FDA–please have the fact sheet, information for physicians and other required documents ready to go. Thanks.

P.S. We would also be really grateful and, you know, it might save some lives if you allowed Moderna to start shipping now so the vaccine is on-site and ready to go on Friday. Please give it some thought and thanks again for your kind consideration. It’s been very stressful seeing thousands of people dying every day.

Remote Work Impact on Ending The Great Stagnation?

Jeff Allen emails me:

If the Great Stagnation is ending (we will see), it seems as if the COVID-forced remote work revolution has to have played some sort of role.

Speaking from personal experience as a white collar Exec, the productivity gains for our highest value workers has been immense. The typical time-sucks and distractions of in-office work have been eliminated, as have their personal time investments like physically visiting the grocery store or running errands. Mental focus on productive efforts is near constant.

Perhaps most importantly, work *travel* is not happening. Valuable collaborations with colleagues, customers, regulators or other partner companies aren’t delayed by the vagaries of the various groups’ availability to meet in person, navigating being in different cities, flights, hotels, etc. Collaboration happens as soon as you have the idea to meet via Zoom. And a lot *more* collaboration happens as a result. It may be lower productivity collaboration than meeting in person around a whiteboard (maybe), but the sheer quantity of it means on net there’s perhaps been a boom in cross-pollination of ideas.

Not to mention all of the wasted productivity time that work travel eats up by putting high value workers in low productivity transit mode….Uber to airport, security lines, wait for flight in the terminal, maybe grab an hour of in-flight WiFi to catch up on email, land, taxi on the airstrip for 20 minutes, Uber to hotel…is completely gone from our lives.

In general, I think we drastically overrate the value of work travel.

I’m sure this Mass Virtualization event doesn’t benefit all workers equally.

But could it be an accelerant for certain high-value innovations worked on by the best of the best in science and technology?

I’m not saying I don’t want the world to go back to normal. Travel is great. In-person human interaction certainly has many benefits (duh). But I think we should ask ourselves how we can retain some of the best advantages this last year has brought us, even after the vaccines and herd immunity bring us back to something resembling normalcy in 2021.

Here is a related Robin Hanson post on the importance of work from a distance.  Of course remote work is, to some extent, a way around both immigration and NIMBY restrictions.  You will note this is all very much in line with my earlier take that, if the great stagnation ends, it will be because we have placed the internet at the center of our institutions, rather than using the internet as an add-on.

What might an end to the Great Stagnation consist of?

If indeed it did, they are asking a similar question at The Economist. In recent times you might cite the onset of Apple’s M1, GPT-3, DeepMind’s application of AI to protein folding, phase III for a credible malaria vaccine, a CRISPR/sickle cell cure, the possibility of a universal flu vaccine, mRNA vaccines, ongoing solar power progress, wonderful new batteries for electric vehicles, a possibly new method for Chinese fusion (?), Chinese photon quantum computing, and ongoing advances in space exploration, most of all from SpaceX. Tesla has a very high market valuation, and Elon is the world’s second richest man.

Distanced work is very important, and here is a separate post on that.

I would say that almost certainly the great stagnation is over in the biomedical sciences.  It is less obvious that the great stagnation is over more generally, as we might simply retreat into our former sloth and complacency once we are mostly vaccinated.  Applied Divinity Studies has posed some pointed questions about why we might think that stagnation is over.

If you are looking for a quick metric to indicate the great stagnation might be over, consider total factor productivity.  It is entirely possible that tfp in 2021 will be 5 or more, its highest level ever.  (To be sure, this will show up as a measured increase in inputs more than as tfp, but we all know why those inputs will be increasing and that is because of science…yes this is a problem with tfp measures!)  Over the two years to follow after that, we should be seeing very high tfps around the world.  So that will be very high tfp for a few years.

Again, that is not proof of a permanent or even an ongoing end to the great stagnation.  But it is something.

Two more general points seem relevant.  First, many of the biomedical advances seem connected to new platforms, new modes of computation, new uses of AI, and so on, and they should be leading to yet further advances.  Second, there are (finally!) some very real advances in energy use, and those tend to bring yet other advances in their wake, and not just advances in bit space.

But not all is rosy.  If you recall my paper with Ben Southwood, the obstacles standing in the way of faster scientific progress, such as specialization and bureaucratization, mostly remain and some of them will be getting worse.

My The Great Stagnation, published in 2011, offered some pointed predictions.  It argued that the “next big thing” was already with us, namely the internet, but we simply hadn’t learned to use it effectively yet.  Once we put the internet at the center of many more of our institutions, rather than treating it as an add-on, the great stagnation would end.  Numerous times (using roughly a 2011 start date) I predicted that the great stagnation would be over within twenty years time, though not in the next few years.  The Great Stagnation in fact was an optimistic book, at least if you read it to the end and do not just mood affiliate over the title.

By no means would I say that specific scenario has been validated, but as a prediction it is looking not so crazy.

The gains from truly mobilizing the internet may in fact right now be swamping all of the accumulated obstacles we have put in the way of progress.

I also wrote, in 2011, that as the great stagnation approaches its end, we will all be deeply upset, and long for the earlier times.  That too is by no means obviously wrong.

Are the elites worse than you think?

Here is a new and important paper by Joshua D. Kertzer, noting that it mainly confirms what I observe every day (aren’t those the very best research studies?)  Here is part of the abstract:

…political scientists both overstate the magnitude of elite-public gaps in decision-making, and misunderstand the determinants of elite-public gaps in political attitudes, many of which are due to basic compositional differences rather than to elites’ domain-specific expertise.

My rewrite of his sentence is that elites are arguing from their class and demographic biases (a bias can be positive, to be clear), not from their expertise.  That lowers the marginal value of expertise, at least given how our world operates.  I recall earlier research blogged by Alex showing that if you are a French economist, your views are more influenced by being a French person than by being an economist.  And so on.

This is one of the very most fundamental facts about our world, and elites are among the people least likely to have internalized it.

Have a nice day.

The Simple Math of FDA Delay

Two to three thousand people a day are dying from COVID. Thus anything that delays rolling out a vaccine has a very high cost in human lives. People want to deny this, perhaps because it is so horrifying. I get a lot of pushback when I say that FDA delay is deadly. Let’s dispense with a few objections. It is true, of course, that the people who are dying today can’t literally be saved by a vaccine today but they could have been saved had they been vaccinated four or five weeks ago and similarly projecting forward.

Another response that many smart people tell me is that a vaccine can’t be rolled out immediately so even under the best scenarios you couldn’t save that many people immediately. That’s true but irrelevant. Since a lot of people are getting this wrong, I want to show this in a simple model using pictures. Red is for deaths. Green is for life. Suppose two thousand people are dying from COVID a day as in panel 1. Let’s for the sake of the simple model assume that you could deliver a vaccine to everyone on Day 1. You would then save 2000 lives a day going forward for however long the pandemic would have lasted as shown in panel 2. If you delay by one day then two thousand people die who would have lived without the delay, as shown in panel 3. Pretty obvious so far.

Now assume that the vaccine can’t roll out to everyone immediately. For the sake of this simple model let’s assume that on day one you can only vaccinate half the population. By doing so you save 1000 lives on day 1 and 2000 lives every day thereafter for the length of the pandemic. That’s the fourth panel. Now suppose we delay the vaccine rollout by one day. 2000 people die on Day 1 but you save 1000 on Day 2 and 2000 on Day 3 and every day thereafter for the length of the pandemic. How many people were killed by the delay? Compare the 4th and 5th panels. 2000 exactly as before! The slow ramp up doesn’t change the number of deaths caused by delay it just spreads them out over different days. You can adjust the ramp so that it occurs over 10 days or 30 days. Doesn’t change much on the delay margin unless you delay for so long that the pandemic is close to being over.

What could matter is if delay increases the speed at which you can ramp up. I doubt that this is true. We were ready to go with millions of doses in late October (guess why?). (In fact we had a vaccine in January and millions of doses around March-April.) We won’t really be better prepared tomorrow than we are today. It’s learning by doing that matters. See the point Tyler made earlier about economic time versus calendar time.

As Tyler noted, this is hardly the final analysis but many people are not even conceptualizing the problem correctly and this is a good place to begin.

Herd Immunity is Herd Immunity

Some assorted thoughts:

In the big picture, the efficacious of a vaccine doesn’t matter per se what matters is getting to herd immunity. If you have a less efficacious vaccine you need to vaccinate more people but herd immunity is herd immunity, i.e. vaccines mostly protect people not because they are efficacious but because we reach herd immunity. I’ve never had measles mostly because I have probably never been challenged with measles not because I have been challenged but due to a vaccine I fought it off. The AZ vaccine at 70% efficacious will work just fine. (One potential issue, as Josh Gans notes, we don’t yet have data on transmission reduction which could vary by vaccine.)

As I mentioned in The Vaccine Works Fast, the first shot of the Pfizer vaccine seems to work well enough so that one *might* consider delaying the second dose a few weeks to get the first dose out more widely. In fact, the accidental low-dose, standard-dose regime for the AZ vaccine had people getting the second dose 7 to 8 weeks after the first dose and that was the 90% efficacious regime. We don’t have full-information but the exact timing of the second-dose does not seem critical, although everyone should get a second dose.

A related point is that we could mix and match vaccines. The UK will run a trial on this question. Mix and matching has two potentially good properties. First, mix and matching could make the immune system response stronger than either vaccine alone because different vaccines stimulate the immune system in different ways. Second, it could help with distribution. It’s going to be easier to scale up the AZ vaccine than the mRNA vaccines, so if we can use both widely we can get more bang for our shot. (As Tyler has noted the British have really stepped up on rational trial design.)

The mRNA vaccines are getting the press but for the world as a whole the AZ, Chinese, Russian and similar more traditional vaccines are going to be the big players because facilities exist for scaling them up around the world.

Addendum: Countries in the world that now have a vaccine: the UK, Canada, Bahrain, China, Russia. One country without a vaccine: the United States. The US FDA advisory committee is meeting today. You can watch here.

Why so many delays with vaccine complementary infrastructure parts?

The problems are very real and catalogued here, earlier Alex had warned of this.  And here is an excerpt from the first link:

The drop-off [in expected vaccine deliveries] is a product of manufacturing problems, bottlenecks in the supply of raw materials and other hurdles in ramping up clinical-trial production of 5 liters of protein-based vaccine at a time to commercial-scale fermentation of 2,000-liter batches, the companies and the Trump administration said.

Note that Operation Warp Speed, for all its wonders, creates some bad incentives.  A pre-purchase, whatever other advantages it may bring, is also a kind of indirect price control.  And when price controls are present, quality declines ex post, as in many other procurement problems.  But the companies do not wish to lower the quality of their vaccines, so instead they have “slack” incentives to boost quality along other parts of the supply chain.

Here is a simple analogy.  Let’s say the government did a pre-purchase of left shoes, at the price of a left shoe/right shoe combination.  But to get the upfront money the company only had to produce a left shoe.  There might be a relative shortage of right shoes.

So there is pre-purchase for “the vaccine,” but not for “all of the complements to the vaccines.”  (Listen to Alex!)  The companies are getting paid for the vaccines no matter what.  So their incentive to be speedy with the complementary infrastructure — whether producing it themselves or contracting for it in Coasean fashion — just isn’t as strong as it would be for a social optimum.

The more you rely on pre-purchase, the more you have to worry about what is happening on the fringes of that activity.  And you can expand pre-purchase to the initial complements, and probably should, but of course in doing so new fringes arise as well.

The Vaccine Works Fast

From the FDA report:

Two doses is great but one dose already looks good even though sample is small. “Efficacy against severe COVID-19 occurring after the first dose was 88.9%.” (Added. n.b this is over the entire sample.)

Based on the number of cases accumulated after Dose 1 and before Dose 2, there does seem to be some protection against COVID-19 disease following one
dose; however, these data do not provide information about longer term protection beyond 21 days after a single dose.

This is potentially important as we could vaccinate more people in a hot-spot and potentially delay the second dose. Noting, however, that this is a post-hoc analyses and the second dose came within 3 weeks.

As expected, a bit of pain, swelling and fatigue in a minority of participants are the biggest issues. No major safety concerns. Of course, we still need to monitor long-term.

Serious adverse events, while uncommon (<1.0%), represented medical events that occur in the general population at similar frequency as observed in the study…. No specific safety concerns were identified in subgroup analyses by age, race, ethnicity, medical comorbidities, or prior SARS-CoV-2 infection. 

Hat tip: Biostatistician LucyStats.

The case for going big is still strong

Since back in April, Michael Kremer, myself, and the AHT team have been advising governments to go big on investing in vaccines. The US, to its credit, made early purchases but they made two mistakes. First, they didn’t buy enough as the Washington Post indicates:

Last summer, Pfizer officials had urged Operation Warp Speed to purchase 200 million doses, or enough of the two-shot regimen for 100 million people, according to people knowledgeable about the issue who spoke on the condition of anonymity because they weren’t authorized to discuss the situation. But the Warp Speed officials declined, opting instead for 100 million doses, they said.

“Anyone who wanted to sell us … without an [FDA] approval, hundreds of millions of doses back in July and August, was just not going to get the government’s money,” said a senior administration official.

But last weekend, with an FDA clearance expected any day, federal officials reached back out to the company asking to buy another 100 million doses. By then, Pfizer said it had committed the supply elsewhere and suggested elevating the conversation to “a high level discussion,” said a person familiar with the talks who spoke on the condition of anonymity because they were not authorized to share the conversation.

In our discussions, we were talking about at least a $70 billion dollar program and optimally double that and we continually faced the sticker shock problem. Investing in unapproved vaccines seemed risky to many people despite the fact that the government was spending trillions on relief and our model showed that spending on vaccines easily paid for itself (the mother of multipliers!). I argued that this was the world’s easiest cost benefit calculation since Trillions>>Billions. But it was hard to motivate more spending—not just in the United States but anywhere in the world. For reasons I still don’t understand anything out of the ordinary–big spending on at-risk vaccines, spending on testing and tracing, challenge trials–was met with a kind of apathy and defeatism. As I said in July:

Multiple people [in Congress] have told me that things move slowly, no one is stepping up to the plate, leadership is absent. “Who is John Galt?,” they sigh. Ok, they don’t literally say that, but that sigh of resignation is what it feels like in the United States today at the highest levels of government.

OWS was actually the one area where there was some action. But there was a second mistake. We argued that governments shouldn’t buy doses but capacity, i.e. they should cover the cost of building a factory or production line in return for an option on doses from that line. The problem with buying doses is that if you buy without a timeline then the company takes all orders and pushes the low-priced orders to the back of the queue. If you demand a timeline, however, that puts a lot of risk on the firms, since not everything is under their control, and that’s expensive and difficult to contract for and monitor. Thus, we advocated for push funding to de-risk capacity construction for the firms. Capacity construction is well understood–double this line–and thus much easier to contract for and monitor. (Contracting on capacity is also cheaper than a traditional AMC for reasons explained here and also in my discussion with Tyler here.) The nice thing about buying capacity is that it changes the dynamic from one where countries are scrambling to buy before others do to one where early purchases increase capacity that is later available for everyone. OWS, to its credit, did fund capacity construction for Moderna but we wanted more and other governments didn’t step up to the plate.

OWS has been a success. In combination with investments from other governments and organizations like CEPI it will save trillions of dollars and many lives. It could have been better but the main takeaway is that the case for going big is still strong. We have solved the scientific problem of making the vaccine but step two is getting billions of doses in arms. If we can increase capacity enough to vaccinate millions more people next year than currently planned that would still pay for itself many times over. Increasing capacity is not impossible. China is increasing capacity for its vaccines. It will be harder to increase capacity for mRNA vaccines since the technology is new and bespoke but it can be done. We need a second Operation Warp Speed, OWS: Delivery and Distribution.

As Tyler said yesterday, Williams wants a cow! We want billions of vaccine doses quickly. It can be done, it should be done.

Fallacies about constraints

I am reading many people claim something like “production and distribution of the vaccine is the constraint, not FDA approval.”

There are multiple mistakes in such a view, and here I wish to focus on the logic of constraints rather than debate the FDA issue.

First, there are vaccines available right now, and it helps some people (and their contacts) to have those distributed sooner rather than later.

Second, easing the FDA constraint encourages the suppliers and distributors to hurry to a greater degree.  Just imagine if the FDA were to take a few months longer to approve.  The more general point is that citing “x is right now the main constraint right now” does not mean “the elasticity of x is zero.”

“Sure” wrote in the comments:

On the economics side, I am not convinced that production has ramped up as full and as fast as possible. After all there is some risk premium for expanding plants, running constant shifts, etc. and the danger of delayed approval, particularly if you are in some (mostly negligible) way to the other vaccines may not warrant the investment.

After all, approvals appear to move stocks. Do we really think the market is that dumb? If approval has an impact on market value, why exactly would it not also have an impact on the cost of borrowing, expanding, etc.? Surely somebody believes that approval will result in something different will happen than was happening the day before.

Third, “FDA vaccine approval” is a complementary good for the final vaccine service, strongly complementary in fact.  If the other complementary infrastructure goods have price/quality combinations that are “too disadvantageous,” the theory of the second best implies that approval processes should be speedier and more lax than you otherwise might have thought.  This is just the converse of the classic result that multiple medieval princes imposing multiple tolls on a river create negative externalities for both river users and each other.  Lower those tolls wherever you can.

Fourth, let’s say there were three constraints, each absolutely binding at the current margin.  Speeding FDA approval, taken alone, would have absolutely no effect.  We then ought to be obsessed with identifying and remedying the other two constraints (along with approval)!

But we are not.  Instead we keep on citing those (supposed) constraints in defeatist fashion.  This absence of obsession with easing constraints is in fact one of the biggest reasons for thinking we can do better.  We need to throw more money and talent at these problems, and we are not working hard enough on how to do that.  We are just citing the constraints back and forth to each other and pleading helplessness.

As a final note, I recall that my recently deceased colleague Walter E. Williams was especially good on these issues.  I recall him once saying he wanted to hire a helicopter to drop a cow into the campus central quad, just to show people that supply has positive elasticity.  “I’m going to call them up and say “Williams wants a cow!””

Moo.

How many lives will be saved if the FDA had moved faster?

Many people are asking me this question.  I don’t mean to relitigate the question of whether the FDA should be moving faster, rather consider this an exercise in how to think about the trade-offs.  I thus am going to hold the safety and quality of the vaccine constant.

To proceed, consider the distinction between processes defined by economic time and processes defined by calendar time.  In Virginia it may snow in February but not in October, and that is defined by calendar time, not caused by local gdp.  But for many inventory processes, they do not restock until the shelf is emptied by buying customers, and that is economic time.  They don’t check to see if it is June or July.

Let us say that only economic time matters, though I will drop that assumption shortly.

Now, given how late we are in “the season,” it is easier to think about pushing the approval date back rather than moving it forward.  Let’s say that the FDA postponed the December 10 meeting to January 10.  Some number of people would die of Covid during that month — the current clip being around 2600 a day but changing — and then around Jan.10 some kind of vaccine-related health and economic recovery would move into fuller gear.

If only economic time matters, it seems the Dec.10 recovery and the Jan.10 recovery run about the same.  The net difference between the two scenarios is the lives lost in the meantime, to oversimplify say 2000 x 30 days, or 60,000 lives plus accompanying lost jobs and gdp.

I do not think that losing those lives would somehow speed the later, Jan.10-starting recovery process, and it may in some ways render it more fractious.

On top of that, the postponed recovery period likely will imply some kind of grinding uncertainty in the meantime, and possibly intertemporal substitution from some agents (like me!) who are waiting for the change to come before going to the barber. The true net costs are thus higher than what I listed two paragraphs above.

Now, how might the introduction of calendar time alter those estimates?

First, the production of complementary goods for vaccines (say freezers, but the point is more general) may be on a clock of its own, more or less on automatic pilot and requiring time.  When approval comes later, more of those complementary goods are in place, and thus the later recovery is a more powerful one.  That factor tends to lower the cost of delaying approval.

(Of course to the extent those same complementary inputs depend upon economic time, that is reason not to delay approval!  The sooner you approve, the sooner they will get working on getting those freezers in place, which of course boosts recovery power.  Supply is elastic with respect to approval, as suggested for instance by stock market reactions to approval decisions.)

Second, the seasonal effects will differ.  Ideally you want the spread of vaccines to be covering some of the more infectious and thus more difficult winter months.  February is worse than March, and so on.  Given the current clock, this is a big reason to be hurrying.

You might think of other ways calendar time could matter.  You also might think of various non-linear effects and interactions, though I am not sure whether they would make delay more or less costly.

Overall it seems to me that the costs of approval delay are likely very high.  They are not obviously overturned or minimized by citing the relevance of complementary inputs.  The import of complementary inputs might be more ruled by “economic time,” or the seasonal effects may be a stronger quantitative magnitude, again favoring faster speed of approval.

I do understand this is far from a final analysis, rather it is a starting point for conceptualizing the problem.

Selfish corporations, and does thinking about business make you like it more?

Alas, maybe not!  (Try a love letter instead…)

From Emanuele Colonnelli and Niels Joachim Gormsen:

We conduct representative large-scale surveys of U.S. citizens aimed at measuring perceptions of large corporations’ environmental, social, and governance performance and investigate how these perceptions affect the public support for economic policies. The public demands corporations to behave better within society, a sentiment we label “big business discontent.”We experimentally vary individual perceptions by showing animated videos that highlight the“good” and the “bad” of corporate behavior in recent years. We show that higher big business discontent lowers support for corporate bailouts. The effects are present across the whole political spectrum, but they are stronger for liberals than for conservatives, and they persist even a week after respondents viewed the videos. A second randomized experiment shows that simply making respondents think about the role of large corporations in society lowers their support forbailouts, highlighting a key mechanism whereby the public’s pre-existing negative beliefs about big business influence behavior once these beliefs are manipulated or triggered. We conduct an additional experimental survey to show that individuals’ self-reported policy preferences are reflected in costly behavioral actions. A higher big business discontent makes respondents less likely to sign an online petition or contact U.S. senators to support corporate bailouts. Treated respondents are also less likely to donate to a non-profit organization supporting the genera linterests of top U.S. executives. Together, our findings suggest that the perceived strength of the social contract between big corporations and their stakeholders may impact the public support for important economic policies.

Here is a link to the paper.

Covid-19 as a Ramsey tax problem

So many commentators cite lives, hospitalizations, and so on, as measuring the costs of the pandemic, and I understand that those are the rules of engagement, and furthermore I know that welfare economics is not the only relevant normative approach.

Nonetheless let us try to apply welfare economics for just a moment.  In that framework what counts as a cost is deadweight loss (no sick pun intended, nor recursively).

Look at it as a public finance problem. The total deadweight loss stems from the size of the “pandemic taxes” or “risk mark-ups” being applied to various human activities, then magnified by elasticities of adjustment, and quite possibly further social externalities from the collapse of critical scale (e.g., it is not just that movie-going might be dangerous, you can no longer enjoy the movie with large crowds of people).

Many of the biggest “risk pandemic taxes” have been put on in-door socializing, many church activities, offices, elevators, live NBA games, etc.  You know the story.

If you say that people are overreacting to Covid, in essence you are admitting that those elasticities are high, and probably you think the resulting social externalities are high too.  And thus you are saying and indeed emphasizing that the costs of the pandemic are high.

There is a positive statement — “those elasticities are high!” — bundled with a normative statement — “I don’t think those elasticities should be so high!”  Being a human, your attention may be drawn to the normative statement. But what welfare economics hears is the positive statement about high elasticities and thus high deadweight loss.

Now you might believe that “talking people down out of their high elasticities” is a good strategy.  Maybe.  Still I ask you to consider whether this is generally how you approach economic problems.  How about?: “Don’t leave NYC just because the taxes are going up!  It will wreck the city.”  Would your focus be on talking people out of leaving, or rather on keeping taxes down or raising residence benefits correspondingly?

The “overreaction” advocates try to signal “the costs of Covid aren’t that high,” but translated into econspeak it is actually “the costs of Covid are really high.”

Unless they believe a great, great deal in the efficacy and corrective power of moral education. (Does Bryan?)

On top of that, keep in mind that the better informed and better educated people tend to be playing it safer, so the moral education you would have to deploy here would be very strange indeed — “don’t listen to what the other educated sources are telling you, listen to meYou are overreacting!

That is not where I wish to put my money or my time.

As a side point, note that in the 1968/1957 pandemics elasticities of adjustment were way lower, because you couldn’t switch things to Zoom, Amazon, and so on.  So those pandemics were closer to being a “lump sum tax” on human life and thus they were cheaper, and had lower deadweight loss, probably in per capita terms as well.  From the framework on welfare economics, that is.  The value of human lives was lower then too.

We all know that welfare economics is an inadequate “all things considered” moral framework.  But still it brings us insights every now and then.

The Great Walter Williams, Radical Troublemaker

Our colleague, the great Walter Williams, died on Tuesday shortly after teaching his last class–which is exactly how he would have wanted to go. He was 84 and had been teaching at George Mason since 1980. As Don Boudreaux writes in the WSJ:

For 40 years Walter was the heart and soul of George Mason’s unique Department of Economics. Our department unapologetically resists the trend of teaching economics as if it’s a guide for social engineers. This resistance reflects Walter’s commitment to liberal individualism and his belief that ordinary men and women deserve, as his friend Thomas Sowell puts it, “elbow room for themselves and a refuge from the rampaging presumptions of their ‘betters.’ ”

Walter taught UCLA-Chicago price theory to multiple generations of George Mason students. His students loved him. He secured funding for me when I was a  student, for which I have always been grateful. You can find many of his graduate exam questions here. They are tough!

Walter led a remarkable life recounted in his autobiography, Up From the Projects. He was arrested for disorderly conduct several times and drafted into the army. He was later court-martialed but, acting as his own attorney, he wins his case. He’s sent to Korea and when asked to fill in a form stating his race he writes Caucasian because the Negros got all the worst jobs. He tells his commanding officer that he has pledged to defend the constitution against all enemies foreign and domestic and that he, the commanding officer, is a domestic enemy of the constitution. He writes to complain to President John F. Kennedy. The army gives him an honorable discharge. His wife, Connie, helps him to become more mannerly. It was only when he discovered economics, however, that he learned to combine trouble-making with discipline. He was interviewed a few years ago on these themes by Jason Riley for the WSJ:

“I was more than anything a radical,” says Mr. Williams. “I was more sympathetic to Malcolm X than Martin Luther King because Malcolm X was more of a radical who was willing to confront discrimination in ways that I thought it should be confronted, including perhaps the use of violence.

“But I really just wanted to be left alone. I thought some laws, like minimum-wage laws, helped poor people and poor black people and protected workers from exploitation. I thought they were a good thing until I was pressed by professors to look at the evidence.”

During his junior year at California State College in Los Angeles, Mr. Williams switched his major from sociology to economics after reading W.E.B. Du Bois’s “Black Reconstruction in America,” a Marxist take on the South’s transformation after the Civil War that will never be confused with “The Wealth of Nations.” Even so, the book taught him that “black people cannot make great progress until they understand the economic system, until they know something about economics.”

He earned his doctorate in 1972 from UCLA, which had one of the top economics departments in the country, and he says he “probably became a libertarian through exposure to tough-mined professors” — James Buchanan, Armen Alchian, Milton Friedman — “who encouraged me to think with my brain instead of my heart. I learned that you have to evaluate the effects of public policy as opposed to intentions.”

Walter was never politically correct. He once demanded that our Dean do something about the lack of representation of Asian-Americans on the GMU basketball team. He enjoyed his iconoclasm but his provocations were designed to get people to stop and think not to offend. It’s not clear that this is possible anymore.

Walter was a brilliant communicator. GMU Econ Chair Daniel Houser noted:

That Walter is so beloved by legions of non-economists speaks not to his dumbing down of economics in order to attain popularity. Instead, it speaks to his unusual mastery of economics to make it accessible and relevant to ordinary men and women.”

Walter was always his own person, perhaps best reflected in this interview with Nick Gillespie.

Gillespie: Let’s talk a little bit about the broad-based libertarian movement. Do you feel that you are part of a libertarian movement?

Williams: No, I don’t.

Gillespie: So, what are you then?

Williams: I am not a part of a movement. I have never been part of a movement, I just do my own thing.

I miss him already. There is no replacement. Here is Suffer No Fools, an excellent video-biography of the great Walter Williams.