1. 2007 Thomas A. Garett piece on the economics of the 1918 flu pandemic. What else has been written on the macro side?
3. John Gray being John Gray (but “Second Life”??).
5. Why Veneto did better than Lombardy (FT, less hospitalization is one reason).
6. Covid requests for everything: “Kaddish will be said by a group of people who currently have a mild case of Coronavirus and are together at the Prima Palace Hotel in Jerusalem (they are the only people who are legally able to Daven with a Minyan right now.”
8. How Chinese apps handled Covid-19, excellent post.
9. The Covid culture that is middle-aged Pink Floyd fans from New Jersey. You know you want to read this one.
10. MIT economics paper on ventilator rationing schemes, offers concrete proposals, not just BS.
15. Japan finally declares state of emergency. By the way, the mounds of evidence (testing data, not all public) are piling up against the “so many of us already have been exposed” theories.
Officials at the Internal Revenue Service have warned that $1,200 relief checks may not reach many Americans until August or September if they haven’t already given their direct-deposit information to the government. Taxpayers in need of answers from the IRS amid a rapidly changing job market are encountering dysfunctional government websites and unresponsive call centers that have become understaffed as federal workers stay home.
Here is the full piece by Jeff Stein. And here is me in WaPo:
Cowen said it’s inexplicable why the federal government, given all the warnings and evidence from China of a spreading pandemic, did not move more rapidly.
“You know, Trump was terrible, but you can’t just pin it on him. It’s far more systemic than that. The NBA [which suspended its season on March 11] really gets so much credit. I would put the NBA in charge of fighting climate change at this point.”
The piece there is by Dan Balz.
Robin Hanson makes the strongest case for variolation, here is one excerpt:
So the scenario is this: Hero Hotels welcome sufficiently young and healthy volunteers. Friends and family can enter together, and remain together. A cohort enters together, and is briefly isolated individually for as long as it takes to verify that they’ve been infected with a very small dose of the virus. They can then interact freely with each other, those those that show symptoms are isolated more. They can’t leave until tests show they have recovered.
In a Hero Hotel, volunteers have a room, food, internet connection, and full medical care. Depending on available funding from government or philanthropic sources, volunteers might either pay to enter, get everything for free, or be paid a bonus to enter. Health plans of volunteers may even contribute to the expense.
1. Qualified medical personnel are remarkably scarce right now. I do not see how it is possible to oversee the variolation of more than a small number of individuals. Furthermore, it is possible that many medical personnel would refuse to oversee the practice. The net result would be only a small impact on herd immunity. If you doubt this, just consider how bad a job we Americans have done scaling up testing and making masks.
The real question right now is what can you do that is scalable? This isn’t it.
I recall Robin writing on Twitter that variolation would economize on the number of medical personnel. I think it would take many months for that effect to kick in, or possibly many years.
2. Where will we put all of the Covid-positive, contagious individuals we create? What network will we use to monitor their behavior? We have nothing close to the test and trace systems of Singapore and South Korea.
In essence, we would have to send them home to infect their families (the Lombardy solution) or lock them up in provisional camps. Who feeds and takes care of them in those camps, and what prevents those individuals from becoming infected? What is the penalty for trying to leave such a camp? Is our current penal system, or for that matter our current military — both longstanding institutions with plenty of experienced personnel — doing an even OK job of overseeing Covid-positive individuals in their midst? I think not.
Under the coercive approach, what is the exact legal basis for this detention? That a 19-year-old signed a detention contract? Is that supposed to be binding on the will in the Rousseauian sense? Where are the governmental structures to oversee and coordinate all of this? Should we be trusting the CDC to do it? Will any private institutions do it without complete governmental cover? I don’t think so.
If all this is all voluntary, the version that Robin himself seems to favor, what percentage of individuals will simply leave in the middle of their treatment? Robin talks of “Hero Hotels,” but which actual hotels will accept the implied liability? There is no magic valve out there to relieve the pressure on actual health care systems. Note that the purely voluntary version of Robin’s plan can be done right now, but does it seem so popular? Is anyone demanding it, any company wishing it could do it for its workforce?
3. The NBA has an amazing amount of money, on-staff doctors, the ability to afford tests, and so on. And with hundreds of millions or billions of dollars at stake they still won’t restart a crowdless, TV-only season. They could indeed run a “Heroes Hotel” for players who got infected from training and play, and yet they won’t. “Stadium and locker room as Heroes Hotel” is failing the market test. Similarly, colleges and universities have a lot at stake, but they are not rushing to volunteer their dorms for this purpose, even if it might boost their tuition revenue if it went as planned (which is not my prediction, to be clear).
The proposal requires institutions to implement it, yet it doesn’t seem suited for any actual institution we have today.
4. Does small/marginal amounts of variolation do much good compared to simply a weaker lockdown enforcement for activities that involve the young disproportionately? Just tell the local police not to crack down on those soccer games out in the park (NB: I am not recommending this, rather it is the more practical version of what Robin is recommending; both in my view are bad ideas.) Robin’s idea has the “Heroes Hotel” attached, but that is a deus ex machina that simply assumes a “free space” (both a literal free space and a legally free space) is available for experimentation, which it is not.
5. Society can only absorb a small number of very blunt messages from its leaders. You can’t have the President saying “this is terrible and you all must hide” and “we’re going to expose our young” and expect any kind of coherent response. People are already confused enough from mixed messages from leaders such as presidents and governors.
6. There is still a chance that Covid-19 causes or induces permanent damage, perhaps to the heart and perhaps in the young as well. That does not militate in favor of increasing the number of exposures now, especially since partial protective measures (e.g., antivirals, antibodies) might arise before a vaccine does. This residual risk, even if fairly small, also makes the liability issues harder to solve.
7. The actual future of the idea is that as lockdown drags on, many individuals deliberately will become less careful, hoping to get their infections over with. A few may even infect themselves on purpose, one hopes with a proper understanding of dosage. One can expect this practice will be more popular with the (non-obese) young. The question is then how to take care of those people and how to treat them. That debate will devolve rather rapidly into current discussions of testing, test and trace, self-isolation, antivirals, triage, and so on. And then it will be seen that variolation is not so much of a distinct alternative as right now it seems to be.
8. The main benefit of variolation proposals is to raise issues about the rates at which people get infected, and the sequencing of who is and indeed should be more likely to get infected first. Those questions deserve much more consideration than they are receiving, and in that sense I am very happy to see variolation being brought (not much risk of it happening as an explicit proposal). That said, I don’t think Heroes Hotel, and accelerating the rate of deliberate, publicly-intended infection, is the way to a better solution.
Soon I’ll write more on what I think we should be doing, but I would not put explicit variolation above the path of the status quo.
You are going to be running to the refrigerator for snacks anyway, so why not make the most of it? Pickles are cool, fresh, delicious, and just the right size for snacking. At the same time, they are not too delicious, and they are pretty good for you, more so than say chips or candy. They store well too. I have been ordering from Number One Sons (kimchee too, and they deliver in my area), while one very smart reader (Alex R.) recommends Oregon Brineworks, especially the spicy ones.
Soon I’ll be turning to books and movies for your lockdown.
3. On the decline of “Bridge Over Troubled Water.” (I myself prefer “Cloudy,” among many other S&G songs.)
5. “We find that firms that had more connections on the eve of the 1929 financial market crash have higher 10-year survival rates during the Great Depression. Consistent with a financing channel, we find that the results are particularly strong for small firms, private firms, cash-poor firms, and firms located in counties with high bank suspension rates during the crisis. Moreover, connections to cash-rich firms are stronger predictors of survival, overall and among financially constrained firms.” Link here.
8. Roger Congleton model of the pandemic, the link downloads it rather than opening it up.
9. Maybe shaky as evidence, but this paper argues that thinking about coronavirus makes people more right-wing.
You’ve previously publicized the clever solution to the Corona-crisis of “stopping time.” As others have pointed out, a drawback is that we can’t stop time for everyone. In particular, we need essential services to continue.
Separately, there is a significant case for hazard pay. In principle we could let the market sort this out. But in practice, we don’t want to spend the next month getting to the equilibrium with health care workers.
The current round of government interventions entail mounting distortions.
So perhaps a more efficient solution to all of this would be:
–stop time, but
–government sends everyone checks that can be used for food and gas and directly pays for essential services (public safety, medical, utilities)
The net effect is hazard pay for essential workers—they continue to draw income, but their rent/mortgage/loan/utility obligations are frozen just like everyone else’s.
As a ballpark cost: if 25% of the economy is essential, this is about $400B/month.
Expensive, but much cheaper than alternatives.
That is from an email from Philip Bond, University of Washington.
The strategy chosen by Sweden is of course discussed, but I would still say that there is a broad consensus across the political spectrum viewing the strategy, at least so far, as being wise.
I think this can be explained by at least the following five factors:
1. The high horizontal trust and the high vertical trust in Swedish society. In Swedish culture we usually trust that our peers will behave a responsible way and respect the integrity of others. Moreover, we usually trust our authorities, not only politicians but also the public administration. As a consequence “recommendations” for how to behave in regards to Covid-19 has so far been enough.
2. The long tradition of administrative independence. Since the 17th century we have an administrative system where the central governmental agencies such as the National Health Agency is independent. It is a quiet unique system of division of power, where the implementation of laws and regulations is entrusted to the bureaucracies rather than the politicians. As a result the experts rather the politicians have the say, make recommendations and the like, even in a situation like this. And their recommendation has been to not close down the whole society, but to avoid social contacts and to totally refrain from interact with people older than 70 years.
3. An attempt to reach group or mass immunity. As I interpret these experts the attempt is to reach group or mass immunity, 60 – 70 percent, of the population without reaching the limits of intensive care and by protecting the elderly. Also the ambition is to have the staff at hospitals on the job. Hence, child care and schools for children up to high school s still open as usual, shops, restaurants are still open, even if I many of them have very few customers.
4. As strong belief across the political parties to keep the economy going. There is wide consensus in Sweden about the value of work and to have jobs available, and in particular to keep the important export sector intact. I think especially the experience of the deep crisis we had in the early 1990s is important here. But perhaps also that the current prime minister has a back ground as the chairman of the metal workers union.
5. A long tradition of peace. A last factor I believe is that Sweden has stayed out of wars for over 200 years, Hence, we really do not think that disaster can happen to us. This in contrast to for example Denmark, Norway and Finland, who in fact have chosen very different strategies.
In autumn 1830, Pushkin was confined by a cholera outbreak to the village of Boldino, his father’s remote country estate in southeastern Russia. Desperate to return to Moscow to marry, he wrote to his fiancée: “There are five quarantine zones between here and Moscow, and I would have to spend fourteen days in each. Do the maths and imagine what a foul mood I am in.”
Pushkin went on complaining bitterly but, with nothing else to do, he produced an astonishing number of masterpieces — short stories, short plays, lyric and narrative poems, and the last two chapters of his verse novel Eugene Onegin — in a mere three months.
Here is the full FT piece by Robert Chandler.
3. “I, basketball hoop” — It took Steph Curry five hours to assemble the hoop he bought (WSJ). By the way, when they reboot the playoffs, can they arbitrarily insert the now healthier, re-formed Warriors and also Zion Williamson? You know it would be good for the ratings. (Putin picked Alekseenko to play in the Candidates tourney, so there is precedent.)
8. Robert Wiblin’s “good news take.” Relatively speaking, that is.
12. Saku is now blogging, on tech and the future of the world (and more).
16. Italy also may be choosing viral status segregation (NYT). And more on “the German exception” (NYT).
In The Defense Production Act I argued that the DPA was neither especially useful or necessary and would probably be misused. In Sicken Thy Neighbor Trade Policy I argued that exports bans were a bad idea. So, of course, Donald Trump has used the DPA to ban 3M from exporting masks to Canada. “We hit 3M hard today” tweeted Trump, as if 3M were a foreign terrorist camp.
Over the last several weeks and months, 3M and its employees have gone above and beyond to manufacture as many N95 respirators as possible for the U.S. market. Yesterday, the Administration formally invoked the Defense Production Act (DPA) to require 3M to prioritize orders from the Federal Emergency Management Agency (FEMA) for our N95 respirators.
…There are, however, significant humanitarian implications of ceasing respirator supplies to healthcare workers in Canada and Latin America, where we are a critical supplier of respirators. In addition, ceasing all export of respirators produced in the United States would likely cause other countries to retaliate and do the same, as some have already done. If that were to occur, the net number of respirators being made available to the United States would actually decrease. That is the opposite of what we and the Administration, on behalf of the American people, both seek.
I am against export bans in general but placing an ethically charged export ban on one of our largest trading partners and allies is especially shortsighted. For example, guess where one of the world’s largest producers of a key input for making surgical masks (FYI, these are different than N95s) is located? Canada.
…the Harmac mill [on Vancouver Island] is the world’s only producer of the particular grade of paper pulp used in the manufacture of surgical masks and gowns…
“K10S is the pulp that we’re producing for these medical supplies. We’re the only one that produces it,” he said. “Different pulp mills run different grades of pulp – almost kind of like recipes.”
K10S pulp is made from western red cedar that produces a soft fibre that makes it suitable for the final products made from it.
“It’s been tweaked over the years to come up with the right formula that allows it to go into the medical supplies,” Sampson said.
…the U.S. customer that produces [the surgical masks[ has doubled its order for the K10S pulp.
More generally, in the aftermath of the crisis, supply lines will tighten. I don’t favor this for the reasons given in my TED talk but it will probably happen. It’s not going to happen universally, however. China is going to be hit especially hard as they rely on the world trade system much more than does the United States. Canada and especially Mexico will gain, however, as supply lines move closer to home. In the post-Covid world, manufacturing will rationalize on North American grounds so we may as well start planning for that future by treating Canada and Mexico like a part of the US family.
This is from a very able and perceptive correspondent:
|World 1.0||World 2.0|
|110 successive months of job growth||10 million jobless claims in 2 weeks|
|10 year bull market across sectors||Winners and losers with extreme outcome inequality|
|Full employment||30% unemployment|
|Base rate thinking||First principles thinking|
|Office by default||Remote by default|
|Office for work||Office for connection, community, ecosystem, makerspaces|
|Suit, tie, wristwatch, business card||Good lighting, microphone, webcam, home office background|
|Commute + traffic jams||Home + family|
|Last mile||Only mile|
|Restaurants||Groceries + delivery|
|$4 toast||Sourdough starter|
|$100k for college||Not paying $100k for a webinar|
|Internal issues||Exogenous shock|
|Lots of little problems||One big problem|
|Stupid bullshit||Actual issues|
|Too much technology||Too little technology|
|Assume some government competence||Assume zero government competence|
|Trusted institutions||Trusted people|
|Tail risk is kooky||Tail risk is mainstream|
|Boomers most powerful||Boomers most vulnerable|
|Productivity growth collapse||Economic collapse|
|Social services Democrat||UBI Communist|
|Corporate debt||Government debt|
|Techlash||Tech a pillar of civilization and lifeline to billions|
|Break up Amazon||Don’t break up Amazon!!!|
|Avoiding social issues||Avoiding layoffs|
|Phone is a cigarette||Phone is oxygen|
|Resource depletion||$20 oil, $0.75 watt solar, <$100/kwh batteries|
|Low volatility||High volatility|
|20th century||21st century|
7. I could link to Matt Levine every day, but do read this one on liquidity transformation.
8. How is the cloud holding up? A good post.
12. The true story of the toilet paper shortage: it’s not about hoarding, rather a shift of demand away from the commercial sector into the household sector (you are doing more “business” at home these days).
14. Fan, Jamison, and Larry Summers 2016 paper on the economics of a pandemic. I wrote at the end of the blog post: “In other words, in expected value terms an influenza pandemic is a big problem indeed. But since, unlike global warming, it does not fit conveniently into the usual social status battles which define our politics, it receives far less attention.”
5. Why was it so hard to raise the coronavirus alarm? (the yappers are one reason, btw — are you one of them?)
6. Under these calculations, an average coronavirus death in China means 11 years lost, 16 years lost in the United States.
8. Are the new testing kits going to be sent to the American South, which has fewer measured cases? Where should they be sent? A good piece.
10. Overnight, Magnus Carlsen just revolutionized the future organization of chess play. This will become the new normal.
11. Social distancing tips from a hermit. “Keep track of something” is a good one.
Lots of economics, remember what that is? Here is the link, check out the contents. Topics include bracero labor, lone shooters, film incentive programs, FDA liberalization, should Ed Leamer get a Nobel Prize, reviewing money and banking textbooks, and much more.
3. Anti-price gouging laws mean masks leave America, I wonder if Alex is preparing a whole post on this link?
5. The culture that is Bengali priorities: sweet shops will stay open. And a short history of coronavirus in Japan. And Ezra Klein interviews Evan Osnos on coronavirus and U.S.-China relations.
7. Why there are lags in scaling up California testing. A very good (and depressing) piece.
10. “Our infectiousness model suggests that the total contribution to R0 from pre-symptomatics is 0.9 (0.2 – 1.1), almost enough to sustain an epidemic on its own. For SARS, the corresponding estimate was almost zero (9), immediately telling us that different containment strategies will be needed for COVID-19.” Link here.
15. Our system of scientific funding is broken for rapid science (recommended).