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FDA Postpones Inspections Delaying New Drugs and Creating Shortages of Old Drugs
NYTimes: The Covid-19 pandemic has forced the Food and Drug Administration to postpone hundreds of drug company inspections, creating an enormous backlog that is delaying new drug approvals and leading the industry to warn of impending shortages of existing medicines.
…In an interview, F.D.A. officials said they sharply curtailed the inspections to protect their investigators, following guidelines from the Centers for Disease Control and Prevention, which discouraged federal employees from travel during the pandemic.
But some people in both industry and public health communities say that federal drug inspections are essential, and that the agency should bypass travel restrictions by taking precautions, including wearing proper personal protective equipment.
…In interviews, F.D.A. officials denied that the dramatic drop in inspections has slowed drug approvals. But a number of drug companies, including Spectrum Pharmaceuticals, Biocon Biologics and Bristol Myers Squibb, has issued statements noting deferred F.D.A. action because of the agency’s inability to conduct inspections.
In October, Spectrum announced that the F.D.A. had deferred action on its application for Rolontis, a treatment for cancer patients who have a very low number of certain white blood cells, because it could not inspect the manufacturing plant the company uses in South Korea.
In late December, Biocon Biologics notified shareholders that the F.D.A. deferred action on its joint application with Mylan for a proposed biosimilar to Avastin, a cancer drug.
Bristol Myers Squibb announced in November that the F.D.A. would miss its November deadline for taking action on a lymphoma treatment, lisocabtagene maraleucel because it could not inspect a third-party Texas manufacturing plant. The agency eventually did complete its inspection and approved the drug last month.
Grocery store workers are working, meat packers are working, hell bars and restaurants are open in many parts of the country but FDA inspectors aren’t inspecting. It boggles the mind.
Let’s review. The FDA prevented private firms from offering SARS-Cov2 tests in the crucial early weeks of the pandemic, delayed the approval of vaccines, took weeks to arrange meetings to approve vaccines even as thousands died daily, failed to approve the AstraZeneca vaccine, failed to quickly approve rapid antigen tests, and failed to perform inspections necessary to keep pharmaceutical supply lines open.
I am a long-time critic of the FDA and frankly I am stunned at the devastation.
Canada: An Official Strong Recommendation for First Doses First
Canada’s National Advisory Committee on Immunization (NACI), a scientific advisory group to the government, has made a forceful and dramatic statement strongly favoring First Doses First (delay the second dose.) This is a very big deal for the entire world. Basically NACI have endorsed everything that Tyler and I have said on First Doses First since my first post tentatively raised the issue on December 8. I am going to quote this statement extensively since it’s an excellent summary. No indentation.
—-NACI Statement—-
Based on emerging evidence of the protection provided by the first dose of a two dose series for COVID-19 vaccines currently authorized in Canada, NACI recommends that in the context of limited COVID-19 vaccine supply jurisdictions should maximize the number of individuals benefiting from the first dose of vaccine by extending the second dose of COVID-19 vaccine up to four months after the first. NACI will continue to monitor the evidence on effectiveness of an extended dose interval and will adjust recommendations as needed. (Strong NACI Recommendation)
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- In addition to emerging population-based data, this recommendation is based on expert opinion and the public health principles of equity, ethics, accessibility, feasibility, immunological vaccine principles, and the perspective that, within a global pandemic setting, reducing the risk of severe disease outcomes at the population-level will have the greatest impact. Current evidence suggests high vaccine effectiveness against symptomatic disease and hospitalization for several weeks after the first dose, including among older populations.
Protecting individuals
- By implementing an extended four month interval strategy, Canada will be able to provide access to first doses of highly efficacious vaccines to more individuals earlier which is expected to increase health equity faster. Canada has secured enough vaccines to ensure that a second dose will be available to every adult.
- As a general vaccination principle, interruption of a vaccine series resulting in an extended interval between doses does not require restarting the vaccine series. Principles of immunology, vaccine science, and historical examples demonstrate that delays between doses do not result in a reduction in final antibody concentrations nor a reduction in durability of memory response for most multi-dose products.
- Assessment of available data on efficacy and effectiveness of a single dose of mRNA vaccine was a critical factor in assessing the impact of a delayed second dose at this time. The two available clinical trials for mRNA vaccines (Pfizer-BioNTech and Moderna) provide evidence that indicates that efficacy against symptomatic disease begins as early as 12 to 14 days after the first dose of the mRNA vaccine. Excluding the first 14 days before vaccines are expected to offer protection, both vaccines showed an efficacy of 92% up until the second dose (most second doses were administered at 19-42 days in the trials). Recently, real world vaccine effectiveness data presented to or reviewed by NACI assessing PCR-positive COVID-19 disease and/or infection from Quebec, British Columbia, Israel, the United Kingdom and the United States support good effectiveness (generally 70-80%, depending on the methodology used and outcomes assessed) from a single dose of mRNA vaccines (for up to two months in some studies). While studies have not yet collected four months of data on effectiveness of the first dose, the first two months of population-based effectiveness data are showing sustained and high levels of protection. These data include studies in health care workers, long term care residents, elderly populations and the general public. While this is somewhat lower than the efficacy demonstrated after one dose in clinical trials, it is important to note that vaccine effectiveness in a general population setting is typically lower than efficacy from the controlled setting of a clinical trial, and this is expected to be the case after series completion as well.
- Published data from the AstraZeneca clinical trial indicated that delaying the second dose to ≥ 12 weeks resulted in a better efficacy against symptomatic disease compared to shorter intervals between doses.
- The duration of protection from one or two doses of COVID-19 vaccines is currently unknown. Experience with other multi-dose vaccines after a single dose suggests persistent protection could last for six months or longer in adolescents and adults. Longer-term follow-up of clinical trial participants and those receiving vaccination in public programs will assist in determining the duration of protection following both one and two doses of vaccination. NACI will continue to monitor the evidence on effectiveness of an extended interval, which is currently being collected weekly in some Canadian jurisdictions, and will adjust recommendations as needed if concerns emerge about waning protection.
Protecting populations
- Although effectiveness after two-doses will be somewhat higher than with one dose, many more people will benefit from immunization when extending the interval between doses in times of vaccine shortage; offering more individuals direct benefit and also the possibility of indirect benefit from increasing population immunity to COVID-19 disease. Everyone is expected to obtain the full benefit of two doses when the second dose is offered after 4 months.
- Internal PHAC modelling reviewed by NACI based on Canadian supply projections suggested that accelerating vaccine coverage by extending dose intervals of mRNA vaccines could have short-term public health benefits in preventing symptomatic disease, hospitalizations, and deaths while vaccine supply is constrained. Even a theoretical scenario analysis in which intervals were extended up to six months and protection was lost at a rate of 4% per week after the first dose also showed that extending the mRNA vaccine dose intervals would still have public health benefits. External modelling results have also suggested that extending dose intervals can avert infections, hospitalizations and deaths.
- The impact on variants of concern by extending the interval between doses is unknown, but there is currently no evidence that an extended interval between doses will either increase or decrease the emergence of variants of concern. COVID-19 mRNA vaccines and AstraZeneca vaccine have shown promising early results against variant B.1.1.7. As effectiveness of the first dose against other variants of concern is emerging, ongoing monitoring will be required.
- Vaccine distribution will be optimized through this strategy, and current vaccine supply projections will work well with an extended dose strategy that aims to immunize as many Canadians as efficiently as possible. Extending the dose intervals for mRNA vaccines up to four months has the potential to result in rapid immunization and protection of a large proportion of the Canadian population….
First Doses First, Now! – New Information
A lot of new information has dropped recently about the efficacy of First Doses First.
First, as I mentioned yesterday, we now have epidemiologists and vaccine researchers saying that for people previously infected with COVID a second dose is not necessary and may be “overkill.” Given how many people have had COVID, this increases the net benefit to First Doses First for everyone significantly.
Second, an important new study verifies that for the AZ vaccine a longer delay for the second dose is better because it generates a more powerful immune response (picture from the FT). This 
is a common finding for vaccines. The authors write:
ChAdOx1 nCoV-19 vaccination programmes aimed at vaccinating a large proportion of the population with a single dose, with a second dose given after a 3 month period is an effective strategy for reducing disease, and may be the optimal for rollout of a pandemic vaccine when supplies are limited in the short term.
In addition “Analyses of PCR positive swabs in UK population suggests vaccine may have substantial effect on transmission of the virus with 67% reduction in positive swabs among those vaccinated.” In other words, the vaccine cuts transmission risk.
As I have said before “the US failure to authorize the AstraZeneca vaccine in the midst of a pandemic when thousands are dying daily and a factory in Baltimore is warmed up and ready to run is a tragedy and dereliction of duty of epic proportions.”
Third, the New and Emerging Respiratory Virus Threats Advisory Group (NERVTAG), a scientific advisory group to the British government, recently considered the risks of immune escape from the delayed second dose strategy and concluded that although the risk is real it is likely small, especially in comparison to other sources of immune escape such as therapeutics and natural infection. Moreover, the risk is outweighed by the measurable benefits of getting more does out quickly.
It is not currently possible to quantify the probability of emergence of vaccine resistance as a result of the delayed second dose, but it is likely to be small.The UK currently has more than 1,000 COVID-19 related deaths each day and has limited supplies of vaccine. In the current UK circumstances the unquantifiable but likely small probability of the delayed second dose generating a vaccine escape mutant must be weighed against the measurable benefits of doubling the speed with which the most vulnerable can be given vaccine-induced protection.
..a single dose of vaccine does not generate a new/novel risk. Given what we have observed recently with the variants B.1.1.7 and B1.351, it is a realistic possibility that over time immune escape variants will emerge, most likely driven by increasing population immunity following natural infection.
Fourth, the British health establishment has largely solidified around First Doses First. Consider this from the Four UK’s Chief Medical Officers.
The 4 UK Chief Medical Officers agree with the JCVI that at this stage of the pandemic prioritising the first doses of vaccine for as many people as possible on the priority list will protect the greatest number of at risk people overall in the shortest possible time and will have the greatest impact on reducing mortality, severe disease and hospitalisations and in protecting the NHS and equivalent health services.
Fifth, the US public health experts are beginning to come around to the economic point of view. Consider Experts tout delaying 2nd COVID vaccine dose as US deaths mount which notes:
“The maximum public health benefit would come from giving a single dose to as many people as possible, and following up with a second dose when supply improves,” said Neal Halsey, MD, of Johns Hopkins University, in an interview. Halsey and Stanley Plotkin, MD, co-authored a letter in Clinical Infectious Diseases last week explaining how delaying a second dose of vaccine would accelerate the US vaccine rollout.
Halsey said data from both companies show the first dose of the vaccine offers significant protection against COVID-19 in the short term, for at least 1 to 3 months after injection. He also said he and Plotkin believe this was the most beneficial public health strategy even before the arrival of new variants of the virus was discovered.
“There are a number of examples of changing [vaccination] course because ACIP takes into account public health impact,” Halsey said. “We asked the ACIP to review in depth this strategy to give one dose as rapidly as possible. Such a meeting should be scheduled as soon as possible.”
The University of Minnesota’s Michael Osterholm, PhD, MPH, said yesterday on “Meet the Press” that he believes the United States has to change direction on vaccine strategy in light of the possibility of a surge of new infections coming from variant strains.
I believe that the US will go to First Doses First. The only question is will we go to First Doses First soon, when it can still help, or will we be forced to do it later in an act of desperation and agony.
My Conversation with Benjamin Friedman
Here is the audio, transcript, and visual. Here is part of the CWT summary:
Benjamin Friedman has been a leading macroeconomist since the 1970s, whose accomplishments include writing 150 papers, producing more than dozen books, and teaching Tyler Cowen graduate macroeconomics at Harvard in 1985. In his latest book, Religion and the Rise of Capitalism, Ben argues that contrary to the popular belief that Western economic ideas are a secular product of the Enlightenment, instead they are the result of hotly debated theological questions within the English-speaking Protestant world of thinkers like Adam Smith and David Hume.
Ben joined Tyler to discuss the connection between religious belief and support for markets, what drives varying cultural commitments to capitalism, why the rate of growth is key to sustaining liberal values, why Paul Volcker is underrated, how coming from Kentucky influences his thinking, why annuities don’t work better, America’s debt and fiscal sustainability, his critiques of nominal GDP targeting, why he wouldn’t change the governance of the Fed, how he maintains his motivation to keep learning, his next big project on artificial intelligence, and more.
Here is one excerpt about religion:
COWEN: If we think of the most influential advocates for capitalism in the mid–20th century, there’s Hayek, I would say Keynes at most phases of his career — maybe not all, Milton Friedman. They seem to be largely secular rather than religious. If we look at theologians — while there’s a great diversity of views, on average, they seem to be left-leaning. So why is it the religious thinkers lean towards socialism, and the economists are quite secular?
FRIEDMAN: I think there’s a part of the story that you’re missing, and that has to do with the coming together at mid–20th century in America, of religious conservatism and economic conservatism. I think the catalyst that brought them together was the existential fear of world communism. Here we are — call it 70 years later, and it’s difficult to put ourselves back in the shoes of Americans in the 1950s, but that was a real fear.
Communism, at least as advocated at that time, had a unique feature of being simultaneously the existential enemy of lots of things that we hold dear. It was the enemy of Western-style political democracy, but it was also the enemy of Western-style market capitalism, and importantly for purposes of this line of argument, it was the enemy of Western-style religion.
I think the religious conservatives and the economic conservatives realized that they had an enemy in common, and they took the threat seriously, and this led them to come together.
And about macro:
COWEN: Pandemic aside, if, on average, G is greater than R, can’t we just grow our way out of the debt? As you mentioned, now borrowing rates are negative in real terms, right? Economic growth, on average, is positive, so just keep on plowing straight ahead. Let the clock tick.
FRIEDMAN: There are two parts of the sustainability question, and you hit one of them correctly. If your economy is growing in real terms faster than the debt, then you can grow your way out of any debt. But there’s another side of it, and that’s how rapidly are you taking on new debt?
Let’s take your question seriously and say we’re going to put the pandemic aside. In the year before the pandemic — we’re talking about the government’s fiscal year 2019, so ended September 30, 2019 — none of us had talked about pandemics yet. In that year, the US government spent $4.5 trillion, and it only took in, in revenues, $3.5 trillion.
That $1 trillion deficit, even at a time of a fully employed economy and, of course, before the pandemic hit, that was nearly 5 percent of our national income — even though our economy was growing nicely, more rapidly than the rate of interest that the government was paying on the debt, we were on the other side of the equation, adding new debt so rapidly that the debt-to-income ratio was going up instead of down.
So simply pointing to the so-called R-minus-G factor, I think, is a very incomplete way to look at the question of sustainability.
Recommended, and here is Ben’s new and very interesting book Religion and the Rise of Capitalism.
Felix Camilo Ayala, RIP
He was an indigenous, Nahuatl-speaking Mexican painter in the “Naive” tradition, working on board, amate paper, and ceramics. Some of you will know that I was his biographer, along with his two brothers Marcial Camilo and Juan Camilo, both painters as well. I spent many hours interviewing Felix Camilo (and his friends and relatives) about the events of his life, so it is especially sad for me to see such a tragic final episode, namely death by Covid in his mid-sixties. He simply was not able to breathe any more, and then he died.
Felix was less ambitious than his brothers, but he had a natural eye for a lovely scene. Pretty much everyone in San Agustin Oapan, his home village, liked or loved him, and such general popularity there is rare. He worked hard to avoid faction, to stay on good terms with all, and to raise his children after his wife passed away almost thirty years ago.
Here is an update on the coronavirus situation in Mexico:
Officials reported 1,219 deaths Saturday, which was a near-record for one day, and 463 deaths Sunday.
Mexico has now seen over 1.64 million total infections and registered over 140,000 deaths so far in the pandemic. With the country’s extremely low testing rate, official estimates suggest the real death toll is closer to 195,000.
Here is some basic background on Felix Camilo, his village, and my involvement with it. These days, one of my friends in Oapan estimates that about two percent of the village has died from Covid, and about half of those are relatively young. There are many comorbidities and no medical care to speak of.
Here are a few other Felix Camilo images. He was never a famous painter, but he played a significant part in capturing and communicating a culture that is vanishing rapidly.
Elrond and the New Crypto Spaces
I’m an advisor to a number of firms, including several in the crypto space such as Elrond (eGLD coin). When I signed on as an advisor more than two years ago, Elrond was almost completely unknown, which wasn’t surprising as they were based in Romania. I thought the Romanian base was a positive, however, because it meant that Elrond could hire extremely well-educated computer scientists, mathematicians and software engineers at below Silicon Valley prices. Moreover, the blockchain world, true to its foundations, is decentralized. Like a modern day Erdos, Vitalik Buterin operates out of his suitcase. The Silicon Valley of the blockchain is the internet. Why the blockchain world has evolved differently than Silicon Valley is an interesting question (with implications for whether SV could loses its centrality) but because it is decentralized I thought location was less important than the quality of the team. And the team, led by hard-charging founder Beniamin Mincu, is excellent. In the last two years the Elrond team has built a completely modern blockchain from the ground up using secure proof of stake and sharding to achieve a potential throughput of upwards of 16 thousand transactions per second with 6s latency and $.001 transaction cost and a toolkit for developers. I was also impressed by the commitment Elrond had to security, including formal verification methods, and especially to making Elrond accessible to the masses. Today Elrond/eGLD is on a tear and by market cap it is one of the top 50 projects in the space with a strong upward trend.
Will Elrond take over the world? I hope so! But, of course, it is unclear. Aside from ranking Elrond versus other projects the space itself still doesn’t have a killer app for the masses. In 2017 near the peak of the market at that time, Vitalik Buterin tweeted:
So total cryptocoin market cap just hit $0.5T today. But have we *earned* it?
How many unbanked people have we banked?
How much censorship-resistant commerce for the common people have we enabled?
How much value is stored in smart contracts that actually do anything interesting?…
The total market cap is now close to a trillion, about twice the level when Vitalik tweeted, and these are still good questions. Bitcoin has established itself as a new asset class that is rapidly supplanting gold as a store of value (gold is lame) but not as a payments platform. Ethereum, Elrond and competitors like Algorand were built for smart contracts, including things like stable coins which will be used for payments, but smart contracts are capable of doing much more. In theory, smart contracts let people cooperate in new ways, potentially unlocking trillions in value. But we aren’t there yet.
Decentralized finance or DeFi is one suggestive hint of where things are going. Already many billions of dollars are “lent” and “saved” using DeFi. The lending and saving, however, is almost entirely done in one cryptocurrency for another. In essence, the DeFi system is leveraging off of crypto speculation and trading.
Nevertheless, something interesting is happening in DeFi. The DeX’s or decentralized exchanges have shown that automated market makers can perform the services of market order books used by the traditional exchanges like the NYSE at lower cost while being easily accessible from anywhere in the world and operating 24/7/365. Thus, every exchange in the world is vulnerable to a DeX.
Also, although DeFi is a place where you can easily lose all your money to mistakes, scams, and bugs (not to mention changes in asset values), DeFi is rapidly developing state-of-the-art security. Only the paranoid survive on the blockchain which means that the systems that do survive are robust. Balaji Srinivasan recently tweeted that Bitcoin is the most powerful algorithm in the world and few algorithms have been as battle-tested as Bitcoin. In a similar way, DeFi will be secure or die and security in a blockchain world will be more secure than anywhere else.
Combining security with accessibility is what’s hard. It’s telling that Coinbase is one of the most successful firms in the crypto space despite performing services which are in some tension with the philosophical foundations of crypto. Satoshi Nakamoto would probably be a little disappointed to learn that people were depositing their Bitcoins in a bank! I can understand the impulse, however. It’s almost magical how you can move money on a blockchain without input or permission from any authority. But when you click the button and your money disappears it’s terrifying as you pray for the invisible hand of the miners to restore your money in another account. Elrond’s soon to be released Maiar app, a wallet that interacts with the Elrond blockchain using only a phone number, will be an interesting test of whether a blockchain platform can duplicate the ease of use of something like PayPal or Zelle.
The other interesting development in the space are zero knowledge proofs. Zero knowledge proofs let someone prove that they know a piece of information or the results of a computation without revealing the information. ZK proofs started in the academic literature but research in their uses and applications has exploded as computer scientists like Silvio Micali start blockchains and blockchains like ZCash hire computer scientists who advance the scientific literature (to give just one example). Truly anonymous digital cash is one application but more generally zero knowledge proofs let people buy and sell information in a way which has always been difficult and seemed impossible (how can you sell a piece of information without showing it to someone first but then having seen the information why would they buy it?).
Bottom line is that crypto is still waiting for the killer app which will make it 21st century infrastructure but there has been tremendous scientific progress in blockchains since the ur-date, 1/3/2009. Modern platforms like Elrond are faster, more robust, and more powerful than past platforms and the potential is there for transformative growth.
The politics of Covid just got even more hellish
That is the title of my latest Bloomberg column, here is one excerpt:
Preliminary data indicate that the new strain in the U.K. allows the virus to spread from one person to another more easily. The practical upshot is that even the strict lockdowns of early 2020, such as the one just ordered in the U.K. by Prime Minister Boris Johnson, may not be enough to reverse the spread of the virus.
It is far from obvious that politicians will be able to sell voters on strict lockdowns if they still allow the virus to spread. Furthermore, vaccine distribution has been sufficiently slow that a full lockdown would have to last for many months, and that probably isn’t feasible or desirable. Yet not having lockdowns would lead to a much more rapid spread of the virus, overloading hospitals and public health facilities.
And:
The biggest moral dilemmas might come in those countries that to date have been fairly successful at containing the spread of the virus. Apart from restrictions on foreign travel, life in Taiwan has been normal for some time now, and Covid-related casualties have been miniscule. Other successful examples of virus containment can be found throughout Asia and the Pacific.
But how will those countries deal with the new strain? It has already appeared in both Taiwan and China. So far it has not taken over, but the previous tactics of quarantine and tracing may no longer suffice, should the new strain become more active. It is already spreading in Denmark, which did a good job against Covid-19 early on.
Imagine being a leader of a country that has successfully contained Covid, and now realizing that a single mistake could undo almost a year of very hard work. You also know that, precisely because your country has been so effective at fighting the virus, it is not on the verge of vaccinating your entire population. What if you let a single returning citizen pass through customs taking one Covid test rather than three? What if you then cannot control the subsequent spread of the strain that person is carrying?
When was the last time that stakes for such apparently minor decisions were so high? How will leaders deal with the extreme moral anxiety that their decisions will likely induce?
It is like we are living in a horror movie, and just when we think it’s over, the monster comes back, stronger than ever.
Important throughout.
Why bitcoin will not take over the world
Yes it is here to stay, and it is not a bubble, but…here is one part of the argument:
If you hold or trade with a stablecoin, you incur several risks. First, the stablecoin peg to the dollar may someday be broken, an old problem with pegged exchange rates that Milton Friedman often warned about. Second, to the extent stablecoins and other crypto assets become a major part of the financial system, they will attract more regulatory interest. That in turn will limit many of their advantages over the traditional bank sector. The U.S. government does not want a financial system that evolves outside the purview of the Federal Reserve, FDIC and other regulatory institutions.
Third, the formal banking sector will improve, for instance by moving to more rapid clearing, or by introducing electronic reserve currencies. With the latter, you could transfer your electronically-based dollars within the accounting system of the central bank, and achieve a non-intermediated transfer without resorting to crypto. It is not obvious that crypto will be the market winner once more mainstream institutions learn some lessons from the success of crypto.
And in sum:
The more utopian scenarios for crypto, whether proponents realize it or not, rely on the notion that crypto remains simultaneously fringe and mainstream. That will be a hard trick to pull off.
Your rebuttals, and more, are considered at the link to my latest Bloomberg column.
I am not so worried about inflation
I have pondered this matter further, and have upon reflection abandoned my previous concern with the high M2 figures. Here is one excerpt from my latest Bloomberg column:
To understand forthcoming inflation rates further, consider why monetary aggregates such as M2 have been rising so rapidly. It is not that the U.S. Federal Reserve wishes to relive the experience of the 1970s. It’s that many businesses have been borrowing while they can, fearing they may end up strapped for cash as the pandemic continues.
From that point onward, there are two possible paths. The first is that businesses will actually need that extra cash, due to low consumer demand and a stalled recovery. In that case, the potentially inflationary boost from a higher money supply would be offset by lower demand elsewhere in the economy. The velocity of money would be weak, and there would be no reason to expect major inflationary pressures.
The second possible path is that the recovery will proceed at a rapid clip, and businesses will have extra cash on their hands for a while. That likely would translate into lower borrowing for the rest of the year and a smoothing of monetary flows — and no major increase in inflationary pressures.
There will, however, be some areas of the economy in which inflation will likely be high. Consider a sector in which demand is largely seasonal and has been stifled by the pandemic, and supply in the short run is inelastic. One obvious example is summer vacation travel.
You also might say that I am agreeing with the market forecasts embedded in interest rates, indexed securities prices, and so on.
Wednesday assorted links
The ideological shift of the libertarian movement on pandemics
In the midst of his libertarian phase, Milton Friedman wrote:
As already noted, significant neighborhood effects justify substantial public health activities: maintaining the purity of water, assuring proper sewage disposal, controlling contagious diseases.
Yet today many libertarians shy away from the actual execution of this for Covid-19.
Here is a 2014 Reason magazine symposium on Ebola, by . Of those four I know Bailey a wee bit (not well), but from the entries and bylines and the very title of the feature — “What Is the Libertarian Response to Ebola? How a free society should respond to a communicable disease outbreak” — they would indeed seem to be self-described libertarians.
All four, as I read them, are willing to accept the idea of forced quarantine of individuals. Not just in extreme lifeboat comparisons, but in actual situations that plausibly might have arisen at that time. If you don’t already know, Reason, while not mega-extreme, typically would be considered more libertarian in orientation than most of the libertarian-leaning think tanks.
Maybe I was napping at the time, but I don’t recall any mega-scandal resulting from those proclamations.
Here is my earlier Bloomberg column rejecting the notion of forced quarantine of individuals for Covid-19, mostly on rights grounds, though I add some consequentialist arguments. I would not trade in the American performance for the Chinese anti-Covid performance if it meant we had to weld people inside their apartments without due process, for instance, as the Chinese (and Vietnamese and others) did regularly.
To be clear, Ebola and Covid-19 have very different properties, and you might favor forcible quarantine for one and not the other. Whether those differences in properties should matter for a rights perspective is a complex question, but still I am surprised to see that quarantine was — not long ago — considered so acceptable from a libertarian point of view, given the current pushback against pandemic-related restrictions.
(Speaking of shifts, here is Will Wilkinson on GBD. While I agree with many of his points, I am curious where Will stands on forcible quarantine of individuals on a non-trivial scale. He does say he favors a “supported isolation program,” so maybe he favors coercive quarantine but he doesn’t quite commit to that view either?)
I am surprised most of all how little interest current libertarians seem to have in the following “line”:
“A unregulated Covid-19 response would have been much, much better. We would have had a good vaccine right away, and tested it rapidly with a Human Challenge Trial. It would be sold around the world at a profit, with much quicker distribution and pandemic resolution than what we are seeing today. This pandemic was awful, but the market would have kicked butt cleaning it up.”
I am not here claiming that view is correct, only that a strong libertarian ought to be amenable to it. And yet I hear it remarkably infrequently, even though I think most committed libertarians would agree if you posed it to them as a direct question.
It is at least 20x more fashionable to obsess over the costs of lockdowns, combined with various denialist claims about the severity of the problem.
As for masks, how about this?:
“Masks? Masks are great, of course they are a public good. Markets are great at producing and maintaining value-maximizing voluntary norms such as mask-wearing!”
I cannot help but think that the views above in quotation marks would have been the dominant libertarian response in the 1980s or 1990s, and that the various brews appearing today are yet another sign of our Douthatian decadence.
Where We Stand
There is good news and there is bad news.
Let’s start with the good news.The early results from the Pfizer vaccine are very good, 90% efficacy. That will probably fall a bit but it’s very good news not just for the Pfizer vaccine but for most of the vaccines in the pipeline which target the spike protein.
The Pfizer vaccine does require very cold storage which means it won’t work for large parts of the world. A distribution plan is in place for most of the United States and Pfizer already has 50 million doses, which can cover ~25 million people, in storage.
Many thousands of people are dying every week so Pfizer should apply for and the FDA should issue a EUA without further delay.
One issue is, given limited supply, how to distribute the vaccine. I have suggested we randomize distribution across hospitals, police and fire stations, and nursing homes (see also my piece in Bloomberg with Scott Kominers, The Case for a COVID Vaccine Lottery.) A vaccine lottery is fair, it will make distribution easier by limiting the number of vaccination locations and it will in essence create a very large clinical trial. With millions of participants we will be better able to make fine distinctions between the vaccine’s safety and efficacy in different populations and the results will come in quickly. Thus, if we randomize and collect data, limited capacity has a silver lining.
Second issue. Manufacturing capacity. Pfizer will have enough capacity to produce 1.3 billion doses in 2021 which sounds like a lot but it’s a two dose vaccine and there will be losses in distribution so maybe 500 million people vaccinated. We need to vaccinate billions.
The cost to the world economy of COVID is in the trillions so we want to vaccine a lot faster. Faster than private markets are willing to go. There are other vaccines in the pipeline but we still need to ramp up capacity. Increasing capacity is something that Michael Kremer, Susan Athey, myself and others at Accelerating Health Technologies have been working on since the beginning of the crisis. It’s not too late to do more.
Third issue is testing. Trump got it into his head that more tests means more cases when in fact a lot more tests means fewer cases. There is a Laffer curve for testing. Our failure to get ahead of the virus with tests has meant hundreds of thousands of excess deaths. We are still failing this test. Winter is coming. Infections and deaths are both rising.
Biden won’t be president until late January but there are things he can do now. In particular, Congress already allocated $25 billion to testing in April—that was far too little. We spent trillions on relief and comparatively little fighting the virus. But here is the real shocker, most of the $25 billion allocated in April hasn’t been spent. Let me say that again, most of the money allocated for testing in April has not been spent. Biden can signal today that that money and more will be spent. He can also signal, as in fact he has, that he wants rapid antigen tests approved.
Rapid antigen tests are cheap, paper strip tests that can check for infectiousness and are ideal to getting things like the schools running again.
Even if we start vaccinating this year, we won’t vaccinate a majority of the US population until well into 2021. That’s true but what’s underappreciated is that testing, masks, social distancing and vaccines are complementary. The more people are vaccinated, for example, the greater our testing capacity rises relative to the population at risk.
The pandemic is getting worse not better but we did flatten the curve, albeit imperfectly, and now if we can summon the will, we have the tools including rapid antigen tests, vaccines and monoclonal antibodies to really crush the virus.
Wednesday assorted links
1. GMU tenure-track assistant professor ad.
2. “We find that the fiscal, macroeconomic, and health benefits of rapid SARS-CoV-2 screening testing programs far exceed their costs, with the ratio of economic benefits to costs typically in the range of 4-15 (depending on program details), not counting the monetized value of lives saved.” Link here.
3. Incentive-based approaches to addiction (NYT).
5. Do swordfish stab and murder sharks? (NYT)
Monday assorted links
1. On the history and use of EUAs (NYT).
3. Sara Lowes on ethnographic and field data in economics.
4. Saez and Zucman respond to their critics in great detail.
5. The value of rapid self-testing for Covid-19. Yes it works and the medical professionals and the FDA are wrong on this one.
6. Logistical problems with supplying monoclonal antibodies, important. It is time to stop dumping on this treatment people, and get our act together. Now. Let’s not have another fiasco. And a good NYT story on the whole topic, you can feel the media mood shifting toward the positive and away from the skeptical.
7. Can you even win at the Japanese crane game? What else is like this?
8. The captain of Operation Warp Speed (WSJ).
9. How it enters your brain. Or might.
10. A Fine Theorem on Milgrom and Wilson, recommended, note that Milgrom also does not have a Ph.D. in economics.
Wednesday assorted links
1. Now they are cancelling parrots. And there is no satire anymore. Or is it Straussian?
2. Oakland airport wants to attract passengers with free rapid Covid testing.
3. Should Matt Yglesias go on the warpath against car seats?
4. Virtual work partners to help you focus.
5. Survey of the evidence on declining Covid death rates. And here is yet further evidence on the relevance of T-cells. And new Covid results from lots of Indian data (NYT).
6. 15-minute test coming to Europe (Bloomberg).