Death, Economics And Coronavirus

In the past, I have argued that the threat to lives from the shutdown is far greater than the threat to lives from the virus. Not lives in the developed world, but the lives of the 3-4 billion people who live hand-to-mouth outside the developed world.

assorted food in sacks

Image Source: Unsplash

The growing threat of our economic catastrophe threatens massive numbers of their lives. For context, 700,000 have been killed by the coronavirus. The World Food Program estimates 120 million additional people will face acute food shortages ( They have lowered their predictions for child death, nonetheless they are predicting 128,000 deaths among children under 5 in 2020. The children are particularly important (not just because they are cute) but because they would otherwise have decades of life in front of them. Even in Sub-Saharan Africa, life expectancy has hit 60 years ( Each child thus represents 55+ years of life lost while the average coronavirus victim has lost 10 (

These impacts are as great as they are because the developing world depends on the wealthy world for all manner of economic activity from textile manufacturing ( to petroleum ( and mineral extraction ( to cash remittances from people working in the developed world ( Without that work, the economic structure of entire nations can collapse. The impacts will not only kill, they will destabilize.

For these reasons, it is critical we chart a course back to economic health as soon as we possibly can.

Of course, we can’t do that without any consideration for the lives at risk from the virus in our world. The goal has to be to take both the virus and economic impacts into consideration.

This article is an attempt to analyze the current situation and determine – in more depth than I have before – the path forward for different regions. My prior articles have been very broad in their recommendations. I have actually recommended both paths in this article before – but not at the same time. Unlike previous pieces, this article bifurcates its recommendations by region. This bifurcation is due to the more in-depth analysis in this piece.

As I see it, the following factors are in play:

  1. In countries that had severe outbreaks, death rates have fallen dramatically (even in places like Sweden that have never practiced government enforced social distancing). Note that Sweden had a very high death rate in part because – to quote the WSJ - "About 90% of nursing-home residents who succumbed to Covid-19 in Sweden were never admitted to a hospital, according to official estimates."
  2. Case death rates (from known diagnosis) are highly unreliable as they are very dependent on testing rates.
  3. Infection death rates are unknown because serological survey testing has basically stopped. It could tell us how much the virus as spread and how deadly it is now, but we just don’t know.
  4. The BBC was reporting that large numbers of people (perhaps 50-60%) appear to have T-cell based immunity that pre-dates the current outbreak. In other words, blood samples taken several years ago indicated patients were already immune. This would enable community immunity even without 60+% infection rates. 10-20% might be enough to protect communities from further large-scale death.
    1. This might be why NYC had 22,310 deaths through May 2020 (272 deaths/day from the date of the first death. Serological surveys indicated 20% at this point. Since, there have been 1,244 coronavirus deaths in the city, for 19 deaths/day. In the past month, this has fallen to 10 deaths/day – despite massive public protests. In the week ending August 4th, deaths were 3.6/day. The current death rate is roughly 1/15th the death rate from heart disease. Coronavirus has gone from the overwhelmingly cause of death to one of a number of causes.
    2. NYC’s performance could have been due to lockdown, but Sweden (which didn’t lock down had a similar pattern). There were 54 deaths/day until June 1st. Despite a lack of economically crippling mandates, death rates then dropped. From June 1st to today, they have averaged 21 deaths/day. And from July 1st, it has been 12.4 deaths/day. It is possible their slower decline is due to a less intense initial assault (as show in the chart).

  1. We have possible vaccines on the horizon. There are many candidates and while some say they won’t be available for years, others are indicating large-scale vaccination by the end of this year. I can’t predict which is true.
  2. Contract tracing has never really succeeded in much of the West.
  3. We are seeing contradictory information on the impact of children. Studies of hospitalized patients in Geneva, China, Korea and New South Wales indicate young children are not good transmitters of the virus. Other studies have disagreed. One argued that they must be good transmitters because the concentration of the virus in nasal cavities of children under 5 is far higher than in others. Another, based in Italy, argued that family transmission was higher for children under 5. In the past, I have argued for having under 10s go to school. Parents with children in this age bracket are unable to work with the kids at home. They serve as a major economic brake. Kids over 10 can more easily fend for themselves and thus have less of an impact on an economy. Because we don’t know which is true we need a plan that doesn’t depend on this factor.
  4. I believe a concept of community immunity might be relevant. This isn’t herd immunity. With herd immunity a large percentage of people are immune and the virus can’t effectively spread within a population. With community immunity, the virus continues to spread. However, it spreads to people who have partial immunity as they were exposed in recent months. This tops up their immunity and extends the immunity of the community as a whole. Thus, the virus’ effects are limited. Deaths continue, but at a much lower rate. For this to work, the virus has to keep circulating in the population. Otherwise people will lose immunity and the virus will have a free reign.
  5. A great deal of coverage is politically focused. Below are the hardest hit countries with over 5,000,000 in population by cumulative death rate. Many critical news articles focus on the UK, US and Brazil – being as they are led by widely ridiculed buffoons. This is despite two of those three countries not leading the world in death rates. Negative coverage of government actions in Peru, Spain, Italy and Belgium is minimal. You probably can’t even name the heads of state of all three countries – but Bolsonaro, Trump and Boris Johnson are widely fingered with responsibility.

Within the US, the trend continues. Florida, Georgia, Arizona and Texas all receive heavy negative coverage of their government responses (and have for months). But death rates don’t reflect that. I mapped governor’s popularity among democrats prior to coronavirus vs. death rates in their states. Negative press flows to the left of the chart (politically less liberal governors) vs. the right – despite death rates being far higher in states that have governors popular with the left.

With this in mind, we have to step back from the political considerations in determining what course to take. Just because Trump takes a position does not make it right or wrong. Just because the left has gone with lockdowns while the right has been resistant to them does not make those positions necessarily right or wrong.

  1. There is no question in my mind that economically minimal policies (like mask enforcement and isolation of those at very high risk) should be implemented. They appear to lower the impact of infection, and most industries can still function with masks in place.

With all of this in mind, there is one critical question: How many lives will be saved vs. cost by economically severe interventions?

The answer will vary widely by the prior experience of each country/state. In some places with minimal exposure, opening up could lead to a large number of deaths. In others, it would have almost no effect. Given that, I propose the following steps:

  1. First step is another round of statistical testing that includes both antibody and T-Cell based tests for immunity.
  2. If a region has a high level of immunity, it should open up (with masks in place and protections for those at very high risk) to minimize the effects of secondary infection. The additional death rate (as in Sweden) will be low. Use Swedish data as a baseline to determine what level of immunity is necessary to reach this state. States with a high level of immunity (based on following the ‘NYC Curve’) probably include Illinois, Indiana, Maryland, Massachusetts, Michigan, Minnesota, Nevada (they very recently dropped and might still be in the middle), New York, Pennsylvania, Rhode Island and Vermont. These represent 15% of GDP in 2019.
  3. If a region has a low level of immunity, the updated risk of death (due to improved treatment) should be determined. The same surveys from step 1 could be used to assess prior infection rates and plot them vs. overall death rates. This would provide an estimate of remaining deaths necessary to achieve community immunity could be determined for these areas. If the death rates are low, then this value would be low.
  4. If a region determines the cost of opening is low, then they should do so. Non-economically impactful measures (masks, limited isolation) should remain in place to lessen infection loads and somewhat slow the spread of the virus.
  5. However, if a region determines that the cost of opening is too high, then they should dramatically shift in the other direction.
    1. A full lockdown (including grocery shopping) will bring the virus to a near halt. Pharmaceuticals would be delivered by tested staff and the government could make MREs (or equivalent) available in stores in advance of a lockdown so people can easily acquire the food needed for isolation.
    2. The shutdown would last two weeks for single-family households and three weeks for multi-person households. This time frame is because the vast majority of cases are not contagious after two weeks. The extra week for multi-family households would exist to allow for later infection within the household.
    3. At the end of two weeks, those with suspected cases would be isolated and the rest of the economy would be opened up with temperature-based border testing.
    4. This would not stop the virus (illegal immigration, travel from areas with high infection rates, asymptomatic cases still in the population etc… could reestablish it). But it would reset the clock and delay the full impacts of the virus until a vaccine is available.
    5. The clarity of timelines will allow businesses to plan and can itself provide a boost to economic growth.
  6. When a vaccine is available, provide it first to regions with low levels of immunity. This will dramatically limit the impact of the virus.

One thing that shouldn’t happen is remaining ‘partially’ open for an extended period of time. This is because of the costs for lives both in the region itself and in the developing world.

The WFP estimates the number of people who will suffer from acute food insecurity will almost double (Lancet paper, above). Approximately 9 million died in 2019 from this cause, so we can broadly estimate an additional 9 million will die this year. If we want to estimate the cost of our current policies, we can assign each state a third-party impact based on its contribution to the GDP of OECD countries that have had significant shutdowns. The GDP of these countries totals 47 trillion. So, very roughly, each 5.2 million in GDP brought fully back online will save a life (this ignores multi-year impacts – where economic recovery now saves lives in the future). Using this metric, Texas has a GDP of 66 billion. Bringing it fully back online could save 12,695 lives this year and perhaps more years in the future.

As far as local deaths are concerned, there is data indicating that unemployment leads to a loss of 1.5 years of life ( table 5). If corona costs 10 years of life per individual killed then we have a useful comparison. Six people losing their jobs for six months could have the same life-years impact as a single coronavirus death. Approximately 700,000 Texans have lost their jobs since January, suggesting a longer-term impact of a million life years lost in Texas vs. 85,000 life years lost to the virus. Getting people back to work could save a million life years going forward. Although I have no model for the impact of extending unemployment, the costs are clearly high.

Of course, all of this is very rough. I’m not a believer in the reliability of complex models (or simple ones that try to capture complexity). This is simply directional. It does, however, indicate that an extended shutdown or slowdown is the worst of all paths.

In other words, we need certainty.

All in all, I am recommending a simple strategy.

  1. Project remaining deaths based on antibody and T-Cell immunity (and Swedish data)
  2. Determine the cost and benefits of opening for that region vs. shutting down for a short time.
  3. Then, pick one and move on.

Share your thoughts below…

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.