Most biological species specialize for particular ecological niches. But some species are generalists, “specializing” in doing acceptably well in a wider range of niches, and thus also in rapidly changing niches. Generalist species
As you surely know, I pointed to a substantial likelihood that we will do more lockdown than is best. I did not claim that zero lockdown was the optimal policy.
So the fact (if it is a fact) that the lockdown policy will do more damage than the virus does not at all show that the lockdown policy is misguided? (It kind of *sounded* like you were suggesting a negative assessment of the policy, but that was a misimpression.)
It's not that i wouldn't trust a thoughtful estimate. But every single estimate i've seen so far seems designed for shock value. Which is odd because economists are basically accusing epidemiologists of exactly the same thing.
My hunch is that the economic costs are actually quite small in the medium term, provided that the dislocation is indeed temporary and does not lead to war or societal upheaval, etc. It's much akin to a pandemic actually: costs are manageable, provided you can cut off that extreme tail scenario.
There is more uncertainty than economists like to admit around the "economic costs." It certainly is not some simple sum of lost wages or stock market losses. Although such things do occur in recessions, it also seems as though you get accelerated growth coming out of recessions. It's not clear to me if you are any worse off in the long-term. And I certainly wouldn't trust any calculations pretending to know.
If you lose your job, but get a better one post-recession was there a cost? Some might go so far as to argue that recessions are useful in reallocating resources since tough choices have to be made and new solutions are needed in a hurry (e.g., my sister owns a small business...when i asked her why she's laying off people instead of taking govt loans she said the employees weren't a good fit but she just never had a good reason to let them go...and now she does...her business will be more efficient going forward).
I'm not saying there aren't costs...there most likely are. But i keep seeing overly simple analyses resembling "we spent $x trillion to save y lives." I don't think that's even close to correct.
Perhaps we can look at countries like Australia or Israel which have had few technical recessions...if my memory serves me there is no appreciable difference in per capita GDP growth relative to the US.
They did shut down a lot. In Wuhan the measures were much stricter than anywhere. "Police have welded doors shut in order to monitor who enters and leaves buildings." https://www.theguardian.com...
They did quarantine people. One of the main 'lessons learned' that they promote is the need of a 'centralized quarantine' - that is quarantining people who had contact with the virus not at homes, but rather in hotels.
I still see flexibility in their response but not because they shut down little - they shut down much more than in Europe of the USA. You can also argue that there is flexibility in localizing it to Wuhan and Hubei - but it is like localizing it to France.
But there was flexibility in throwing just everything at the disease - masks, temperature taking at work, and devising new ideas likeprotocols of packages delivery, disinfecting surfaces etc, everything that could be helpful was deployed.
When you speculate that the “apparently endless and terribly expensive lockdowns” will actually “end up doing more damage than the virus,” do you mean to suggest that the government’s doing nothing (beyond exhortation—nothing coercive) would have been and would be better policy that what it actually did and seems likely to continue doing? How likely is this, really?
Lt. Gen. Semonite has two degrees from military colleges. Bet those colleges are succeeding at maintaining a repository of flexible thinking practices even during peacetime.
BTW, to be fair, there is a lot of coronavirus misinformation floating around. And the urge to quash misinformation is noble, even if it sometimes ends up being misguided. And let's be honest, most people aren't great at evaluating what is and isn't misinformation for themselves. So they have to rely on authorities. I think these heuristics are good in general, actually. If you wish people would give you deference for your econ PhD, imagine how the epidemiologists feel.
I think if you could form a partnership with an epidemiologist, that would be ideal.
Twitter is super toxic, don't let it get you down.
I am not sure I would call the industrial revolution and the information revolution a period of peace and stability though not as turbulent as world war. We do need to learn from the east, above all protective equipment and testing. Testing, testing, testing. Plans without testing are plans to fail. The only thing more expensive than lock downs are no lock downs and lock downs with no path out. Lock downs are necessary to catch up with production and testing but if we can't manage that, nothing else has any chance.
Since I've been reading Greg Cochran for years I thought of him as someone who both has "thick" knowledge of details and prides himself on his superior grasp of powerful abstractions relative to many credentialed experts. His own credential is in physics.
The greatest example of national flexibility, surely, was China's handling of its Covid outbreak: they re-prioritized everything non-essential and went from 'Coronavirus of unknown origin' to a fully sequenced, prognosed, and clinically documented in 30 days.
The flexiblist part was how little they actually shut down. They did not impose a quarantine but used the more porous cordons sanitaires, around cities, counties and provinces–while keeping all strategically important industries running 24x7.
They even made up special trains to take workers to these facilities where they quarantined them for 14 days before letting them back on the factory floor.
Now everyone's back and GDP growth is 100x ours.
They took a licking and kept on kickin. That's flexible.
If you look at his background, the answer is no. He is just a doctor with a sociology Ph.D.
As you surely know, I pointed to a substantial likelihood that we will do more lockdown than is best. I did not claim that zero lockdown was the optimal policy.
So the fact (if it is a fact) that the lockdown policy will do more damage than the virus does not at all show that the lockdown policy is misguided? (It kind of *sounded* like you were suggesting a negative assessment of the policy, but that was a misimpression.)
The 'welded doors' meme was just Western propaganda. As evidence that they did not shut down consider this:
February rail freight loadings rose 4.5% yoy.Feb-March Imports/Exports were down 6% yoy.
When we compare that performance to America's, as we will, we will see what flexibility looks like
It's not that i wouldn't trust a thoughtful estimate. But every single estimate i've seen so far seems designed for shock value. Which is odd because economists are basically accusing epidemiologists of exactly the same thing.
My hunch is that the economic costs are actually quite small in the medium term, provided that the dislocation is indeed temporary and does not lead to war or societal upheaval, etc. It's much akin to a pandemic actually: costs are manageable, provided you can cut off that extreme tail scenario.
You won't trust anyone else who offers an estimate, yet you seem to offer an estimate. Why are you more trustworthy?
There is more uncertainty than economists like to admit around the "economic costs." It certainly is not some simple sum of lost wages or stock market losses. Although such things do occur in recessions, it also seems as though you get accelerated growth coming out of recessions. It's not clear to me if you are any worse off in the long-term. And I certainly wouldn't trust any calculations pretending to know.
If you lose your job, but get a better one post-recession was there a cost? Some might go so far as to argue that recessions are useful in reallocating resources since tough choices have to be made and new solutions are needed in a hurry (e.g., my sister owns a small business...when i asked her why she's laying off people instead of taking govt loans she said the employees weren't a good fit but she just never had a good reason to let them go...and now she does...her business will be more efficient going forward).
I'm not saying there aren't costs...there most likely are. But i keep seeing overly simple analyses resembling "we spent $x trillion to save y lives." I don't think that's even close to correct.
Perhaps we can look at countries like Australia or Israel which have had few technical recessions...if my memory serves me there is no appreciable difference in per capita GDP growth relative to the US.
They did shut down a lot. In Wuhan the measures were much stricter than anywhere. "Police have welded doors shut in order to monitor who enters and leaves buildings." https://www.theguardian.com...
They did quarantine people. One of the main 'lessons learned' that they promote is the need of a 'centralized quarantine' - that is quarantining people who had contact with the virus not at homes, but rather in hotels.
I still see flexibility in their response but not because they shut down little - they shut down much more than in Europe of the USA. You can also argue that there is flexibility in localizing it to Wuhan and Hubei - but it is like localizing it to France.
But there was flexibility in throwing just everything at the disease - masks, temperature taking at work, and devising new ideas likeprotocols of packages delivery, disinfecting surfaces etc, everything that could be helpful was deployed.
I made no such claim.
When you speculate that the “apparently endless and terribly expensive lockdowns” will actually “end up doing more damage than the virus,” do you mean to suggest that the government’s doing nothing (beyond exhortation—nothing coercive) would have been and would be better policy that what it actually did and seems likely to continue doing? How likely is this, really?
I can't speak for Nick, but surely Nicholas Christakis would have to count as a biomed expert who is good at abstract reasoning?
So, we have embarked on lockdowns that might save an unknown number of lives, although that unknown number seems to be shrinking before our eyes,
But with a great deal of certainty, we have implemented an economic depression, although an exit from the depression is not certain.
I am beginning to suspect the costs do not line up to the benefits.
Fascinating post. No wonder the military has looked so good recently: https://twitter.com/USArmy/...
Lt. Gen. Semonite has two degrees from military colleges. Bet those colleges are succeeding at maintaining a repository of flexible thinking practices even during peacetime.
BTW, to be fair, there is a lot of coronavirus misinformation floating around. And the urge to quash misinformation is noble, even if it sometimes ends up being misguided. And let's be honest, most people aren't great at evaluating what is and isn't misinformation for themselves. So they have to rely on authorities. I think these heuristics are good in general, actually. If you wish people would give you deference for your econ PhD, imagine how the epidemiologists feel.
I think if you could form a partnership with an epidemiologist, that would be ideal.
Twitter is super toxic, don't let it get you down.
I am not sure I would call the industrial revolution and the information revolution a period of peace and stability though not as turbulent as world war. We do need to learn from the east, above all protective equipment and testing. Testing, testing, testing. Plans without testing are plans to fail. The only thing more expensive than lock downs are no lock downs and lock downs with no path out. Lock downs are necessary to catch up with production and testing but if we can't manage that, nothing else has any chance.
Do you have any such generalist experts in mind?
Since I've been reading Greg Cochran for years I thought of him as someone who both has "thick" knowledge of details and prides himself on his superior grasp of powerful abstractions relative to many credentialed experts. His own credential is in physics.
The greatest example of national flexibility, surely, was China's handling of its Covid outbreak: they re-prioritized everything non-essential and went from 'Coronavirus of unknown origin' to a fully sequenced, prognosed, and clinically documented in 30 days.
The flexiblist part was how little they actually shut down. They did not impose a quarantine but used the more porous cordons sanitaires, around cities, counties and provinces–while keeping all strategically important industries running 24x7.
They even made up special trains to take workers to these facilities where they quarantined them for 14 days before letting them back on the factory floor.
Now everyone's back and GDP growth is 100x ours.
They took a licking and kept on kickin. That's flexible.