WHAT PRICE CORONAVIRUS?

Note: This article has been updated from the initial post (as of April 22, 2020).

Nearly 2,000 years ago, a sage spiritual leader asked those who would take on any project of consequence to "first sit down and figure the cost so you'll know if you can complete it." Just to make sure that no one misunderstood the range of costs to be considered, this founder of what became the Christian movement offered up two illustrations : the cost of a physical construction project (building a tower), and the cost of going to war (assessing the capabilities of one's army against that of the enemy).

So, in our current pandemic, count not only the costs of those who will be directly stricken by an unseen enemy, but also those who will be affected by potential loss of livelihood and home. In 2020, the U.S. and much of the rest of the world have gone into virtual lockdown in a mad rush to avert or mitigate the mortality effects of COVID-19 virus — albeit with minimal consideration of the short and long-term cost necessary to beat this previously unknown foe.

As David Farragut, flag officer of the U.S. Navy declared in a battle of the American Civil War: "Damn the torpedoes, full speed ahead."

In 244 years of the American republic, there has never been an occasion when the U.S. and most states effectively shut down the social and economic life of the country. Not even in wartime have such radical steps been taken.

Yes, there's lip service given to mitigating the collateral damage, but no meaningful initiative to date to directly and honestly answer the threshold question: Is the cure worse than the disease? Is the price we are paying to combat this pandemic too high?

Or perhaps the question is better phrased as: What price is too high? 

COMPARING THE COST

For some perspective on the human toll of the virus, it is useful to make comparisons with other conditions affecting mortality in the U.S.

Consider this. As shown by the following graph, there were over 2.8 million deaths in the U.S. for calendar year 2018. By comparison, as of April 16, 2020, COVID-19 has claimed close to 31,000 American lives. The number of deaths attributable to coronavirus, to date, equates to about 1.4% of total annual mortality in the U.S.


New York Times figures do not include more than 4,800 people in New York City who died and are believed to have had the coronavirus. As reported by the Times, many of those patients died without being tested, a consequence of a strained medical syst…

New York Times figures do not include more than 4,800 people in New York City who died and are believed to have had the coronavirus. As reported by the Times, many of those patients died without being tested, a consequence of a strained medical system and a persistent lack of testing capacity.

As depicted by the graph, a few other selected indicators are of note. The number of people in the U.S. who have died of COVID-19 to date can be calculated as equivalent to:

  • Approximately 5% of the number deaths of all persons age 85 and over who passed away in 2018 (for any and all reasons)

  • 6% of the number of deaths for those age 75-84

  • 6% of the number deaths of those who die of heart disease each year
    (the number 1 killer in the U.S.)

  • 7% of the number of deaths attributable to cancer

  • 24% of the number of deaths caused by accidents of all types
    (Just over 100% of the number of deaths attributable to vehicle accidents)

  • 47% of the number of deaths attributable to diabetes

  • 68% of the number of deaths attributable to flu & pneumonia

  • 78% of the number of deaths attributable to kidney disease

  • 83% of the number of deaths attributable to suicide

While lost jobs are not a form of physical mortality, they do represent human and economic loss. As of April 11, the increased joblessness of more than 22 million means that well over 500 jobs have been lost for every coronavirus death, to date. And like COVID-19 deaths, the number of unemployed has yet further to go on its upward trajectory.

Bottom line and while tragic, the number of deaths attributable to COVID-19 is only a small fraction of all mortality — only a small fraction of deaths attributable to the major causes of death in the U.S. Why this undue focus on an unseen killer which has, so far, added only marginally to the on-going death toll associated with the everyday cycle of life and death across America?

Would we lock America down like this to go all out to stamp out the causes of diabetes or cancer? What about to eliminate all car accidents by shutting down all motor vehicle transportation? Or to prevent all suicides?

What is it about COVID-19 that gives the fight to take on this pandemic a higher priority than addressing any other substantial form of mortality? Is this a battle worth impoverishing large segments of the American population for years to come?

As of mid-April, the chief economist of the International Monetary Fund (IMF) has stated that:

As countries implement necessary quarantines and social distancing practices to contain the pandemic, the world has been put in a Great Lockdown. The magnitude and speed of collapse in activity that has followed in unlike anything experienced in our lifetimes.

Do we care about the cost to America? Do we care about what the IMF now says will be the worst downturn since the Great Depression of nearly a century ago? Or is our answer to be that of the medical bureaucrats who, like Farragut, would command: "Damn the torpedoes, full speed ahead."

Damn the cost, damn the livelihoods lost. Damn the kids whose educations are disrupted. Damn the increased disparity between the haves and have nots. Damn the loss to public revenues essential to provide public services. Damn the death of small businesses and gig workers into the hands of an engorged  corporate America. Damn the deplorables to strengthen the self-proclaimed rule of the medical-bureaucratic elites.

When will anyone have the guts to answer these questions?

REJOINDERS

There are those who would undoubtedly say this is over-the-top hyperbole. Even if there has never been an explicit policy pronouncement that this fight is worth any cost, there seems to be some implied social contract to make this effort, no matter what price it takes.

And there are technical issues, like:

  • This is a disease of unknown proportions unlike other diseases for which risk can be more readily measured and calibrated — so it's worth going all out to beat the unknown (unlike such known maladies as cancer, diabetes, car accidents or suicides for which risks are now well defined).

  • What we do know is that the more than 40,000 deaths (as of April 21) will grow larger by the time this is over — maybe now to 100,000 or 200,000 or if we relax too much off measures like social distancing, conceivably increasing to less likely worst case scenarios of perhaps 1 - 2 million.

  • And there may be recurrences, flare-ups in the infection rate, as a start-stop stutter process that continues indefinitely — at least until a vaccine is found.

There are counters to these likely responses. No choice of this magnitude should occur merely as part of some implied social construct. If cost be damned is to be the order of the day, that should occur via informed and explicit legislative actions at federal, state and local levels including a policy commitment to hold the rest of society harmless, not impoverished — no matter what it takes, whether short or long term.

And regarding the technical issues. While this is a disease with many unanswered questions, the unknowables have been pared back as the health care community learns more day-by-day. We certainly know that the major variables to managing the risks going forward involve slow and measured ease-off of social distancing, widespread testing for the virus and for antibodies, getting therapeutic drugs and vaccines quickly to market (to reduce and ultimately stop the ravages of this disease), and (quite possibly) contact tracing using the tracking powers of ubiquitous smart phones.

In instances where the private market is not responding quickly enough — whether with masks or testing equipment — the powers of the presidency could be more actively applied to compel production and distribution. Now, not later.

We even have learned enough from disease modeling to better understand the potential range of outcomes and how the key variables likely influence these outcomes. And the monitoring tools related both to COVID-19 and economic recovery are there to gauge what is happening in real time — then scale the regulatory mechanisms to ease-off or tighten accordingly.

But there's one step that is essential to make all this work. There needs to be some general and explicitly communicated consensus of what a reasonable mortality target should be. It's not good enough to say that we aim to bring the rate down as much as possible. That approach suggests that our resources are infinite and that the cost imposed to get that one extra life saved is worth the universe.

Rather, aim for realistic targets. Based on what is known today, it now appears reasonable to aim for a goal of less than 100,000 deaths before this is over - but accept the possibility of going as high as 200,000 (as within the range of variability). Note: Even if there were 200,000 COVID-19 deaths this year, annual deaths in the U.S. would increase by only about 7% — going from an underlying rate of about 2.8 - 2.9 million per year to perhaps 3.0 - 3.1 million.

Coronavirus mortality targets should ideally exclude estimates of co-morbidity where an elderly or immune-compromised individual is likely to experience near term death anyway, with or without the virus. The medical profession needs to come clean and quantify the extent to which co-morbidity is or is not occurring.

WHICH WAY FORWARD?

Maybe it’s time to pay a bit more attention to sage advice — historically proven. Count the cost before going into battle. Do it before continuing to spend extraordinary sums of funds while impairing business and household incomes with minimal regard to both foreseen and potentially unforeseen consequences. Not just the cost from one perspective, but from all relevant viewpoints before making decisions as to the most viable course of action.

Putting this in today's context, this could mean continuing to follow the course of continued lockdown if the cost to the rest of humanity is widely viewed as worthwhile to save a small percentage of deaths, including at least some who are likely to die anyway. Alternatively, tack toward a new course of COVID-19, social and economic recovery if this is the more acceptable price.

Either way, make the choice consciously and with the consent of the governed. The worst of all worlds will be to attempt to muddle through — putting the cart ahead of the horse. The interests of the self-anointed over those doing the work — on whom the future of our republic ultimately rests.

THE CHANGING LINK BETWEEN COVID-19 & JOBLESSNESS

What a difference a week makes! And not for the better.

In one week from March 29 - April 4, the U.S. coronavirus mortality rate quadrupled from a cumulative total of 7 to 28 deaths per million U.S. residents. The number of new unemployment claimants has gone from over 10 million to nearly 17 million jobless. Claimants in the last three weeks now equate to about 10.4% of the normalized base of 145+ million U.S. workers covered by unemployment insurance.

This blog post updates statistical information posted on April 4 regarding the state-by-state relationship between COVID-19 and joblessness. And this week, our update also looks at the breathtaking changes in both metrics as have occurred in just one week’s time.

Note: For this review, information is as of an April 4 weekly report (the latest for unemployment claims). In contrast, COVID-19 death data is posted daily. As of April 11, the nationwide COVID-19 mortality rate had jumped from 28 deaths per million population (on April 4) to over 65 deaths (April 11), led by dramatic increases in New York mortality (as shown by the map on our website home page). This linkage review will be updated for April 11 jobless data when this updated employment data is next made available Thursday, April 16.

EARLY APRIL UPDATE

The following graph compares cumulative unemployment claims filed during the weeks ending March 21, March 28 and April 4 with COVID-19 mortality as of April 4.

As with last week’s chart, cumulative unemployment claims over a 3-week period are calculated as a % of total covered employment, by state. Mortality is calculated in terms of the number of COVID-19 related deaths per million residents, by state.

Deaths vs Layoffs 4-4-20.png

If you were to compare this week’s scatterplot with that of last week, the most obvious change is that the variability of outcomes has greatly widened. As of March 29, New York’s cumulative mortality rate was 50 coronavirus deaths per million residents. One week later, the mortality rate had more than quadrupled — to about 214 deaths per million population as of April 4 (a number that has again more than doubled to 482 deaths per million as of April 11).

And the span of joblessness has widened. As of March 28, Pennsylvania and Rhode Island had experienced unemployment claims equaling 13.8% of total base employment. As of April 4, Rhode Island’s rate has jumped to 19.4%.

Several other items are of note in with this update:

  • There is much greater spread of mortality rates than before. In addition to New York, the states of New Jersey and Louisiana have mortality rates at just over 100 deaths per million residents. Michigan now tops 50. All other states and territories have mortality rates of less than 50 deaths per million.

  • There is also a much wider range of unemployment claims — from 4% to nearly 20% of the total workforce covered by unemployment insurance. At the upper end of the spectrum are Rhode Island, Michigan, Pennsylvania, Nevada and Hawaii, all in the 16-20% range. The lowest rate is noted for South Dakota at 4%. Despite having almost off the chart mortality, New York’s 8.4% rate of unemployment claims is below the nationwide 3-week cumulative rate of 10.4%.

  • And there is now a circled group of about 25 states (with Washington D.C. included) that so far have experienced a combination of relatively low mortality (below 45 deaths per million population) and low rates of unemployment claims (below 10%). This group includes some very rural as well as urban states - with strong representation from the sunbelt and mid-America. These are the states that, so far, might be considered as either best practice examples or just plain lucky as compared to the other half of states.

Focusing more on what is working well for half the states may help in determining a path out for further curve flattening and for economic recovery. But before jumping too quickly to conclusions, we shift the analysis to also consider changes of the last week - both in mortality and joblessness.

CHANGES IN COVID-19 DEATHS VS JOB LAYOFFS

An added feature of this update involves comparing outcomes of the period ending March 28 with April 4, one week later. The following graph displays much of the same information as the prior illustrative depicting trends in coronavirus morality versus job layoffs. The difference is that the prior graph showed the pattern of deaths versus layoffs as of a single point in time (April 4) — while the following graph shows the change from one week to the next (from March 28/29 - April 4).

Change in Deaths vs Layoffs 3-28 - 4-4-20).png

As shown by the graph:

  • Just 8 states experienced an increase of COVID-19 mortality of at least 20 deaths per million residents in the most recent week ending April 4. Led by New York (with a week-over-week increase of nearly 165 deaths per million, other places with mortality increases of 20 or more per million residents were New Jersey, Louisiana, Michigan, Connecticut, the District of Columbia, Massachusetts and Rhode Island. The increase in mortality rates nationwide averaged 21 deaths per million residents.

  • All the remaining states experienced mortality rate increases of 20 added deaths per million residents or less. The extent to which these slower rates of increased mortality is due to good public policy, lower population density, and/or just plain luck varies widely across these states.

  • There also is wide disparity in the job layoff patterns across these states with slower growth in mortality rates. Georgia’s unemployment claims increased by 9% of the employed work force in the one week ended April 4. At the other end of the spectrum, Colorado’s unemployment claims increased by less than 2% points. In effect, there appears to be no guaranteed employment reward for those states that have contained the death toll, to date.

A PATH TO ECONOMIC RECOVERY?

At long last, serious discussion about re-starting the American economy is beginning to get underway. At this point, there is as yet no certainty as to the appropriate mechanisms or timeline for Americans going back to work. This is likely to be a subject of intense debate from health care and economic perspectives, not to mention anticipated differences across the political spectrum

Are there any observations from this coronavirus and joblessness discussion worth considering as part of this emerging policy debate? Three observations are suggested:

  • First, as has been previously suggested, this updated review further reinforces the observation that national and state-level policy should not be framed around the assumption that “one size fits all.” New York’s experience (together with that of adjoining states) is well beyond the pale of what has been or is likely to be experienced across much of the rest of the country. This is made abundantly clear by the very different curve flattening trajectory that the nation’s most populous state — California — has followed. And the experience of a California is yet different from that of a Wyoming or South Dakota — where mortality rates increased at 0 and 1 deaths per million residents over this most recent week.

  • Second, this analysis does suggest that continuous monitoring of changing mortality may serve as a useful guidepost for determining which states are best positioned to ease away form their business shutdowns — and how quickly. States like New York, New Jersey, Louisiana, and Michigan appear to warrant continued lockdown until the mortality growth rates ease back to the national average (or to below zero). Other places like DC, Connecticut and Pennsylvania that have been relatively calm so far may be erupting as data over the next one to two weeks may demonstrate — warranting more intensive measures at least temporarily.

    Conversely, states that have consistently held mortality increases to well below the national average gain of 21 deaths per million this last week (to a gain of, say, no more than 10 deaths per added million), appear to be the best candidates right now for potential relaxation of shutdown requirements. Of 52 states and territories, 36 appear to be in this category right now. Of these, 20 are below a mortality gain of 5 per million for the week ended April 4.

    As the country reaches the peak of mortality in the days or weeks ahead, the weekly change in national COViD-19 should go to zero and then negative. As the weekly mortality threshold for America declines, states remaining below the national curve offer the best case to be the most quickly rewarded with economic re-boot. This type of monitoring and economic adjustment may be required not only in the weeks ahead but over an extended period to limit the risk of re-infections longer term.

  • Third, a similar but more nuanced approach might be taken to states experiencing unemployment claims well above the national average. To what extent are higher rates due to earlier shutdowns, different industry mix (as with a high proportion of businesses dependent on face-to-face contact), unusually draconian business closure requirements, or other factors? Encourage states with unduly high rates but without demonstrable mortality benefit to begin opening sectors posing the least risks of virus transmission.

ANY LINK BETWEEN COVID19 & JOBLESSNESS?

As follow-up to a blog of April 2 on The Jobless Trajectory: State-by-State, E. D. Hovee has done further analysis to compare recent job layoffs with coronavirus related mortality — on a state-level basis. The following graphic is a plot comparing cumulative jobless claims filed during the weeks ending March 14, 21 and 28 with COVID-19 mortality as of March 29.

In the chart, cumulative unemployment claims filed over this three week period are calculated as a % of total covered employment, by state. Mortality is calculated in terms of deaths per million residents, by state.

COVID vs Job Layoffs.png

At first glance, there would appear to be little evidence of any clear statistical relationship between coronavirus deaths and job layoff experience, by state. Even if there were to be a clear statistical relationship, no direct causality is asserted at this point. In other words, no assertion that high mortality necessarily causes a state to exact massive job shutdowns, and no assertion that job shutdowns affect mortality one way or the other.

However, there may yet be a story to tell. As suggested by the graph, four potential clusters of activity are noted:

  • First is the experience of the 6 high mortality states — New York, Louisiana, Washington, Vermont, New Jersey and Michigan — with mortality to date ranging between 10-50 deaths per million residents. While each has a slightly different story to tell, all but Vermont are states with relatively high population densities. Vermont is a low population state but in the outer orbit of the Boston and New York spheres of influence — as is obviously the case for New Jersey. Washington state got it early on (clustered in one facility) and Louisiana suffered in the aftermath of Mardi Gras. Michigan is in the early stage of a significant increase in virus cases in the Detroit area. And New York is both highly dense and internationally focused, both of which put the city and metro area at greater risk.

  • Second is the experience to date of three states experiencing high job loss of more than 12 to nearly 14% — Pennsylvania, Rhode Island, Nevada — albeit with minimal coronavirus mortality experience to date. One could argue that these states are bearing an unnecessarily high economic burden relative to virus-posed risk, so far.

  • Third is South Dakota clustered with 10 other states that have experienced less than 4% job loss and less than 10 deaths per million population. Several of these states, in addition to South Dakota — Arkansas, Colorado, Mississippi, Utah, West Virginia and Wyoming — have below average population densities. Four states — Connecticut, Florida, Georgia and Texas — are more densely populated but with the southeastern states politically resistant to early job shutdown.

  • Finally, there are another 30 states that have experienced job losses ranging from 4% to less than 10% but also with relatively low mortality rates. These are critical swing states that may be experiencing somewhat disproportionate job loss relative to reduced mortality — but perhaps investing now in shutdown to better stave off potentially harder pandemic-related times to come.

Currently, there is considerable debate as to whether more stringent national guidelines should be extended (or mandated) across all 50 states uniformly. The alternative is to continue providing state-by-state discretion to adapt to changing conditions when and if warranted.

This analysis, while preliminary, suggests that when it comes down to determining the right tradeoff between human and economic survival, the right choice is not necessarily “one size fits all.” Neither the circumstances nor the policy prescriptions appropriate for New York are necessarily well suited for South Dakota or Wyoming.

In the weeks (and perhaps months) ahead, the death toll will inevitably increase. So will the loss of gainful employment and business opportunity — some quickly recoverable and some not. The pivotal and ever more painful decision will be how to make the trade-off between potential lives lost versus impoverishment for many of the more numerous survivors. .

If there is to be a national mandate, let it be a prescription that sets certain threshold targets, which when violated, will become mandatory at the state level. Otherwise, let state-by-state discretion prevail. And let both the national and state-local level decisions be guided by both real-time heath and economic data — each in tension and balance against the other.