Trade offs and Coronavirus
My quote of the day this morning, one of my favourite sayings from American economist Thomas Sowell, was chosen for a reason.
He once said that "There are no solutions, there are only trade-offs."
Much of economics is about how you use finite and often scarce resources, so it is not surprising that an economist should say it or another would like it.
COVID-19 has presented some of the cruellest trade-offs of all.
Ban all entrance from those who do not work or live their into care homes and you stop family visits, which will be a very cruel thing to do to both residents and their families, especially where the former do not have long to live, and will damage their mental health and wellbeing, But every person through the doors of a care home increases the chance that they will bring COVID-19 with them with dire consequences.
The social distancing measures necessary to slow the spread of the coronavirus have had dire consequences for the economy. So would the even greater death toll which would have happened if those measures had not been introduced.
There was a very difficult balancing act on when and how severely to introduce those measures. There was a case for moving more quickly. But here again there are trade-offs.
For one thing, if this had been done before the measures were in place which have now been taken to protect business, such as the scheme to pay 80% of the wages of furloughed workers, the economic consequences would have been even more dire.
More importantly, there was always going to be a limit to how long the lockdown could be enforced. That's why it was important to time the introduction to make sure it was most effective when most needed . To quote an article by Dan Hodges today,
"As a No10 adviser said: 'You can see lockdown is starting to sag at the edges a little. Imagine if that had happened two weeks ago just as we were approaching the peak. Imagine the lives that would have been lost.'
You can read the Dan Hodges article in full here.
The next set of trade-offs will be around how we can loosen the lockdown as the death rates fall in a way which maximises the ability of the economy to get going again and the ability of people to get away from the frustrations of lockdown while minimising the risk of letting infections, and deaths a few weeks later, take off again.
I hope and believe that the government will be working on an "exit strategy" which addresses this and it will not be too long before they can publish and implement it.
But this will involve the judgement of Solomon on how we balance the needs of the economy with the requirements to save lives.
Virtually every pandemic in history has had more than one wave. Three is more normal.
It is almost certainly overoptimistic to suggest that we have any chance of avoiding a second wave entirely.
The key thing is to do what we can to let the economy get going again while minimising the lives lost to COVID-19 and the size of the second wave.
Difficult trade-offs will be with us for a long time yet.
He once said that "There are no solutions, there are only trade-offs."
Much of economics is about how you use finite and often scarce resources, so it is not surprising that an economist should say it or another would like it.
COVID-19 has presented some of the cruellest trade-offs of all.
Ban all entrance from those who do not work or live their into care homes and you stop family visits, which will be a very cruel thing to do to both residents and their families, especially where the former do not have long to live, and will damage their mental health and wellbeing, But every person through the doors of a care home increases the chance that they will bring COVID-19 with them with dire consequences.
The social distancing measures necessary to slow the spread of the coronavirus have had dire consequences for the economy. So would the even greater death toll which would have happened if those measures had not been introduced.
There was a very difficult balancing act on when and how severely to introduce those measures. There was a case for moving more quickly. But here again there are trade-offs.
For one thing, if this had been done before the measures were in place which have now been taken to protect business, such as the scheme to pay 80% of the wages of furloughed workers, the economic consequences would have been even more dire.
More importantly, there was always going to be a limit to how long the lockdown could be enforced. That's why it was important to time the introduction to make sure it was most effective when most needed . To quote an article by Dan Hodges today,
"As a No10 adviser said: 'You can see lockdown is starting to sag at the edges a little. Imagine if that had happened two weeks ago just as we were approaching the peak. Imagine the lives that would have been lost.'
You can read the Dan Hodges article in full here.
The next set of trade-offs will be around how we can loosen the lockdown as the death rates fall in a way which maximises the ability of the economy to get going again and the ability of people to get away from the frustrations of lockdown while minimising the risk of letting infections, and deaths a few weeks later, take off again.
I hope and believe that the government will be working on an "exit strategy" which addresses this and it will not be too long before they can publish and implement it.
But this will involve the judgement of Solomon on how we balance the needs of the economy with the requirements to save lives.
Virtually every pandemic in history has had more than one wave. Three is more normal.
It is almost certainly overoptimistic to suggest that we have any chance of avoiding a second wave entirely.
The key thing is to do what we can to let the economy get going again while minimising the lives lost to COVID-19 and the size of the second wave.
Difficult trade-offs will be with us for a long time yet.
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