Seriously? There were a number of submissions yesterday to HN discussing the relative merits of sacrificing millions for the sake of the market. Perhaps you missed those?
> Besides, it is a false dichotomy. There will be an economic collapse either way.
In what way is the fact that there will be two different levels of economic costs in two scenarios a 'false dichotomy'?
Edit: I think this is worth clarifying. I may misunderstand you, but it looks like there are two errors in your post. The first is treating differing scenarios with differing outcomes as if they were the same, simply because they have some facet in common.
The second is a mis-use of the term 'false dichotomy'. If you believe that a choice between two options will have the same outcome, that is not a false dichotomy. A false dichotomy is a logical fallacy, a special case of the fallacy of exhaustive hypothesis. Here, one wrongly assumes that there are only two possible choices and uses this assumption to arrive at some seemingly logically derived conclusion.
My apologies if I've misunderstood your intended meaning from your short post.
Hospitals will be overwhelmed much more, and there will be far more deaths if we don't "flatten the curve." In addition, workers will stay home anyway (which many are already doing), collapsing the economy regardless.
It is indeed a false dichotomy. If anything, just irresponsibly letting nature run its course will be worse. Besides, recessions have been consistently associated with decreases of death rates. There is no evidence, and plenty of counter-evidence, that recessions cause increased death. Of course, we are getting a recession either way.
Not sure if this was your intent, but "sacrificing millions for the sake of the Market" sounds like you're trying to shift away from the point that right now about 3.28 million more folks (probably more) are wondering how to pay their rent/mortgages and feed their children. If this lockdown continues indefinitely the death numbers from the economic fallout will likely eclipse those of the pandemic.
But nah, the "market" apparently entirely consists of assholes on Wall Street playing Capitalism II and lobbying governments for payouts. No way it has any real impact!
This is where it's very important to distinguish between financial conditions and material conditions. Feeding children and supplying respirators and masks are material conditions, dependent on the production and distribution systems.
Paying rent and mortgage, on the other hand, isn't material. If you don't pay it nothing material changes - it's not an iron law of the world in the way that hunger is, evictions are a choice. Admittedly it transfers the problem to someone else, but if the solution to maintaining everyone fed includes them then they're not going to go hungry.
Financial conditions also have a time tradeoff. Reducing retirement funds affects material conditions in the future. Or the date at which people are able to retire.
If you had a button you could press which let you retire immediately, but (with probability P) took the life of some random person in the world, would you press it? With what value of P?
Economic conditions have real and immediate health consequences too.
For example, in 2010 US unemployment briefly grew about 6% to a total of 10% in the US and there were 40,000 additional deaths from cancer alone[1]. When you consider heart disease, other indications, drug abuse, and suicide, the numbers are much greater. The often cited number of 40k for each percent unemployment may not be far off if these factors are taken together.
This trend also holds true in the OECD where social programs are more common because there are still budgetary constraints on centralized healthcare.
Mortgages and by extension rent provide liquid funds to banks so that account holders, including essential business's like hospitals, farmers, and factories can pay their employees and bills.
You are delusional to think it is possible to suspend payments without printing massive amounts of money that will certainly lead to more death.
shrug we provided liquidity last time and can do so again. Money printing doesn't kill people, viruses do. The banks are intermediaries. The essential businesses are not affected provided we do not let the banks fail randomly, and there is no need to do that.
> By March 2009, it held $1.75 trillion of bank debt, mortgage-backed securities, and Treasury notes; this amount reached a peak of $2.1 trillion in June 2010.
That feels like a lot of liquidity to me.
Liquidity expansion through loans and purchase of credit and equity instruments simply isn't very inflationary. It can only cause real price inflation if the money starts chasing a shortage of real goods and services - which are currently being dramatically underproduced. If it does start causing inflation, the Fed can and will simply raise interest rates from their current near-zero level. Or fiscal policy can be used.
Yes, quantitative easing is okay. But that is a lot different than the direct money being given to individuals and businesses by Congress. Especially the direct payments to individuals means printing money.
What the fed is doing is printing money now that will be destroyed later, or held in reserve. Either way, it is backed by actual financial instruments (whatever equity or bonds or notes they're buying).
People do not need liquidity to survive. They need air, water, food, medicine, shelter, in decreasing order of importance. No one has ever died for lack of liquidity.
We've done a middling job at making sure people have air and water, less good with food and even worse with shelter and medicine. But liquidity? That should be last on the list of things to worry about. It should always be last.
I imagine some communities will simply sink lower and never recover trajectory, and some sociologist will write a sad book sometime in the future about them. How does Black 2030 look like in America? Optimistic?
We should believe that some economic curses last multiple lifetimes.
> If you had a button you could press which let you retire immediately, but (with probability P) took the life of some random person in the world, would you press it? With what value of P?
Death is not a problem, everyone dies, nobody knows when they will. Could be someone pressing a button, could be a bus, could be old age. You can die tomorrow. But suffering, that really matters. I wouldn't make someone suffer, but if it's quick painless death... way harder question.
I just really dislike the focus on living rather than focusing on the value of life. I mean this in a pre-pandemic sense. Hearing people talk about fear of death, and yet accept a lifetime of meaninglessness.. just irks me.
> If this lockdown continues indefinitely the death numbers from the economic fallout will likely eclipse those of the pandemic.
Seeing that doing nothing will likely lead to lead to millions of deaths, how would the lockdown possibly kill more than that? Are you under the impression people will just willingly starve to death, or that fighting over food will get so bad that millions of people will die?
> Seeing that doing nothing will likely lead to lead to millions of deaths, how would the lockdown possibly kill more than that?
The lockdown is wasting months to years of billions of people's lives. That has to be equivalent to some number of deaths, hard to quantify how many, but it's greater than zero.
Also, a bad economy literally kills people by starvation albeit in foreign, poor countries that don't have food surpluses or the ability to print USD.
It is seemingly easy to (roughly) quantify the number of deaths which have occurred as a result of COVID-19, and it is certainly greater than zero. It would seemingly be difficult or impossible to quantify the number of deaths which have occurred as a result of social distancing policies (aka "lockdown"). For that reason alone the certainty of a COVID-19 threat seems greater than the certainty of death by economy.
First of all the "millions of deaths" comes from one model. There are many others and we haven't tested enough to know the true spread or lethality of the virus in a general population. It's quite possible that many people have already had covid-19 and were completely asymptomatic, which would make the death rate look much less scary. Anyone who tells you with certainty that "millions will die" is going off incomplete data like everyone else at the moment.
And if we locked down the global economy for a year or two until a vaccine is developed, yes it's not out of the realm of possibility that millions worldwide would die a result of the 2nd, 3rd, 4th and 5th order consequences of that decision. Look how many stress fractures are occurring after just a few weeks. You think they'll get better with time and continued stress?
Honestly I think the UK had the best original strategy of locking down the people most at risk, make sure they're taken care of as much as possible, and letting everyone else get herd immunity as quick as possible. But people weren't/aren't willing to accept that, and likely still won't for at least the next few weeks.
The millions of deaths comes from most models, which is why governments the world over are willing to endure economic devastation. Also, we are talking about the US specifically, so bringing in the worldwide death toll from 5th order effects (why not 20th?) seems disingenuous.
Finally, the UK changed their strategy away from sequestering the 70+ population because Imperial College told them that would only halve their death toll, and it would still remain solidly in the millions (for a country of 66 million).
Clearly we've been looking at different sets of models with different assumptions. I haven't done an objective survey, but I'd dispute "most" predict millions of causalities.
But if we're just talking about the US: The range from the CDC models last I checked is anywhere from 163,000 - 1.7 million for a country of ~330 million.
By comparison the opioid epidemic alone has already killed somewhere between 100,000 - 200,000+ over the last 5 years. And that was largely the result of a kinder, gentler, less dramatic economic shock known as the 2008 recession and decades of preceding industrial decline.
We've already compressed shocks that took months in 2008 to weeks, not the least of which is the record unemployment filings in the posted article. Hence the largest stimulus package in world history being passed in days.
"The economy" is not some vague abstract number on the evening news, and economic shocks do kill people, it's just less tangible than a virus. If this continues for more than a month or two I expect people returning to work out of desperation and then receiving death threats for doing so, and things will get uglier from there if the lockdowns continue.
>UK had the best original strategy of locking down the people most at risk, make sure they're taken care of as much as possible, and letting everyone else get herd immunity as quick as possible.
The problem in the UK is that they seemed to have no substance to the plan. Yes, hard lock down the people at risk, but where is the government response to make that possible?
If they had a well developed plan to carry out those words it might be worth doing, but they didn't and then caved when it was clear it was just rhetoric.
They have half a million volunteers. When you sign up you get an idea of what for, delivering food and stuff to the vulnerable is part of it. So the boomer generation can have the millennials delivering them their toilet paper with some goodies to eat.
Yeah I don't see that the tradeoff is "letting coronavirus kill millions of people vs. Jeff Bezos losing 2% of his income" so much as "letting coronavirus kill millions of people vs. letting millions of people die of starvation". We're not there yet, but lets see where we are in a month.
Are you aware of a quantitative model relating economic losses to loss of life / quality-of-life? I see this claim repeated over and over, but after hours of searching I can't find any quantitative models. If such a class of models did exist, we could weigh it against various SIR models and make an actual assessment. Without that economic model, the decision calculus you're suggesting we make isn't really possible.
Also: even that conversation seems like a huge false choice. Why not just give up on market capitalism for a few quarters and make sure everyone is fed/clothed/sheltered? It's not like houses disappear overnight if rent/mortgages aren't paid. And it's not like we've never suspended capitalism in the past -- the federal government put in price controls, effectively nationalized industries/supply chains, etc. during WWWII. And then we returned to capitalism afterward.
> But nah, the "market" apparently entirely consists of assholes on Wall Street playing Capitalism II and lobbying governments for payouts. No way it has any real impact!
TBF, those are the folks getting most of the economic relief so far. And not just from recent Congressional action. Somehow when it comes to ensuring liquidity in certain financial markets, the federal government can move mountains in minutes. But when it comes to people having a safe place to sleep and food to eat we're the mercy of the invisible hand.
Why can't e.g. HUD, unilaterally and without congressional action, create "liquidity in the housing market" by making enormous zero-interest loans to everyday folk whenever they feel like that's necessary?
People who trade in equities and bonds have enormously powerful economic backstops, which people who merely pay rents and mortgages and buy food do not have.
The problem with that black and white reasoning is that on some level "the market" represents people's livelihoods and eventually there comes a point where it's reasonable to say "X people should die to prevent Y amount of hardship for Z people".
I agree. It's easy to fall in the trap of "human life above all else", but there comes a time where tradeoffs become reasonable.
Society already does this with the automobile. 36,000 people die every year for the convenience of driving, which I feel is a completely reasonable tradeoff, and this is not a controversy, at least in the united states.
That seems to only include the accident mortality rate. It would likely be even higher if you included deaths from automobile air pollution.
Unrelated but curious, why do you feel it's a completely reasonable tradeoff? In my mind, automobiles have led to a class (and historically race) divide which further segregates and polarizes sects of society.
I seriously doubt cars cause a "racial divide" in any reasonable way.
As for whether I think it's a "reasonable tradeoff". I don't know, but maybe because it's not brought up as controversial by society. This is not a good reason, I suppose, but I haven't really thought about it. I guess I'm mindlessly mimicing the ethics of people around me.
