On Sunday, October 25, 2020 the White House Chief of Staff, Mark Meadows, announced the administration was throwing in the towel on our national efforts to control Covid19. The stated reason? “Because it’s a contagious virus.” Oh, and because we can’t expect people to wear masks in a free society. Unstated in that interview, but evident from the course of their actions, is that sustaining the stock market, which they think is the economy, is more important than either the real economy, the millions who have lost jobs enroute to losing their homes, or the lives of those who are dying. Instead of containing the disease the official strategy is to wait on the development of vaccines and therapeutics that will be unavailable to all those Americans who have already lost access to healthcare, as well as all those they seek to strip of their healthcare as quickly as they can get the court properly packed.
To most reasonably intelligent people that sounds flat out crazy. They probably don’t need a lot of added details to see the substantial dangers we face on this path. However, now that they’ve made this strategy clear we need to ensure we all understand just how crazy it actually is.
Let’s start with a few important unknowns about Covid19. As of this writing, we know we’ve had over 8 million confirmed cases and 225,000 confirmed deaths. Some large jurisdictions, like Florida and Texas, are almost certainly, and deliberately, under-reporting so it’s probably larger than that, but let’s just use those numbers to start. There are many important unknowns hiding under those two numbers. Let’s highlight two for discussion purposes. First, “confirmed” cases are much less than “total” cases. There are lots of mild cases that go unreported, so we know we’ve had more than “just” 8 million people who’ve been infected. Second, death isn’t the only important outcome to care about. Some number of people recover, but with long term damage to their lungs, heart, and often nervous systems. Professional athletes so affected will obviously need to find other careers, but even those with less demanding occupations may find their jobs too physically strenuous for their “post-Covid19” bodies. And, it’s not just physical. A recent study of the neurological damage done to Covid19 survivors estimated an average IQ decline of 3–5 points.
We don’t know how many of those folks there are. One early report from Sweden suggests that the total infected fatality rate (IFR) may be as low as 0.6%. That’s considerably better than most estimates, which have all hovered around an IFR of 1%. However, that same report claimed that 15% of those infected ended up with long term health problems that are sufficient to limit future activities and employment. That’s the only data point I’ve seen for that crucial number and is certainly not confirmed. But, let’s use it for discussion purposes. Here’s what that implies: If the IFR rate is correct then our 225,000 deaths suggest we’ve had 37 million infected in total. That’s slightly more than 4.5 times our confirmed cases and, based on various studies in the US seems high but within reason. However, If the long-term health impact numbers are right, then it suggests we may already have as many as 5.5 million people whose lives have been irrevocably altered by long term health problems. In a war, those folks would be counted as “casualties” not ignored as simply unimportant or described as “long haulers.”
Here’s the other ugly little implication. This is a “herd immunity” strategy and to achieve that objective, we’d need something like 60–70% of the population to have been infected. If our 37 million estimate for our currently infected total is correct, that’s roughly 11% of the US population, suggesting we’d still need 6x more people get infected. That further implies 1.3 million fatalities and 32 million “long haul” casualties. Those are truly staggering numbers.
Of course, that assumes the virus works its way through the population before a safe and effective vaccine can be deployed widely. I do believe here’s a good chance of having several viable vaccines over the course of the next year. That will be great but having a vaccine in the market is not the same as having it widely deployed. With our sabotaged healthcare system being held hostage by packed courts that’s a huge issue.
Let’s put some numbers around that. Among the many other threats to our freedom and democracy, the Republican court packing has been aimed at eliminating the Affordable Care Act (ACA) as well as protections for those with “pre-existing” conditions. The former includes 23 million Americans, the latter 54 million. And, we just estimated we’ve added 37 million Covid survivors and about 10–20 million who have lost their healthcare because they lost their jobs due to Covid. Now, there’s overlap between those different populations, so you can’t just add them together. However, it’s not 100% overlap any more than it’s zero. I’d estimate we’re looking at 80–100 million who will be without healthcare once the Republican packed courts are done overturning the legislative will of the American people. That’s about 27% of the population who will not have access to a vaccine.
But, there’s more. Remember, this strategy is aimed at herd immunity which means our intent is to grow our 37 million survivors, all of whom will lose their healthcare, to something like 213 million, or an additional 176 million Americans. In the absence of a vaccine, all those folks will lose their healthcare as well. That’s part of the risk of this strategy.
A key part of the gamble is for the progress on the development and deployment of a vaccine to happen faster than the spread of the disease and the Republican elimination of healthcare for most of America. Let’s assume we have a viable vaccine before the end of the first quarter and reasonably widespread deployment by the end of the second. That’s 7–8 months from now which is roughly as long as we’ve been dealing with the disease. Now the disease has spread far beyond where we were in early 2020 and we’re heading into flu season. So, we should expect all our key numbers to be at least double where we are today.
Those assumptions lead to a best case of 450,000 deaths, 12 million with long term health disability, and 120 million people without healthcare. That would be “success” for this strategy. If effective vaccines fail to materialize or the virus mutates faster than we can keep pace then we’re looking at 1.3 million deaths, 32 million with long term health problems and somewhere around 250 million people without healthcare.
This national sacrifice is being demanded so that the 2–3 million Americans with substantial stock market holdings don’t suffer any erosion to their portfolios. At least that’s what Republicans seem to believe. In truth, the stock market is so far removed from the economy it might not matter at all. As long as the Fed keeps pumping trillions of dollars into the financial system there’s a decent chance the stock market remains strong completely regardless of what happens to the rest of the economy.
But the rest of the economy does matter to the rest of us. Let’s assume most of the deaths occur to folks who aren’t part of the workforce. That’s not completely true but won’t change the conclusion we’re about to reach. The total US workforce is roughly 157 million people. So, our 12–32 million casualties represent 7–20% of the US workforce who will have suffered long term illness and are without healthcare. Some of those folks will be unable to work at all while others will need to find new jobs and careers, with all the attendant job search and retraining that entails. The absence of care will skew that mix in the wrong direction.
Furthermore, when someone gets the flu they may be out of work for a few days at most. In the case of Covid19 that can easily be a few weeks, even for those with a full recovery. If we assume 65% of the workforce experiences such an absence that implies over 100 million people will be out of work for several weeks which represents another 6–8 million “man-years” of lost productivity. Once again, we have an unknown amount of overlap but when combined with our casualties that represents a total labor loss of probably 20–30 million man-years. That puts us in the range of a 15+% drop in our available workforce.
That’s a huge and highly disruptive number. For all the wailing and moaning about the supply chain disruptions from China, the reality is that China hasn’t been the problem. And, since they actually are working to contain the disease, there’s no reason to suspect they will become one. The main supply chain problems will be US firms who must rely on a workforce plagued by physical and psychological impairments, long unplanned absences and abrupt career shifts.
In addition to those economy-wide labor losses we have specific issues in several key segments of the economy. It’s hard to know what our healthcare sector will look like in another year. It was badly broken before Covid19 hit the scene and is only going to get worse. At 18% of GDP our costs were twice that of any other nation, imposing an enormous burden on US businesses and workers. Our quality of care has been steadily eroding all over the country, but particularly in many rural communities. Covid19 is making both of those realities far worse. Our real costs will go up with 12–32 million new casualties. Our overall public health will decline further with 120–250 million people losing their healthcare. Our already failed healthcare system is likely to become even worse. Possibly far worse.
Finally, with all this public health and employment carnage we can expect significant drops in consumer demand for all kinds of services that happen to be critical to the economy. Before Covid19 the combination of retail, restaurants, bars and other personal services represented roughly one third of all existing jobs and two thirds of all projected job growth over the next 5–10 years. Covid19 has been a perfect storm for that substantial chunk of the US economy. The small businesses at the heart of that employment engine are all staring into the abyss of bankruptcy. Failing to contain the virus is a dagger in the hearts of those hanging on by their fingernails.
When you lose 15% of your workforce and see dramatic impacts to the core job engines of healthcare, retail and personal services you will not have a good economy. It turns out a population and workforce beset by a dangerous disease doesn’t lead to a healthy economy any more than a healthy society. The strategy of “surrender” might make sense in the fictional confines of the Republican Cinematic Universe #RCU, but in the real world is a complete disaster. But, according to the White House, that’s the best we can do, because it’s a contagious disease.
Or, I suppose we could just wear masks.