Politicians have finally decided
to take demonstrative actions to reduce the spread of the coronavirus and
reassure the public that they really don’t need to wipe out all the available
packages of toilet paper from local stores. Unsurprisingly, most of these actions to
date have been initiated by local and state governments. However, Dr. Anthony
Fauci has further cemented his role as America’s 79-year old patron saint of rational,
informed virus dialogue. Thank you, thank you Dr. Fauci.
On March 19 California Governor
Gavin Newsom adopted the local SF Bay Area counties’ recently-enacted
Shelter-in-Place – ShiP – rules (aka, everyone stay at home) by
ordering all Californians to board the ShiP until further notice. Welcome to
the ShiP, designed to manage our rising viral load.
According to the letter sent by
Governor Newsom to President Trump, the governor justified his state-wide order
by stating, “We believe the virus will impact about 56% of California’s
population – 25.5 million people – within the next eight weeks.” This estimated
56% infection rate is apparently based on projections from Johns Hopkins
University. It’s been a sellers’ market for epidemiologists and their models
that have spread far and wide. The more chilling these models’ predictions are,
the more media-notice they get.
Here’s why the governor’s
projections are fugazzi[1]
math. California’s current population
is 39.94 million people. His statement that 25.5 million people represent 56%
of the population means his state population has to be 45.54 million [45.54 =
25.5/0.56], which it’s clearly not. To make his math work, he’s overestimating
California’s population by 15%. Oh, well. His heart is in the right place.
Also extreme is his assumed 56% infection
rate. This is a gigantic percentage of people who will have been infected
(assuming the governor’s fuzzy word, “impact” means infected) by the
coronavirus in eight weeks. For comparison, Italy is dealing with its own significant
viral threat that’s several weeks ahead of California’s. Italy now has 41,021 cases of covid-19,
the largest in Europe, out of a total population of 60.48 million people. Its
infection rate is thus 0.07%. As of March 21, the New York Times shows
California has 1,261 coronavirus cases and 23 deaths, which works out to a case
fatality rate of 1.8%. Cases will certainly surge, as epidemiologically
expected, with more testing finally getting done and as the virus continues its
sweep, but having over one-half of my fellow Californians be infected has not
been expected.
As threatening as Italy’s infection
rate is, it’s worlds apart from Gov. Newsom’s projected 56% rate. However,
there is virtually no downside for politicians not amplifying the potential
threat to their constituents; even if a worst, worst-case epidemiological model
result is used like the governor probably did. He understandably wants
attention and fiscal support from the federal government, overly-giant numbers
probably help. Even though any projections, like those from Johns Hopkins,
remain based on completely preliminary, ever-changing input values for infection
and case fatality rates. However, Gov. Newsom’s dramatic prediction for viral
infections in California got #45’s commitment to send the USNS Mercy Hospital Ship
to the Port of Los Angeles. Alas, #45’s promise wasn’t to last, like too many others. Later, the US
Navy said the Mercy would instead be steaming to Seattle, the initial US epicenter
of the coronavirus pandemic.
The Governor’s 56% infection rate together
with a fatality rate of 3% (similar to China, Iran and Italy) would produce
5.55 million possible deaths in the US from covid-19. That is over four times
the deaths from summing the fatalities of both heart disease and cancer, the
two most lethal diseases in the US.
This series of ever-escalating, extreme
epidemiological projections may provoke stronger policy actions that can begin
to manage the viral load on our healthcare system.
For politicians, ever-stricter interventions
are designed in no small part to demonstrate they care, really care,
about their constituents’ well-being, whether or not such rules and orders are truly
effective. A fine example of this is the federal Treasury Department’s possibly
postponing the due date for annual tax form submission from April 15 to July
15. This proposal seems fairly vacuous; after all, for the expanded millions of
us who now live under SHiP orders – and it’s only a matter of time that we all
will be – won’t we have more time to fill out our 1040EZ’s by April 15? But
Secretary Mnuchin’s postponement perhaps shows he does care about the stress of
filing your tax form in just 3½ weeks,
while you’re doing nothing else.
Media criticism has focused the
fact that US hospitals are “thoroughly unprepared” to deal with this viral
crisis, citing the US’s rather low hospital beds/1000 people statistic. Such
criticism implies or explicitly mentions that if we miraculously already had a
publicly-funded, universal healthcare system – say along the lines of Medicare-for-All that
Bernie Sanders (remember him?) has proposed – everything would better.
That’s very unlikely. The US
hospital beds/1000 people statistic is 2.89; the UK’s statistic (home of the
publicly-funded National Health Service, NHS) is 2.76, according to OECD data. Both
US healthcare and the NHS, two nations with two very different systems, have
apparently under-invested in medical capacity. But every nation’s
healthcare system has inadequate capacity to deal with a novel coronavirus
pandemic that no one’s built up immunity to.
My reaction to such criticism is at best a large simplification with a very pricy solution. If our
healthcare sector were built to satisfy every unforeseen peak-demand surge,
like covid-19, and thus have existing physical infrastructure (e.g., hospitals,
beds, medical equipment) and more importantly additional numbers of well-trained
medical staff (doctors, nurses, administrators) to deal with every unanticipated
peak demand, we citizens would be paying far more for healthcare every
month, whether a peak happens or not. I doubt whether many people or
politicians would be willing to have their regular healthcare costs or taxes
increase to build for such peaks that would only rarely happen. If you build to
meet any unforeseen peak, you pay for that capability each and every
day.
Healthcare systems are managed to
deal with expected variations in required demand, through disaster preparedness
plans, contingent staffing and supply-chain tractability. Satisfying sizeable, unexpected
peak medical demand would require large numbers of extra Emergency Rooms, ICUs,
beds, equipment, nurses and doctors to be already available in place. No real
instant-on extra hospital capacity or nurses or doctors are realistically possible,
aside from temporary structures or Clinics-in-a-Can. Training nurses and
doctors takes years, not weeks. Having such medical healthcare resources
standing idly by only for infrequent extreme peak surges would be a significantly
expense, all the time. The complaint about insufficient extreme peak medical
capacity is real. Its solution would be steep for the healthcare system, no
matter what its structure or ownership. That’s the logic of reducing peak
medical demand via “flattening the curve.”
Flatten the curve has rapidly become
policy makers' go-to goal for managing and surviving the coronavirus’ spread,
and is hypothetically illustrated in the chart below.
Flattening the Curve
A concern I have with this curve
flattening is that the public’s general acceptance of the goal does not include
much understanding of one consequence. Specifically, as policy and personal
actions hopefully, eventually flatten the curve, people will become infected over
a much-extended time period, as shown above. Thus, people and hospitals will
have to deal with coronavirus cases during a far more protracted period. Will
that be ok with everyone? Everybody is now for flattening the curve, are they
also for extending the viral distress?
The coronavirus pandemic’s
timeline is very distinct from the many financial crises we’ve weathered. The
virus’s time period is sort of reversed: it is unclear what will happen in the
coming several months, but reasonably certain (hopefully) that within twelve
months its menace will have subsided. This world-wide health emergency is
unlike the economic crisis of 2007-09, where the government was certain what it
had to do in the immediate time, but uncertain about the longer-term issues would
be.
Speaking of economic crises, the
coronavirus’ consequent economic maelstrom is now growing ever-larger. As I mentioned
above about the propensity of seemingly worst-worst case projections to
dominate headlines, the same also goes with regard to the imminent “coronavirus
recession.” One economics professor cogently characterized our upcoming recession
as: This will probably be the world’s first recession that starts in the
service sector, not in manufacturing.
JPMorgan Chase now estimates that
the economy could decrease by 14% between April and June, the biggest contraction
since post-WWII era. Goldman Sachs estimates 2.25 million people filed for
unemployment this week, nearly a ten-times increase from a week ago. That
estimate was before the White House demanded that state employment agencies not
publicly provide information regarding unemployment claims.
Goldman Sachs (GS) also projected 0%
GDP growth in the first quarter of this year and a 5% contraction in the second
quarter. It estimated that we will lose 3 million jobs by summer. But then on
Wednesday, JP Morgan saw GS and raised them in forecasting that the second
quarter contraction would be a stunning 14% — worse than the depth of the Great
Recession. This forecast could translate to 7.5 million jobs lost by the
summer. Others are predicting that the drop in payrolls for April alone could
be as high as 5 million.
Can we manage the coronavirus’
expansion and mitigate economic damage by flattening the curve with enough of
us staying in our residences for an extended period? If we unswervingly
practice staying in our dwellings, washing our hands semi-continuously, maintain 6-ft personal
distancing, stop dancing on any beaches and stop tippling in all bars and
restaurants, ☹ time will tell. Here’s hoping, really hoping.
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