What the west got wrong fighting Covid-19 and what they can do about it.

Thursday, Oct 29, 2020
by Scott DeMichele

Best of Both Worlds

I admit I felt a bit of jealousy when I read how New Zealand packed more than 46,000 fans in the stadium for the Bledisloe Cup.  They are almost back to their normal lives.  No mask mandate, no distancing.  They can have friends over for dinner or parties.  They don’t have to worry about killing mom or grandpa simply because they went out for Sunday brunch. Tight border controls, thorough testing, and supportive isolation now keep folks safe. This wasn’t just happenstance.  It required a certain amount of sacrifice.  New Zealand Had to lockdown in Auckland again following a flare-up of cases, but only had to stay locked down for 18 days.

This month, Australians were packing into a plane to fly… nowhere at all.  Why? Because they can. It’s hard to blame them.  Australia had a more difficult time. Melbourne endured a 112-day lockdown from which it has just emerged and have joined the bubble of green corridors to New Zealand.  As long as they don’t import any cases, they are free.  Almost all of East Asia have done equally well or better.

East-West Divide

This clip from the Wall Street Journal illustrates the differences between East and West.

“When you lag behind and try to play catch-up with an explosive number of cases, it’s nearly impossible to conduct proper contact tracing”

“[Western countries] can’t shift to a model more like Asia immediately. They first must bring the virus under control in order for things like contact tracing and mass testing to work”

Imagine this as high interest credit card debt that we are making the minimum payment on.  The less we pay on it now, the more it will cost to pay it off and the longer it will take.

The trade-off myth

In the West, dealing with the pandemic has been characterized as a trade-off of lives vs prosperity. However it turns out that there is, in fact, no trade-off and, according to the Financial Times as well as the demographic tracking project OurWorldInData, countries with the most deaths were also the ones that sustained the most economic damage. The result for the West has been the worst of both worlds.  

We want it now, but that is not how this works. 

Anything worthwhile requires a degree of delayed gratification.  And in our case, the more we cling to the now, the longer it will take to get to anything resembling normalcy and the more it is going to cost.

Vaccines often take years. Even in the absolute best-case scenario, where we get a perfect vaccine tomorrow, production and distribution will take the better part of a year. The more likely outcome is it will take 12-24 months, will be semi-effective, and many will refuse to get it anyway. In the meantime, we will have to deal with the virus.  This means theaters, sporting events, and dine-in restaurants aren’t safe.  This creates uncertainty which inhibits investment which leads to weak economic growth… for possibly eight more quarters. Even with the record annualized growth of 33% in Q3, the US is still well below the the 46% annualized growth needed just to put us where we were at the end of Q1. Q4 is likely to be worse as new outbreaks of COVID-19 sweep across Europe and the US.

Ensuring better growth in the future will require investment now.  Using the lessons learned from Australia and New Zealand we only need to damage a single quarter. Before we can crowd in a football arena, we need to have at least 10 days of zero new cases.  To get to zero cases, we need to stop the spread.  We already have a plethora of tools to do this, including masks, mass-testing, contact-tracing, isolating the infectious as well as travel restrictions.  If spread is still growing faster than we can test-trace-and isolate, then additional restrictions will be necessary to slow down the spread. We cannot hope to keep up when we can only see where the virus has been weeks ago and not where the virus currently is.

Lockdowns (or shelter-in-place orders) have a proven record of arresting the spread in East Asia, New Zealand, Australia, and Israel. Done right, they need only last five weeks. However, they will not be effective unless used in concert with the other tools. We already have real-world working examples of stopping the spread and returning to a greater degree of normality and prosperity.  We have the tools.  All that is necessary is the will and fortitude to see it through. 

It doesn’t even have to be perfect; all that is necessary is to sustain a replication rate (Rt) of less than one and stop importing new cases.  Do this and the disease dies. At that point it is only necessary to prevent the importation of new cases.  This can be done at the country level, as well as state/county/city level. Your green zone can connect to other green zones and create green corridors.

Only at this point have you joined the winner’s circle. Health, freedom, and prosperity are your reward.