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The COVID-19 Pandemic: The Shape of Things To Come

For much of the world, it is obvious that this situation is not improving. Just over three months ago your author (when there were a "mere" 425,000 cases and 19,000 deaths) warned that the cases and fatalities "will double, and then double again, and then double again". If there was an error in that remark it was that it didn't continue for several more iterations. Now, at the time of writing, there are over 11,179,000 cases and over 528,000 deaths. And the previous iterations will continue; it will double, and then double again, and then double again. But even when the world reaches 90 million cases and 4 million deaths, there will be those who, despite all the evidence, will place ideology above reality in their mad worship of power and authority. Simply put, "the worst is yet to come".

At the time the United States, Brazil, and the United Kingdom were identified as three countries that were particularly susceptible to the virus due to political leadership that placed ideology above reality. Predictably, these three countries have suffered catastrophic failures. Continental Europe was, as we know, the first region to be hit very hard and the figures still show that that region as the deaths per million indicates, and whilst San Marino, Belgium, and Andorra still hold the unenviable position of the highest values in that regard, new cases in the EU have flattened whereas in the US, the UK, and Brazil, they continue to rise, to the extent that the US is facing a travel ban to the EU and, in an act of madness, Brazil re-opens its cities.

To be blunt, the pandemic disaster will continue to unfold. The number of new daily cases continues to rise, currently at approximately 200,000 per day. The new daily death rate has stabilised, for what that's worth, at around 4,000 per day. Whilst initially the virus was largely concentrated on advanced economies and especially the European Union, they have largely flattened the curve (Sweden being an ugly contrary experiment). It is now spreading significantly to developing nations with less than adequate health infrastructure. Again on a per-capita basis, Bahrain, French Guiana, Chile, Armenia, Peru, all being particularly heavily-hit. On a raw numbers basis, one can add India and Mexico to the list of concern. Of those countries, it is only Peru that is flattening the curve of new and active cases, and attention is drawn especially to Indonesia and India whose rate of new and active cases is growing at a rate that is less than manageable.

This said, there are some success stories, which provide stark evidence of approaches that work. New Zealand averted disaster with extensive movement restrictions, Thailand made extensive use of volunteers, and Vietnam the largest country with zero deaths, engaged in "drastic and early action". Of course, as the place of origin, China's response is widely considered impressive, especially by its citizens. Every jurisdiction should learn from these examples and many won't and the people will pay the penalty of their leaders.

Not only do we have extensive (if unfortunate) evidence of how to prevent the spread of COVID-19 on a large-scale, public health approach, there is also much-improved evidence on how it is transmitted and how individuals become infected. To simplify, one has to exposed to enough of the virus for infection to occur, which essentially comes down to three factors; social distance, the period of exposure, and ventilation. Masks do help in reducing what is increasingly looks like a distance effect, but there are caveats on this, requiring the proper use, proper quality, the scale of an existing infection, and the supply of appropriately graded masks.

The alternative to prevention is a cure, and there has been a great deal of rapid development in finding an effective vaccine for COVID-19. The World Health Organisation has some 140 potential vaccines being tracked, of which only 26 are in clinical trials. The possibility that there will never be a vaccine remains high and the virus will always be with us. But "something" will come from the research activities. Thus one should look at the various medications that increase the chance of recovery; Remdesivir and steriods, for example, is effective, whereas hydroxychloroquine and lopinavir are not.

This overview should, at the very least, give a clear indication that we are far from a return to a pre-COVID society, and indeed it should be clear that we never will be. The economic effects are, of course, extremely damaging and we have written about this previously. This is a time to engage in public expenditure on physical and social infrastructure, a time to introduce a universal basic income funded through economic rents. The current model adopted by many governments - stimulus packages, wage subsidies, etc - can only have a short term effect. Deep structural change are needed, and the evidence exists on what does and doesn't work. But as we have seen throughout even as something as blunt as scientific facts, the evidence is not always convincing. What hope is there then for the adoption of economic policies that have normative content? Very little, one must, unfortunately, conclude, even if the dead are many.

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