Author Archives: Arnold Kling

General update, April 30

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1. David Benatia and others write,

We found a nationwide 1.9 percent infection rate in early April, which is similar to the estimated prevalence in Austria (1.1%), Denmark (1.1%), and the United Kingdom (2.7%) as of March 28. Meanwhile, Germany’s 0.7% infection rate would rank in the lowest tercile of prevalence among U.S. states. The highest rates of infection in New York (8.5%), New Jersey (7.6%), and Louisiana (6.7%) are still lower than the estimated rates in Italy (9.8%) and Spain (15%).

Pointer from John Alcorn.

As I understand it, their approach is to look at how the change in reported cases per capita changes as you change the number of tests per capita over a short time period. That makes sense to me. The

Their results imply a total number infected as of early April of about 6 million, which is lower than the outlandish figures some have proposed but much higher than the reported cases at that time.

2. This story reports,

The number of nursing homes publicly reporting cases of covid-19 has doubled in the past week, with more than 1 in 6 facilities nationwide now acknowledging infections among residents or staff, a Washington Post analysis of state and federal data found.

…In five states – Maryland, Massachusetts, Connecticut, Georgia and New Jersey – the virus has struck a majority of nursing homes, the data shows. In New Jersey, second only to New York in total number of confirmed coronavirus cases, health officials have reported infections at 80 percent of the state’s homes.

Doubling the number of nursing homes hit in the last week would lead me to expect a dramatic increase in deaths a few weeks from now. I am cynical enough to predict that the media will attribute these deaths to “re-opening the economy.”

I really wish that deaths were consistently reported by age category, rather than as aggregate figures. My point is not to suggest that deaths of the elderly do not matter. My point is that our prevention strategy ought to be aligned with where the risks lie, rather than talking about “the” infection fatality rate.

3. From Nature,

parts of the world that do not have a policy of universal BCG vaccination, such as Italy and the USA, have experienced higher mortality associated with COVID-19 than places with long-standing universal BCG vaccination policies, such as South Korea and Japan

This has also been proposed as an explanation for why death rates are lower in Eastern Europe than in Western Europe.

The Heckman interview

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I assume you have seen the interview of James Heckman by Gonzalo Schwarz. You can tell that Heckman is not a fan of Piketty and Saez.

In truth, the evidence based on the IRS data is deeply flawed and has been incorrectly analyzed. Take “The Opportunity Atlas” promoted by the New York Times. It claims that “zip code is destiny.” Careful statistical analysis of the data shows otherwise. The same can be said of the academics who write about the growth of the Top 1%.

Heckman is known for his studies of education. A lot of support for the Null Hypothesis, with the exception of pre-school for impoverished children. But this may be his bottom line:

The main barriers to developing effective policies for income and social mobility is fear of honest engagement in the changes in the American family and the consequences it has wrought. . .Dysfunctional families produce dysfunctional children. Schools can only partially compensate for the damage done to the children by dysfunctional families.

News unfit to print

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1.

To date, the total number of reported patients treated with HCQ, with or without zinc and the widely used antibiotic azithromycin, is 2,333, writes AAPS, in observational data from China, France, South Korea, Algeria, and the U.S. Of these, 2,137 or 91.6 percent improved clinically. There were 63 deaths, all but 11 in a single retrospective report from the Veterans Administration where the patients were severely ill.

Source here. I recommend the whole article (short).

They are not talking about a controlled study. Remdesivir shows some small mortality benefits in a controlled study, plus it is not tainted by association with President Trump. Which drug would you want if you were diagnosed positive?

2. Concerning Sweden,

This individual-based modelling project predicts that with the current mitigation approach
approximately 96,000 deaths (95% CI 52,000 to 183,000) can be expected before 1 July, 2020.

Source here. That model-based forecast was made on April 10. As of April 29, one widely-used site gives Sweden’s cumulative deaths as 2462. The model predicts a peak in the first half of May. New deaths on April 29 in Sweden were 107. If this is the peak, we will not make it to the bottom of the 95 percent confidence interval for the model.

Pointer from Dan Klein. This story makes Sweden look good and a model look bad. So you know I am bound to like it. Discount accordingly.

3DDRR, April 29

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1.12 overall, 1.16 outside of New York, so moving in the wrong direction. Curious to see whether the timing of reporting means that today borrowed some reported deaths from earlier days or even from tomorrow.

General update, April 29

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1. John Cochrane on the financial plight of universities.

One might say that universities have an over-bloated staff and a lot of deadwood so this might not be a terrible thing. But that requires an administration ready to impose pain on entrenched constituencies. Not hiring promising new researchers is a lot easier.

The worst thing to be right now is someone who will graduate with a Ph.D in a month. Cochrane has many other insights. Read the whole post.

2. From the NYT.

The difference in investor expectations for large and small companies is stark: The Nasdaq 100, an index of the largest technology companies — which also happen to be the largest companies in the country — is down 0.6 percent this year. The Russell 2000 index, which tracks small public companies, is down 22 percent — roughly double the 11 percent in losses for the S&P 500.

Wall Street thinks that it will be fine if not a single bank or goes under but thousands of small businesses disappear. I am guessing that they are counting on milder social unrest than might be expected.

3.

Inside Higher Ed reports,

Ten percent of college-bound seniors who had planned to enroll at a four-year college before the COVID-19 outbreak have already made alternative plans.

Fourteen percent of college students said they were unlikely to return to their current college or university in the fall, or it was “too soon to tell.” Exactly three weeks later, in mid-April, that figure had gone up to 26 percent.

Pointer from Tyler Cowen. I don’t think that the higher education lobby will let this happen. That sector is going to get a decent amount of the money that is being printed these days.

Were excess deaths merely shifted?

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A reader asks whether the excess deaths we are seeing now are mostly people who would have died later in the year, so that for 2020 as a whole the epidemic will not stand out. My thoughts.

1. For what it’s worth, the models say otherwise. Experts who look at models expect another wave of deaths as social distancing is relaxed.

2. I am willing to speculate against the models. What I am seeing is a very gradual decline in the death rate. The death rate will remain high enough over the next month to ensure that 2020 will be a bad year for excess deaths. But we may very well see months later in the year in which “excess deaths” are negative, because of the death in March-May of people who would have died later in the year.

3. During the first two weeks of April, we saw cumulative deaths rising at 10 percent per day or more nearly everywhere in Western Europe and in the most hard-hit U.S. states. Now, we are seeing increases of 10 percent per day almost nowhere. Not in Sweden. Not in Florida. Not in Texas. There is a very broad based slowdown. Too broad based to be accounted for by lockdowns, which were imposed in different degrees and at different dates across all of these regions.

a. Perhaps the slowdown is an illusion, and we are going to get a second wave. That is the story that the models want to tell.

b. Perhaps the virus has already attacked the weakest victims. Recall the Avalon Hill model, in which there are offensive factors and defensive factors. Perhaps the people with weak defensive factors have already been attacked, and what remains are harder targets: elderly in well-run nursing homes that are keeping the virus out; or people who themselves have a decent defense against dying of the virus.

c. Perhaps the offensive factor is down because the virus has mutated to be less deadly. I remember an early Weinstein-Heying podcast where Bret said, “The virus doesn’t want to kill you. It wants to get into the future.” Their point was that the virus would increase its survival chances by mutating into a less deadly form. They did not give a time frame for this benign mutation trend to emerge, and it may be improbable that it has taken place already.

By the way, here is a long NYT article on excess deaths.

The medium is the mess

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Adam Garfinkle writes,

The deep-reading brain excels at making connections among analogical, inferential, and empathetic modes of reasoning, and knows how to associate them all with accumulated background knowledge. That constellation of sources and connections is what enables not just strategic thinking, but original thinking more broadly. So could it be that the failures of the American political class to fashion useful solutions to public- and foreign-policy challenges turn not just on polarization and hyper-partisanship, but also on the strong possibility that many of these non-deep readers are no longer able to think below the surface tension of a tweet?

If the printing press helped produce the Enlightenment, then perhaps the iPhone is producing the Endarkenment.

Health care rationing

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My brother-in-law is suffering in pain 24-7 from an injury that could be treated with surgery, but that is now forbidden. I think it is pretty likely that other people are suffering and even dying because they are denied medical care. This is because health care is being rationed, reserved for Covid patients who

a) are not showing up in hospitals in the expected numbers; and
b) might not be treatable if they did show up

I am surprised there is not more outrage about this.

3DDRR update

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1.090 overall, 1.11 outside of New York state.

I am seeing a lot more stories featuring overall excess deaths, because of doubts about virus death counts. But I will stick with the 3DDRR indicator.

I saw a headline that said that the models think we are headed for an increase in deaths. I don’t see that. I see a downward trend. Not as steeply sloped as I would like, but still downward.

In order to forecast fatalities going forward, what you really need is an indicator that predicts infection rates in nursing homes. If you could promise me that nursing homes will do a better job of keeping out the virus going forward, then I would promise that the deaths per week from the virus will fall rather than rise.

General update, April 28

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1. Peter Zeihan writes,

Despite its smaller population, Iowa has half-again more COVID-19 cases than Minnesota. I’ve little doubt that this is due to Iowa still having no stay-at-home orders from the governor as well as the fact that Iowa hosts the country’s densest cluster of meatpacking facilities.

But despite Iowa’s much larger overall caseload, the state has also suffered fewer than half the deaths from COVID as Minnesota. Over ¾ of Iowa’s positive cases are in people aged 65 and younger, an age group that is highly likely to survive the virus. Minnesota’s cases are skewed into older age groups, making death more likely.

2. Tyler Cowen notes that people are turning toward comfort music and comfort food. I would add “comfort news” to the list. For the right, it’s news that supports the view that the virus is no worse than the flu. Right-wing sites are still all over the Santa Clara study as proof of that. For the left, comfort news includes analysis that blames the virus crisis on President Trump. The left also seems to want stories that show that remote learning and/or charter schools are really awful. There is a recent NYT story filled with such anecdotes. Meanwhile, I know a private school teacher who says that she is trying to make the best of it, noting that in this environment she has the ability to mute a student at the touch of a button.

3. WBUR reports,

After Brigham and Women’s Hospital in Boston began requiring that nearly everyone in the hospital wear masks, new coronavirus infections diagnosed in its staffers dropped by half — or more.

Brigham and Women’s epidemiologist Dr. Michael Klompas said the hospital mandated masks for all health care staffers on March 25, and extended the requirement to patients as well on April 6.

Pointer from Scott Sumner, who has other interesting items in his post.

4. Scott also points to a Vox story pooh-poohing the notion that the virus came from a Chinese lab. The story does not address the argument made by Weinstein/Heying that bats and pangolins do not ordinarily hang out together (I cannot explain why this makes the virus unnatural, but that is what they say).

5. Michael T. Olsterholm and Mark Olshaker write,

The F.D.A. must bring order to this chaos and determine which tests work well. It should stick to its normal review process but expedite it by giving it top priority with its clinical reviewers and bringing in more reviewers as necessary.

But they also write,

as long as testing for SARS-CoV-2 is too limited or unreliable, the United States must ramp up what public health professionals call “syndromic surveillance”: the practice by medical personnel of observing, recording and reporting telltale patterns of symptoms in patients

I also feel better about low-tech methods than I do about the technocrats’ favorites of models and tests.

6. Casey B. Mulligan, Kevin M. Murphy, and Robert H. Topel write,

If an extensive shutdown of economic activity costs $7 trillion, largely in terms of economic hardship, and a limited response would lead to a $6 trillion loss of life, then an intermediate solution could, in principle, achieve a great deal.

If you are salivating for a cost-benefit analysis, these may be your guys. I just skimmed it, then I did a search for the word “mask” which came up empty, and decided to dismiss it. Tyler Cowen says “They think like economists,” which would only be praise if we didn’t know that they are economists.

7. Derek Thompson writes,

In the early innings of this crisis, the most resilient companies include blue-chip retailers like Amazon, Walmart, Dollar General, Costco, and Home Depot, all of whose stock prices are at or near record highs. Meanwhile, most small retailers—like hair salons, cafés, flower shops, and gyms—have less than one month’s cash on hand. One survey of several thousand small businesses, including hotels, theaters, and bars, found that just 30 percent of them expect to survive a lockdown that lasts four months.

Big companies have several advantages over smaller independents in a crisis. They have more cash reserves, better access to capital, and a general counsel’s office to furlough employees in an orderly fashion. Most important, their relationships with government and banks put them at the front of the line for bailouts.

Pointer from Tyler. That last sentence is the important one. The politicians talk about helping small business, but it’s the banks and the big companies that will wind up getting most of the newly-printed money.

Ironically, I think that ordinary people, as opposed to government officials, want to do the opposite. They want to support small businesses, and they don’t worry about the banks much. The contrast between the preferences of the people that earn money and the looting class that prints money could create some social tension in the months and years ahead.