There is still a good deal that is unclear about the CORVID-19
epidemic, but a few things have become clear:
1. It is clearly more
dangerous than the seasonal influenza. Seasonal influenza kills about 0.1% (1
in 1000) of those it infects. CORVID-19 looks like it is lethal in about 1-2%
of cases (1 in 100 or 1 in 50). And for
the old the percentage of deaths is significantly higher, running about 15% (1
in 7) for those 80+.
2. We have no idea how widespread the infection is in the
US, because we have tested so few people. We know the number who are ill enough
to get hospitalized and tested, where test kits were available, but that is so
few cases thus far that we are really running blind at the moment. It is highly likely that we already have hundreds
or even thousands of people in the U.S. with mild or no symptoms, spreading the
infection.
3. The official response in the US has been, to put it
charitably, pathetic. At the point where South Korea had tested 140,000 people,
the US had tested about 2000, and the fiasco with the production of testing
kits is just the tip of the iceberg. Trump can’t figure out what to do. He is
trying to limit panic, but he is so clumsy at it that the result is simply confusion.
But the incompetence isn’t just limited to the president; the whole federal bureaucracy
and political system can’t get its act together or move fast enough or decisively
enough to make any difference.
4. It is clear that this infection will sweep through a majority
of the U.S. population within the coming months, no doubt causing - belatedly -
school and business closing throughout the economy and disrupting life for all
of us. Fortunately, most people will only get the mild version, often no worse
than a cold, but there will be a significant number of deaths and a good deal
of panic and hoarding. (Why people are stocking
up on toilet paper, of all things, is beyond me. Toilet paper is made in the
U.S., from trees grown in the U.S. – we aren’t going to run out of it, unless of
course the hoarders get it all.)
5. It is also clear that this epidemic is going to cause a
severe economic hit to the entire world. The U.S. will probably be impacted
less than most other countries, but even we will feel pain. The problem is that
key supply chains throughout the world have been cut off. A new car or a pharmaceutical
product may only have 5% of its components sourced from, say, China or Italy or
South Korea, but if that 5% disappears, one can’t complete and deliver the car
or the medicine. This is true of hundreds of thousands of products we buy or use
daily, and we are about to see how dangerously interdependent and vulnerable
the world economy has become.
6. The worst of the pain will be probably be delayed until
April or May. Companies know that Chinese factories close down for the Lunar
New Year, so they build up inventory in anticipation, In addition, it takes
about 30 days to ship goods from Asia to the US by sea, so we have a 30-day
supply still in transit. Once that excess inventory is used up and the goods at
sea arrive and are used up, the pinch will start.
7. Our best hope is that state and local governments are
more competent than the federal government, and move decisively to limit the
infection and the economic dislocation. State and local governments are closer
to the people they govern, and therefore tend to be more responsive than federal
officials and politicians – not always true, but true more often than not.
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