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Another Shutdown?

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KEY THEMES

Politics
Health

location

United States

KEY SOURCES

PNAS
Nature
Mercatus Center
Cato Institute
US Department of the Treasury
Bureau of Labor Statistics
Economic Policy Institute
Foreign Policy Research Institute
CDC
JAMA Psychiatry
SAMHSA

WHY THIS QUESTION MATTERS: 

After months of COVID-19 lockdowns, states across the country began to lift stay at home orders and restrictions at the end of May. Today, all 41 states which issued stay at home orders have begun lifting restrictions. However, as the number of COVID-19 cases surge across parts of the country, the opening process is being slowed or even reversed in several states. 

If we use the 1918 Spanish Flu as our guide, we can presume a second peak is coming. In 1918, US cities which had implemented control measures to limit public interaction saw a second peak after they eased the restrictions. This is because the majority of their populations were not exposed during the initial outbreak and the communities did not develop a herd immunity. 

Lawmakers are becoming increasingly concerned about rising infection rates and potential implications for overcrowded hospitals. Today, we’ll walk through some of the pros and cons of reinstating widespread shutdown or stay at home measures.


SHUTDOWNS TO DATE:

On March 19th, California became the first state to issue stay at home orders, followed by 41 other states as well as the District of Columbia. Even states that did not issue a stay at home order, including Arkansas, Iowa, Nebraska, North Dakota, South Dakota, Oklahoma, Utah and Wyoming, implemented restrictions on certain social activities.

According to a CDC Survey, 80% of Americans said they had self-isolated during this time.

ECONOMIC IMPACTS:

The economy has been severely impacted by the COVID-19 shutdowns. Consumption makes up 70% of the US GDP and is especially hard hit with stay at home orders. Unemployment has soared, with 6.6 million applying for unemployment in a single week in March when the shutdowns began. 


Small businesses have been especially hard hit as they lose revenue and have to cut payroll. However, virtually all sectors have been impacted.

NON-ECONOMIC IMPACTS:

Shutdowns have also taken a non-economic toll. According to Forbes, there is also risk of increased kidney failure, homelessness (which is linked again to depression, drug addiction, alcoholism, and anxiety), poverty, unplanned pregnancies, and abuse. 

Additionally, many individuals have begun to experience “Quarantine fatigue,” which occurs when people show low motivation or energy to comply with safety guidelines. During the early days of the pandemic most individuals were motivated to comply with restrictions based on fear. However, after three months where many people haven't seen someone infected, people begin to let their guard down and underestimate the threat of infraction and harm.

ONGOING THREAT:

Unfortunately, the thread of COVID-19 is still very real.

Some states are experiencing a rapid increase in cases since lockdowns have been lifted, leading many to question if another round of shutdowns will be needed. 

Let’s get into the research.

THE COMMON THREAD:

Americans need to balance safety and prosperity.

FIND YOUR THREAD:

Supporters of another shutdown focus on preventing further infection and overwhelming hospitals. Opponents of another shutdown focus on the economic and health impacts of a shut down and ask if the pros really outweigh the risks.

What do you think?

​Yes, we need another shutdown.

Reason 01

Shutdowns and social distancing leads to less infections and deaths.

  • History tells us that limiting public interaction decreases infection rates. Models of the 1918 Pandemic show that cities with the most effective intervention, including multiple “waves” of interventions and distancing policies, reduced transmission rates by up to 30–50%. PNAS

      

    • The study of the Spanish Flu predicts that if San Francisco, which had the most effective measures, had continued their preventative measures longer, they would have had a 90% reduction rate in deaths. Conversely, when interventions are time limited, the total mortality rate is reduced only moderately (perhaps 10–30%) because interventions are introduced too late and lifted too early. PNAS

  • Current analysis of 11 European countries suggests that their lockdown implementations have decreased the transmission rates. “By comparing the deaths predicted under the model with no interventions to the deaths predicted in our intervention model, we calculated the total deaths averted in our study period. We find that, across 11 countries, since the beginning of the epidemic, 3,100,000 [2,800,000 - 3,500,000] deaths have been averted due to interventions.” Nature

Reason 02

Lockdowns help ensure adequate healthcare capacity is available.

  • If we see a second wave cropping up in other countries, it is best to act sooner rather than later; before it hits the US rather than after. Anticipation is important in crises, or else governments can fall behind in their responses.  Mercatus Center

  • The benefit of flattening the curve is to even out the demands on hospitals, which must have sufficient space, supplies, and healthy staff to care for those who need hospital-level care—whether it’s for coronavirus, a stroke, trauma, or childbirth. Mercatus Center

  • An economic cost-benefit analysis strongly supports “near-term lockdowns”. "Near term" is a short term lock down instituted as soon as possible and is over within 6-8 weeks. Weak early actions have been shown to have devastating effects on health because hospitals are overwhelmed.  Cato Institute

Reason 03

Shut downs may benefit the economy in the long run.

  • When you take into account the economic impact of loss of life, measured as value-of-production in this study, the net benefits of shut down policies are likely positive and may be substantial (but given significant uncertainty, net benefits may be close to zero). Total benefits of suppression policies are estimated to be between $440 billion and $1,049 billion vs. costs of suppression policies estimated to be between $255 billion and $464 billion. Mercatus Center

  • Through the CARES Act, the “Paycheck Protection Program is providing small businesses with the resources they need to maintain their payroll, hire back employees who may have been laid off, and cover applicable overhead. The CARES Act provides for Economic Impact Payments to American households of up to $1,200 per adult for individuals whose income was less than $99,000 in 2019 (or $198,000 for joint filers) and $500 per child under 17 years old – or up to $3,400 for a family of four.” While the long term impacts are unknown, these government interventions lessens the immediate economic burden of the shutdown. US Department of the Treasury


No, no more shutdowns.

Reason 01

Shutdowns will hurt workers, businesses, and the economy.

  • COVID-19 shutdowns affected all sectors of the economy. “Overall, the unemployment rate (not seasonally adjusted) increased from 3.8 percent to 14.4 percent between February and April.” That’s a 13 fold increase in two months. Bureau of Labor Statistics

     

  • 33.5 million people, or nearly one in five workers, filed for unemployment in April and May. And this was likely an undercount. A survey done by the EPI shows that for every 100 workers that filed for unemployment, 37 tried to apply but couldn’t finish the process. Economic Policy Institute

  • These losses were disproportionately felt among low income and single-parent households as shutdowns here more acutely felt in "highly exposed" industries the require in person interactions, such as restaurants, travel, barbers, department stores, etc.  Bureau of Labor Statistics

  • Another shutdown could hurt businesses that are currently struggling to stay solvent. If businesses must close their doors again, they may be forced to shut their doors permanently. Foreign Policy Research Institute

Reason 02

Shutdowns don’t just affect the economy, there are broader impacts including to physical and mental health.

  • The cost of shutdowns are more than we can quantify. Elective care procedures were not priorities under the CDC guidelines so many procedures were postponed. Preventative care was also not a priority so they were put on hold as well. People will also die from chronic illnesses, cancer, emergency medical situations, or non-emergency but still necessary medical procedures, or miss immunizations. CDC and Cato Institute

     

  • Secondary consequences of social distancing may increase the risk of suicide. Existing research suggests that sustained economic stress could be associated with higher US suicide rates in the future. Suicidal thoughts and behaviors are associated with social isolation and loneliness. JAMA Psychiatry 

  • Shutdowns can also force victims of domestic violence to stay in dangerous situations in their homes. “According to CDC, approximately 1 in 4 women and nearly 1 in 10 men have experienced intimate partner violence (IPV), sexual violence, physical violence, and/or stalking by an intimate partner during their lifetime.” Because of the stay at home orders, it can become more difficult for victims to flee their house. SAMHSA

  • The healthcare system is tied to work through employment provided health insurance, so if people lose their jobs they lose their health coverage as well, and during a time when many people are hesitant to go to hospitals in the first place, human health suffers in ways that are not directly related to the pandemic. Economic Policy Institute

Reason 03

A targeted approach to manage COVID-19 risks makes more sense.

  • Instead of a lockdown, there should be other restrictions and regulations: “safety protocols for businesses to re‐​open (temperature testing, social distancing, screens), shifting towards randomised testing and strict quarantining on those affected, immunity certificates, relaxing rules on outdoor leisure activities, and more.” CATO Institute

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