“How Can you Talk Economics When People are Dying”: A Blast from the Past.

Some people have been “pushing back” against the panic over the Chinese Coronavirus (Winnie the Flu), noting the damage these overreactions are doing, and will continue to do, to the economy.  But you know what else leads to people dying?  A faltering, let alone crashing, economy.  Which brings up this Blast from the (quite recent actually) Past.


It never fails.  When I (or a lot of other people) talk about the economic cost of some policy we always get “how can you think of economics when we’re talking about people’s lives here” or “you can’t put a price on human life” or the big one “if it saves just one life, it’s worth it.”  “If we don’t do this, people will die!”

The problem is that economics translates into lives.  And while whatever folk want to “solve” with their economically unviable proposal might “cost lives” impoverishing people, either as individuals or as the economy as a whole also costs lives.

Consider, that an Earthquake of a severity that might kill a dozen people in California, would kill hundreds, or even thousands, in someplace like Bangladesh.  Wealthier societies are more likely to have buildings built of sufficient strength to withstand earthquakes and, thus avoid crushing their inhabitants.  Wealthier societies are more likely to have networks of roads that allow sick and injured to reach hospitals or aid stations quickly–and the more quickly you can treat, the better the chances for recovery.

Or, never mind Earthquakes.  In wealthier societies more people have shelter from weather that can threaten their health, and not just against storms, but heat is a known killer, as is cold.  Having a draft-free dwelling with adequate heating and cooling for the weather saves lives.  Sure, for a lot of people it’s about comfort but many of the very old and very young, or the sick and injured, are less able to deal with temperature extremes.  Heat waves and cold snaps are invariably accompanied by rising death rates (with cold being by far the worse killer of the two).  Adequate heat and air, and modern, high-tech clothing meant to protect the wearer from temperature extremes make a big difference.

Ordinary illnesses and injuries?  People have accidents, get sick.  Once again, that extensive network of roads–a feature of wealthier societies–allows people to get their sick and injured to doctors and hospitals quickly.  And not just via ambulance.  That might be arranged by some government program which allows people to…

Oh, I can’t do it.  The simple fact is that many times, a person can get a sick or injured loved one to the hospital faster than an ambulance can get to them.  At least they can if they have their own car, which is something that is not common except in wealthy nations.

Look, some economists have tried to study this, to try and figure how many dollars (or whatever monetary unit you care to use) of GDP equates to how many lives saved.  Because of the complexities of such analysis results vary.  After all, there are other things that affect death rates than just the wealth of society.  The basic principle, however, is so universal that it’s not even controversial–people live longer, and better, in wealthier societies.

gdp-life-expectancy
The source for this is a site that does data visualization, but the data is very much real.

The results of all this is that you cannot dismiss economic realities–the cost of doing whatever “good thing” you want to do via government comes at the expense of no longer being able to do something else with those resources.  After all, Economics is the study of cause and effect relationships in the allocation of scarce resources that have alternative uses.  Scarce, meaning you never have enough for everyone that wants it.  And so, use them for one thing and lose the ability to use them for something else.

In politics, people tend to make categorical decisions.  We must do this, regardless of the cost.  And doing “this” means we don’t do “that.” Political solutions tend to miss the incremental tradeoffs.  How much of “that” are we willing to give up for how much of “this”?

And when the “that” is something as nebulous to most people’s thinking as a Gross Domestic Product, particularly when a lot of that product is in other people’s hands rather than ones own, the very real effects of trading “that” get lost in the shuffle.

It’s very short-sighted and we need to work hard to not do that.

Unless, of course, you want people to die.

9 thoughts on ““How Can you Talk Economics When People are Dying”: A Blast from the Past.”

  1. Since there are actually people complaining that they can’t go out and socialize over quarantine reasons and ‘can’t stand it’, plus the crazy panic buying and general ugly behaviour displayed in groceries and shops now, I really don’t want to see what would happen if we DID have a Great Depression level financial crash, where people can’t get work, are starving, etc. I think it’d be bad in ways I don’t dare imagine. =/

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  2. “Winnie the Flu?” I kinda prefer “Kung Flu.” Pity it didn’t start in Hongkers, or we could call it “Hong Kong Fluey.”

    I shudder to think of what would happen if (when?) the economy DOES crash. I went to go buy some eat the other day at the grocery – had two people try to “shop out” of my cart IN the store, one guy try to make off with my cart out the parking lot while I was unlocking my truck (I didn’t even have any toilet paper!) and I saw two women with FIVE carts between them – all together – in line in front of me when I went to check out.

    I was only able to fill about half of my list.

    I’ve seen people panic before. I don’t know if they’re going to get to where a show of force will be necessary to calm them down, but I decided to be ready for them – whenever I go out, I have a large knife (my Applegate-Fairbairn) visible and in easy reach. I’d carry my sidearm, but this is California, and none of my CCWs are valid here (damn…) Still, I’ve found that naked steel – and the readily apparent will to use it – will either calm panicked people down or make them figure out that elsewhere – ANYWHERE ELSE – is a much better place to be. Either way, I get left alone – and I like that.

    “You, you, and you – panic. The rest of you – with me.” -Anonymous sergeant, used later by me.

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    1. I use “Winnie the Flu”, frankly, since Xi was so offended previously at some folk saying he looked like Winnie the Pooh.

      And, yeah, these days I tend to carry heavier than I would normally. Panic brings us that much closer to mobs. As for the intimidation effect of cold steel. That’s what I’ve got the tomahawk for.

      Liked by 1 person

  3. A similar dynamic applies to environmental protection … prosperity gives us breathing space to actually care about real poop-in-our-nest threats, eroding that in the name of “saving the planet” can be counterproductive to that objective (as opposed to busybodies using the environment as a stalking horse to impose their One and Only True Way).

    When people start to question where their next meal is coming from, they are more likely to filet Willy than free him.

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    1. Of course people in wealthier countries live longer. Why is longer lifespans (also a way to measure more lives) the metric we’re looking at. Averages hide a plethora of sins. A friend of mine says that “many a statistician has drowned in a body of water whose average depth is one inch.” A choice that improves the lifespans of 10 people by 1 year produces the same average increase as a choice that improves the life of 1 person by 10 years. What about quality of life?

      Also, our longer lifespans have resulted in some negative effects. Longer lifespans increase morbidity and mortality from age-related diseases. Longer lifespans lead to more people living past age 65 (retirement) than was calculated decades ago to come up with the amount that should be collected from taxpayers to fund Medicare and Social Security. People are being paid out far more than they paid in. Since this is an overall trend, it isn’t taken care of by the risk distribution (insurance) feature of these programs.

      Moreover, it’s not enough to say that practicing social distancing, sheltering in place, closing non-essential business, etc. will harm the economy. Not doing so will lead to the overwhelming of hospitals. This means patients with chronic illnesses may not get out on ventilators because they’re all being used. More people will die. People who die will not be contributing to GDP. You need to also take that into account.

      Many health care workers will die. Doctors and nurses are already scarce and cannot be replaced quickly. (It takes what, 3 to 8 years to get trained & licensed?). So sure, it makes sense to take into account the economic effects of taking these steps, but you need to also calculate the economic harms that will result from not taking these measures.

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      1. What about quality of life?

        What about it? Are you really prepared to attempt to argue that the quality of life is better in poor nations?

        https://thewriterinblack.com/2019/03/14/benefitting-from-prosperity-originally-the-poor-get-poorer-a-blast-from-the-past/

        Longer lifespans lead to more people living past age 65 (retirement) than was calculated decades ago to come up with the amount that should be collected from taxpayers to fund Medicare and Social Security

        Well, that’s how SS and Medicare were sold. That’s not how they ever worked. They have always been pure “wealth distribution”, taking from those currently earning to pay for those not.

        And, let’s see, trouble for wealth restribution government programs and…death.

        Yeah, I think I know which side of that argument I come down on.

        Not doing so will lead to the overwhelming of hospitals.

        What’s overwhelming hospitals in the US are panicked people crowding ER’s over every sniffle. and, overall incidence of pneumonia (those ventilators you’re talking about) is down and was down long before the vary lockdowns started going into effect: https://accordingtohoyt.com/2020/03/27/covid-19-and-us-mortality-by-i-ratel/

        More people will die.

        Many health care workers will die.

        Objection, your honor. Assumes facts not in evidence. Define “many”. Evidence that it will actually be “many.” As a point of fact, in 2015 there were 1.1 million doctors of medicine in the US (plus however many NPs and PAs) and just under 3 million registered nurses. This doesn’t count any retired who could pitch in if things really got hot.

        Bluntly, despite the media and politically motivated driven panic, Winnie the Flu isn’t anywhere near as bad as it’s being portrayed. https://thewriterinblack.com/2020/03/20/the-wuhan-chinese-coronavirus/ (and see tonight’s post for more).

        You know what else causes people to die? A faltering, let alone crashed, economy. But it’s Bastiat’s “seen and the unseen.” The deaths are scattered throughout the economy and don’t have people pointing and screaming about them.

        but you need to also calculate the economic harms that will result from not taking these measures

        Wow, how to completely miss the point. Folk are making the “people will die” argument and dismissing the economic consequences as unimportant next to people’s lives. I’m pointing out that the “economic consequences” also come down to people’s lives.

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  4. Pingback: BECAUSE ECONOMICS ARE LIFE AND DEATH:  “How Can you Talk Economics When People are Dying”…. – The usa report

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