Weekly Selection 27 March 2020

Jonathan Portes, Don't believe the myth that we must sacrifice lives to save the economy

(The Guardian, March 25, 2020)

This concerns the much talked about trade-off between public health and the hit to growth. The economist debunks (as most do) the myth that sacrificing a few lives will save the economy. The primary reason is quite simple: if, as the scientists predict, the loosening the restrictions results in an acceleration of infection, more workers would become infected and many firms would rapidly just stop functioning. The more fundamental argument is this: the economy will not return to “normal” until confidence returns. The conclusion: governments must do whatever it takes and whatever it costs in the interests of our health and our collective wealth (reads in 5-6 min).

Branko Milanovic, The Real Pandemic Danger Is Social Collapse

(Foreign Affairs, March 19, 2020)

This is a sobering read that corroborates many discussions we’ve had over the past few days. The point is straightforward: “If more people emerge from the current crisis with neither money, nor jobs, nor access to health care, and if these people become desperate and angry, such scenes as the recent escape of prisoners in Italy or the looting that followed Hurricane Katrina in New Orleans in 2005 might become commonplace. If governments have to resort to using paramilitary or military forces to quell, for example, riots or attacks on property, societies could begin to disintegrate” (reads in 4-5 min – we hope you won’t be bothered by the paywall).

Nouriel Roubini, A Greater Depression?

(Project Syndicate, March 25, 2020)

This short piece just says it as it is: the risk of a protracted depression is real unless policy-makers deploy massive fiscal stimulus (including through “helicopter drops” of direct cash disbursements to households) that are fully monetized (not financed through standard government debt). A best-case scenario of a recovery in Q4 of this year would also require a bit of “luck” with geopolitical white swans tail risks (reads in 5-6 min).

Thomas Friedman, Finding the ‘Common Good’ in a Pandemic

(The New York Times, March 24, 2020)

Almost every single decision that has to do with the pandemic can be framed as an ethical choice, even more so when it concerns the common good (defined as how we live together in community). The political philosopher Michael Sandel offers his take on this. A great and inspiring read of less than 6 min!

Jordi Sales, What happens after you recover from coronavirus? 5 questions answered

(World Economic Forum, March 20, 2020)

This is a useful read that provides simple answers to complex questions and issues. If you want to get a sense of what is the recovery rate, whether you are still infectious after having recovered, whether it’s possible to catch COVID-19 a second time, how long might immunity to COVID-19 lasts and when you can go back to work, read on (5-6 min).