Coronavirus: It will be unhealthy to ignore the cost of all this

Today in The Australian

While the response of federal and state governments to the spread of COVID-19 is understandable, there must be a danger of going too far.

About Henry Ergas

Henry Ergas AO is a columnist for The Australian. From 2009 to 2015 he was Senior Economic Adviser to Deloitte Australia and from 2009 to 2017 was Professor of Infrastructure Economics at the University of Wollongong’s SMART Infrastructure Facility. He joined SMART and Deloitte after working as a consultant economist at NECG, CRA International and Concept Economics. Prior to that, he was an economist at the OECD in Paris from the late 1970s until the early 1990s. At the OECD, he headed the Secretary-General’s Task Force on Structural Adjustment (1984-1987), which concentrated on improving the efficiency of government policies in a wide range of areas, and was subsequently Counsellor for Structural Policy in the Economics Department. He has taught at a range of universities, undertaken a number of government inquiries and served as a Lay Member of the New Zealand High Court. In 2016, he was made an Officer in the Order of Australia.
This entry was posted in Uncategorized. Bookmark the permalink.

26 Responses to Coronavirus: It will be unhealthy to ignore the cost of all this

  1. Peter Finch

    A sense of proportion seems to be lacking. Let me give you the CDC (USA) estimates for influenza season 2017-18.
    Illnesses 9,300,000 – 45,000,000
    Hospitalisations 140,000 – 810,000
    Deaths 12,000 – 61,000 or assuming a 26 week season then 66 – 335 deaths per day

    So deaths represent around 8% of hospitalisations. To date the USA has around 83,000 cases, 3,400 deaths and critical cases (around 100 per day for the sum of both) mostly in NYC with around 20%. The deaths figure as of today is close to 1,000 or 26 per day. Compare CV case figures with 2017/18 flu and they are less than 10% of 9.3 million and around 0.2% of 45 million.

    My son, a young and very fit student athlete in his final year at the University of Long Island left NY state a couple of weeks ago and is in the care of his girl friend’s family in Boston, probably the best medical centre in the world. On the above figures I am confident he will be OK. He is undertaking remote classes, thinks they are going well and the university seemed to be doing well in this regard. I hope our local universities are up to the job.

  2. Rossini

    I am certain that the jobs been stood down now may not be there when we get over this.
    Cannot understand all these dickheads (in my opinion) calling for major shutdown.
    Most are infected overseas……..all returning from o/s should be sent to Christmas Island
    for the mandatory two weeks at their expense

  3. Caveman

    Majority want a major shut down as the quicker they take the medicine the sooner they will be back at work. This is a slow water torture to the productive in the community.
    And how many will enjoy sucking on the teat of government after this eventually unfolds, will have a new class of dependent the Coronavours.

  4. egg_

    While the response of federal and state governments to the spread of COVID-19 is understandable, there must be a danger of going too far.

    Cats have been saying this from the get go – too little too late for nought.

    The arch chair experts now chime in – after the battle, as usual – with 20/20 hindsight?

    Spare me.

    The MSM will now turn on the Leader, when they were headless chickens themselves and part of the problem.

    Chi nese students weren’t the elephant in the room?

  5. egg_

    My son, a young and very fit student athlete

    So you say, but does he have underlying conditions like asthma?
    People often make claims like they’re selling a used car, when there’s all sorts of bother under the hood.

  6. egg_

    Most are infected overseas……..all returning from o/s

    From the Northern Hemisphere’s Winter season – ’cause it’s the flu, stoopid!

  7. Rossini

    egg_
    #3378747

    Thanks for the complement!

  8. Peter Finch

    No underlying conditions thank goodness

  9. egg_

    Thanks for the complement!

    I was reinforcing your point!

  10. Ian

    It’s “compliment” anyway …

  11. Confused Old Misfit

    Dear old Henry. About a week late. With the obvious.

  12. flyingduk

    I fear we are fighting the wrong war here because we are prioritising the wrong thing, minimising deaths. In war there is a mission to achieve for victory to be had. Our current goal seems to be to delay illness progression as long as possible to allo w the maximum number of sick, old, dependent people to survive. I think our real goal must be to minimise economic damage because, given our failure to set resources aside for winter, the hunker down option is lost to us, we simpl y cant afford it. Moreso if we combine ‘hunker down’ with ‘ spend up big on icu treatments to keep liabilities alive’, we are going to ‘win the war but lose the peace’.

  13. DHS

    Majority want a major shut down as the quicker they take the medicine the sooner they will be back at work.

    That doesn’t make any sense. I mean, I know people might actually believe it, but it makes no sense.

    Wouldn’t people who want to be at work be in favour of, I don’t know, not being shutdown at all?

  14. lily

    I have just received a email from JB Hi-Fi no more cash just credit card accepted, and from Coles they would prefer card usage rather than cash.

  15. Elderly White Man From Skipton

    Strangely, Dr Ergas goes to great lengths to wring hands over possible excess. Yet he doesn’t mention the actual indicators.
    Australia currently has about 2800 cases. Clearly the medical experts convinced governments to tighten the movement of people at least twice, so they expect an uptick. In fact we know that hospitals are being emptied nationally to prepare and old units are refurbed for extra ICUs.
    If we look at the curve (John Hopkins has some good data and indicators), Australia’s 3000 might be 30,000 by Easter. If it then peaked in May (following some other comparable trajectories), Australia could have as many as 200,000 cases.
    The UK has about 12,000 cases and so far 578 deaths.
    Given the uncertainty of Chinese data and the runaway numbers in the US, Indonesia and parts of Europe (not to mention the uncertainty that lingers over most developing countries), it would seem entirely prudent for our Government to act with great commitment and focus to limit the disease transmission and sustain the people who are at risk – in health or financially. Making comparisons with a common flu is unhelpful.

  16. Caveman

    No greater opportunity for some businesses to scale down for the future with these shut downs. Being able to get rid of crap employees and costly departments within the business without the three strikes and your gone rule. I dont think it will be mandatory for businesses to re employe the same amount of people back when it’s all over.

  17. Speedbox

    Rossini
    #3378704, posted on March 27, 2020 at 10:16 am
    I am certain that the jobs been stood down now may not be there when we get over this.

    Beyond any doubt.

    When this is over, the effect of flicking the ‘light switch’ (aka the economy) off will not be readily reversed by merely switching it ‘back on’. Hundreds of thousands (million? more?) of jobs and tens of thousands of businesses will be, at best, in suspended animation.

    Over the next few weeks, many more will meet the same fate and household incomes will be decimated by those directly affected. Even on the periphery, those who still have jobs or businesses will not be unscarred.

    Personal (and accumulated interest) debt will be through the roof for vast numbers and when they get their job back, assuming they do, what do you think their first thought will be? Go the cinema? Out for a meal? Buy that new car or holiday? Nope, they will stay at home and lick their financial wounds for months, and in some cases years.

    In any case, many will be lucky to be working by Christmas. It will be a staged return to work for probably hundreds of thousands. Of course, Governments will throw billions of dollars at assorted projects to ‘pump-prime’ the economy. We all know that is going to happen.

    The damage being done to the global economies is simply unbelievable and my comments are not drawing a moral stance – we just need to see the facts before us. Fortunes will be made and lost and for many, the financial shock will take at least a decade to recover from. Some may never recover.

  18. Rossini

    egg_
    #3378783

    Sorry egg just over sensitive with all these dick heads calling for a complete shutdown

  19. Tim Neilson

    Majority want a major shut down as the quicker they take the medicine the sooner they will be back at work.

    I’ve never quite understood this argument.

    With no shutdown the infection would rip through quickly, overwhelming the health care system, but would then peter out quicker.

    The measures to date are designed to slow the spread of the virus, thus preventing a spike that outstrips available health care resources, but that has the inevitable effect that the “curve” goes on for longer.

    So how does a full lockdown make us get over it quicker?

  20. Cynic of Ayr

    So, how many people suffer and perhaps die from established health problems, due to the ban on elective surgery, so that someone else may need the bed?
    Note the words established and may.
    An example that I am aware of. A 48 year old man, full time worker, has an arthritic hip. No amount of so-called “clean living” could prevent this. He was scheduled for hip surgery in October.
    A year or two ago, he had a medical for employment. A mild heart murmur was detected. No amount of so-called “clean living” could prevent this, as he was born with it. But, he’d die of old age before it killed him.
    Recently, a routine review revealed that the condition has unexpectedly worsened considerably. No problems, he was told, we’ll fix your ticker then fix your hip in October.
    A more detailed examination was scheduled for early April, to be sure what to do with the surgery.
    Nope! Been canceled indefinitely!
    Why? Just in case the bed was needed (and I don’t say this lightly or unsympathetically) by some old geezer, with lung cancer from smoking and alcohol, suffering from a virus.
    I wonder how many youngish people with a medical problem not of their making, are in this same boat.
    I suspect it to be more than the virus victims hospitalised.
    I wonder how many deaths could occur, which I suspect be more than the direct virus victims deaths.
    Someone with a modicum of authority, is seeking their 15 minutes of fame, and wildly cancelling all elective surgery.
    Of course, the elephant in the room is the decision between elective surgery, and necessary surgery.
    Elective surgery can turn in to necessary surgery in a short time, and the response will be, “Sorry. We fucked up?”

  21. Tim Neilson

    Elective surgery can turn in to necessary surgery in a short time, and the response will be, “Sorry. We fucked up?”

    No, the response will be “it’s all ScoMo/Trump’s fault”.

  22. Boambee John

    stackja
    #3378669, posted on March 27, 2020 at 9:57 am
    Trust WHO?

    Drum roll, Sure can’t! (Apologies to Rolf the unmentionable and British Paints.)

  23. Squirrel

    Aside from some small businesses calling for a more comprehensive shutdown (on the apparent assumption that this will trigger various protections and assistance which might leave them less worse off than at present) the demands to go harder and faster are coming from people who will be OK (or think they will) no matter how long it lasts.

    After all, if you’re being paid a very nice six-figure salary to do a b/s desk job, why wouldn’t you want to get paid the same money, without having to commute and put up with people you don’t like in the office?

    If/when these people get their way, they might be reminded of the old saying about being careful what you wish for – the longer a “lockdown” goes on, the more likely employers are to decide that they don’t need quite so many seat-warmers – and also that if the job can be done from home in Paddington or Carlton, it can probably be done from Mumbai, or some other place where salaries are much, much lower.

  24. flyingduk

    I have just received a email from JB Hi-Fi no more cash just credit card accepted, and from Coles they would prefer card usage rather than cash.

    Yep, hate so say it but the war on cash has been won by them. I didn’t see it coming but the ‘cash is contagious’ line is going to be all they need to ban it completely – for public safety you understand. I took my 20k emergency stash to the bank on Monday so I can turn it into Monero.

Comments are closed.