‘The cure could be worse than the disease’

Shutting up shop: Normally seething with tourists, the leaning tower of Pisa sits deserted. © EPA

Is it worth sacrificing the economy for the coronavirus? An increasing number of experts now say that the long-term impact of Covid-19 could be more devastating than the pandemic itself.

Billions are living under lockdown.

Shops have been told to close. Workers have been fired. Businesses have no one to sell to. Planes have nowhere to fly.

The coronavirus pandemic has drastically reshaped our society and our economy.

Governments across the world have agreed that protecting lives is more important than protecting profit.

As New York Governor Andrew Cuomo said, “I’m not willing to put a price on a human life.” In the UK, Chancellor Rishi Sunak promised to do “whatever it takes”.

They all agree: no one needs to be sacrificed in order to save the stock market.

But is it that simple? Many critics of government strategy point to the fact that there is not a straightforward choice between money and death. Both scenarios – ignoring the virus and continuing as usual, or shutting the economy and stopping the virus – will likely lead to a massive loss of life.

This is because an economic collapse will have devastating consequences on all aspects of society. One leading economist has said that the UK should expect “a recession of a scale we have not seen in modern history”.

Less money means fewer jobs. The US already has a record number of unemployment benefit claimants and, in the UK, it was disclosed yesterday that nearly a million small and medium-sized UK businesses are set to run out of money and go bust by the end of this month.

Fewer jobs mean less ability for people to buy food or pay rent. During the 2008-2009 financial crash, suicide rates increased almost 5% in the US and over 6% in Europe.

Life expectancy is also often tied to wealth. In general, the richest countries have the populations that live for the longest time.

In Italy – the country worst hit by the coronavirus – GDP is set to decrease by almost 6%. According to a researcher at Bristol University, if a recession of that scale took place in the UK, then “more years of life will be lost [...] than will be saved through beating the virus”.

But other thinkers are keen to remind us that the future is up to us. None of this damage is guaranteed.

As one expert said, “If we allow Covid-19 to permanently damage our economic and social fabric, it will be our own fault, not that of the virus.”

So, is it worth sacrificing the economy for the coronavirus?

Blood money

Yes. We know that we can save lives today by taking these draconian measures. We cannot let the virus tear through society unchecked. On the other hand, the lives that may or may not be lost due to a recession are still hypothetical. This crisis has shown that almost anything is possible politically – and that lives matter more than numbers. Let us maintain that mentality for the tough years ahead.

No. The coronavirus is not an existential threat to our civilisation. A large proportion of the people dying were likely to die in the coming years anyway. Sacrificing the life chances of millions over the coming decades is too high a price to pay. No one is saying that money matters more than human life. The choice is between a few shorter lives now or many shorter lives in the future.

You Decide

  1. Do you agree with the lockdown where you live?
  2. If not through economic measurements, how would you gauge the health of an economy so that it values the most important aspects of life?

Activities

  1. Write a list of the shops, restaurants, and leisure centres that you are most looking forward to visiting again after the outbreak.
  2. Discuss with your household what you think the government should do immediately after the pandemic in order to kick-start the economy again.

Some People Say...

“Nothing like this has ever happened to the economy in our lifetimes. But bringing the economy back [...] that’s more of a reversible thing than bringing people back to life.”

Bill Gates, Microsoft founder and billionaire philanthropist

What do you think?

Q & A

What do we know?
US economist Nouriel Roubini says that the “shock to the global economy from Covid-19 has been faster and more severe than the 2008 global financial crisis and even the Great Depression”. IPPR, a London think tank, estimates that 130,000 people lost their lives as a result of government policy after the last financial crisis. However, during the Great Recession of the 1930s, life expectancy in the US actually increased.
What do we not know?
We cannot know how many more lives would be lost to coronavirus or as a result of an overwhelmed healthcare system if we were not staying at home. We also have no idea exactly how many lives might be lost as a result of a global recession. We also do not know if any individual economy could prosper while the rest of the world is in lockdown.

Word Watch

Economy
The state of a country or region in terms of the production and consumption of goods and services, and the supply of money. In short, all the work and spending that happens in a single place.
Stock market
The stock market is where investors connect to buy and sell investments – most commonly, stocks, which are shares of ownership in a public company.
Recession
Economic term meaning a decrease in the financial well-being of a nation. It technically applies after six months of a country’s GDP shrinking.
Unemployment benefit
Money made available by a government for people who lose their job or cannot find one. It is a key part of the welfare state.
Life expectancy
The number of years, on average, that someone should expect to live. It varies throughout history and across different countries. In the UK, it is currently 81 years.
GDP
Short for gross domestic product: the market value of all finished goods and services produced by a country in a specific time period.
Draconian
Excessively strict or punishing measures, often enacted by a government against its citizens’ freedoms. Named after the Athenian legislator Draco.
Hypothetical
Based on possible ideas or situations rather than actual ones.
Existential
That brings into question the entire viability of a thing. Most crises bring about some change, but an existential threat – say, aliens invading – changes everything.

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