Shutdown decisions are made by people with no skin in the game; when would they ever decide to reopen?

A friend in Holland in is his 60s and therefore beginning to enter the real risk window for COVID-19. When I call to check on him, he is usually out in the busy square of his university town. “Some students just walked by with six crates of beer,” he remarked. Holland never truly shut down. Unlike Sweden, however, the schools closed. “The teachers are unionized,” my friend said. “So they knew they’d get paid whether or not they went to work. Of course they immediately refused to work and said that the schools had to be closed in the name of protecting everyone.” How about the stores? “Everything is open except for the red light district,” he responded. (If the gals working there could somehow make it to Boston, they could earn a lot more than they’d been getting in Amsterdam!)

(How’s Holland doing? The Population is 17 million. As of April 9, they’d suffered 2,248 deaths compared to 10,853 in France, population 67 million. I.e., the Netherlands has had a lower death rate than France. France began locking down on March 13.)

If people making the decisions on shutting down continue to get paid, when would they ever suggest reopening? Who is involved in or has influenced decision-making in the U.S. on this issue?

  • State governors
  • CDC bureaucrats
  • NIH bureaucrats (such as Dr. Anthony Fauci)
  • WHO bureaucrats
  • Tenured professors at top research universities

One thing the above folks all have in common: they will still have the same job at the same pay regardless of the length of the shutdown. What’s their lockdown experience like? I was on FaceTime yesterday with a (flying friend) professor of “science and public policy,” i.e., exactly the kind of person whom a government might turn to for advice. He is suffering through the lockdown at a 20-acre family property right on the ocean.

If your job is engineering or manufacturing widgets, on the other hand, every additional day of shutdown is additional risk that a customer will decide to buy widgets from Korean, Japanese, Taiwanese, or Chinese suppliers that remain up and running. You will come back after the shutdown to reduced revenue and a much tougher competitive environment in direct proportion to the length of the shutdown.

Given that even one death is one death too many from COVID-19 and that we should always act out of an abundance of caution and that we assume that our shutdown has had a tremendous life-saving effect, when would folks who are immune to any negative effects of economic/societal shutdown ever decide that it is time to reopen?

24 thoughts on “Shutdown decisions are made by people with no skin in the game; when would they ever decide to reopen?

  1. Teachers and Professors will get a comeuppance. If you had a high school senior today would you write a check for 50K to send them off to school in Sept. knowing they might end up back on your couch in a month?
    States at the moment are outlawing homeschooling. Right now. Imagine that. They can try but they will never put the cat back in the bag. A lot of kids ain’t shipping off to college and a lot aren’t going back to public school.

    • GB: I think the tenured professors at the most elite schools, i.e., the ones that get to advise government, will be fine. If a school did have to fire half the faculty, guess who keeps his/her/zer/their job?

  2. “…they will still have the same job at the same pay regardless of the length of the shutdown.”

    That’s not entirely true–their job and pay are dependent on a functioning civilization, and they can’t collect that pay if they’ve been strung up from lampposts. I do think that the people pushing for 6-18 month lockdowns are entirely incapable of recognizing the consequences of getting what them, though, so _from their point of view_ they don’t have any skin in the game.

  3. NYC has a population about 12% of that of France but we have about as many deaths so the media seeing a success story in the making is lauding our Governor as presidential material.

    • Jack: Good point. The folks running NYC and NY State haven’t even suffered a loss of popularity for their failure to use any of their $88 billion/year Department of Health budget to (a) buy masks, (b) buy ventilators, or (c) write down a plan for load balancing patients to hospitals.

  4. Some have nevertheless demurred, at least to some extent, from Coronapanic. To name a few: Jay Bhattacharya, John Ioannidis and Knut Wittkowski in the US; Ansgar Lohse and Sucharit Bhakdi in Germany; and Andreas Sönnichsen in Austria.

    In the UK one unexpected source of doubt is NHS England which, according to Dr Malcolm Kendrick, fears that “we could end up losing more ‘years of life’ because of fatalities relating to non-covid-19 health complications.”

  5. Part of my wish list out pandemic-2020 is that we get out of profiling people. I think part of how we got here was doctors looked at someone and said “oh you have the flu” and then tomorrow you can’t take up oxygen. So “in is his 60s and therefore beginning to enter the real risk window” is age profiling – the issue is ill health, not age. Is ill health correlated with age? Yes. Does age cause ill health? No.

    • That’s a great point and I should apologize for profiling my friend (a vigorous non-smoking skier with a booming voice). I spent some time in late January with Apollo 15 astronaut Al Worden, nearly 88 years old. He was walking and talking faster than most of the 50-65-year-olds in our group. He was looking forward eagerly to the advances being made by Blue Origin and SpaceX. I would have been happy to bet on him living another 10 years at a high level of function. However, he died in his sleep on March 18 (not from coronavirus).

  6. I’m worried about the food supply and getting it to people who are at the most risk. You can shut down society with civil authority for a certain amount of time. Then you can unleash the criminal justice system, tighten the restrictions and issue fines, arrest the rogues, and make examples of them – in the beginning, for a while, while the vast majority of people are still afraid of contagion, in the “stay at home” phase, watching TV, Zooming their meetings, and trying to flatten that curve.

    That will continue to be a more-or-less orderly if unpleasant state of affairs right up until the moment people start going hungry, and then they are going to do whatever they have to do to survive.

    That doesn’t mean society will restart on its own. Rather, it will become increasingly unraveled and dangerous. Here and there, each place a different way, some more quickly than others, but it will happen. Anyone who thinks lockdowns and law and order can be maintained in a society where 50% of the people are going to start running out of money by the end of May (some already have!) – even with their stimulus checks – has obviously never tried to live for more than a few days without food.

    I have, I tried it once in College with a few friends, just to see what it was like. No food, just water. No alcohol. By the middle of Day Four we all bailed and had started thinking of each other as appetizers. One person chronicled the experience but alas, this was the pre-Internet world and I lost touch with him. It’ll suffice to say that after just 48 hours things start to get interesting, and unless you know it’s all just a game, panic will start seeping in around the edges very quickly.

    There are going to be a lot of people at risk, and our producers and supply chains are nowhere near as robust as the starry-eyed optimists were proclaiming at the end of March. In less than two weeks the situation has deteriorated to the extent that some big producers are now using words like “perilous” — and we aren’t halfway through April yet.

    “Smithfield Foods, the world’s biggest pork processor, on Sunday said it is shutting a pork plant indefinitely and warned that plant shutdowns are pushing the United States “perilously close to the edge” in meat supplies for grocers.”

    • Just to be accurate it should not say “Smithfield Foods … warned …”, but “The CCP … warned”

    • @Alan: Yeah. We’ve allowed ourselves to do an awful lot of damage to our survivability as a nation on many, many levels over the past several decades. We’re way out on a lot of limbs.

    • Actually I think it will resolve itself, much as the Japanese purchase of US assets with an artificial currency did last century. I expect in the near future, someone from the US will buy back Smithfield for deci-pennies on the RMB.

      I expect Enstrom, Cirrus, Mooney and Diamond will be available soon Phil, if you are interested.

  7. With regard to decisions being made with no skin in the game, this happens all the time – they are called judges! Supposed to weigh the cases and facts and render decisions and we WANT them with no skin in the game so they can be (or at least appear to be) impartial! Governors surely have skin in the game (elected or not).

    But taking your point, do you want people who only have selfish economic interests (I said ONLY) to be the decision makers? Hmm…

    • Paul: You raise a great point. But judges, especially in European Civil Law jurisdictions, are supposedly applying rules that are set up by representatives of the people (legislatures). Here, there are no rules! There was never an election where people got to vote on whether the government should shrink the economy by $1 billion to save a single American life (while killing multiple people in poor countries with whom we trade) or if $10 billion should be the limit or if $10 million should be the limit or what.

    • A group of unionized teachers, for example, will be better off staying at home (fewer hours of work, zero hours of commuting, reduced chance (at least in their minds, if not in the Swedish v. Massachusetts data) of contracting coronavirus). They’ve already completed their own schooling. So I can’t see a situation in which it would make rational sense for them to say “We want to go back to work.”

    • Here’s a text message reply that I received today from a housecleaner, a legal immigrant from Brazil (I informed her that a check was on the way): “We are ok. All my clients cancel but some still pay thank you God. Thank you for support me”

      She gets no vote in when Massachusetts reopens. But the folks at the who had no plan in place for load balancing of patients to hospitals and no stockpile of masks or ventilators for any SARS-type outbreak… they get a full paycheck and a vote. The folks at who stockpiled no masks and who will probably get a pay raise when this is done… they get a vote. (Back in 2018 they had a $1.1 billion budget, including $500,000 for the “GLBT Commission” that would have been enough to have purchased a mask for every resident of Massachusetts; (Why do they need to pay people to be on the GLBT Commission? Any of my Facebook friends would be happy to volunteer for an LGBTQIA+ cause!).)

  8. Good points, Philip. Yea, no rules (unlike judges). On the teachers, yes, for sure short term esp if fearful of contracting coronavirus is high and pay is adequate. Maybe, though, some (most!??!) of them have motivations beyond pay – to make a difference in kids’ lives? Ok you can stop laughing now… Also maybe they are bored to death as well!

  9. from Wikipedia: “Then known as Shuanghui Group, WH Group purchased Smithfield Foods in 2013 for $4.72 billion.[9][10] It was the largest Chinese acquisition of an American company to date.[11] The acquisition of Smithfield’s 146,000 acres of land made WH Group, headquartered in Luohe, Henan province, one of the largest overseas owners of American farmland.[b]”

    • Allowing foreign ownership of real estate is treason. Yes I know it is clown world legal.

  10. MIT President L. Rafael Reif writes with respect to running MIT under the pandemic, “I would like to be clear that, in this work, we will put people and mission first.”

    I’ve heard of putting mission first (military), and I’ve heard of putting people first (non-profits with respect to their own staff), but MIT will put people AND mission first. What are they going to put last, IT maintenance and upgrades? Won’t that affect people and mission?

  11. I’m wondering if we could say the same about the Boeing 737 MAX. The people who can authorize the MAX to fly again — the FAA — have no skin in the game. Except if they are wrong, they will be criticized in the media.

  12. Phil, go easy on the NIH, they’re still trying to figure out if funding creation of chimeric SARS-CoV viruses in collaboration with the Chinese was or wasn’t the smartest idea. Once they figure out the answer, I would expect some stern words and less-than-stellar job evaluations for those involved.
    In 2015, American researchers and Chinese Wuhan Institute of Virology researchers collaborated to transform an animal coronavirus into one that can attack humans. Scientists from prestigious American universities and the US Food and Drug Administration (FDA) worked directly with the two coauthor researchers from Wuhan Institute of Virology, Xing-Yi Ge and Zhengli-Li Shi. Funding was provided by the Chinese and US governments. The team succeeded in modifying a bat coronavirus to make it capable of infecting humans.

Comments are closed.