Tag: lockdowns

The Grim Costs of Total Lockdowns

 

The coronavirus crisis raises two urgent questions for the United States: First, what are the likely number of deaths from the coronavirus in either the absence or presence of a determined program of social intervention? Second, what is the set of tools, both coercive and noncoercive, that should be used to implement the most effective interventions in light of the limited resources that are available? Both questions give rise to multiple, often clashing considerations, and they require urgent answers given the rising anxiety about the disease. As of March 30, a total of over 143,000 cases have been confirmed in the United States, with just over 2,500 deaths, many of which are concentrated in the New York metropolitan area.

It is critical to take a step back from the immediate crisis in order to articulate a few fundamental propositions that should help place this problem in context.

The first proposition is that there are no acceptable market solutions on how best to allocate scarce social resources for dealing with the coronavirus crises. Markets use wealth as a medium of exchange, and do nothing directly to satisfy the subjective preferences, or individual utilities, of market players. In ordinary times, the correlation between utility and wealth is generally strong enough that it becomes unwise to allocate resources on the basis of utility without reference to wealth. A set of charitable institutions grew up alongside markets to provide assistance to those individuals who had evidently high utility but no wealth to satisfy them. The family is one such institution, but, where it breaks down, private orphanages, hospitals, and countless other charitable institutions grow up to fill that void along with some government programs.