The economic harm comes mostly from the sudden stop in business activity due to social distancing, not the lost productivity of those suffering or dying from Covid-19. The demographics of those suffering from coronavirus and those suffering from the economic virus are quite different.Governments around the world are awakening to these truths, and beginning to debate how to assist businesses suffering from the downturn. (A pedestrian wearing a face mask walks through a near empty Hardware Lane in Melbourne, Australia, yesterday)
Across the world, as governments take their first economic stimulus measures to address the Covid-19 crisis, debate is intensifying over the right form and size of that assistance. But this discussion hasn’t yet come to grips with five fundamental realities.
First, mandating social distancing in response to the Covid-19 crisis requires socialising the economic costs of doing so.
We as a society can’t reasonably require social distancing, with the massive economic consequences it entails, and believe that most of those costs should be privately borne.
We therefore need to either abandon social distancing (thereby overwhelming health systems and sparking untold deaths) or enact much larger stimulus measures. And by much larger I mean far larger even than the eye-popping figures the Trump administration is now pursuing in the US.
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