Despite the fact that we don’t yet have the Covid-19 epidemic under control (we may just about have a more or less constant, but not yet a reducing, infection rate).  Debate has started on exit strategies and herd immunity.

Owl thinks it might be wise to watch and see what happens in other nations, further down the path. It also might be wise to wait until we get a fully functioning testing system which will be an essential prerequisite.

However, here is some interesting historical research.

Tom Whipple, Science Editor  www.thetimes.co.uk 

Seattle could see the pandemic coming as, to the east, town after town fell. When Spanish flu at last hit the Pacific coast the city was ready. Theatres, saloons, churches and schools were shuttered for five months.

In Saint Paul, Minnesota, the response was different. Worried, perhaps, about the economic effects, the town dithered and reopened after a month. Years later, as Seattle boomed, its economy was still suffering.

Economists believe that the 1918 flu pandemic could offer us a parable. For those countries weighing up the economic cost of intervention versus the lives saved, it is part of growing evidence that suggests the two are not mutually exclusive.

The study, by researchers from the Federal Reserve Bank of New York and the Massachusetts Institute of Technology, compared the severity of measures taken a century ago by 43 cities and the subsequent recovery. Their analysis of employment, manufacturing and bank losses implied that the economic costs alone of stopping a pandemic might be less then those of not stopping it.

Although the work has a caveat that Spanish flu had a higher death toll than coronavirus, and killed more people of working age, it is just one of a number of similar analyses being brought out to help governments.

Economists at Chicago University have used standard measures of the monetary value of a life to conclude that, assuming models of the pandemic were correct, the cost in US deaths of not stopping it would be equivalent to $8 trillion, or $60,000 per household.

Anna Scherbina, of Brandeis University in the US, has considered other trade-offs in an unchecked pandemic, factoring in medical costs and days of work lost to illness. With a total estimated bill equivalent to 43 per cent of US GDP, she concluded that it would be some time before the cure was worse than the illness.

The lessons should be an encouragement to governments to hold firm, she said, at least for now. “The economic costs of a lockdown are immediate and clearly visible to all, in a form of shuttered businesses, lower paychecks, lost jobs, etc,” she said. The benefits of a lockdown, however, are “not as obvious to the public”. According to her model, however, she calculated those benefits would run out and it would not be economically advantageous to maintain a lockdown until a vaccine was found.

Jonathan Portes, of King’s College, London, said that the uncertainties in what we know about the virus makes it hard for policymakers. While there is agreement on the economic merits of the present response, the same is not true in the longer term.

“Right now, there’s no trade-off between health and wealth,” he said. “Later, however, when the initial pandemic is firmly under control and we are thinking about how and when to lift restrictions, we may face difficult decisions on how to balance health risks and restarting the economy.”

Ultimately, said Julia Steinberger, from Leeds University, what matters may not be money, but how the money is directed. Last week a paper was published arguing that a long-term economic contraction of more than 6.4 per cent would cause more cumulative loss of life than the virus itself.

She has recently published research, however, suggesting that the GDP of a nation and its life expectancy is not so closely linked. Instead, she argues, the correlation between the two is our choice.

“A lot of things matter in the economy that are not measured in GDP,” Ms Steinberger said. “The UK has a highly-educated workforce, physical infrastructure, technology. All these things don’t leave the country just because GDP is going down.”

To get through this crisis, she said, “we need to protect essentials — basic goods like food, transport, housing. We need to keep focused on what we can do for each other.”