The COVID cure is worse than the disease
To open or not to open? That is the question that is driving a partisan wedge between women and men, young and old and, most of all, between liberals/ Democrats and conservatives/Republicans.
Those still paid to work from home wag ascornful finger at those who want to get back to work, mainly hourly paid factory workers and small shopkeepers. As usual, the elites are content to let the expendables pay the price for the outcomes that think will be best for themselves.
Fear makes scared people and scared governments do foolish things. Fear can turn people’s values on their heads. It can make progressive liberals, who until the arrival of the virus were campaigning for an ever growing list of human rights, to suddenly have an abrupt change of heart.
Those same people are suddenly calling for the implementation of draconian measures that would trample those very same rights. They want schools to be shut down or want to impose big fines on people who are walking too close to each other in defiance of physical distancing rules.
They, of course, want the lockdown maintained. Even if the contagion subsides during the summer, they warn of a reinfection next fall and winter. They seem indifferent to the enormous economic consequences of what they call for. And make no mistake about it — the consequences are already enormous and get more so with every passing day.
More than 33 million Americans have filed for unemployment insurance over the course of a seven week period. Three million Canadians have done the same. The jobless rate in both countries stands at the second-highest level ever recorded. The contraction in second quarter GDP will be of Depression-era magnitude and government deficits are soaring to postwar highs. Do these things not matter?
Defenders of the lockdown say you can’t put a price on human life. But are there not health consequences when people are denied needed procedures at hospitals that have re-engineered themselves to accept an expected avalanche of desperately ill COVID-19 patients that has yet to materialize?
Cancer, for example, doesn’t take a holiday just because of the coronavirus. In the United Kingdom in April, cancer centres that would see 30,000 people a month barely saw 5,000. British oncologists warn that if this continues, as many as 60,000 cancer patients could die due to a lack of diagnosis and treatment.
Just because there aren’t daily updates on the number of turned away patients in need of medical care, like Johns Hopkins University’s running daily tally of global COVID-19 infections, shouldn’t mean these people have suddenly become expendable.
It’s not only panic-stricken hospitals that are being re-engineered to meet the pandemic’s challenge. Panic-stricken central banks are doing the same. The Federal Reserve Board, the Bank of Canada and other central banks are opening up their balance sheets to hold corporate debt including high yield, or as they are better known in the market, junk bonds. In the Fed’s case, it is expected to open its arms to more than double what it took on during the financial crisis of 2008-09.
Guess who ultimately picked up the tab for the Fed’s bail out of Wall Street and its toxic subprime mortgage backed securities? The same people who will ultimately pick up the tab this time as well.
That also holds true for reducing soaring budgetary deficits left in the pandemic’s wake. No one cares right now about them but, rest assured, governments will care plenty about them soon enough.
At the levels they are heading to, they will inevitably become the political narrative of the day. And when they do and governments feel compelled to reduce them, it won’t be the top one per cent who make their money through dividends and capital gains that will be paying them down. Instead, it will be the wage-earning middle class.
Soon, it won’t be just U.S. President Donald Trump and his good-ole-boy supporters who think the cure is worse that the disease. Soon, you will, too.