March 27, 2020
The Pandemic
Sometime in mid-November 2019, a virus that circulates among bats in China jumped the species barrier and infected a human host, likely through a live-animal meat market in Wuhan, China. The virus, one of the family of Corona viruses, was able to infect the human respiratory tract, leading to fever and coughing, and possibly pneumonia. Unlike other Corona viruses that have jumped into humans in the last 20 years, SARS and MERS, this virus was able to go from one human to another easily, almost as easily as the flu. That was genetic bad luck, but it caused the entire global economy to come to a halt.
The infection rapidly spread in Wuhan, and by December the Chinese alerted the world they were dealing with a new infection that appeared to kill 2-4% of those infected. With incredibly severe measures that basically shut down the Chinese economy and quarantined over 50 million people, China has been able to bring the outbreak under control, though over 3,000 people have died.
Unfortunately, the virus has escaped China and has spread worldwide. Thousands have died in Italy, Iran, and Spain. Infections in the US have climbed from 1,600 last week to 6,000 at the time of this writing. Only 100 Americans have died as of yet, but to prevent a massive spike in infections, the country has basically come to a halt. Air travel has collapsed, hotels are empty, conventions are canceled, universities have closed except for online classes, and school districts in California, Washington, and New York are shut down. Restaurants and gyms and bars have emptied out. Very soon, these industries are going to lay off millions of employees and the economy is going to go into a vicious downward spiral. The unemployed will not be able to buy much or pay their rent or mortgage, causing everyone to suffer major economic damage, resulting in even more unemployment and business closures. The US airline industry is asking for a 50-billion dollar bailout package.
Why is there this massive reaction to a virus that has killed less than 10,000 people worldwide? Because without dramatic steps it could rip through the global population and cause tremendous loss of life. The fatality rate of influenza (“flu”) is about 1 in 1,000 or 1 in 2,000 infected patients. In the US in a flu season 40 million people get infected and 20-40,000 people die. This virus so far appears to have a mortality rate much higher, but thankfully almost none of those deaths occur in children or healthy young adults. In China the rate has been about 3.5%, and in Italy it is over 5%. However, that is not accurate as we are not counting a large number of infected people who had little or no symptoms and were never tested.
The true mortality is probably around 0.5 to 1%. This is still extremely high, and for every death there are five other patients that needed to be in an ICU on a ventilator to save their life. If 40 million Americans get infected with this virus, that translates into some really big numbers. It would mean 200-400 thousand dead, and 1.5 million or more needing a stay in an ICU. There are only about 100 thousand ICU beds in the entire country, so we would have to space out these infections over many months or we would overwhelm the healthcare system and run out of ICU beds, ventilators, and critical care specialists to treat them.
So how does this end? How do we get back to normal? The only sure way is to develop a vaccine. Crash programs to design and test vaccines are in progress around the world, but it will take months and perhaps a year or more to get a vaccine that is safe and effective and can be produced in hundreds of millions of doses. The second option is to find a drug that treats the infection and prevents it progressing into a life-threatening pneumonia. That is possible, and aggressive efforts are being pursued. Several candidate drugs are being looked at already, including remdesivir (an experimental anti-viral) and chloroquine (an old anti-malaria drug). The Chinese and South Koreans have used these drugs to treat some patients. The third option is to let the virus infect most of the population, and then the pandemic would die out as the virus runs out of victims. People who recover are immune and cannot be infected again. That would work, but it will result in a massive loss of life. Finally, we can suppress transmission by locking down society and preventing social interaction that transmits the virus. This works, but it is going to very hard to maintain.
And the effects of this on the economy is catastrophic. While the health care sector is going to try to deal with medical issues as best as possible, Congress and the White House need to act aggressively to soften the economic blow. The government is going to have to simply print money and send Americans checks to keep the economy going. This is normally an economic folly, which would result in hyperinflation, but these are not normal times. Without government sending out checks, we will end with a Great Depression like event, with unemployment going to 15% or higher and large sectors of the economy disappearing.
For Third World countries this virus is going to be a very tough challenge to manage. These countries lack the resources of the US or EU or East Asia, and so cannot provide the medical care needed to save lives. Iran is a good example, where the virus is out of control and the mortality rate is 6%. The only saving grace for poor countries like Pakistan is that the age profile skews much younger. There are relatively few Pakistanis over the age of 60 and even less over the age of 80. So the overall mortality may be lower.
For any one country, with aggressive testing and quarantine, it is possible to suppress transmission. But what will happen when they try to go back to normal? Won’t the virus just start transmitting again? And even if you somehow completely eradicate it, because it is now global, travelers will still bring it back in to your country. This problem has no easy solution and we are going through a terribly difficult challenge for the entire globe.
