Skip to content
  • About
  • Contact
  • Contribute
  • Book
  • Careers
  • Podcast
  • Recommended
  • Speaking
  • All
  • Physician
  • Practice
  • Policy
  • Finance
  • Conditions
  • .edu
  • Patient
  • Meds
  • Tech
  • Social
  • Video
    • All
    • Physician
    • Practice
    • Policy
    • Finance
    • Conditions
    • .edu
    • Patient
    • Meds
    • Tech
    • Social
    • Video
    • About
    • Contact
    • Contribute
    • Book
    • Careers
    • Podcast
    • Recommended
    • Speaking

The economic argument for saving lives

Yenting Chen, MD
Policy
June 4, 2020
2K Shares
Share
Tweet
Share

The COVID-19 narrative is strong and pervasive: we must sacrifice either jobs or lives.  This debate has seemingly polarized our society on moral and ethical grounds.

For many healthcare professionals, the intrinsic value of life is self-evident.  No price can ethically be placed on the value of health and human life.

Fortunately, from an economic point of view, the choice between the economy and health might be a false dilemma.

The intersection of the economy and public health is not a zero-sum game.  In fact, the strength of our economy and the state of our health are closely tied.  It is well known that adverse economic situations can lead to illness and “deaths of despair.”

Conversely, the illness and death caused by a pandemic can itself lead to economic disaster.  In the war against COVID-19, the path to our economic recovery must start with a focus on saving lives.

The first thing to consider is whether we are ruining our economy with social distancing measures designed to save lives.  Millions have filed for unemployment, and businesses of all sizes are teetering on bankruptcy.  It is tempting to see a direct correlation between social distancing policies and our economic suffering.

However, global pandemics like our current COVID-19 crisis are akin to wildfires ripping through our economy. Social distancing mandates are the controlled fires we set to contain the devastation.  Both are damaging to the economy, but the primary destructive force is the pandemic itself.

A study published by the University of Copenhagen compared the economic impact of the COVID-19 crisis in Denmark and Sweden.  The two Scandinavian countries both suffered outbreaks at the same time.  Denmark imposed severe social distancing restrictions, while Sweden famously did not.

Sweden experienced a drop in total aggregate spending of 25 percent, while Denmark suffered a loss of 29 percent: only a 4 percent additional difference.  The data implies that most of the damage to the economy is done by the pandemic itself, not the mandated lockdown.

Why is this the case?  While social distancing prohibitions result in supply-side restrictions, the horrors of a dangerous and contagious pandemic simply crush demand. Most people are highly motivated to avoid illness, disability, and death.  Even without restrictions on businesses, events, and gatherings, many consumers will stay home until the threat is reduced.

How will social distancing affect economic recovery once the pandemic eases? Economists from the Federal Reserve Board, the New York Fed, and MIT attempted to answer this question by comparing the diverse social distancing policies of American cities in response to the 1918 Spanish flu pandemic. They found that cities that imposed stronger measures actually had more robust economic recoveries after the pandemic.

Cities that implemented the most timely and strict social distancing policies subsequently enjoyed the fastest growth in employment, manufacturing output, and bank assets.  Conversely, cities that allowed the pandemic to ravage their communities were stuck in economic doldrums afterward.  Clearly, the short-term costs of social distancing are mitigated by long-term economic gain.

One reason for the long-term economic impact of a poorly controlled pandemic is the financial cost of fatalities.  Each life lost to COVID-19 represents a permanent loss of future productivity and demand.  Scores of retirees, family breadwinners, and business owners might be erased forever from our economy. While jobs are replaceable after a lockdown ends, the lives of consumers, workers, and entrepreneurs are not.

The cost of deaths alone does not capture the full magnitude of the economic burden of COVID-19.  This disease has an alarming potential to cause severe long-term illness and disability.

Multiple organ systems can be permanently damaged. A majority of patients are left with lung scarring, which might result in loss of function.  Abnormal blood clotting is thought to be responsible for strokes and kidney failure in previously healthy COVID-19 patients.  The virus also directly attacks the heart, causing inflammation and injury.  The loss of productivity and the medical costs of disability among COVID-19 survivors can potentially dwarf the cost of fatalities.

The health and well being of all members of our society are among our most valuable economic resources.  Like any other vital and non-renewable resource, we should not squander the lives and health of our community needlessly.  Although the current economic burden is heavy for all of us, we must play the long game: saving lives and preventing illness will save our economy.

The savings are potentially immense.  A study published last month in the Journal of Benefit-Cost Analysis calculated that the lives saved by social distancing might result in an economic net-benefit of $5.2 trillion to the US GDP.  Another study by the University of Chicago estimated that moderate social distancing would result in mortality benefits of $8 trillion to the US economy, or $60,000 per US household.

To reap these economic benefits, lockdown measures do not need to be draconian nor interminable.  Economists at Cambridge and the Federal Reserve recently proposed that a targeted lockdown affecting only one-third of our population for eight months would limit the economic damage of the pandemic by one-half compared to the costs of inaction.

A more recent study estimated that rolling cycles of 50 days of lockdown followed by 30 days of easing might greatly reduce deaths while allowing economies time to “breathe” at intervals.  As we move to open our economy, we should be flexible and consider the use of such dynamic and tactical restrictions.

Although future economic benefits might seem intangible to those of us now facing financial ruin, controlling this pandemic aggressively today will bolster our economic health tomorrow.

The stakes are high, and the actions that we take now will reverberate through the years to come.  We must be mindful that the best economic policy is the best pandemic policy.  Saving lives and preserving health is a long-term investment in our economic recovery.

Yenting Chen is an emergency medicine physician.

Image credit: Shutterstock.com

Prev

Primary care isn’t broken. It needs a better support system.

June 4, 2020 Kevin 1
…
Next

Protect our medical trainees during the pandemic [PODCAST]

June 4, 2020 Kevin 1
…

Tagged as: COVID, Infectious Disease, Public Health & Policy

Post navigation

< Previous Post
Primary care isn’t broken. It needs a better support system.
Next Post >
Protect our medical trainees during the pandemic [PODCAST]

More by Yenting Chen, MD

  • Empathy in the age of misinformation

    Yenting Chen, MD

Related Posts

  • Is this cost-saving Medicare proposal doomed?

    Martha Rosenberg
  • Saving our mothers requires taking more than baby steps 

    Janice Phillips, PhD, RN and Gina Lowell, MD, MPH
  • Are behavioral economic interventions the key to health system improvement?

    Peter Ubel, MD
  • Medical students in solidarity: Black Lives Matter

    Anna Delamerced
  • Can the Maternal CARE Act fail moms? 

    Sonal Patel, MD
  • The impact of economic inequality on the incidence of mass shootings

    Niran S. Al-Agba, MD

More in Policy

  • Pediatricians grapple with guns in America, from Band-Aids to bullets

    Tasia Isbell, MD, MPH
  • Health care wins, losses, and lessons

    Robert Pearl, MD
  • Maximizing care amidst provider shortages: the power of measurement-based care

    Tom Zaubler, MD
  • Unveiling excessive medical billing and greed

    Amol Saxena, DPM, MPH
  • Chronic health issues and homelessness

    Michele Luckenbaugh
  • The impact of certificate of need laws on rural health care

    Jaimie Cavanaugh, JD and Daryl James
  • Most Popular

  • Past Week

    • I’m a doctor, and I almost died during childbirth

      Bayo Curry-Winchell, MD | Physician
    • Unveiling excessive medical billing and greed

      Amol Saxena, DPM, MPH | Policy
    • Bitcoin’s role in diversified portfolios [PODCAST]

      The Podcast by KevinMD | Podcast
    • Dying is a selfish business

      Nancie Wiseman Attwater | Conditions
    • Navigating medical decision-making: Embracing limits and growth

      Benjamin Wade Frush, MD | Physician
    • Empathy and compassion in palliative care [PODCAST]

      The Podcast by KevinMD | Podcast
  • Past 6 Months

    • Medical gaslighting: a growing challenge in today’s medical landscape

      Tami Burdick | Conditions
    • Balancing opioid medication in chronic pain

      L. Joseph Parker, MD | Conditions
    • I want to be a doctor who can provide care for women: What states must I rule out for my medical education?

      Nandini Erodula | Education
    • Navigating the broken medical system: challenges faced by foreign medical graduates

      Anonymous | Physician
    • Mourning the silent epidemic: the physician suicide crisis and suggestions for change

      Amna Shabbir, MD | Physician
    • The essence of medicine: genuine connections in practice

      Jennifer Tillman, MD | Physician
  • Recent Posts

    • Bitcoin’s role in diversified portfolios [PODCAST]

      The Podcast by KevinMD | Podcast
    • 1 in 5 doctors will become disabled. Are you prepared?

      Amarish Dave, DO | Finance
    • The pros and cons of whole life insurance for high-income earners

      Shane Tenny, CFP | Finance
    • Family support is pivotal in the treatment of schizophrenia

      Frank Chen, MD | Conditions
    • Is emergency medicine your calling? [PODCAST]

      The Podcast by KevinMD | Podcast
    • Exploring disfigurement and self-worth

      Kathleen Watt | Conditions

Subscribe to KevinMD and never miss a story!

Get free updates delivered free to your inbox.


Find jobs at
Careers by KevinMD.com

Search thousands of physician, PA, NP, and CRNA jobs now.

Learn more

Leave a Comment

Founded in 2004 by Kevin Pho, MD, KevinMD.com is the web’s leading platform where physicians, advanced practitioners, nurses, medical students, and patients share their insight and tell their stories.

Social

  • Like on Facebook
  • Follow on Twitter
  • Connect on Linkedin
  • Subscribe on Youtube
  • Instagram

CME Spotlights

From MedPage Today

Latest News

  • CDC Advisors Endorse Maternal RSV Vax to Protect Newborns
  • Amoxicillin Alone for Acute Sinusitis Holds Up Against Broad-Spectrum Cousin
  • Despite Taboo, Med Students, Doctors Use Substances Too
  • White House Opens Gun Violence Prevention Office
  • Nurses Step Up to Bat on Educating Patients About Climate Change

Meeting Coverage

  • Loneliness Needs to Be Treated Like Any Other Health Condition, Researcher Suggests
  • Stopping Medical Misinformation Requires Early Detection
  • AI Has an Image Problem in Healthcare, Expert Says
  • Want Better Health Outcomes? Check Out What Other Countries Do
  • ERS Roundup: Cell Transplant Boosts Lung Function in COPD Patients
  • Most Popular

  • Past Week

    • I’m a doctor, and I almost died during childbirth

      Bayo Curry-Winchell, MD | Physician
    • Unveiling excessive medical billing and greed

      Amol Saxena, DPM, MPH | Policy
    • Bitcoin’s role in diversified portfolios [PODCAST]

      The Podcast by KevinMD | Podcast
    • Dying is a selfish business

      Nancie Wiseman Attwater | Conditions
    • Navigating medical decision-making: Embracing limits and growth

      Benjamin Wade Frush, MD | Physician
    • Empathy and compassion in palliative care [PODCAST]

      The Podcast by KevinMD | Podcast
  • Past 6 Months

    • Medical gaslighting: a growing challenge in today’s medical landscape

      Tami Burdick | Conditions
    • Balancing opioid medication in chronic pain

      L. Joseph Parker, MD | Conditions
    • I want to be a doctor who can provide care for women: What states must I rule out for my medical education?

      Nandini Erodula | Education
    • Navigating the broken medical system: challenges faced by foreign medical graduates

      Anonymous | Physician
    • Mourning the silent epidemic: the physician suicide crisis and suggestions for change

      Amna Shabbir, MD | Physician
    • The essence of medicine: genuine connections in practice

      Jennifer Tillman, MD | Physician
  • Recent Posts

    • Bitcoin’s role in diversified portfolios [PODCAST]

      The Podcast by KevinMD | Podcast
    • 1 in 5 doctors will become disabled. Are you prepared?

      Amarish Dave, DO | Finance
    • The pros and cons of whole life insurance for high-income earners

      Shane Tenny, CFP | Finance
    • Family support is pivotal in the treatment of schizophrenia

      Frank Chen, MD | Conditions
    • Is emergency medicine your calling? [PODCAST]

      The Podcast by KevinMD | Podcast
    • Exploring disfigurement and self-worth

      Kathleen Watt | Conditions

MedPage Today Professional

An Everyday Health Property Medpage Today
  • Terms of Use | Disclaimer
  • Privacy Policy
  • DMCA Policy
All Content © KevinMD, LLC
Site by Outthink Group

Leave a Comment

Comments are moderated before they are published. Please read the comment policy.

Loading Comments...