Since the coronavirus first slammed the brakes on the U.S. economy in March, policymakers have tried to weigh the cost of keeping people safe against the potentially disastrous consequences of putting millions out of work in a country with a meager social safety net.
A group of economists has compared these scenarios in a working paper issued earlier this month and come down squarely on the side of the shutdown: Closing down the economy saved between 900,000 and 2.7 million U.S. lives, they conclude.
The authors — economists Olga Yakusheva of the University of Michigan, Eline van den Broek-Altenburg and Adam Atherly of the University of Vermont, and Gayle Brekke of the University of Kansas — don't try to put a dollar amount on the value of a human life. Instead, they compare the number of deaths avoided through extreme lockdown measures with the number of deaths that might be expected from the long-term effects of the economic shutdown.
The paper uses models from the World Health Organization and the U.S. Centers for Disease Control and Prevention to estimate the number of deaths if COVID-19 spread unchecked, and arrive at an estimate of 1.1 million to 2.9 million projected deaths. Subtracting the roughly 130,000 deaths that have already occurred in the U.S. and others that are likely to occur even under the strictest of shutdowns, the authors arrive at 900,000 to 2.7 million lives saved this year.
Economic shutdowns also can have severe financial, professional and social costs., or can have lifelong effects, including on people's health.
"[T]he notion that a person's well-being and life expectancy is associated with personal income and wealth is recognized and accepted across the fields of medicine, public health, epidemiology, and economics," the authors write.
Many studies have documented that poor people, on average, have worse health than wealthy people. Individual stressors, especially inconsistent and fluctuating income, have also been shown to hurt health and.
"We calculated that COVID-19-related restrictions on economic activity will create significant, albeit less overt, downstream mortality," the authors write. "People who will be sickened or die from joblessness, lack of access to care, inability to afford healthful food and lifestyle choices are just as real as those who die from the virus."
The authors calculate that the economic contraction is projected to take between 50,000 and 323,000 lives in subsequent years. (That figure fluctuates with the exact size of the economic hit.) So, even in the most dire scenario, three times as many lives are saved from a shutdown than would be lost down the line, the authors concluded.
Wanted: Sustainable business models
To be sure, the paper simplifies a complex situation. For instance, it doesn't account for voluntary actions, such as people choosing to stay indoors and shopping activity for the sake of personal safety. Most economists agree that, even without state-mandated lockdowns, personal consumption is likely to remain sluggish until a vaccine or a reliable treatment for the coronavirus is found.
"The basic problem is that there are many businesses that cannot reopen in a way that is profitable or sustainable, while still assuring consumers and workers that they are not putting their health in jeopardy," David Kelly, chief global strategist at JPMorgan Funds, recently told investors.
A "rolling-wave pandemic and economic uncertainty will likely keep home and auto sales suppressed ," Kelly wrote in a report. "Economic weakness could be further exacerbated by more layoffs in the energy sector, due to low global oil prices, and declines in state and local government employment, reflecting the inevitable impacts of lower revenues and inadequate federal support."