Donald Trump says that the cure must not be worse than the disease, and is trying very hard to jump-start the US economy by eliminating public health interventions, including reopening most retail businesses, eliminating quarantines, and (strangely enough) discouraging the wearing of masks. Now they are even trying to force schools to reopen in the fall.
The result in terms of deaths is beyond dispute. US states that reopened prematurely (even as COVID-19 cases were rising), such as Florida, South Carolina, Texas, and Arizona, have seen dramatic surges in both deaths and new cases.
The only remaining question is whether taking drastic health measures to reduce the spread of the pandemic hurts the economy. Or to put it more bluntly, is the cure really worse than the disease? Unfortunately, there is now strong evidence that the answer is no, you cannot trade lives for jobs.
The evidence comes from the fact that when the pandemic reached Scandinavia, Sweden had a very different response than its neighbors Norway, Denmark, and Finland. These four countries are all rather similar to each other, so this becomes a good comparison of their respective responses.
Sweden, unlike the other countries, did not impose social distancing, they left businesses such as restaurants, schools, playgrounds, and gyms open, and didn’t restrict larger gatherings of people. They depended on their citizens to voluntarily take measures to reduce the spread of the disease. In comparison, other Scandinavian countries opted for strict quarantines, banning large groups, and locking down shops and restaurants.
The result? Per million people, Sweden has suffered 12 times more deaths than Norway, seven times more than Finland, and six times more than Denmark. That’s a dramatic (and heartbreaking) increase in deaths. They’ve even had 40% more deaths than the United States, because at least some US states imposed lock-downs and other restrictions on their citizens.
So did these dramatic increases in deaths in Sweden save jobs and paychecks? Sadly, we now know the answer is no.
They literally gained nothing. It’s a self-inflicted wound, and they have no economic gains.
Letting the economy run unimpeded, Sweden still suffered economic damage the same as its neighbors. Sweden is on track for its economy to contract by 4.5%, and the unemployment rate is currently 9%. In Denmark, the economy will contract by 4.1%, and unemployment is 5.6%.
Norway imposed aggressive measures when the pandemic first started, but that allowed them to relax these measures earlier. As a result, their economy is expected to see a more rapid economic return to normalcy. Norway’s economy will contract by only 3.9%. Taking dramatic measures early not only saves lives, it actually helps the economy.
It is simplistic to portray government actions such as quarantines as the cause of economic damage. The real culprit is the virus itself. From Asia to Europe to the Americas, the risks of the pandemic have disrupted businesses while prompting people to avoid shopping malls and restaurants, regardless of official policy.
The economic damage from the coronavirus is likely to be even worse in the US than in Sweden:
Collectively, Scandinavian consumers are expected to continue spending far more robustly than in the United States, said Thomas Harr, global head of research at Danske Bank, emphasizing those nations’ generous social safety nets, including national health care systems. Americans, by contrast, tend to rely on their jobs for health care, making them more cautious about their health and their spending during the pandemic, knowing that hospitalization can be a gateway to financial calamity.
In addition, the Trump administration did not take advantage of the shutdown time to ramp up testing and contact tracing. Instead of creating national guidelines for fighting the virus, they sent out confusing and mixed messages, and even claimed there was nothing to worry about. On top of those fatal mistakes, they are now opening up the country recklessly. The result is that we already lead the world in cases and deaths, and it will only get worse.