Hong Kong is culling (cute) pet hamsters by the thousands in a fierce effort to stop the spread of SARS-CoV-2 infection. Experts say there is little risk from getting infected from an animal. But when a HK pet store clerk had tested positive for COVID-19, tests found that the shop’s hamsters imported from The Netherlands were also infected with the virus.
The tumultuous Hong Kong government has been resisting pushback from pro-Democracy and the rich in their China – merging actions. The new hamster-cide is part of HK acting more Chinese than Western. Some elites have charted planes to get their rabbits, cats, and dogs out of China in response. The Financial Times reported that some pet owners might pay over U.S. $18,000 to get a Labrador and owner from Hong Kong to London.
The HK cull has ignited panic and anger, which has confused people about animal to human transmission of the SARS-CoV-2 virus. On Thursday, January 20, HK government authorities announced that every precaution should be taken, including turning hamsters in to the authorities to be “dealt with humanely.” Hong Kong and China are clearly more worried and strict about COVID- 19 than most nations.
And something has worked. HK has had only 213 COVID-19 deaths since the pandemic began. To put that into perspective, if HK was the same size as the U.S. they might have only lost 9,155 people to COVID-19, not our 900,000. The New York City region is about as large as HK and it lost over 200 people to COVID just by end of March 2020. The impact on the economy seems to be about the same in the U.S. and China. The OECD predicts China will have 22% more GDP by January 2022 than the end of 2019 and the U.S. 8% more.
But my point is not that China’s hyper-caution compared to Florida and UK’s “let-er rip” strategy is right or wrong. My point is that we have had massive experiments in managing the triple goals of health, wealth, and equity when humans face the same virus.
One country culls the hamsters, the other kisses them. I just finished teaching a graduate economics class at the New School for Social Research “How to Manage an Economy During a Pandemic.”
Lessons About How To Manage An Economy During A Pandemic
At the beginning of the pandemic there was an initial thought that nations and places had to tradeoff between the economy and health. But the data doesn’t show that. There is very little long-lasting correlation between lockdown orders and economic outcomes. Nations with initial better health systems did better with maintaining health and wealth than others.
We also learned that just telling people to go out to work doesn’t help. Florida let it rip; but also suffered huge absences, deaths, and sickness, which reduced the capacity of its entire economy anyway.
Cheap and effective protective measures got politicalized. Controlling for relevant factors such as population density, income, and education, being a Republican had a significant and independent effect on mask wearing.
Mandates probably are the only effective way to quickly eradicate pandemics. Left on their own people don’t behave safely because, like littering, they do not internalize the costs they impose on others. One study showed people perceive the cost of an additional infection to be around $80k, when the social cost is more than three times higher, around $286k.
It turns out no matter what countries did people’s fear of the virus greatly affected pro-social behavior like wearing masks and staying a safe distance. The other major factor was whether people could work and stay home. Those that couldn’t faced more risk than those that could.
We also learned a third goal needs to be added in managing an economy during a pandemic — avoid making inequality in wealth, income, and death worse. We didn’t. The pandemic created new inequalities and made existing ones worse.
Preparing for the Next Pandemic
The class’s task was to help prepare for the next pandemic. Fortunately, the Biden administration is revising their 2021 plan. The 2021 National Strategy for the COVID-19 Response Blueprint has a lot more about the economy and equity than the 2016 White House National Preparedness Plan, which mainly focused on disease management. There are a lot of public health investments in the public health infrastructure provisions of the Build Back Better Act. I suspect the 2022 plan will have a lot more about how to maintain equity.