Paste your Google Webmaster Tools verification code here

Beware those who’d lock us down and throw away the key

Beware those who’d lock us down and throw away the key

Rather like dedicated Remainers, pro-lockdown enthusiasts never seem to give up.

Their ardour will have been fuelled by leaks over the weekend of results from the epidemiological models.

Apparently, even though quite soon all the over-70s will have been jabbed, lifting restrictions before the summer would lead to a massive third wave of the virus.  Daily death rates would once again soar over 1,000.

The SAGE modellers seem to have arrived at a totally different view to that of the Chief Executive of the NHS, Simon Stephens.  He told a House of Commons committee last week that Covid would soon become a much more treatable disease.  We can look forward, he said, to a “much more normal future” over the course of the next year.

Instead of wallowing in gloom, we might usefully look at Sweden.  The country has not just the prospect of a normal future but the actual reality of a normal past and present.  In Stockholm today, for example, you can walk up to the bar and order a beer.

In terms of economic outcomes, Sweden has performed better.  In 2020, output in the UK fell by over 10 per cent, and by just over 3 per cent in Sweden. The UK is running a public sector deficit of over 13 per cent of GDP, getting on for £400 billion. The comparable figure in Sweden is 4 per cent.

The Covid death rate in Sweden is rather high, at 1144 per million people.  But in the UK, it is 35 per cent higher, at 1550.

Currently, and adjusting both rates to the UK population size, the daily death rate in Sweden is around 100, and more than 1000 here.

Could a policy of very few restrictions have worked in the UK?

The virus spreads more easily in dense populations.

Much of Sweden is essentially completely uninhabited. In fact, slightly more Swedes live in urban areas than do Brits, 87 per cent compared to 83. So no difference there.

The Swedes are definitely less fat. Just under 20 per cent of them are clinically obese compared to 28 per cent of the UK population. Obesity is a key determinant of serious illness and death in Covid cases. But even adjusting for this, Swedish death rates are hardly likely to have exceeded those of the UK.

No politician would dare as to even hint at this. But could it be that the Swedes are, well, more sensible than we are?

They could be trusted to behave in ways which did not lead to the virus getting out of control.  The epidemiological models do not in general include the possibility of people adjusting behaviour in the face of a pandemic.

Overall, compared to the UK and many other Western European countries, Sweden, with virtually no lockdown restrictions, has had a good crisis.  Behavioural changes can make a massive and sustained difference to outcomes.

With only minor modifications of behaviour and armed with the new vaccines, it seems that Simon Stephens’ vision of a return to normality is close to being realised.

As published in City AM Wednesday 3rd February 2021
Image: Socialising in Sweden by Johan Anglemark  via Wikimedia CC BY-SA 2.0
Read More

Cash for Covid? Cash for jabs makes far more sense

Cash for Covid? Cash for jabs makes far more sense

As the snow fell on Sunday, I almost expected a Cabinet minister to address the nation that very evening: “Don’t go out in the snow. Don’t slip and sprain an ankle. Save the NHS!”

It could have been backed up by a scientist brandishing a chart and a “model” to demonstrate that icy weather led to an increase in broken limbs.

In this case, of course, the science would have been very well grounded and supported firmly by the evidence, something which has definitely not always been the case with Covid-19 pronouncements.

Economics, like epidemiology, is an inexact science. But It can still tell us useful things about the world.

What is probably the best supported insight of economics has been in the real news this past week. Namely, that when incentives change, people change their behaviour.

The proposal that those who catch Covid-19 be paid £500 as an incentive to self-isolate attracted widespread ridicule. The idea was well meaning. It would remove the incentive to go to work in order to get paid.

As many have already pointed out, the concept was flawed. It would create a perverse incentive, especially for younger people for whom the risks are very low, to go out and catch the virus. More simply, there was nothing to stop those who test positive from pocketing the loot and still going out to work.

Economists did point out early in the pandemic that test and trace systems in general faced challenging problems, even if the technology really did work properly.

Self-isolation is not simply a personal inconvenience. For many, it involves a loss of income. There are strong incentives therefore not to comply, which is indeed what has happened.

It is not easy to design a system of monetary incentives around test and trace which only reward good behaviour. The risk of people discovering how to game the system is high.

For example, a £10,000 fine was introduced for failure to self-isolate. This incentivised people either not to sign up at all, or to provide false information when asked.

Incentives still have an important role to play.

They need not be monetary. The over-60s have an incentive to have a jab, for example. The incentive here is to stay alive.

But there is worrying evidence that substantial numbers of younger people may not accept a vaccine when their turn comes. And we need high participation to squash the spread of the virus.

Why make the effort of going for a jab, especially if you might then not feel so good for a couple of days, when you personally are at very little risk?

The government could usefully offer everyone under 60 some ready cash if they get vaccinated. For the whole 16-59 year age group, at £25 a head the bill would come to just under £1 billion, a mere drop in the ocean in terms of the costs of Covid overall.

Public policy and personal incentives would be perfectly aligned. Cash for the under 60s when they get a jab. It makes good sense.

As published in City AM Wednesday 27th January 2021
Image: Covid Vaccine via Pixabay
Read More

The Government scientists’ credibility is shot to pieces

The Government scientists’ credibility is shot to pieces

Imagine.  No, not the silly childish song by John Lennon.  Imagine there were no vaccines available.  What would Matt Hancock, the Secretary of State for Health, do?

He might ask people to pay more attention to the scientific advice.

But the plain fact is that the credibility of Chris Whitty, the chief medical officer, and Sir Patrick Vallance, the chief science officer, is shot to pieces.

They have cried wolf too many times and issued too many Project Fear-type projections for people to have any confidence in their pronouncements.

Without a vaccine, the government would have been forced to confront the single most damaging and destructive aspect of the whole pandemic.

Namely, the apparent inability of the ranks of epidemiologists and government scientists to understand the crucial need to alter behaviour, rather than to rely on lockdowns.

Lockdowns can only work in certain rather extreme circumstances.

They need to be harsh. They need to last for a couple of months. The country needs to seal its borders. And there needs to be a willingness to comply.

So-called “firebreak” lockdowns of a couple of weeks duration cannot work at all.

On average, Covid victims are infected for a couple of weeks. When a lockdown is imposed, many of  those infected at the time will be free of the disease when it ends. But not all. A small percentage will remain infectious.

More importantly, on day one of lockdown, other people will become infected, and still more on each subsequent day.  So a pool of infected people will emerge from lockdown, and the epidemic will spike up again.

Such is the deranged obsession with lockdowns that not only has the Labour leader, Sir Kier Starmer, been a strong enthusiast for firebreaks, they have been implemented in Wales and Northern Ireland.

But as a matter of simple logic, not opinion, they cannot work.

The same logic applies to all but the most rigorous and lengthy lockdowns.  Unless there is a fundamental shift in behaviour, the virus will simply spread again once lockdown is lifted.

A policy of successive lockdowns may very well change behaviour.  But for the worse.  With each one, the willingness to comply is reduced.

This is exactly what has been happening in the working class areas of the UK – the central belt in Scotland, the old mining valleys in Wales, whole swathes of the North and the East End plus its Essex and Kent extensions.

It is in these areas that infection rates have gone through the roof, even when lockdowns were in place. It is not that the rules were insufficiently strict. It is that people have paid less and less attention to them.

Government scientists appear to have no idea about life in these areas.  It is not an easy one.

People get a lot of pleasure from socialising with friends and family, who typically live close by. The longer the restrictions last, the greater the incentive to ignore them.

Imagine we had epidemiologists and health bureaucrats who understood that behaviour must change if a virus is to be contained.

Imagine we had politicians who were not in thrall to pseudo-science. At Christmas, is this too much to imagine?

As published in City AM Wednesday 24th December 2020
Image: Lockdown in Glasgow by Jxseph14 via Wikimedia  CC BY-SA 4.0
Read More

Want people to get the Covid vaccine? Pay them

Want people to get the Covid vaccine? Pay them

The vaccines seem to be coming thick and fast.

The task now is to ensure that enough people get them to keep the virus under control.

The first issue is one of logistics. The track record of the UK’s health bureaucracy during the crisis has not been good. But the NHS does have experience of administering millions of flu jabs every year, and the process seems to work well.

The real challenge is how to persuade enough people to come forward and be vaccinated.

There is clearly a section of the population, revealed on social media, which will never agree to it. Some believe that the vaccine is a sinister plot by a tight-knit cabal to control the world.

True believers in such conspiracy theories are probably relatively small in number. The problem will be if they succeed in undermining the science behind the strategy of vaccination and manage to convince others.

Here, members of SAGE getting on TV to urge vaccination are a liability. They are almost doing the anti-vaxxers work for them.

The credibility of these scientists is being shot to pieces. The 1960s avant-garde artist Andy Warhol is currently enjoying a revival. He once memorably pronounced “in the future, everyone will be famous for 15 minutes”.

The huge numbers of hitherto totally obscure academics on SAGE and its various sub-committees are living proof of the accuracy of Warhol’s prediction.  They fall over themselves to appear in the media with ever more gloom-laden predictions, most of which are rapidly exposed as being wrong.

This is a serious problem for the government.

Local GPs do seem to still have a high level of credibility and trust with the public. These doctors should be the ones promoting the message of vaccination. Government scientists and SAGE members, who have become figures of controversy, should simply keep quiet.

Even so, there may be many individuals who carry out a simple cost-benefit analysis for themselves. Virtually no one under 40 in reasonable health, for example, has died of Covid-19.  If the vaccine has unpleasant side effects, they may decide not to have it.

Incentives need to be put in place. There are externalities involved: if I refuse to have a vaccination, I can infect others. That means vaccination cannot simply be left to individual self-interest.

Some negative incentives seem obvious. For example, anyone who refuses the vaccine could be excluded from treatment if he or she caught the disease. Fines or even prison could be applied in vaccine refusers who are shown to have spread Covid.

But such measures would create the wrong sort of climate.

The best incentives in the current circumstances are positive ones. The idea being floated of a “vaccine passport” that would enable immunised people to experience more freedom in their day-to-day lives might work, though it would immediately create a market in forgeries.

But there is a much simpler way: people should be paid when they get vaccinated.

This would not have to be a vast amount from the government’s perspective. Even £25 per jab would amount to a drop in the ocean in the overall context of what has been spent on Covid. A cash incentive would particularly motivate poorer areas where health in general is a real problem.

Thus we solve the vaccine conundrum not with more doom-mongering scientists on TV, but by delegating the task of persuasion to a local level via GPs, and backing it up with real cash incentives. That is how we will beat Covid-19.

As published in City AM Wednesday 25th November 2020
Image: Vaccine by Pixabay
Read More

The public are not to blame for the second lockdown

The public are not to blame for the second lockdown

Justice secretary Robert Buckland last week blamed the public for England’s new lockdown.

In particular, the fault was with people failing to self-isolate properly.

Of course, in a purely technical sense Buckland is right.

The virus spreads by contact with an infected person. If people do not self-isolate, Covid-19 will continue to percolate across the population.

But this is to miss the point. The real question is: why have people been so cavalier about following the regulations in recent months?

Back in March and April, lockdown rules were widely observed more or less to the letter. At first, regulations which banned crowds at sporting events and closed pubs were accepted as being reasonable. Later, the entire nation accepted the government’s message to stay at home except in extremely limited circumstances.

However, as the summer unfolded, the authorities began to give a more mixed message.

Tens of thousands took part, for example, in Black Lives Matter marches. The police, far from dispersing these events, appeared to offer support.

A reasonable inference to draw was that the authorities did not really believe that mass outdoor gatherings spread Covid in any serious way. The official line of the various UK governments, however, continued to be that the virus remained a major threat.

This kind of public information obviously plays a part when people decide what course of action to follow in terms of, say, self-isolation or not visiting crowded bars. But each person also has information which is private to that individual, or at most shared by a few close family and friends.

Many people, for example, visited crowded beaches and did not seem to catch Covid. And in their immediate circle, most of those who did catch the virus experienced no real problems.  It was not the killer the government scientists warned it was.

Over time, the public has gradually come to place more weight on their own private information, and less on the set of public information provided by the government.

To the scientists on SAGE, this appears to be wholly irrational. Private information by definition is only partial. Public information gives a more complete and hence more accurate picture.

But it can be entirely rational for a person not to just to give increasing weight to one of these, but to come to rely exclusively on either private or public information.

A famous 1992 paper in the Journal of Political Economy by Sushil Bikhchandani and colleagues of the University of California explains why.

A key driver of the change is the relative weights which other people use. The more the people you know rely on their own information rather than that put out by the government, the more rational it is for you to do the same.

The California economists coined the phrase “information cascade” to describe this process.

The UK government allowed doubts to creep in about the reliability of its information. Mass gatherings were a Bad Thing, but the police did nothing to stop them. As such, the information they are giving out now about the importance of self-isolation is being viewed with scepticism.

It was not inevitable that the public message would be undermined. But thanks to other communication debacles (the wildly misleading Whitty-Valance charts, for example), momentum is now firmly moving against government messaging.

Such a trend can only be reversed by drastic action. The justice secretary should look close to home for the culprits of our current predicament. Sacking some prominent scientific advisers could get the “information cascade” flowing back in the government’s direction.

As published in City AM Wednesday 11th November 2020
Image: Stay Safe sign by Stephen Craven via Geograph  CC BY-SA 2.0
Read More

Heavy-handed Westminster diktats have eroded trust — now only localised Covid policy can restore it

Heavy-handed Westminster diktats have eroded trust — now only localised Covid policy can restore it

Last month, the official group of scientific advisers — SAGE — warned the government that only a quarter of those who need to self-isolate due to coronavirus symptoms were in fact doing so.

This illustrates a concept which is of great practical importance: namely the conflict between individual and collective rationality.

Consider Margaret Ferrier, an SNP MP (who has since had the whip removed) who travelled by train from London to Scotland despite knowing she had tested positive for Covid-19. Better for her personally to be at home in Glasgow than stuck in a London hotel for a week, but worse for society as a whole as she risked spreading the virus to everyone on the train with her.

The textbook model of economics neatly sidesteps this potential problem. It sets up an idealised situation in which there is no conflict between individual and collective rationality.  The task is then to discover what assumptions about behaviour are needed to be compatible with such an outcome.

It is a very challenging question, and several of the early Nobel Prizes in economics were awarded for work in this area.

Economics itself has moved on in recent decades and pays much more attention to the potential rift between what is good for the individual and what is good for society.

One of the most influential thinkers in this area is Elinor Ostrom who received the Nobel prize in economics only three years before her death in 2012. Her work is very relevant in the Covid crisis.

Her doctoral dissertation was on how farmers and others in Southern California solved the problem of water management in their local area. For individuals with favourable locations, it was rational to grab as much water as they could. But collectively, this was a bad outcome. Others would be short of water.

The key feature of Ostrom’s work was to show that individuals were capable by their own actions of avoiding conflicts of individual and collective rationality. It was not necessary to have a heavy-handed regulator trying to impose a solution from above.

Like the Nobel laureates before her, she basically worked out what assumptions were needed for this to happen.

An essential element is that those involved must have some feeling of being part of a group. Further, disruptive and self-serving behaviour should be speedily identified and punished, in ways which are seen to be fair within the group. People also need to feel a sense of ownership of any restrictions which are asked of them.

When Boris Johnson announced lockdown on 23 March, in effect the nation was the group. For a period, most people behaved with proper regard to others.

The subsequent maze of complex and often contradictory diktats issued by health bureaucrats and politicians since then has eroded much of this trust.

Countries such as Germany which had locally based Covid strategies from the outset have fared much better than the centrally planned attempts in the UK, in part because they have been able to maintain this trust and sense of community.

At long last, the UK government shows signs of being willing to trust local authorities to do what is best for their area — in the form of local lockdown rules. They may still get it wrong, but local autonomy on Covid policy at least gives the chance of restoring the trust which is essential to any successful strategy.

As published in City AM Wednesday 14th October 2020
Image: icsilviu via Pixabay
Read More