Freeze the economy?

Freeze the economy?

Some countries shut down almost completely during August because people go to vacations. They come back from vacations, start from where they left things and everything is back to normal. There is a big drop in GDP during August but this is anticipated. Likewise, a complete shutdown will be a mandatory vacation at home with no pay but at the same time payments will freeze, be postponed or waived. People can read books, watch TV, surf in the web, exercise, talk on the phone or via videoconferencing, cook etc. When the situation is controlled, they will go back to work like returning from a vacation.

Nobody pays anything to anybody and nobody owes anything to anybody. Everything will freeze like in a movie when we press pause, except the things that are absolutely necessary. It will restart when a drug and a vaccine have been found or when the virus is controlled. This will definitely have a huge drop in GDP during the shutdown period but economic activity will go back to previous and even better level when the shut down stops. Freezing the economy will have a bigger drop in GDP during the period of locked down but will minimize damage. The more alive the economy is the more damage it will be done. When you put food in the freezer, it can stay for months or even years. Outside the freezer it will get spoiled.

Imagine you are in an airplane. A big storm is ahead that was not anticipated. Some time ago you passed a small airport where the plane could land. There are two options. One is to go ahead in the storm. The other is to turn around, land at the small airport and wait for the storm to pass. In the first case there will be no delay but there are chances of a serious damage or even a crash. In the second case, there will be a huge delay but no danger. The delay is the drop in GDP that will occur during the freezing period. If the economy does not freeze, the drop will be smaller but there is a chance that damage will be made, i.e a recessionary cycle may have started and the virus will spread at a higher rate. There is a question. How long can supplies last? The freezing period could be as long as a vacation time even if a drug or a vaccine is not found.

Coronavirus is an upper respiratory desease. The virus is transmitted when an infected person sneezes or coughs. One case is direct transmission when droplets with viral particles reach another person’s mouth, nose or are inhaled. The other is indirect, through touching. Droplets from sneezing or coughing reach surfaces or the infected person touches people, objects and surfaces with viral particles in his hands. If another person touches a surface that has viral particles, the virus will remain in his hands. If he washes his hands it will most likely go away. If he touches his mouth, nose, eyes before washing his hands, he will get the virus. The virus lifespan depends on many factors like temperature and humidity but ballpark figures are; air 3 hrs, copper 4 hrs, cardboard 1 day, plastic 3 days. Higher temperatures decrease lifespan.

Incubation period ranges considerably but most sources claim around 5 days as mean although in some rare cases it can be more than 3 weeks. There are two possibilities and the second has two outcomes.

  • 1) Mild case ends in cure
  • 2) Severe case ends in a) cure b) death

 

The vast majority of people infected are cured. Cured or dead are not contagious. From the cases above some critical times emerge;

  • 1) from contracting to cure for mild cases
  • 2) a) from contracting to severe b) from severe to cure or death

 

Figures that have been reported by some sources will be used as an example; 1) 14 days 2a) 10 days 2b) 10 days. These may not be accurate. Epidemiologists know or will know the exact times. Suppose that freezing (almost complete shut down and lock down) starts at point 0. Some people may have gotten the virus a few days before. The latest is time 0. The assumption is that after point 0, the virus stops spreading.

All severe cases will go to hospitals within 10 days where there are very strict measures against spreading. All mild cases will be cured within 14 days. All severe cases will end in a non-contagious stage, cure or death, after 10 days in the hospital. So, in a 3 week period, there may be no more infected people. The number of infected people is irrelevant (any number multiplied by 0% equals 0). What is critical is the time from contracting to a non-contagious stage (cure of death). That is the time required for the infected cases to drop to zero.

This is not epidemiological knowledge but common sense and elementary operations management. The logic is correct. There is only one problem. It is assumed that spreading is 0% from time 0. That will require an 100% lockdown and no other ways of spreading the virus e.g insects. The stricter the lockdown, the closer the figure of spreading could be to 0%.  It is even possible that supermarkets are closed, if people are told in advance to get 3 weeks food supply. When spreading is above 0%, the percentage of infected people is relevant.

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