Jeremy Arkes, one of my friends and Navy School colleagues, who is also a friend and colleague of Judith Hermis, submitted the letter he would have sent to Governor Newsom. I did some edits, all of which he accepted, and here is the result.
Dear Governor Newsom,
I would like to offer a counterpoint to the letter that my good friend Judith Hermis sent you regarding your private-gatherings restrictions. As with Judith, I hope you and your family are well, and additionally I hope that you have learned now to avoid large gatherings yourself in order to continue to keep your family and others safe.
One factor that Judith cited was that our “unalienable rights to life, liberty, and the pursuit of happiness” should prevent the government from telling us what we can do in our own private homes. But there are well-known limits to these rights. People might gain happiness from, in their own homes, sacrificing Sagittarians who watch Gary Busey movies. But they are not allowed to do so because that infringes on others’ right to life. This, of course, is one example of many restrictions on what we can do in our pursuit of life, liberty, and happiness. That said, such a restrictive measure as you are imposing does infringe on liberty and, thus, needs some justification.
Such justification might come from the basic economic concept of an externality, which is a case in which decisions by private parties impose costs on (or create benefits for) third parties not engaged in the transaction. And basic economics states that, in the presence of a “negative externality” (where decisions impose costs on others), the free market (consisting of the private decisions of people) leads to a higher quantity of transactions than the quantity that would maximize efficiency.
And so a party that brings multiple households together has the potential to have negative externalities, as there can be huge costs imposed on people not involved in the party (from the party-goers infecting others, who in turn infect others, etc.). The costs are not just deaths and health-care costs, but also the costs associated with being sick and having the long-term complications that some experience from COVID.
The theory behind negative externalities is that a more efficient outcome would occur if the parties involved in the transaction/decision have to bear those costs imposed on others. If the costs imposed on third parties had to be paid for by the party guests, then a more efficient outcome would ensue. In the textbook theoretical case of a negative externality, with quantifiable costs imposed on third parties, the efficient outcome could come in the form of a tax on the good or service that causes the market participants to bear those costs imposed on others. The size of the tax would be the monetary equivalent of the costs imposed on others. Imposing that tax would cause the number of parties to decrease to the most-efficient quantity. For those for whom the tax would be just a rounding error (e.g., a party at the French Laundry restaurant), the party would go on. But for others, the tax would dissuade them from their private gatherings.
Unfortunately, the probabilistic nature of COVID infections and deaths, the imprecision of contact-tracing, and the uncertain monetary-equivalent costs of deaths and illnesses make it impossible to fully internalize the costs. And so this health measure you favor could be justified as a method to correct for an externality when no tax-based solution is available. It could actually bring us to a more efficient outcome.
So if anyone opposes your policy, Governor, a good question to ask that person is: At what point would restrictions be okay? If you had a private party and you knew that it would lead to 1,000 people infected and 100 deaths among people not attending the party, would it be okay to have restrictions on such parties? If not, then it seems that society has no safeguards for something that can destroy us. If so, then the problem isn’t that such a measure is antithetical to economic liberty but rather we have different preferences for the level of safety vs. freedom and perhaps different preferences for the certainty of harm that is required before any preventative measures are taken—and, the elected leaders have the right to impose laws that they believe draw the best balance.
I believe that we need to do our best to protect the brave and dedicated doctors, nurses, and elderly-care providers who are risking their health and mental well-being to do their job—a job that the population has made more difficult by the private decisions they have made (e.g., not wearing a mask and congregating in larger-than-advised groups) that has led to the situation we are in today. And the situation today is that it is much more dangerous to engage in the economy than it was at any other point in this pandemic so far. Basically, we need to think the way our military-service members do and make sacrifices to serve people beyond ourselves.
Another important point is that, paradoxically, restrictions on economic activity in the short run could actually lead to greater economic growth in the medium and long term. In my view, most of the economic decline is due to personal decisions of people to be safe rather than the social-distancing and shut-down policies. For example, people are allowed to take flights, and so the ~75% reduction in air travel is due almost entirely to people’s personal decisions not to travel. The bottom line is that the economy can’t return to normal until COVID is reduced to a level at which people feel safe. (Supporting this point is that Europe, which had COVID under control at the beginning of the summer, had a much more normal summer of economic activity than we had in the U.S., where we never had the virus under control.)
Finally, let me offer a different characterization of those who are okay with the limitations. Judith considered them “the most frightened,” but that seems to be too much of a generalization. (I’ll admit to being one of the “frightened,” as I have mountains to climb and books to write, and I do not want to be thwarted.) But there are other reasons than being frightened for why people would support such restrictive measures:
(1) They may have a loved one (who depends on them or whom they hope to visit) who is at risk due to being old or immuno-suppressed.
(2) They might (for religious or other reasons) not want to participate in any activity that has the potential to harm other people (whom they know or don’t know).
(3) They may share my view that taking the strong measures and making personal sacrifices to get COVID under control in the short run is what would return the economy back to normal the fastest.
Good luck,
Jeremy Arkes
Another private citizen (some might argue)
READER COMMENTS
Philo
Nov 25 2020 at 11:08pm
Regarding the private party that you know will lead to 1,000 people infected and 100 deaths among people not attending the party: If the guests attending the party know about the risk of infection, they should be free to run that risk. If they get infected and then infect others, I doubt that the party is to be blamed. These individuals are responsible, post-party, for not putting others at undue risk. Maybe their subsequent conduct (rather than the party itself) should be blamed for the 1,000 infections and 100 deaths. But more likely their subsequent conduct was not blameworthy, in that those they infected were knowingly running a reasonable risk in the way they interacted with people who were, or might well be, infected.
We are responsible for protecting ourselves from infection; we also have other objectives, which we weigh in deciding how to behave. It seems to me that the government is acting to prevent us from running risks that we judge reasonable, as might a Nanny.
Thomas Hutcheson
Nov 26 2020 at 7:21am
The 1000 people are also at fault for attending the party if they know of the risks they are incurring of becoming infected and that their subsequent actions to avoid infecting others will be partially unsuccessful. but this does not absolve the host for creating a risky venue.
MarkW
Nov 26 2020 at 6:44am
If they get infected and then infect others, I doubt that the party is to be blamed
Exactly. I live in Ann Arbor. The University brought back thousands of students in the Fall. Since the majority of classes were virtual (and nearly all offered virtual options), what most students came back for was three months of socializing, including countless parties that, cumulatively, dwarf the hypothetical 1000-person get-together. Should the University be blamed for all cases of Covid that those students might spread?
Jeremy goes on to say about people who support restrictions:
(1) They may have a loved one (who depends on them or whom they hope to visit) who is at risk due to being old or immuno-suppressed.
(2) They might (for religious or other reasons) not want to participate in any activity that has the potential to harm other people (whom they know or don’t know).
(3) They may share my view that taking the strong measures and making personal sacrifices to get COVID under control in the short run is what would return the economy back to normal the fastest.
These are all potentially sound reasons for limiting your OWN behavior, but not for pushing the state to impose your preferences and needs on others. If you have a vulnerable loved one — don’t visit. Or be extra cautious yourself. And get tested before visiting. If you don’t want to risk harming others, again, be very cautious in your personal behavior and avoid close contact.
As for the economic idea — it’s simply appalling to support the state locking people down based on a hunch that this will ultimately produce a stronger economy (especially at this point when the available evidence points in the opposite direction).
(Supporting this point is that Europe, which had COVID under control at the beginning of the summer, had a much more normal summer of economic activity than we had in the U.S., where we never had the virus under control.)
No. Europe took a more severe economic hit than the U.S. through the first three quarters of 2020. AND Covid cases and deaths have been surging in the Fall far more sharply than in the U.S. so that the UK, Italy and Spain all have higher Covid death rates than the U.S. with France close behind. Those countries have seen worse violations of citizens’ liberties AND worse economic performance (and it’s really not a surprise that the two linked).
Jeremy Arkes
Dec 3 2020 at 9:54pm
I’m a bit shocked by this response.
I gave a legitimate economic argument that discussed the economic and health benefits of policies to reduce the spread in that the economy could be stronger when people feel safer (it’s so obvious that it shouldn’t need any justification) …. you were appalled by it, dismissing it as a hunch. You don’t think we would be back in restaurants if the virus was under control now?
I argue Europe benefited from its shutdown policies with a closer-to-normal summer than the U.S. show. You show a website with Q1 and Q2 numbers of GDP, which says nothing about the summer in Europe vs. the U.S. … I might be wrong about Europe … I haven’t checked … that is my hunch based on friends’ Europe travel photos.
But, a question for you (and others) is whether there is a situation in which such a policy were warranted. Right now, L.A. is near ICU capacity. Ambulance companies are soon going to be unable to respond to all calls. My own local hospital, in an area without huge numbers, no longer is allowing non-essential surgeries.
So, people have not done their job to be careful and stop the spread.
Is it time yet for the government to step in since people have not responsible enough to contain the virus? Or, should they never step in? Let people not have an ambulance to pick them up if they have an accident or heart attack?
Should we at all take into account how the frontline workers are affected (such as needing to be quarantined from their own children because of their continuous exposure to the virus)?
Is there a stopping point?
Thomas Hutcheson
Nov 26 2020 at 7:11am
Having criticized Ms Hemis’s letter for failing to take any account at all of externalities, I feel some obligation to comment on Mr. Arkes’s criticism of the letter.
Although I agree with Mr Arkes main a) it is proper for government to try to prevent one citizen from harming others and b) that most of the damage that COVID is causing is through the voluntary actions of people trying to avoid becoming infected, I think his letter leaves out that government should also carefully consider the costs that its legitimate prevention measures themselves impose.
From scattered reports I’ve seen, the Government of California has in the name of preventing the spread of COVID sometimes imposed costs on its citizens that exceed the harn that the prevented behavior could reasonably have caused. For example, people were told avoid going to the beach when the virus almost certainly is not spread outdoors, some businesses were required to shut down completely instead of being required to operate in a manner that reduced viral spread, and certain restrictions were imposed statewide without allowing them to be nuanced locally to reduce their costs.
Perhaps equally important, the government in its messaging about the restrictions it imposed did not clearly communicate that people were being asked or required to make sacrifices to protect others not just (or in the case of wearing masks) even principally to protect themselves. This misplaced emphasis on SELF protection probably contributed to many people taking excessive or misdirected precautions.
While Mr Arkes letter could not reasonably be expected to spell out exactly what the proper response to COVID should have been, it could have avoided seeming to be a defense of whatever the government has done in preventing its citizens from harming others by exposing them to risks of COVID infection.
Michael
Nov 26 2020 at 7:42am
This letter comes close to making a point (though doesn’t quite say it explicitly) that I have been thinking about as I follow this debate.
What I have been thinking is this: among those opposed to Covid-19 restrictions, I generally see 3 main arguments in opposition:
The restrictions are bad because they restrict liberty.
The restrictions are bad because Covid-19 is far less of a threat than it has been made out to be.
The restrictions (or at least some of the restrictions) are bad because they are poorly targeted and sometimes counterproductive.
The first seems a matter of principle – even with convicing evidence that a restriction is strongly beneficial (say, saving hundreds of thousands of lives), the restriction would have to be opposed.
The second comes in a variety of flavors that vary from disputes over what the data show to disagreements about what the data mean.
Anyway, my observation is that people who agree with argument #1 generally also agree with argument #2 – at least as applied to the specific example of Covid-19.
Based on his postings here, my impression is that David H. agrees with both #1 and #2.
What I don’t a lot of is people who clearly accept argument #1 depsite rejecting argument #2 – that is, people who agree with those who think Covid-19 is a major threat but oppose restrictions on liberty grounds anyway.
As to argument #3, it is the criticism of restrictions that I personally find most convincing.
MarkW
Nov 26 2020 at 8:46am
The restrictions are bad because they restrict liberty.
The restrictions are bad because Covid-19 is far less of a threat than it has been made out to be.
But these are inextricably linked. The restrictions that have been imposed are simply without precedent in liberal democracies — if they are to be justified at all, it must be only under the most dire of conditions — as when, for example, the USSC ruled that the imprisonment of Japanese-Americans during WWII passed the ‘strict scrutiny’ test — and most people now believe that infringement on liberty was grossly unjustified — do you? Read about Gordon Hirabyashi
But this pandemic shouldn’t even come close passing a ‘strict scrutiny’ standard for the restrictions that have been imposed in some states. It would be one thing if we were facing an outbreak of a disease that would kill a third to half of the population as the plague did during the 14th century. But Covid-19 is less deadly than ordinary seasonal flu for the 2/3s of the population under 50. We’re not going to lose 1/3-2/3rds of the population, we’re going to lose — at most — a small fraction of one percent. I think America’s founders would be gob-smacked and ashamed (as am I) of a country that would give up so much liberty for such a minor increment in safety.
Long after the pandemic is over, this will have set a terrible, depressing precedent.
MarkW
Nov 26 2020 at 8:48am
Oops. I started to write something about Gordon Hirabayashi (one of my heros) but didn’t finish. Do look him up though — if he’d lived long enough do you think he would have meekly submitted to Covid restrictions?
Michael
Nov 26 2020 at 9:34am
Not really. If you believe #1, #2 is irrelevant. #2 only matters if you reject #1 in favor of the belief that restrictions are acceptable if they are appropriate to the context.
Jon Murphy
Nov 26 2020 at 7:50am
The two letters by your colleagues show the problem with externalities that Coase highlighted back in 1960: externalities are reciprocal. To prevent harm to Mr. Arkes, harm is done to Ms. Hermis (and vice versa).
The Smithian point that the government and government alone can properly violate the rules of justice is also highlighted in these two letters. In order to enforce certain rules of justice (Ms. Hermis not harming Mr. Arkes), the government must violate other rules of justice (causing harm to Ms. Hermis). ‘Twould be improper for Mr. Arkes to imprison Ms. Hermis, but a government (as a jural superior) may do so.
Thomas Hutcheson
Nov 26 2020 at 1:08pm
What is the proper policy that Gov Newsome should have followed, taking proper account of Coase’s insights?
Jon Murphy
Nov 27 2020 at 10:46am
That begs the question, Mr Hutcheson. The proper policy may have been no policy at all.
robc
Nov 27 2020 at 6:00pm
Or the proper policy is 330 million different policies.
Alan Goldhammer
Nov 26 2020 at 11:54am
The problems with David’s posts and all the responses is that they do not address the fundamental issue of what society and/or the individual should do. If one accepts that a pandemic caused by a novel virus can cause great health and economic impacts, it is important to come up with a way to get through it that minimizes both of these. A crude ‘herd immunity’ approach leads to great morbidity and mortality. A rigid lockdown approach causes extreme economic contraction.
Rather than writing letters to a Governor that are likely only to be read by those who follow this and other blogs where the letter(s) have been posted, it is far more constructive to come up with actual solutions. Is there a middle way between the libertarian and communitarian approaches to a public health crisis? I sure have not seen one posted in any of the blogs on this site. Whether you like Tyler Cowen’s thinking over on ‘Marginal Revolution’ at least he has stepped up and given some critical thinking to the problem.
I’ve done a lot of thinking on this since March when I started a daily newsletter and thought back then that the lockdown was necessary in light of the uncertainty (the Rumsfeld Paradigm). There was a way forward that was never adopted by large numbers of people in this country and our national leaders have totally failed us (one libertarian lawyer friend of mine categorized this as ‘negligent homicide’). One only need look at the state of hospital overcrowding, large number of infections, and a rise in mortality. It is likely too late to implement the broader public health measures of physical distancing and mask wearing and contact tracing is impossible with such high infection levels. Even taking personal steps to protect ones self is not an absolute guarantee as two of our close friends who did everything right and still came down with COVID-19 shows (mild cases but complete loss of taste and smell!).
I expected more from this blog community.
robc
Nov 26 2020 at 1:22pm
Society: nothing
Individual: decide for yourself.
Judith Hermis
Nov 27 2020 at 5:27pm
Jeremy, as always, you are a thoughtful and careful thinker. Great points. Glad to see different arguments presented on the same blog. It’s rare these days!
Comments are closed.