America Is In Freefall
The worse the pandemic gets, the worse the economy gets. The worse the economy gets, the less people have to pay towards functioning social systems. Functioning social systems — healthcare, medicine, income guarantees, safety nets — are how to survive a pandemic, and so the fewer there are…the worse the pandemic gets.
This is — if you zoom out for a moment — the death spiral of ancient Rome, really — people grew indifferent, never invested enough together, only funding ever-growing military misadventures, while hoping for new thrilling games at the Coliseum, all the while becoming indifferent to mass death, senselessness, inequality, and poverty — so Rome simply fell apart.
Bang! That death spiral is what America’s now entered. But it’s just the first one. Here’s another.
The worse the pandemic gets, the most people stay home, lose confidence in the economy, and spend less. The less people spend, the more businesses — most of whom already exist on the edge — go bankrupt. The more businesses go bankrupt — since there’s no real support from the government — the more unemployment stays north of a million people filing every week. That’s the death spiral of the Great Depression.
Where does that end? In another death spiral.
The more people fall into poverty, the more fear, despair, and hopelessness grow. The more trust is lost in institutions, leaders, systems, and each other — and so the less collective action become possible. The weaker collective actions grows, the stronger authoritarianism and fascism get. The more authoritarianism and fascism get, the poorer and even more impotent people get. This is the Soviet death spiral.
Alan: All this may seem impossible because major changes (like those proposed by Umair) never take place so quickly.
Now recall the sudden collapse of the Soviet Union.
It took place virtually "overnight."
***
Here’s today’s — just today’s — news.
Coronavirus has hit a fresh all-time high in America. Meanwhile, 1.5 million people filed for unemployment. And the death toll in America? 120,000 dead and counting.
Coronavirus has hit a fresh all-time high in America. Meanwhile, 1.5 million people filed for unemployment. And the death toll in America? 120,000 dead and counting.
What do those three grim, horrific facts tell you? Here’s what they tell an economist like me.
It is a nation that stepped off the edge of an abyss, and is now tumbling down into it. Only there seems to be no bottom. That’s because…there isn’t. What America has entered now is a death spiral. It feels like there’s no bottom because these are self-reinforcing loops, vicious cycles of death and despair.
Yes, really.
Let me first describe how bad the situation really is, and then I’ll explain. You know that Coronavirus in America is bad, but do you really understand how bad? In Pakistan, there were 4000 new Corona cases today. Texas alone had 5500. Pakistan has a population of 212 million people. Texas has one of 29 million people. On a per capita basis, Texas alone has seven times the new Coronavirus cases of Pakistan. Per day. Texas alone.
Even if you doubt Pakistan’s numbers, consider that we’re only counting one state. Just one! If we add Arizona, Florida, Oklahoma — all the Red States — and compare that, the results are staggering. Florida has 5,500 new cases. Arizona, 2,000. South Carolina, 1,200. That’s about 15,000 — and I’ve barely begun adding it all up. If I finished that calculation, America would have something like five times the new Corona cases of Pakistan, per capita.
What the? Pakistan is one of the world’s poorest, most devastated countries. It was founded in 1947, and has spent much of its history as a military dictatorship.
How can America have worse Coronavirus outcomes than Pakistan?
But I could have done the same calculations for almost any poor country in the world — India, Bangladesh, and so on.
Do Americans really understand that they have one of the world’s worst Coronavirus outbreaks? That it is now worse than in shattered, third world countries? It doesn’t seem that way to me. But Americans should begin to understand that. That is what it means to be a failed state: you die, in weird, gruesome, and needless ways.
Let’s talk about the next aspect of all that for a second. The needlessness. If America had done what New Zealand did, how many Americans would have died? New Zealand set the bar for global best practices — locking down early, society cooperating as a “team” — that’s what Kiwis call themselves — testing, tracing, and so forth. Just 22 people died in New Zealand. Adjust per capita, that would have meant that just 1,500 people should have died in America.
(Yes, really. Go ahead and do the math yourself. New Zealand’s population is 5 million. America’s is 330 million. New Zealand’s mortality rate was .00044%. 330 million times .00044% is…1452.)
Just fifteen hundred people should have died in America. 120,000 have. More than all America’s modern wars combined. A rate of 20,000 per month now, which is the same scale of death World War II incurred. But this is different: 120,000 people didn’t need to die.
America has a death rate one hundred times what it should be. Again, there seems to be no real general understanding of this nightmarish point: how bad America’s pandemic is globally — and the shocking scale of needless mass death that’s resulted in.
Did Trump's Coronavirus Action, Inaction And Ineptitude Kill 91,724 People Needlessly?
How did all this come to pass?
When Coronavirus ignited, America was one of three nations in the rich world — almost in the whole world — whose leaders seemed to mostly ignore it. As the now-infamous story goes, first Trump denied it, then he minimized it, then he told people to drink bleach, then he cut funding for the WHO, and now, as cases spike to all-time highs, he’s closing federal testing centers. What on earth?
This vacuum of leadership left the nation adrift. Even poor countries like Vietnam, and tiny ones like New Zealand took swift, decisive action. America? Along with Britain and Sweden, it mostly did nothing. The virus…went viral. Finally, too late, America went into lockdown — one which barely met global standards, but I digress.
At that point, people like me, economists and epidemiologists both, cautioned that reopening too soon would cause another wave to explode. Now it has. Only the first one never really flattened properly all the way, towards zero. It only plateaued. So now America has a tidal wave piled atop another tidal wave.
The American government’s plan to contain Coronavirus was just as inadequate as its plan to support households and businesses through it. People were offered the equivalent of just one week’s worth of income, and so were businesses.
The result was predictably going to be a massive, massive wave of unemployment — because unlike in most of Europe, America had no real functioning furlough scheme. In France, the government will pay 75% of your income up to something like 6K Euros per month. In Italy, mortgages and debts were frozen, and people received income guarantees. America’s government alone barely lifted a finger to help people through the worst catastrophe in modern history. The result?
This is now the 14th week that more than a million people have filed for unemployment. The fourteenth week. Close to 50 million people are unemployed. That means, in plainer English, that something like just half of Americans are now employed.
But the pandemic is reigniting all over again — and that means the economy is going to suffer even more.
What the rest of the world understood that America didn’t is that public health and the economy go hand in hand. If you have a pandemic that lasts forever, then the economy will fall into a deep forever depression, too. America’s staggeringly foolish leaders mostly thought the opposite was true: you had to sacrifice people’s lives for “the economy.” But the point of economy is your life.
What does the future hold now? If you understand the above, then you also grasp that a death spiral is kicking off in America — and that’s why it feels like there’s no bottom to this collapse.
The worse the pandemic gets, the worse the economy gets. The worse the economy gets, the less people have to pay towards functioning social systems. Functioning social systems — healthcare, medicine, income guarantees, safety nets — are how to survive a pandemic, and so the fewer there are…the worse the pandemic gets. This is — if you zoom out for a moment — the death spiral of ancient Rome, really — people grew indifferent, never invested enough together, only funding ever-growing military misadventures, while hoping for new thrilling games at the Coliseum, all the while becoming indifferent to mass death, senselessness, inequality, and poverty — so Rome simply fell apart.
Bang! That death spiral is what America’s now entered. But it’s just the first one. Here’s another.
The worse the pandemic gets, the most people stay home, lose confidence in the economy, and spend less. The less people spend, the more businesses — most of whom already exist on the edge — go bankrupt. The more businesses go bankrupt — since there’s no real support from the government — the more unemployment stays north of a million people filing every week. That’s the death spiral of the Great Depression.
Where does that end? In another death spiral.
The more people fall into poverty, the more fear, despair, and hopelessness grow. The more trust is lost in institutions, leaders, systems, and each other — and so the less collective action become possible. The weaker collective actions grows, the stronger authoritarianism and fascism get. The more authoritarianism and fascism get, the poorer and even more impotent people get. This is the Soviet death spiral.
(Let me translate that one: Trump steals the election. The Supreme Court decides it in his favour, and the Senate does, too, after plenty of manipulation and rigging. But because people are already anxious, weary, desperate, and poor, not to get sick, just to put bread on the table, just trying to subsist — they can’t take much of a stand against it. There goes American democracy — over in the blink of an eye.)
Bang!
Three death spirals. The first one is a vicious cycle of collapsing public health and fiscal ruin — each feeding the other’s decline. The second is a vicious cycle of public health and an economy falling into depression — each feeding the others’ implosion. And the last is the classic one, the biggie: a vicious cycle of depression and authoritarianism, each feeding the other, like a shadow meeting the night. This is Weimar Germany’s death spiral.
Let me say it as plainly as I can.
Even societies like Pakistan and Vietnam are outdoing America now, on basic dimensions of prosperity, like public health.
America, meanwhile, is in free fall. There is no — no — plan, agenda, vision, to contain any of the multiple, interlinked crises America now finds itself faced with. And that means they will just roll on, spiraling into the kind of devastation we don’t even see in poor countries.
I want to warn you in the strongest possible terms that I can, so let me say it again. America is in freefall. When societies enter death spirals like this, it’s quite possible that there is no bottom.
It feels like free fall because it is. It feels like there’s no bottom because there isn’t one. When vicious cycles this powerful, this destructive, this enormous ignite in a society — often, they simply just leave it a smoking wreck. America is now a society which has the death spirals of the Soviet Union, Weimar Germany, ancient Rome — all operating simultaneously. Even the wheels of America’s own Great Depression are beginning to turn.
This is what it means to be a failed state. This is what it means to be negligent and irresponsible towards your society for decades. This is what it is to let the ghosts of slavery still command the minds of today.
America’s in free fall.
Don’t ask me if there’s any way out. First, take a moment. Understand how bad it really is. And then let’s talk about what to do about it. Build a net? Grow wings? Clamber onto the sides?
You see, right about now, the one thing I don’t think Americans really have is a grasp of the severity problem itself: a nation now plummeting headlong into a bottomless abyss.
Umair
June 2020
June 2020
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