Quarantine during a pandemic: if I can handle his business?
While the most effective way to combat coronavirus is quarantine. Despite the fact that it brings enormous damage to the economy, it chose the most countries of the world. There are also those who does not hurry to resort to this unpopular with the people and representatives of business method, as fears that the drug will be more dangerous than the disease itself. Facing a collapse of the economy of individual countries and globally around the world because of the quarantine?
In many countries with quite law-abiding population still more clearly audible murmur of discontent. The number of those who do not want to sit and wait for something unknown is growing every day. They believe that factories, shops, restaurants and offices must work, otherwise people will start to kill not crafty coronavirus, and banal poverty and hunger.
Who to rescue first: the economy or people? To answer this question, scientists turned to events more than a century ago, when the world was raging a deadly influenza known as "Spanish flu". Then, the epidemic has claimed 50 million lives, and the illness suffered, every third inhabitant of the planet.
History repeats itself — in 1918 and has been quarantined, and closed factories, and the massive hype about the masks. There were those who decided not to do "sharp movements" and waited, trying to keep the business in the country. Who have benefited in this situation?
When it was over, it turned out that right were those who to the detriment of the economy was saved from death by the population. When the "Spanish flu" was gone, it was not clear who was right and who was wrong. But it soon became quite clear that faster to normal life return country and city, which operated the quarantine and contacts between people were limited.
Economists of the American Central Bank (fed) and the Massachusetts Institute of technology (MIT) investigated the economic and social indicators of a hundred years ago and declared:
In 1918, the pandemic also came from the East and rolled over the two waves. The spring was crushing, and the second, winter is truly catastrophic. In the United States recently came under attack of the "Spanish flu" in Seattle and Los Angeles, located in the West of the country.
These cities have already had an example of a major East coast city and authorities have taken into account all the mistakes. Then were adopted very similar measures, with the exception of surveillance of the population using technology, e-Commerce and telecommuting.
Had been closed stores, theaters, churches and schools, banned public meetings, and even forced to postpone a memorial event. Public transport was stopped, and the trade is limited to the sale of necessities.
Also was highly recommended self-isolation and established a safe distance between people. All were forced to thoroughly clean and disinfect hands, and wear masks. All these measures helped to mitigate the effect of the infection and provided a rapid recovery of economic indicators. Modern researchers highlighted the following features:
By entering quarantine only 10 days before the other, Seattle and Los Angeles thereby achieved 5% growth of employment in manufacturing after the end of the epidemic. After enduring quarantine for 50 days, the authorities of these cities has achieved job growth of 6.5%.
Lessons learned in the early twentieth century, allow us to make a correct choice in favour of the maintenance of the population, to the detriment of business and the economy as a whole. As we can see, most governments still listen to the experience of our ancestors and common sense and are busy saving lives.
We must admit that the world was not ready for a pandemic. No country was not the required number of hospital beds and medical equipment, and in some places are unable to provide the population with even the basic tools of personal protection. Therefore, almost all countries have chosen the path of smoothing a peak, that is, try to stretch the epidemic in time. For this purpose, and introduced strict quarantine measures.
Among the countries that were skeptical of the idea of quarantine and was trying to save the business, was the United States. But fortunately Donald trump quickly changed his mind and joined the supporters of the exclusion. On the screens of American televisions now several times a day appears in the chart, which makes clear that the government expects that the number of victims of the infection will not exceed 240 thousand. For comparison it is shown that, without quarantine measures, the estimated number of patients was at least 2 million people.
There is in the world and convinced the dissidents. These include the President of Brazil Jair Bolsonaro, which is so actively opposed to who recommendations, that he began to ban on social networks. Not better behaved and the President strongly affected by the coronavirus in Iran's Hassan Rouhani. The politician claims that the epidemic is not that other, as the conspiracy of enemies who dream of the collapse of the great Iranian nation.
Unfortunately, there are those among our neighbors. The President of the Republic of Belarus Alexander Lukashenko does not take seriously the threat of the epidemic and is not going to impose any restrictions. Eccentric politician shared with the citizens of their country recipe "anticreasing cocktail", which consists of vodka, a bath, sports and field work. "Better to die standing than live on my knees" — so we decided for all of Lukashenko and all had to agree.
Without a doubt, the quarantine is a serious blow to the economy. But, oddly enough, it has some good points. But we begin, of course, negative. The basis of consumption in modern economies lies an active social life: people buy things, go to health clubs and beauty salons, dine at restaurants and relax at the resorts.
Much of this they do in order to show himself to others with the best hand, and open new communication opportunities. Quarantine and isolation imposed by the authorities, suppress this demand, but reduced supply. Producing fewer products, and many service providing institutions are altogether closed.
This leads to the fact that the business cease to invest in the development and it strikes his future. We should not forget that an increasing number of bankruptcies — bankrupt people and companies. All of this brings a threat to the banking system, because of mass refusal to pay the bills leads to financial crisis, Bank losses, reduced liquidity and credit availability.
For now, let's talk about the good. Quarantine significantly reduces the extent of the epidemic, and therefore its consequences. The faster and tougher quarantine measures are carried out, the less the duration of the isolation, and hence faster return to work.
It should also be noted that the so-called quarantine smooths out the peaks of mortality. In the absence of effective measures, the health system will not cope with the flow of patients and the sight of crowded hospitals and morgues to act for the people demoralizing.
In this case, people will no longer wants to walk to restaurants and buy new clothes after the lifting of restrictions. People will be in awe to save money and spend time at home that is not in the hands of entrepreneurs. Consumption will be suppressed for a long time and it will be very bad for the economy.
Today it is difficult to predict the depth of the fall. In 1918 an epidemic of Spanish influenza has cut production in the U.S. by 18% and things could be much worse if not promptly entered quarantine. There is no doubt that the pandemic is extremely dangerous both for people and for the economy, but quarantine is the only way to reduce the number of victims and to help the business not finally perish.
Yes, the difference between "Spanish flu" killed young and strong, and COVID-19, the most dangerous for the elderly, is very large. You cannot equate a farm a century ago and the modern economy, is tied to technology. However, between the events of 1918 and 2020 more Parallels than differences.
The countries that first recognized the danger and imposed a quarantine in Singapore and Taiwan, not only failed to stop the development of infection. They have mitigated the negative effects of the pandemic on their economies. It's safe to say that quarantine is not exactly a source of problems for business, and not having alternatives method is not to let him die.
Keywords: The Bank | The flu | Quarantine | Coronavirus | Crisis | Small business | Events | Epidemic