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Posts Tagged ‘declining west’

Some Predictions about Downstream Effects of COVID-19 Shutdown: 1

May 20, 2020 12 comments

Since I have been recently writing a lot of posts about the COVID-19 shutdown (link 1, link 2, link 3, link 4, link 5, link 6), I thought it might be a good idea to write down some more and specific predictions about the downstream effects of COVID-19 shutdown. So here are some of them, in no particular order of importance or significance. Just so you know, most are pretty depressing.

1] As I have mentioned many times in the past, jobs in the service sector dominate the economic landscape of post-industrial western countries. Just think about how many people you know who work in a place which makes a real physical product or processes some raw material vs all those who work at some shop, mall, hotel, restaurant or something similar. But this goes even further, as the largest employers in most towns and cities in this country are either hospitals, universities or school districts. While these more “credentialed” jobs might seem to be something other than service sector jobs- they are just that and you will see why that matters later in this post.

While jobs in the service sector might seem too heterogeneous to be hit by the shutdown and its aftermath, they share some common features that make them especially vulnerable to economic disruption. Firstly, majority of business in the service sector operate on much low margin of profit compared to some other sectors. For example, there is no service sector equivalent of Apple or Microsoft with a few hundred billion dollars stashed into overseas accounts and obscure financial instruments. In other words, consumer sector businesses and employers lack the very deep pockets of corporations in other sectors.

Secondly, as a partial consequence of the first, they are heavily dependent on highly predictable levels of businesses activity and are usually (especially in west) financially over-optimized to the point that they cease to be profitable or even viable when capacity utilization levels are not close to maximum. This is a fancy way of saying that restaurants, bars, hotels, airlines, most shops in malls etc become money pits if they are not operating at close to their maximum capacity for a good part of the year. FYI- this is less of an issue in some Asian countries where the proprietors often own the premises and are not so heavily financially leveraged.

But why does this matter? Well.. because even if they can survive a couple of months of being closed down due to helicopter money from the government, they are just not viable if forced to operate at 25% or 50% capacity for even couple of months. Sure.. restaurants which do mostly takeout (pizza joints, chinese) might survive, but the vast majority will simply close it down because there is no way a sane person would operate, for more than a couple of months, under poorly thought and uncertain regulations made up by bozos without any skin in the game.

And it gets worse.. the service sector is far less monopolized than other sectors of the economy, and the majority of business in it are either small or medium sized. Given that government largess seems to preferentially benefit the large and politically connected in every sector, it is likely.. almost certain.. that many small to medium sized businesses will go bankrupt or close forever. What makes this outcome especially problematic is that those business account for the majority of jobs in that sector. In other words, we will a large rise in long-term unemployment in the very societies which have decided (about four decades ago) to abandon their economies to the “free market” aka financialism and monopolization by choice.

To add insult to injury, the vast majority of people in this sector are under 60 years of age and therefore the least likely to die (less than 1 in 1,000 chance) from COVID-19. And here is what will happen next.. tens of millions will be unable to pay their rents, mortgages, student loans, car loans etc for a prolonged time. Of course, trying to throw so many people on the street and out of their cars will have some very nasty political repercussions- more so because the majority are young. Some of you might say.. but what about unemployment insurance? Well.. that amount paid by most western countries (but especially USA) is not adequate for covering majority of their bills- more so if you live in a medium to large city.

And it gets worse…

2] The whole “social-distancing” and “quarantine” bullshit along with dubious measures such as requiring everybody to wear mask in public perpetuates the atmosphere of a perpetual crisis. I liken these measures to the security theater we saw in USA after 9/11- but with the potential to cause infinitely more economic problems. Think about it.. would you eat out at restaurants with same frequency as before if you server was wearing a face mask and every alternate table was closed off with big stupid stickers? Would you go to a pub as often? What about a movie theater? What about shops in malls pestering you to disinfect your hands every time you walked into them? Would you buy as many clothes as before if you couldn’t try them out in fitting rooms?

What about airlines? would you take a flight as often if you had to deal with all that bullshit? What about vacations? Would you stay at hotels as often even if you still had a job? And all of this security theater for what end? To maybe slow spread of a highly infectious disease with an gross population IFR of less than 0.5% and mostly problematic in people over 70 and 80? A disease that does not cause symptoms bad enough to seek any medical attention in over 90% of those infected. A disease that is functionally asymptomatic in most people it infects? A disease that the vast majority recover from without any therapeutic intervention or long-term sequelae.

The vast majority of disease control measures deployed to stop this pandemic are closer to ritualistic virtue display than good science. Consider for example, face masks. Do they benefit people under 70 to the same extent as those over 70? And given the highly infectious nature of this disease along with very low mortality in most age cohorts, isn’t it a good idea to let non-vulnerable people get the illness and recover from it. thus conferring them immunity than wait for an effective and safe vaccine- which will likely take at least a few months. Now let me ask you another question- do you think I am the only one thinking along these lines?

It is becoming increasingly harder to maintain lock-down in many parts of the world and while those regions might suffer more death at first- it will become increasingly obvious that letting people under a certain age get infected while protecting the more vulnerable minority is the least bad option. Notice I said ‘least bad option’ because there is no realistic good option in the near future. You are really choosing between options that front-load death or those which spread far wider economic misery over a much longer time-scale. Personally, I choose the first and you can be sure that the majority will eventually choose it because the second one sucks far more.

Noe let me ask you a related question- what happens to the credibility of the people and institutions who pushed the second option. As many of you know, it is my opinion that Trump’s rise of power had a lot to the non-recovery of most people from the GFC of 2008 and continued neoliberal policies under Obummer. Imagine what such a crisis and much bigger repudiation of “credentialed” people and institutions would do for the political scene in this country. You might remember that in a previous post I made the case that rise of fascist and strong-men type leaders in continental Europe during 1920s and 1930s had everything to do with high rates of unemployment among men combined with a repudiation of the elites who led them into WW1.

You think Trump is bad? Just imagine the type of right-wing ‘populists’ that will arise in response to these stupid and ruinous lock-down policies. In future posts of this series, I intend to write about the impact of these stupid policies on schools, universities, future of “left”, effects on certain parts of manufacturing sector, municipal bonds, velocity of money, effect on rates of drug use and much more. But before I finish this post, let me say something else. If you think that a crisis of this extraordinary magnitude will make corporate-owned western governments question their faith in neoliberalism- think again.

And another thing.. this crisis will destroy whatever residual faith people in many countries still have in the WHO- but that is the topic of another post.

What do you think? Comments?

An Unusual Observation about Ongoing Coronavirus Outbreak in China

February 8, 2020 18 comments

As mentioned in the previous post on this topic, it is my opinion that the coronavirus outbreak in China is far more hype than reality. To be clear, I am not denying that a bit over 700 people are dead from this particular outbreak at the time of writing this post. Then again, a few thousand people die from influenza and its many complications in USA every single year- in a ‘good’ year. My point is that we should look at the actual evidence to make decisions and prognostications rather than let racism and stupidity make them. With that in mind, here is an odd feature of this current outbreak which sorta validates my initial assessment. It began with an observation about the prognosis of 2019-nCov infections outside China.

As some of you might have heard there are over a couple of hundred confirmed infections of this specific virus outside China, but only one death- thus far. So what is going on? Why is the death rate of patients outside China less than 1%? After posing this question on twitter, I got an interesting reply in the form of an attached table- based on available data from two days ago. Have a look at highlighted row- specifically the low death rate of patients in China (0.21 %) outside Wuhan and the province of Hubei. Note that this rate is rather close to that of cases outside China (0.39%). So, what is going on? Why does the fatality rate for this outbreak drop depending on your distance from Wuhan (4.11%), even in the province of Hubei (0.81%)?

Now let us consider and go through a few hypothesis which might provide an explanation for this unusual pattern. But before we do that, let me say something that is obvious but has to be stated for the benefit of delusional white racists. The numbers provided by Chinese government seem to be as accurate as those which would be provided by the american government under similar circumstances. This is bolstered by the fact that this outbreak seems to noticeably less deadly (on a percentage basis) than SARS. Let me remind you that SARS killed 43 people or almost 20% of the people who got infected in Canada and almost all nations with more than 10 cases ended up with mortality rates over 10%. On to the hypotheses..

1] Are people of Chinese ancestry more susceptible to infection by 2019-nCov and die from it? While the overwhelming majority of those infected and dead, so far, are of Chinese ancestry, the significantly lower death rates outside city of Wuhan (but still in Hubei) suggest that ethnicity and race are unlikely to be an important factor. Also, the majority of 2019-nCov cases outside China (to date) have occurred in travelers of Chinese ancestry from China. In other words, there is no real evidence that people of Chinese ancestry are somehow more susceptible to infection by 2019-nCov or die from it. They were just at the wrong place at a bad time.

2] The virus strain inside Wuhan is different, and more lethal, than the one outside that city? While its certainly possible that more than one strain of 2019-nCov is in circulation, the evidence we have so far suggests that all known isolates are extremely similar and have jumped into human hosts very recently. Having said that, it is common for RNA-based viruses such as Coronaviruses to mutate from more lethal strains into less lethal ones which spread more easily. Need I remind you that some species of coronaviruses are among the many which cause the common cold. In other words, it is possible – but there is a much more likely explanation.

3] In my opinion, the most likely explanation is as follows: there are far more milder infections in Wuhan than have been acknowledged. Imagine that only 1 in 10 or 20 patients have symptoms bad enough to seek medical attention. Now this will result in a 10-20 fold concentration of the worst cases in hospitals. If the infection has a death rate of 0.5%. and only the most ill 10% seek medical attention, the recorded mortality rate at hospitals will immediately jump from 0.5% to 5%. It is therefore likely that, over the next few weeks, we will find out that majority of infections caused by 2019-nCov are mild or asymptomatic and only a small percentage get ill enough to seek medical attention. Not sure if this soothes existing worries, creates new ones or both.

What do you think? Comments?

Some Initial Thoughts about the Recent Coronavirus Outbreak in China

January 31, 2020 12 comments

More than one commentator on my previous post wanted me to write something about the recent Coronavirus outbreak in China, especially regarding how bad it really is or might become in the near future. Since useful and concrete information about this outbreak has been overshadowed by a lot of racist mental projections in the declining west, I thought it was a good idea to write down my initial thoughts about the situation. FYI, one of my degrees is in microbiology. So let us talk about about this outbreak, starting with what we know for sure about the virus in question.

1] The Coronavirus (2019-nCoV) behind this outbreak is fairly close in its sequence to one which caused the SARS outbreak in 2003. And yes, it is closer to some known bat coronaviruses, but not others. Also, both SARS and 2019-nCoV almost certainly jumped from bats to human hosts. The odd thing, though, is that most bat species in Wuhan are currently hibernating and the initial outbreak occurred at a seafood market, suggesting that another mammalian species acted as an intermediate host between bats and humans.. perhaps a sick cat, dog etc.

2] Initial sequence analysis of virus samples from multiple patients and comparing them to each other strongly suggests that the jump from bats to humans occurred very recently, mostly likely within the past 2-3 months. Interestingly it seems to bind to the same human protein (for entry into cells) as the coronavirus which caused SARS. Given the fairly high similarity in sequence, same protein used for entry into cells and similar clinical disease produced by 2019-nCov and SARS we can make an educated guess that many other characteristic (infectivity etc) are also similar. Think of 2019-nCOV as a sibling or cousin of SARS.

3] It therefore follows that 2019-nCov is likely to be similar in its infectivity to the one which caused SARS in 2003. While some preliminary analysis by western scientists pretend that the former is more infectious than the later, everything we know about viruses tells us that they are very similar viruses which use the same protein to gain entry into human cells. I do not expect 2019-nCov to be significantly harder to control than SARS. The key word is ‘harder’ as 2019-nCov might end up infecting more people than SARS- but ease of control will be similar.

4] So far, the percentages of 2019-nCov infections ending in death is around 10%, and is similar to what we saw over the entirety of SARS outbreak. It is well known that viral strains which cause severe infections and high rates of mortality evolve into ones that cause mild infections and low rates of mortality because the former burn themselves out due to lack of new hosts. We can therefore expect the mortality and morbidity rates due to this virus to drop over the course of time due to better quarantine (corrals more aggressive strains) and treatment (lower mortality). Some of you might have noticed that the increase in number of deaths is now far slower than the number of confirmed infections- which is a good sign.

5] It is highly unlikely that 2019-nCov was developed by China as a biological weapon for the simple reason that biological weapons are, for the lack of better words, stupid and dangerous. See.. unlike nuclear weapons (which China posses), biological weapons cannot be controlled once unleashed and are likely to kill as many on your side as the other side. This is especially so, if there is no readily available vaccine or decent drugs to treat that infection. Furthermore, modern scientific techniques allow us to track back their creation to a degree that was unimaginable in even as late as the 1980s. Being greedy is not the same as being stupid.

6] Most hype about 2019-nCov has a lot to do with the increasingly rapid decline of the dying west. To make matters worse, it is now obvious that the western system of corporation-controlled capitalism is vastly inferior to the Chinese system of state-controlled and directed “capitalism”. In case you think otherwise, tell me how people similar to Trump (fraudulent right-wing populists) are increasingly getting elected in western countries. Every white idiot (and non-white idiot from subservient countries) expressing public alarm about 2019-nCov outbreak is subconsciously or consciously driven to do so because of a combination of racism and the unspoken recognition that their own system is in terminal decline with no realistic hope of recovery.

7] To be clear, I am not minimizing the potential problems this outbreak could cause. Having said that, the Chinese system is probably the most capable of actually stopping such an outbreak. As mentioned above, having a state-controlled system of governance not beholden to corporations and other short-sighted moneyed interests allows you to get things done and devote resources in ways that are impossible for corporation-controlled “democracies” such as USA, not to mention semi-functional anarchies such as India. You can be certain that Chinese government will things done, regardless of the financial cost and suppression of worthless “human rights”.

What do you think? Comments?