Economic pain and the ethics of lockdowns

Posted on by Matthew Wright

One of the problems with lockdowns is that they carry a direct economic hit. Here in New Zealand, it’s been calculated this week at 37 percent for the complete ‘Level 4’ lock-down, and forecast at about 9 percent for the ‘nearly back to normal’ Level 2 into which the country is expected to go.

I used to work with the economists who crunched those numbers, and I see no reason to doubt their figures. In point of fact, the calculation isn’t as simple as the ‘EITHER lockdown OR economic crash’ to which it’s been popularly reduced around the world – but I’ll cover that next time. What I want to talk about this week is the ethics of the lockdown concept versus the personal financial hit.

There’s no question that a lockdown saves lives: it stops the virus spreading at a time when the virus itself is unknown, and where there is no vaccine. But it also causes an immediate financial hit to individuals. Small businesses struggle because it cuts the cashflow they need to pay staff, rental on premises and so forth. Sole traders find their income’s dried up. Government support – which, in New Zealand, has been generous – only works for the majority income pattern. Others have fallen through the cracks, including many writers (me included – please click on the links to the right and BUY MY BOOKS.)

So why are governments persisting with lockdowns despite knowing it will hurt people and destroy some businesses? The fact that a global economic downturn was due to happen anyway – and that a lockdown means it’ll happen without a pile of bodies attached to it – is one explanation. More on that next time. But in general, whatever a government does over the virus, it’ll be slammed for it. You know: the lockdown was too late; it wasn’t released early enough; it was released too soon; people before economy; economy before people. I need a haircut. That sort of thing.

How do decision-makers handle that? The answer I’ve seen applied in a number of countries, particularly New Zealand, is textbook Utilitarianism – an ethical approach championed over 200 years ago by Jeremy Bentham. It can be summed up as: ‘The needs of many outweigh those of a few.’ Spock uttered something like those words in The Wrath of Khan.

This is the principle governments have been using when it comes to lockdown: we’re facing a virus with a lot of unknowns, including the scale of its potential to kill or do permanent damage. What course of action delivers the greatest net benefit to the most people?

You see the issue: when dealing with a population, it’s impossible to help everybody, because individual cases differ. Decision-makers have to live with that. But the principle is ‘what course of action helps the majority’? And in that regard, I suspect the calculation has been that a financial hit won’t kill someone. Covid-19 might, especially if critical care beds are overwhelmed. The guiding principle has been medical advice, erring on the side of caution. And rightly so. Economies recover. But you’re a long time dead.

Utilitarianism isn’t perfect. A decision made today might be seen with hindsight to be wrong later. The rate at which discoveries are being made about Covid-19 means that decisions made even a month ago perhaps seem over-cautious now. Hindsight gives us 20:20 vision, but nobody can predict the future – and, as I say, the cost of getting it wrong is human life. Reduced to that level, applying cautious utilitarianism isn’t a big decision – is it?

I mean, what would Spock do?

Copyright © Matthew Wright 2020

17 thoughts on “Economic pain and the ethics of lockdowns”

  1. Matthew, good point but I think it has been said by someone in authority, that the economic fallout from Covid 19 may kill more people than the virus and I’m guessing that might be true. Estimates of excess deaths from austerity in UK were put at 120,000 (four times the current Covid mortality number) by the British Medical Journal 2017. It’s a grim detail, but the two sides of the argument are a real ethical dilemna. Of course austerity can be seen as a choice.

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    1. Apologies, but I’d love to know where that figure of 120,000 came from, and how it was calculated. Surely no one in the UK is being allowed to starve to death? And while mental health is a very real problem and can lead to suicide, I simply can’t fathom how 120,000 people would willingly kill themselves because of ‘austerity’. In Third World countries, yes. The death toll in parts of Africa is going to be unimaginable because there, people really will face a choice between the virus and feeding their families. In the UK though?

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        1. This is an article describing the consequences of the neo-liberal austerity measures of the past couple of decades in the UK, and particularly since 2012 (post-GFC), as affecting the health system. That’s a different issue from the economic downturn expected to follow the Covid-19 lockdowns, for which governments so far have introduced measures that are the reverse of austerity (‘fiscal impulse’ in economic terms), and look likely to continue to do so. It will, of course, take many years to fully recover the chronic under-funding of government services globally. As I read this article, however, it’s clear that a proportion of the Covid-19 death toll in the UK must also be levelled at those austerity measures. All credit to the incredible hard work and self-sacrifice of the medical professionals who have to work under such conditions.

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    2. Yes, the potential for the lockdowns to provoke death through delayed medical treatment, austerity and so on, has to be factored in. These kinds of ethical problems are interesting to the extent that they challenge thinking in many levels. One of the major issues with the lockdown and economic downturn, however, is that a major crash has been forecast for some time anyway. The lockdown is simply a potential trigger – I’ve got a post coming up on V-shaped recoveries (typical of a lockdown) vs the structural economic problems that world economies were facing before the virus even hit. These economic matters are broadly calculable; I think the issue facing governments has been that the unknowns associated with the virus are not so easily reducible, and into the mix of government reaction also has to be factored public fear.

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  2. I agree with you that we cannot expect our governments to get it perfect right off the bat, and it is of course impossible to help everybody. However, lockdown does not just have economic effects. Social isolation can increase mortality rates and many people who should be going to hospitals are avoiding it due to fear of Covid-19. In Canada many surgeries have been postponed adding to the already long wait times. The actions we take against the pandemic have consequences that are not just economic, but directly effect public health. For anyone interested, I’ve recently written about how Covid deaths compare with the average death rate in Canada, and how determining cause of death is critical to a having balanced approach against the virus.

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    1. I can’t speak for Canada, but I know that in Northern Italy, the hospitals were overwhelmed and had nothing but Covid-19 patients. People with non-virus related health issues didn’t have a hope of being treated. They literally became collateral damage from a situation in which the virus was allowed to spread unchecked.

      Yes, there are people now, in Australia even, who are putting off health checks and all but the most acute medical care for fear of the virus. I’m one of them. But that’s a /choice/, and it’s based on my fear of spreading the virus to the Offspring. In Italy, there was no choice.

      We talk about the lockdowns and their consequences as if they are worst case scenarios. They’re not. What happened in Italy is a worst case scenario. The UK and the US both thought that they could do better than Italy. Both countries have discovered that they can’t.

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      1. Yes, I understand the lockdown calculation included not overloading the hospital systems that might be needed by other patients. I believe Sweden is also suffering elevated levels of coronavirus after experimenting with different restrictions.

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        1. Yes, both Sweden and Japan appear to be experimenting. Given the age of Japan’s population, the experiment could go horribly wrong.

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  3. Thanks, Matthew. 🙂 I didn’t know that this strategy was called Utilitarianism. To me, ‘The needs of many outweigh those of a few’ has always been the definition of democracy. There are other social contracts, but when you get right down to it, every human being gives up something to be part of a society that protects everyone.

    We’ve never been able to compete against the other predators individually; we simply don’t have the strength, or the teeth of the claws. But in groups, even prehistoric cavemen could take down a mammoth.

    Living within the safety of the group comes at a cost. No such thing as a free lunch.

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    1. I have colleagues in the history field, here in NZ, who have explored the way utilitarianism was applied here during the earlier colonial period. I’d guess it also applied in Australia – I need to look it up to be sure, but I think Lachlan MacQuarie applied it during the 1830s.

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        1. I’m not that au fait with it myself – I looked into elements of Australian history to the extent of understanding NZ history – they were one and the same for a while, and then closely entwined in the colonial period. In point of fact, MacQuarie’s house has been preserved at Parramatta, complete with his piano. I contemplated playing it when on a tour there a few years back. I didn’t, because (a) it’s unplayable – it’s bowed in the middle; and (b) the more historic, famous and rare the instrument is, the more likely I am to use it to play ‘Louie Louie’. (I NEARLY managed to play the commandant’s piano at Port Arthur, during a visit there in 1996. It’s in good condition and apparently they allow people to play it. My wife dissuaded me, when we were there, because she knew I’d do ‘Louie Louie’.)

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          1. lmao! Oh this reminds me of the time I took the Offspring and a little friend we’ll call ‘David’ to Montsalvat, the artist’s colony here in Melbourne. At that time, they had a number of old pianos in one of the public rooms and David proceeded to play Chop Sticks on each and every one of them… 😀

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  4. A decision is not easy, I think flexibility can be a solution. I mean it’s important to do the right thing at the right time.

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