Corona virus

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The distance between the Prime Minister and the President

So the PM, the Health Secretary and the Chief Medical officer are confined to quarters. We do not know whether they practiced what they preached when off-screen, however,  what this does demonstrate is that if you continue working the chance of avoiding infection is low. The multiple infections are perhaps not surprising amongst a group of people who have had to work intensively and closely together for some time however it is unfortunate in terms of the governments messaging.

To date I think I would give the Prime Minister 7 out of 10 for his handling of the Covid-19 crisis. Due account has to be given to the sheer scale and multi-dimensional nature of the problem and the speed at which it has evolved. It is one thing to hear descriptions of the spread and see graphs it is another to live it. On the positive side, he has taken the issue seriously and, has deferred to the science or at the very least taken serious account of it. He has “pivoted” when necessary, albeit a touch abruptly.

Overall I think, from the distance of the North, he has done as good or bad a job as many of the other West European leaders have. The leaders of countries in the East, like South Korea and Japan have had much more recent experience of what a national epidemic can do and might have been expected to be better prepared both logistically and mentally to respond with more appropriate alacrity and concern.

There are of course questions to be asked. The timing of lockdown looked more a like a response to mounting political and external scientific pressure than the next step in a carefully crafted, strategic timeline. It would be interesting to see what mortality rates were attached to the herd immunity strategy which was disavowed as soon as the Imperial College Report was in the public domain.

Communication has been and continues to be a problem. The daily press briefing, meant to reassure the public by demonstrating a transparent approach to keeping the nation informed, was a good idea. Its very existence communicated a sense of urgency. The professional and business like way they were conducted and the presence of subject experts transmitted seriousness but also reassuring competence. Unfortunately the message was not clear enough.

This may have been that the strategy was evolving from mitigation to suppression however the social distancing message was just not strong enough. Details about what it involved keeping 2 meters apart, staying at home etc. was undermined by a failure to communicate the need for rigid adherence. The Prime Minister talking about continuing to shake hands and hoping to visit his mother on mothers day weakening and confusing the message.

As the potentially catastrophic consequences of the disease began to sink in, driven it would seem by the Imperial College Report the Prime Minister stiill appeared to be struggling with either his libertarian instincts, his concern for the economic consequences or fear that stricter controls would be ignored. He started out by “asking”,  then moved to “telling”, but then in very short order he moved to  “instructing” as emergency legislation was put in place. It may be argued that the language followed the legislation or that it was part of a strategy to take the population on a journey, however, a pandemic is not a time to be “nudging” people. It is a time for decisiveness and clear, consistent, simple messages. Days mattered.

Unfortunately as time has gone by the communication strategy has become more problematic. If you start out claiming you want to be transparent and that you are following the science you set yourself up to fail if you start to obfuscate. As the media have asked increasingly specific questions about, how many ITU bed spaces are available – now, how many ventilators the NHS have – now, and where the PEP is – now, the vagueness of the answers has become a source of concern and, for front line staff, anger.

Nadhim Zahawi, Minister for Business and Industry, was writhing like a fish on a line when being pushed to provide detailed figures on this and dates when more of all of these items would be available. It looked as if at one point he would crack and shout out, “You can’t handle the truth.” He would have been wrong. People prefer truth, however unpalatable, to obviously untrue platitudes about “ramping up”.

It is obvious to all that the requirement for rigid social distancing is absolutely critical and that anything less will mean the NHS is overwhelmed. It does not have the equipment or staff it would need to address anything other than a limited spread of the virus. False reassurance will come back to bite when reality tragically contradicts it as the infection rate accelerates and peaks.

Having said all this, I still hold to my 7 out of 10 for the Prime Minister. He may not have acted as decisively and early as he should  to implement rigid social distancing and he may not have been clear enough in the initial messaging, however, he appears to be someone doing the best he can in a fast moving crisis. He remains courteous to the media, even in the face of difficult questioning, he respects the views of the scientific advisors and at least seems to understand what it is, and he is trying to communicate that medical advice to the public.

By comparison,… a picture is worth a thousand words, and here are two.

However effectively implemented by the PM and his team there is a real attempt to communicate the social distancing message.

If you watch the two briefings the contrast could not be greater. In the US version, depicted here, three advisors stood like lemons on the stage of the press briefing  room waiting for the President. There was an awkward, nay embarrassing silence. Eventually, presumably when the time had built up enough tension for a grand entrance, the President appeared.

There was then a rambling, incoherent presentation by the President, talking mainly about what a terrific job his administration and he personally was doing. His one strength is consistency, whenever he speaks he is saying something which is either a lie or stupid or both. Firing on all four cylinders he managed the double on most of what he had to say.

His overriding concern to ensure re-election tempered his concerns for the thousands who may die from this virus. His view is that we must ensure the “cure is not worse than the disease”. He talked about the 50k people who die each year from flu and those involved in road traffic accidents to reassure the American people he had their welfare at heart.

He probably struggles with numbers (other than $ bills) but if the US do not get a grip on Covid-19 the fatalities could be in the hundreds of thousands not, the clearly more acceptable to the President, tens of thousands. From the start the President has treated Covid-19 as an annoying distraction from the main business of getting reelected for another four years of self aggrandisement and national corruption. Variously he has referred to Covid-19 as a “hoax”, the “Chinese virus”, only affecting 15 Americans, something where the “cure cannot be worse than the virus”, and which is likely to be pretty much over “by Easter”.

I had been thinking a suitable sobriquet for President Trump might be, “The President that Broke America.” Sadly, if the individual States don’t save him and their citizens I think a more appropriate one may be, “The President that Killed America.” At least the distance between him and the Prime Minister is reassuringly large.

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Covid-19 & Imperial College Report

The government’s pivot from a strategy of mitigation to a strategy of suppression this week was caused by the work of the MRC Centre for Global Infectious Diseases analysis led by Prof Neil Ferguson. The report in question is the Centre’s 9th report on Covid-19. Twenty pages long there is some very impressive statistical analysis but the argument and the conclusions are clear for any lay reader.


It considers the pros and cons of both mitigation and suppression strategies for dealing with Covid-19. Spoiler alert, it comes down very much on the side of suppression given the likely level of deaths of the mitigation strategy, 250k. In essence this is mainly due to the health system being overwhelmed before any benefits of herd immunity begin to appear.


I recommend anyone not yet convinced of the need to take seriously the advice of the government on radical social distancing to read the report. Specifically I suggest you contemplate Figure 3 from the report shown below.

The key thing to look at here is the red line at the bottom of graph (A), as expanded in the lower graph (B). This is the critical care bed capacity in the system.  The black, green and orange lines are what happens given different social distancing responses. Black is that colour for a reason. If we do nothing then the NHS will be overwhelmed with cases and have nowhere near the capacity to meet demand. This will therefore mean some 250k+ Corona virus patient deaths. I am not sure  whether this addresses collateral damage ie. those patients that ordinarily need a critical care bed but will not be able to get one because they are full of Covid-19 patients.

The orange and green lines show differing levels of social distancing. We have moved from being “advised” to being “told” by the PM that we should move to what the green line requires. I suspect the next step will be “instruction” backed with sanctions.

The aggressive suppression strategy clearly manages to keep the cases of corona virus requiring critical care within the capability of the system. However, it does assume the social distancing measures last until September, a touch longer than the PM’s optimistic timeframe. 

The down side of the suppression strategy is that it slows/prevents herd immunity and thus when the measures are relaxed the virus takes off again. Does, therefore, suppression simply delay the inevitable? No. Critically what suppression does is buy us precious time. Time to build critical care capacity: beds; staff; PPE; ventilators etc. Time to build testing capacity both in terms of scale but also the ability to test for those that have had the virus and are well. Finally, time to identify a vaccine, although this is clearly many months away at best.

The strategy seems to be the “Hammer and Dance” one set out by Tomas Pueyo’s in his article, referenced in my last post. This involves Hammering the virus with aggressive social distancing. The aim being to get the infection rate from something like 2.4 persons to 1 or below. In other words  the number of people an infected person passes the virus on to falls from 2.4 to 1.

Then infections will start to reduce and the Dance begins as critical care facilities gain capacity social distancing restrictions can be relaxed. As soon as the rate of infections start to build again the restrictions need to be reapplied, however, by then it may be possible to target them more effectively through the use of much more wide spread testing. A touch of 2 steps forward and one back. Or perhaps more like  like the fair ground game “Whack a Mole” where moles pop up in random places and you have to whack them back down.

If you want to get a reasonably good picture of the likely evolution of the disease and the key factors driving its spread the Imperial College Report is well worth a read.

Stay safe 

 

 

 

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Covid-19 “Another day another $300bn.”

The Chancellors announcement of a £300bn support package for business to address the impact of the Corona Virus epidemic should ring loud alarm bells. When this is presented as a starter for ten then you know we are in trouble. A Tory government, lately of austerity fame, has discovered the money tree, in fact has found a forest of them.

There are two things that make the current situation stand out. Firstly, daily briefings from the PM setting out the state of play with the spread of the virus and the actions the government is taking to address its health, social and economic consequences.

Secondly, the scale of resources being talked about which, outside of war time, are unprecedented.

Given all this it seems strange that the government seems loath to move from an exhortatory strategy of mitigation, please do not go to the pub, to a much more aggressive strategy of suppression by shutting the pubs. At the moment there seems to be a dissonance between on the one hand the rhetoric about the seriousness of the situation and  importance of social distancing actions and on the other hand the advisory nature of the steps to achieve the appropriate social distancing.

In the PM’s press conference yesterday the public were thanked for the way they were following the advice. Perhaps if your only experience is the drive from 10 Downing Street to Parliament you may be impressed by how quiet the Capital is. However, you do not have to go far to see reduced but brisk trade in bars, pubs and restaurants.

Maybe there is some legal impediment to his issuing closure notices to Britains hospitality industry. Maybe that will be corrected next week when the Corona Virus Bill is enacted. This contains a whole range of enabling powers to: allow the health work force to be expanded; the effective management of the disposal of bodies; and the power to regulate the access to premises.

Given the speed of the current virus, if there was ever a case for acting now and legislating later this is it. Or indeed, getting Parliament to sit over the weekend to put the legislation in place if that is what is needed.The legislation could have a 6 month sunset clause to enable Parliament to review, amend and improve in the light of experience. Days matter.

My concern on this is driven partly, but far from wholly, by the article I referenced in my last post on this by Tomas Pueyo entitled: “Coronavirus: why you must act now“. It made a strong argument for urgent action.  Mr Pueyo has written a follow up article, (Coronavirus The hammer and the Dance) on the importance of early adoption of an aggressive suppression strategy as opposed to a mitigation strategy.

Ordinarily CEO’s of $billion businesses are not my favourite source of information. However, the logic of Mr Pueyo’s argument seems reasonable and the numbers he quotes are consistent with information from other public sources. Further, his logic is certainly no weaker than that which says – it is vitally important that you don’t go to pubs, but we are not going to force them to close. The latter message undermines the former.

Whilst Mr Pueyo’s articles are at best sobering the latter one provides some hope about the period of social isolation we might face.

If these articles are wrong in their estimation of what strategy the government needs to be pursuing and when, they at least provide a framework of questions which seem to me to be very relevant. If you are interested in a very accessible introduction to the epidemiological issues around Corona Virus,  then these articles are the best I have seen so far.

But, to be clear, my concern about the current situation is not based on a single article however well illustrated with graphs. In the past we have heard about Ebola, SARS and MERS as things that happen over there, to other people, far away. This is here and now. We can see what it has done to those that have gone before us. Italy is a peacetime war zone with the health system all but overwhelmed. What all the experience to date points to is the urgency of action and the cost of delay.

We are told we are about three weeks behind Italy and that we have a finely graduated response which will minimise the impact on our social end economic lives. I am sure there are some very clever people looking at this with some very sophisticated models. However, if ever there was a time for the adoption of the precautionary principle this is it.

The advisory position at the moment is logically lockdown. Businesses are closing left, right and centre. Serious economic damage has been done. But lock down is not complete. People think if the pub is open why can’t I go?

If lock down would get us on top of this virus why would we not enforce it now. If, they manage to calibrate the perfect flight path we may save some economic and social dislocation and some lives. If they act too early it could cost us more social and economic dislocation. but save more lives. If they are just too late, the consequences are much worse. The economic and social loss will be greater than either of the two other options. But, more critically, we will face an overwhelmed NHS, thousands of deaths and scenes which will live with people for the rest of their lives. 

I think I am in the camp of those who feel the government needs to act now to aggressively suppress the virus with all that goes with that.

Be Safe.

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Cash – COVID-19 Virus

“Turnover is vanity, profit is sanity, but cash is reality”.

There are plenty of unprofitable businesses in the world some with very high turnovers, but there are none without cash. Some businesses have mountains of cash like Apple and Amazon, tucked away in low tax regimes. Obviously they are “smart” businesses avoiding paying taxes to states that waste the money on things like universal healthcare. I wonder if all those tax dodgers are immune to COVID-19?

However I digress. In the last budget, that was six days ago when the world was a different place, the Chancellor announced a £12bn package of measures to support business. This morning on the Today Programme that amount was dismissed as a rounding error for the scale of support needed.

The need is not for tax relief next month  it is for cash, today or tomorrow. The reason for this is that so many businesses in the hospitality industry operate on very tight cash margins. Once day to day operating costs are covered the money coming into the business during a month provides the cash to pay for the salaries and the tax bills at the end of the month, and if you are lucky an element of profit. If halfway through the month, say on the 16th, the Prime Minister tells all your customers they should not go into your pub, restaurant, hotel, theatre etc then it is very likely by the end of the month you will not be able to pay your salary or tax bill.

HMRC can be as understanding about late payment of tax as they want, staff will either sue for their wages, or walk out, or both. In any of those scenario’s its game over for the business.

This is what will happen to hundred of businesses around the country and thousands of staff, possibly millions as it is clear other industry sectors are beset by the same basic cash problem. The scale of the problem is enormous.

Providing cash to keep businesses afloat when there are no customers, for one, two or six months is a mind boggling number. So big it may be dismissed out of hand. But then on the other hand the alternatives are not great.

Firstly, there is a logistical problem. In the space of a couple of weeks hundreds of thousands could be being made unemployed. The DWP are wrestling with Universal Credit, and losing. They will be overwhelmed with demand for from new claimants. The transfer payment bill will go through the roof.

Although the social security bill will balloon, as people move from low wages of circa £300 per week (most hospitality workers are on minimum wage) to unemployment benefit of around £70 per week the impact on demand in the economy will be immense. Causing other businesses to contract or collapse creating a vicious circle of decline, further reducing tax revenues and further increasing transfer costs.

The level of discontent this will generate in a population restricted to their homes does not bare thinking about.

COVID-19 is not just infecting people it is infecting the economy. More specifically it is attacking cash, the life blood of all current economic life. The only way to insulate against this is an enormous transfusion of  new cash into the economy. As Jim O’Neil suggested on the Today Programme we need Quantitative Easing for people. Others have called it helicopter money, after the notion that you empty sacks of money out of helicopters. The idea being to put effective demand into the hands of consumers, the vast majority of whom will spend all of it and thus stimulate the economy.

There are some very radical proposals kicking around at the moment. If people thought the last budget was a radical spend budget for a Tory government, they ain’t seen nothing yet.

(Declaration of interest – The writer part owns a small restaurant)