Taking the Lead

I’ve been struggling a bit with what to say about the US’ new position as having the most cumulative cases in the world, as well as a high growth rate. I’m going to start by updating the projection, and then I’m going to say something about how I think we got to this place.

Yesterday I ran the projection based on a 29% growth rate. I’ve reviewed the growth over the past week, and I think that 25% is a more accurate figure for our current rate. The good news is that it’s lower. When I first started these projections, the rate was in the low 30s. So here is the projection from yesterday to April 3rd based on a 25% growth rate.

3/26 76,000
3/28 118,750
3/30 185,547
4/1 289,917
4/3 452,995

I have a real question about whether we have adequate testing capacity to keep up with that growth. The virus grows exponentially, but our testing grows linearly. I think we are approaching the point where reported cases will be an increasingly unreliable metric.

So, how did we get here? Why is the US, a country with immense resources and only one quarter the population of China, the world leader in both cases and growth rate at this stage?

We’re in the realm of speculation and theorizing here. While I’ve tried to be as reasonable as I can in forming my views, they are still just views from a particular perspective. I’m going to avoid calling out particular political actors, though they of course have their effect, and focus on underlying causes.

First, this is a new virus and so it went undetected for a while. It first came to light last December in a group of cases in China. It was growing in China for at least a month before that, perhaps much longer. We. Don’t. Know. It seems likely, or at the very least plausible, that the virus made its way outside of China before it was noticed. Although the first known case in the US was in WA in mid January, the virus was likely circulating before that. A high percentage of cases show little to no symptoms, and during the height of the flu season even symptomatic cases would likely be attributed to influenza rather than a novel virus. So China and the US were likely facing different levels of knowledge about the spread of the virus within their own borders. Different levels of knowledge affect the effectiveness of a response.

Second, if you look at the graph, you’ll note that countries that have most quickly brought the virus to a low growth rate are East Asian. This suggests that there may be cultural differences that impact our ability to implement needed measures.

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For example, societies that place a high value on cooperation and group welfare may fare better than those which place a premium on individualism and independence. I’m not nearly knowledgeable enough to know how this difference plays out in the vast majority of countries. However, the US is noted for valuing individualism and independence. To the extent that I understand the Japanese concept of Wa, it seems that culture may place a much higher value on group welfare and cooperation than we do. I would be interested in seeing some research along this line if anyone knows of such. Along this same line, I would hazard a guess that totalitarian regimes should be able to mount a more effective response should they choose to do so.

This cause comes down to the ability to solve collective action problems – problems which require group action that may go against an individual’s self-interest in order to achieve an acceptable result. The easiest way to solve collective action problems is through strong central control. Totalitarian regimes achieve this through coercion, but some societies weave it into their culture. Interestingly, in the US we value this strong central control in our military, both in terms of coercion and culture, but seem to despise it outside of that context. (By coercion, I simply mean threat of negative consequences. Obey or else!) The broader culture of the US is not good at solving collective action problems. Our instinct is to resist authority and that can get us into trouble.

Third, we have recently heavily favored economic efficiency over resilience. Our business models aim to leverage every aspect to make money as quickly as possible. This is one of the reasons we’ve moved to just-in-time supply chains. A resource sitting in a warehouse isn’t making money, it’s just sitting there. Instead of warehouses, we want goods to be produced and consumed with minimal delay in the chain. The less time lag between production and consumption, the more efficient our economy. The problem is that this model is not resilient. If there is a break in the supply chain at any point, the products don’t make it to the next stage. We saw this in the toilet paper shortages. We’ve tuned our toilet paper supply chain to deliver just the amount of toilet paper people typically want. There’s not a stockpile of toilet paper somewhere; we produce it, ship it, stock it, and sell it just in time. So when demand spikes, there’s not enough supply to meet it. It takes time to increase the supply chain, so there are shortages. If every grocery store had a month’s supply of toilet paper in the stock room, they could have better met the demand surge without shortages. But that’s less efficient. Toilet paper in a stock room isn’t earning any money.

This shows up most ominously in our healthcare system, which is run largely on business principles. Hospitals, for example, keep supplies and resources in quantities that they typically use. Sure, they keep a buffer bigger than a grocery store might, but the goal is generally to minimize that buffer as much as reasonably possible in order to increase the efficient use of funds. A hospital that rarely needs more than 3 ventilators, isn’t going to keep 30 in a room somewhere. That room costs money and so do the ventilators. The supplier only produces the number of ventilators it usually sells. Storing some, or maintaining unused production capacity, costs money, it’s inefficient. The story of recessions in my life is, I think, really a story of times when we let our desire for efficiency get ahead of our need for resiliency. We occasionally regulate some businesses to make them more resilient, banks are a good example. But over time we notice that those businesses could be more efficient, so we relax the regulations. Then something happens that requires resilience and bam, it’s far worse than it might have been.

Anyway, those are my thoughts today, thanks for reading.

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