There are times when I wonder if there are people reading this blog and quietly being influenced by it. In his Washington Post column Josh Rogin muses over the possibility, supported by former CDC director Robert Redfield, that SARS-CoV-2 was accidentally released from the Wuhan Institute of Virology. Here’s the conclusion of his column:

Flinders University medical professor Nikolai Petrovsky, one of more than two dozen scientists, including Ebright, who signed an open letter calling for a full and independent investigation into covid-19’s origins, told me the Chinese government now realizes it can’t prevent a real investigation into the Wuhan labs and therefore is calling for all such labs worldwide to be investigated. And that, he says, is actually a great idea.

“I agree this is entirely appropriate, although clearly most of the immediate focus would need to be on the Wuhan labs, given their geography and the work they were doing,” he said.

If Redfield is right, that would mean China bears some accountability for the outbreak, which will greatly complicate already tense relations. If Redfield is right, that would also mean the U.S. government had a big role in supporting the research that resulted in the pandemic outbreak. If Redfield is right, the current response plan could greatly increase, not reduce, the risk of another pandemic.

These are all very unpleasant facts. But facts are stubborn things. And we have no choice but to pursue all possible theories and accept whatever truth the facts lead to. This must be done in a nonpolitical way, to show Beijing and the world that we still have the ability to place public health and truth above the narratives to which we have become beholden.

Just to be crystal clear in what I think we should be doing, I believe that

• We should assume that SARS-CoV-2 did originate at the WIV.
• Until that can be disproven conclusively we should greatly reduce travel to and from China.
• We should quarantine all travelers from China or who have visited China recently for at least two weeks before allowing them entry into the U. S.
• We should greatly reduce our trade with China.

I wouldn’t be upset at all if China reciprocated. In fact, I’d welcome it.

There’s an interesting post at Axios by Jonathan Swan, analyzing the data on Hispanic voters from the 2020 presidential election:

A new analysis of U.S. voters suggests — counterintuitively — that the coronavirus pandemic may have helped drive former President Donald Trump’s surprising increase in support from Latinos last November.

The short version is

• Trump received a sharp increase in votes from Hispanics compared with 2016.
• That increase wasn’t limited to Cuban-Americans but true of Hispanic voters generally.
• “YouTube has become a leading source of election news for Latinos”

which tends to support points I’ve made around here. Hispanics are not single-issue voters. They are frequently not as supportive of activist government as Democratic voters, generally. Like black voters they tend to be more conservative than Democratic voters, generally.

I tend to believe that “Hispanic voters” itself is an over-generalization. I think that one may reasonably consider Cuban-American voters, Mexican-American voters, Salvadoran-American voters but that “Hispanic voters” conceals more than it reveals.

Here’s the kernel of Sadanand Dhume’s Wall Street Journal column:

China’s authoritarian system of government, economic heft and technological prowess make it the foremost challenger to the U.S.-led international order that has underwritten global peace and prosperity for more than seven decades. At the same time, Asian-Americans and Pacific Islanders—some 19.3 million strong according to the Census Bureau—are America’s fastest-growing demographic group. Those who call on the U.S. to drop its criticism of China for the supposed well-being of Asian-Americans are asking Washington to enter a geopolitical boxing ring with one arm tied behind its back.

and here’s his conclusion:

In the end, America has no choice but to grapple with the threat of an authoritarian and increasingly belligerent China. But the best way to strengthen the country domestically is to reject both white supremacy and “wokeism” by striving toward a society that is race-blind, not race-obsessed.

In a country of 330 million people and growing there will always be enough evidence to support your case for practically anything. And stoking racial animosity is such a lucrative grift I expect it to continue for the foreseeable future.

The editors of the Wall Street Journal are again a bit more pointed in their criticism of the Biden Administration’s “infrastructure plan”:

Most Americans think of infrastructure as roads, highways, bridges and other traditional public works. That’s why it polls well, and every President has supported more of it.

Yet this accounts for a mere $115 billion of Mr. Biden’s proposal. There’s another $25 billion for airports and $17 billion for ports and waterways that also fill a public purpose. The rest of the $620 billion earmarked for “transportation” are subsidies for green energy and payouts to unions for the jobs his climate regulation will kill. This is really a plan to build government back bigger than it has ever been.

They go on to detail it out and conclude:

Note the political irony of all this. Mr. Biden says “public investment” has fallen as a share of the economy since the 1960s, and he has a point. But the main reason is that government spending on social welfare, entitlements and public unions have squeezed out public works. Now he’s redefining social welfare as public works to drive more social-welfare spending, which will further crowd out money for public works and government R&D to compete against China.

As usual, Mr. Biden professes to want to make this bill “bipartisan,” but also as usual he let Democrats on Capitol Hill write his plan. That explains its money-for-everybody-and-everything character. Along with his gigantic tax increases (see nearby), Mr. Biden has proven to be the perfect political front for the Warren-Sanders agenda.

I’ll point out a couple of other things I’ve reminded you of before. The first is that the ARRA was popular, too, until people began to figure out how the money was actually being used. Approval for an infrastructure plan in principle and approval for an actual plan are two different things.

The second is that when you have an “infrastructure plan” you’ll get “infrastructure” not infrastructure in the sense of an investment that will expand productive capacity. Consumption is consumption not investment. As the editors of the Washington Post pointed out when it comes to investment the private sector does a better job. Calling consumption investment doesn’t make it investment. It reminds me of what Lincoln said about the horse.

BTW I would wholeheartedly support an infrastructure plan that spent $150 billion on electrical grid redundancy and load expansion and stopped there and I wouldn’t be surprised if you couldn’t get real bipartisan support for such a plan.

The topic that I began the last post with the intention of discussing but somehow couldn’t manage to weave in is the question of how do you ensure probity in a $2 trillion program? How much money wasted is too much? One potential recent place to look is the PPP. Maybe its problems are attributable to the incompetent Trump Administration but, since every recent largescale government program implemented recently has suffered from similar defects, I think we need to at least consider the possibility that the Biden Administration’s “infrastructure plan” will suffer from some of the same defects.

First, how big a problem are we talking about here? As Ev Dirksen put it, a billion here and a billion there and pretty soon you’re talking about real money. Some observations from the Tax Policy Center might be a good place to start:

An October report by the House Select Subcommittee on the Coronavirus Crisis noted that over 20,000 loans, amounting to $4 billion, were potentially subject to fraud, waste, or abuse. The Department of Justice is currently investigating and charging those who engaged in PPP fraud. These cases comprise a small share of the total number of loans made, but they do raise questions about the tradeoffs of moving fast without sufficient due diligence, and whether a more targeted program in the first round would have been more equitable.

We can be pretty confident that 1% of the total was “waste, fraud, or abuse” but the honest truth is that we don’t really know and probably won’t ever know. Let’s pick an upper boundary at random, say, 10% of the total. In the case of the proposed “infrastructure plan” that would mean anything between $20 billion and $200 billion. Compared with the federal budget or the national debt that’s not an enormous amount of money but it’s not chickenfeed, either.

Ignore the boilerplate about job creation. It won’t create jobs any more than the ARRA did and for the same reasons. It will necessarily be administered through the states; bidding will be restricted to a handful of “qualified vendors” and those vendors simply don’t do that. By and large they’re large companies (think: Bechtel) and politically connected and rather than staffing up they’ll schedule the projects in such a way they don’t need to staff up or procure equipment.

Speaking of administering the plan through the states, if there’s a way to prevent the states from using portions of the money to increase the pay of public employees or pay the pensions of retired public employees, it’s unclear to me what that might be. I don’t even consider that under the category of “waste, fraud, and abuse” but more along the lines of carrying costs, like paying off public officials in Third World countries. We don’t do that here but we have other ways of accomplishing the same thing. As the late Dan Rostenkowsi put it, don’t take a bribe just hand ’em your business card.

My best advice for ensuring the honesty, decency, and equitability of disbursing such large amounts of money is basically three-fold:

• Don’t do anything that’s “shovel-ready’. Those projects have already been funded. Funding them through a federal “infrastructure plan” will allow those funds to be used for other purposes which will accomplish very little of the presumed objective.
• Focus on market failures. Things like grid redundancy or greatly expanded capacity or better sewer systems. Anything the private sector just won’t do. A few years ago I would have said rural broadband but it looks like Elon Musk has that one well in hand.
• Lots of federal oversight with measurable performance criteria and clawbacks for non-performance.
• Concentrate the spending in poorer counties or in poor sections of more prosperous counties.

I’m open to other ideas IMO it’s genuinely a tough nut.

The editors of the Washington Post remark on the Biden Administration’s “infrastructure plan”:

PRESIDENT BIDEN bills his eight-year, $2 trillion American Jobs Plan as an “infrastructure” proposal, but its notion of infrastructure encompasses far more than the traditional definition of that term. Along with $621 billion for highways, bridges, water systems, ports and the like, the bill would provide $400 billion for the “care economy” — home- and community-based services for the disabled and elderly — and $50 billion to subsidize semiconductor manufacturing. And the list goes on, to be paid for over 15 years by significantly higher taxes on U.S. corporations. Mr. Biden’s plan represents an unapologetic commitment to a bigger federal government, with bigger responsibilities, for the foreseeable future.

concluding:

The caveat — and it’s a significant one — is that there is a reason Mr. Biden’s predecessor Bill Clinton once felt constrained to declare “the era of big government is over.” And that is that the public grew disenchanted with Democratic policies of the 1960s and 1970s, sometimes justifiably. The enduring lesson from that experience is that government should do more — of what it does best. Government has a comparative advantage in providing public goods — education, training, roads, ports, basic research — which indeed figure largely in Mr. Biden’s plan. When it comes to allocating investment capital, however — picking winners among alternative industries, companies, technologies and locations — the private sector ordinarily performs better.

At its heart, Mr. Biden’s plan shifts hundreds of billions of dollars from the private sector to the public sector on the theory that the latter can put them to better use than the former. It’s a bold and potentially historic move whose results could shape the country’s future, political and economic, for generations.

There’s so much there to comment on it’s hard to know where to start. “Public good” does not mean “a good for the public” or “good for the public”. It is a term of art in economics meaning a good that is non-rivalrous (my using it does not conflict with your using it) and non-excludable (you can’t be prevented from using it or benefiting from it). Going to college is a private good; an educated workforce is a public good. A road is a private good; a transportation network is a public good. Healthcare is a private good; a sanitary sewer system is a public good. National defense is a public good; so are legal systems and fire departments.

I agree with them that government should focus on public goods. A good guide for that is the U. S. Constitution in which the responsibilities of the federal government enumerated are overwhelmingly public goods. Most of what they list as public goods are in fact private goods. Defense, the judicial system, a sound currency. You will search in vain for healthcare, education, or housing. The “general welfare” is cited with an understanding lacking today. General welfare is not the same as individual benefit.

Believing that the government is able to make better use of resources places you in the ranks of science deniers. There is copious research illustrating that government’s substituting its own judgment for private judgments on how resources should be allocated results in less overall benefit than would otherwise be the case. Not too many years ago a Nobel prize was awarded for just such research. That’s what I’m talking about when I harp on deadweight loss. There are occasions when there is no other choice—that’s what’s meant by a “market failure”.

What I think we’re seeing emerge is an unholy chimera of what I’ve called “folk Keynesianism” with what I’ve called “folk Modern Monetary theory (MMT)”. Keynesianism does not claim that all government spending will stimulate the economy. MMT does not claim that a monetary sovereign can issue itself credit indefinitely with impunity. But those are precisely the beliefs of their folk variants and they’re wrong, disastrously wrong. What is missing from the folk variants is any notion of expanding aggregate product and that’s where our grave economic problem is today.

One more observation. When you enact an infrastructure plan you get more or improved infrastructure. When you enact an “infrastructure plan” you get more “infrastructure”. That’s what we should be afraid of.

At RealClearPolitics Bill Briggs argues that the Payroll Protection Program worked:

But did the Paycheck Protection Program deliver on its promise? The evidence reveals that it did — and in more ways than most realize.

As the economy shut down a year ago, there were dire warnings of unemployment rates exceeding 20%, perhaps even 30%. Department of Labor data from March 2020 to April 2020 shows unemployment quickly surging from 4.4% to a COVID-era peak of 14.8% before steadily receding over subsequent months.

[…]

Any clear-eyed assessment of these efforts would recognize that the program wasn’t perfect, as no government program that had to be set up in under a week and distribute over $700 billion could be. However, recent academic studies have suggested that the program was inefficient, even unnecessary. However, much of that snapshot analysis examined just the past year.

Here’s another scenario to consider: As noted above, DOL data reveals that PPP and other measures stemmed economic freefall. Economists and other experts didn’t consider how these programs prevented “deaths of despair” over a longer time horizon. Such horrific events have many contributing factors, but job loss and economic dislocation are all too often the trigger.

Some studies suggest that the opioid epidemic accelerated on the heels of the Great Recession. Humans innately understand how economic hardship can lead to despair: a person loses their job along with their employer-supported health care, then eventually gets hurt or sick, is unable to access proper care, and ultimately becomes addicted to deadly opioids in just a few short years.

The true value and lasting legacies of PPP and other COVID relief programs will rest on their mitigation of both economic and human tolls over time.

It’ll only become clearer over time that the Paycheck Protection Program averted mass unemployment and restored calm to both labor and small business markets while balancing the need for nationwide social distancing. These measures prevented a death toll with a longer tail that could have amounted to millions more deaths over several years.

I have no strongly held views of the efficacy of the PPP one way or another but I would say he’s arguing the wrong thing. We should be doing a cost-benefit analysis rather than just a benefit analysis and I honestly don’t know how the program would fare under such scrutiny. I do know that there was a substantial amount of fraud involved in the disbursement of funds, some intentional, some not.

I also think that we should avoid what I think of as “the masterstroke phenomenon”. While a PPP that operated over an even shorter period might have been worthwhile, it’s equally possible that the desire to solve the problem with a single “masterstroke” may have increased the costs while reducing the effectiveness of the program.

As Mr. Briggs suggest, I think the PPP should be assessed with clear eyes and that means considering other alternatives and reckoning the costs while tallying the benefits.

In an op-ed in the Wall Street Journal Yochai Re-em responds, presumably to the same op-ed I commented on last week:

The lack of a positive Covid test doesn’t mean a patient never had Covid or doesn’t have long Covid. There is significant research both establishing the presence of prolonged Covid symptoms and laying out possible explanations for these symptoms. A literature review published this month in Nature Medicine, a leading scientific journal, posits that organ damage from infection, immune issues and inflammation can partly explain long Covid. These explanations are supported by the data significantly better than the psychosocial argument.

Medicine has been burned in the past by misattributing physical symptoms to psychological issues. Think of lobotomies used to treat ulcerative colitis and Freud’s attribution of physical symptoms to repressed thoughts. That some repressed thoughts can be transformed to physical symptoms doesn’t mean that all unexplained physical symptoms are caused by psychological processes.

Many healthcare providers seem to assume a psychological link when traditional medical work-ups don’t turn up an immediate cause. That medicine doesn’t have all the answers seems too readily forgotten in favor of a simple explanation: “It’s all in your head.” We know that medical science is always evolving. So why is the default approach doubting patients instead of believing them?

I think I can provide one answer to his concluding question although certainly not the only one. Blaming the patient obviates the physician from the unpleasant chore of confessing the limitations of his or her and, indeed, the entire profession’s knowledge.

I think that some of the long-term effects are, indeed, psychological in origin but probably not all of them.

IMO the editors of the Washington Post exhibit a serious lack of understanding in their remarks about the need to know the origins of SARS-CoV-2:

THE WORLD HEALTH ORGANIZATION joint investigation with China into the origins of the coronavirus looked into a dark chasm and saw darkness. The report offers theories about pathways of a zoonotic spillover from animals to people, but not a single animal source among thousands has tested positive with SARS-CoV-2. The investigators did not conduct a forensic probe into the possibility of a laboratory leak. The origins of the pandemic remain obscure. Finding the answer is as important and elusive as ever.

with the remarkably tone deaf conclusion:

China has a responsibility to open its doors. This is not a blame game, but an essential investigation into the cause of this pandemic to make another one less likely.

At this point there is no way to separate “an essential investigation” from a “blame game”. The Chinese authorities have staked their collective reputation on the virus having originated anywhere but China so they will naturally leap onto any explanation which would support that supposition. Frozen food. Some as yet untested animal species. Anything regardless of lack of evidence.

I think that ultimately we’ll need just to accept that we’ll never have iron-clad evidence for how or when the virus originated but, given the very large number of animals that have been tested without finding any results, we should formulate our policy responses as though the virus was spread from an accidental leak from the WIV. What sort of policies would would that imply? I would suggest at the very least we should impose an absolute ban on U. S. government funding on virological research in China for the foreseeable future.

Update

The editors of the Wall Street Journal are more pointed in their conclusions:

The U.S. and 13 other governments released a statement Tuesday expressing “shared concerns” that the WHO study “was significantly delayed and lacked access to complete, original data and samples.” That’s nice, but it sounds like they’re prepared to conclude that Covid’s origin story is unknowable and move on.

That shouldn’t be the end of it. The Biden Administration knows the underlying intelligence and should release it to the public. Unless it does, China’s propaganda backed by the WHO’s failure will prevail in much of world opinion. The Biden Administration says it wants to revitalize multilateral institutions, and that should start with refusing to accept the WHO’s Wuhan whitewash.

That, too, is nice but IMO we should be prepared to proceed, armed with the realization that we’ll never know the real story.