The editors of the Chicago Tribune have noticed that Gov. Pritzker and his pals in Illinois’s legislature are not letting the present crisis go to waste and are proceeding to beg for a bailout from the federal government using COVID-19 as a pretext:

It is not surprising an Illinois politician finally put in writing what economists and financial watchdogs have been warning for years: That elected officials who failed to take seriously decades of fiscal warning bells in this state eventually would seek a bailout from the federal government.

What is beyond galling is using the coronavirus as an excuse. But that’s what Illinois Senate President Don Harmon, D-Oak Park, did last week in a letter circulated among Illinois’ congressional delegation and obtained by The New York Times. Harmon requested more than $41.6 billion in bailout aid as part of the next coronavirus relief package, including $10 billion for Illinois pensions, due to economic collapse from the virus.

Even by this state’s low standards, asking federal taxpayers from California to North Carolina, from North Dakota to Texas — farmers, small business owners, teachers, nurses, bus drivers, bartenders — to help dig Illinois out of its pre-coronavirus, self-inflicted, financial hellhole is astonishingly brazen. Every member of Congress should carefully scrutinize pleas from states whose unbalanced budgets, embarrassing credit ratings and vastly underfunded pension systems predated virus outbreak.

“I realize I’ve asked for a lot, but this is an unprecedented situation, and we face the reality that there likely will be additional, unanticipated costs that could result in future requests for assistance,” Harmon, who has been in office since 2003, wrote in the letter.

SARS-CoV-2 did not create a fiscal crisis in Illinois. Illinois was already in the midst of a fiscal crisis before the virus existed. Illinois has the lowest credit rating of any state in the Union—teetering on the verge of junk status which would render the state unable to borrow at all. Its population is shrinking faster than any other state. Its tax base is eroding. Housing values in the city of Chicago have not recovered the values they had in 2006 and there is little prospect of their doing so. That has not stopped property taxes from rising. Property taxes are reaching confiscatory levels. Chicago’s retail sales tax is already the highest of any major city. City fees have risen just about as high as they can.

Under the circumstances asking for a bailout from the federal government is not merely brazen it is ghoulish. It is asking people suffering more greatly than we are from COVID-19 to bear the costs of decades of Illinois’s politicians’ misfeasance, nonfeasance, and malfeasance.

Illinois’s request should be rejected out of hand. The only conditions under which Illinois should receive money from the federal government are in exchange for some serious terms. There are many, many compelling reasons for that not the least of which is moral hazard.

I have read several proposals for such terms. Everything I have read so far punishes the innocent right along with the guilty while rewarding the guilty, will accomplish the opposite of what I presume their authors’ intent to be, or both.

For example, demanding that Illinois be split into two state—downstate and the Chicago environs—would actually reward Illinois’s incompetent political class while ruining downstate Illinois. The erstwhile Illinois would be given two additional senators along with a stack of cash. Converting the erstwhile Illinois to a territory and taking it into a sort of receivership would disenfranchise those who’ve been voting against Illinois’s prodigality right along with those who voted for it.

Here’s my modest proposal.

• Illinois’s state constitution should be amended to allow the state’s legislature to renegotiate pension agreements of state public employees.
• The state’s constitution should be amended to ban defined benefit pensions from being paid to any present state employee.
• Its constitution should be amended to prohibit paying any form of pension to elected officials, present or past.
• Its constitution should be amended to prohibit public employees’ unions in the state from lobbying officials or striking for pay.
• Its constitution should be amended to bar any present holder of statewide office or member of the state legislature from seeking re-election or holding statewide office or serving in its legislature in the future. That is similar to the provisions of the 14th Amendment and is completely appropriate under the circumstances.
• State payrolls should be cut until the state is in sound fiscal shape.
• A freeze on state taxes for at least five years.
• If, after five years of belt-tightening, the state continues to be unable to come into sound fiscal shape, only then will it be able to seek additional revenue via a gradated income tax.

In his latest Wall Street Journal column Walter Russell Mead ruminates over something I’ve touched on now and again since January—the plight of the poor countries of the world, most in the “Global South”. Maybe SARS-CoV-2 will be less contagious there due to their climates or may it won’t be as virulent. Dr. Mead remarks on the “lockdown” strategy:

Take the “lockdown” strategy. The purpose of this extremely costly policy is to “flatten the curve,” by shutting down much of the economy to ensure that health systems aren’t overwhelmed by waves of desperately ill patients.

In much of the world, this strategy is impossible. Only rich countries and rich peoples can afford lockdowns. In much of the Global South a substantial percentage of the population lives from hand to mouth. Many people make money selling things on the street or in crowded informal markets. They draw their water from communal taps; they use community latrines, if they have sanitation at all. Hundreds of millions do not have reliable access to clean water, much less to soap or hand sanitizer. After a few days without work, hunger will drive people back out onto the streets.

Even if lockdowns could be sustained, they would do little good. There are five ventilators in the Democratic Republic of Congo, one for about 20 million people. Ten African countries have no ventilators at all. Even if the disease’s spread could be slowed, medical capacity in the Global South is so lacking that there’s no chance it could be built up in time to help. The most stringent lockdown could not prevent a massive public-health crisis in many countries, and no such lockdown can endure.

He goes on to touch on some of the tactics that have been bandied about for helping them, e.g. foreign aid, gifts of medical and protective equipment, and so on. Those are more likely to help rich people in poor countries than they are the poor themselves.

There are basically two things that we can do to help the poor people of the world and those are to end our own agricultural subsidies which confer competitive advantages on our farmers compared with theirs and to reopen the U. S. economy with all due speed. The American consumer who is a prisoner in his own house and whose stores are all closed cannot pull the world economy out of the ditch into which it is heading.

And who should bear the cost of that? While I agree in broad terms with James Capretta’s proposals for improving our policies respecting physicians:

The federal government should encourage a more adaptive and flexible pipeline of physicians entering the US market by (1) shifting away from the excessively hospital-centric orientation of current funding for residency training and directing the aid to the residents themselves; (2) promoting new forms of institutional certification with fewer ties to the economic interests of existing practitioners and academic medical centers; (3) adjusting the Medicare fee schedule, which sets income expectations for physicians, based on the market prices revealed through transparency initiatives; (4) promoting and testing a shorter and less costly education option that merges a traditional undergraduate curriculum with medical school; and (5) enacting immigration policies that accommodate a larger influx of well-trained and talented foreign-born physicians.

I think a little explanation is in order and we should, perhaps, be considering some additional questions.

The first thing I believe needs explanation is that the Medicare system pays something in the vicinity of $80,000 for each and every medical resident in the country, the amount paid to the hospital by which the residents are employed, and has done for the last 55 years. The rationale for this was to increase the number of physicians. Its effect has been to establish a cap on the number of physicians.

Presently, the AMA plays a key role in establishing the relative value of various different procedures and, consequently, the expected pay for different medical specialties. I won’t burden you with the mechanisms by which that is achieved. You just need to accept that it is true. I don’t believe that should be the case and one way of changing it could be by changing the formula by which hospitals are paid for medical residents. For example, should we actually be subsidizing all medical specialties? Or should we just be subsidizing those we want more of?

Many people are not aware of it but the U. S. is one of the few countries in the world in which medicine is a post-graduate course of training. It’s controversial but there is no clear relationship between outcomes and years of medical education. Or between physician pay and outcomes for that matter.

Now my questions. Do we really need more physicians? Or should we engage in a larger reorganization of the way in which health care has been delivered? Unlike Mr. Capretta I would suggest ending the system of paying for medical residents in favor of encouraging many, many more physician assistants and nurse practitioners and nudging medical education more in the direction of a supervisory role. That’s the present general direction and IMO it’s a good one.

Is the cost of health care in the U. S. really established by supply and demand? I think that Medicare functions as an income price support for physicians. That is supported by the reality that nearly all physicians accept Medicare. If that’s right, then the most important thing we could do to reduce the price of health care would be to stop increasing the Medicare reimbursement rates, something our legislators have demurred from doing.

Finally, I think #5 is flummery. Is there a single case of a foreign-trained doc who was denied entry to the U. S.? We’re in serious competition for medical professionals with the United Kingdom, France, Germany and just about every other developed country in the world. Said another way, our high compensation rate and thirst for physicians is raising the cost of health care everywhere. There is a market in GPs. That’s why their price is so close among the countries in the developed world. And I haven’t even touched on the grave immorality of luring physicians the cost of whose educations are borne by their home countries away from those countries.

I thought you might be amused by this anecdote, from Jamil Anderlini at the Financial Times:

Roger Roth received an email from the Chinese government asking him to sponsor a bill in the Wisconsin state legislature praising China’s response to coronavirus, he thought it must be a hoax. The sender had even appended a pre-written resolution full of Communist party talking points and dubious claims for the Wisconsin senate president to put to a vote.

“I’ve never heard of a foreign government approaching a state legislature and asking them to pass a piece of legislation,” Mr Roth told me last week. “I thought this couldn’t be real.” Then he discovered it was indeed sent by China’s consul-general in Chicago. “I was astonished . . .[and] wrote a letter back: ‘dear consul general, NUTS’.” 

It is impossible to see this episode as anything but another disastrous own goal in Beijing’s attempts to boost its global standing in the time of coronavirus. 

From the deplorable treatment of African citizens in southern China to the export of faulty medical equipment, or the official endorsement of conspiracy theories blaming the US military for the outbreak, most of the Communist party’s efforts to control the international narrative have backfired.

The balance of the article outlines the fight President Xi is waging in China to hold onto power. Everything including your life, mine, and billions of others have been subordinated to that objective. I would not be a bit surprised if, looking back from twenty years in the future, the six months from the middle of December to the middle of June 2020 were seen as the most significant in world history. Maybe we’ll be luckier than that.

I think that Republicans and Democrats alike would be very prudent in distancing themselves from China.

I wanted to share this Brazilian research article with you. It’s an analysis of the genomes of the SARS-CoV-2 viruses of the first two individuals identified as having contracted the disease in Brazil. You may already be familiar with it but it was new to me.

The TL;DR version of the article is that the disease originated from a different places in each of the cases, one from China to Italy to Germany and then to Brazil, the other from China to Australia to Brazil. I think there are several puzzling aspects to the results of this analysis.

For one thing I don’t see how the number of mutations expressed in these samples, collected at the end of February in Brazil, is consistent with the presumed mutation rate of SARS-CoV-2 and a start of community spread in China of late December. Maybe I’m missing something but it appears to me that either the mutation rate is wrong or the time when community spread is wrong or there’s something wrong with the analysis. IMO it throws some doubt on whether there was any possibility of containment of the disease outside the U. S. unless all foreign travel to or from the U. S. had been suspended no later than December which would have been controversial to say the least.

Although I am sorely tempted I will not fisk the latest New York Times editorial, calling for an “all-in” effort (read: nationalized) to rescue the city from the consequences of its own folly. I’ll limit myself to remarks on this sentence:

Public health experts say wide-scale testing has saved lives in countries like South Korea and Germany, which have seen far fewer deaths from Covid-19 than the United States.

That’s an example of something called “lying with statistics”. While true when looked at from 50,000 feet, that doesn’t tell the whole story.

A quarter of all cases and fully half of the deaths due to COVID-19 in the entire United States are in New York State. 70% of New York State’s cases and deaths are in the counties of the New York City metropolitan area. Do the math. Moreover, the adjacent areas of New Jersey and Connecticut, essentially bedroom communities of New York City, add even more to the NYC cases and deaths.

To place that in perspective the number of cases and deaths, adjusted for population, in Illinois is 10% of New York State’s while California’s is 3%. In other words when you exclude the New York Metropolitan Area from your figures for the United States, the U. S.’s cases and deaths due to COVID-19, adjusted for population, are actually better than Germany’s and approaching South Korea’s.

The inescapable conclusion is that there is a serious COVID-19 outbreak in the NYC MSA, coping with it will require federal resources, and extraordinary measures will be required. In a sense that’s good news. The logistics of dealing with New York’s problem are manageable; extending it to the entire United States is impractical.

I won’t even hazard a guess as to why New York has this problem. There is no shortage of prospective reasons. Population density, reliance on subways, more extensive contacts with Europe, inadequate health care resources for a city of that size, the list goes on. I will only point out that the way you determine if there’s enough light in a reading room is if you have enough light to read by.

Here’s my modest proposal for dealing with the outbreak. First, close the NYC MSA, by force if necessary. No one goes in or out except to deliver necessary supplies or assistance. Second, focus national testing efforts and PPE deliveries on the NYC MSA. Test everybody, again by force if necessary. That alone is a daunting task. There are 20 million people in the NYC MSA. The entire U. S. has conducted about 3.5 million SARS-CoV-2 tests to date.

Third, shut down all public transport within the NYC MSA. That will slow the spread of the disease. Fourth, no one would be allowed out of the cordon sanitaire unless, after a two week mandatory quarantine, they test negative for the disease.

Finally, the quarantine will not be lifted until everyone within it has recovered from the disease, died, or a vaccine for it has been discovered.

The plan may cost trillions. It should be treated as a loan to the people of the NYC MSA. A surtax should be levied on residents of the NYC MSA so that the loan may be repaid over a period of 10 yearS. That should also serve to mitigate future risks.

I fully recognize that this plan is a non-starter. It has serious logistical, moral, legal, and civil rights issues. But that’s what an “all-in” plan would look like.

It’s always gratifying to see others thinking along the same lines as I have been. In this case shrink Vatsal G. Thakkar muses in this Wall Street Journal op-ed about the role Vitamin D might play in explaining disparities:

Black Americans are dying of Covid-19 at a higher rate than whites. Socioeconomic factors such as gaps in access to health care no doubt play a role. But another possible factor has been largely overlooked: vitamin D deficiency that weakens the immune system.

Researchers last week released the first data supporting this link. They found that the nations with the highest mortality rates—Italy, Spain and France—also had the lowest average vitamin D levels among countries affected by the pandemic.

Vitamin D is produced by a reaction in the skin to the ultraviolet rays in sunlight. Many Americans are low in vitamin D, but those with darker skin are at a particular disadvantage because melanin inhibits the vitamin’s production. As an Indian-American, my skin type is Fitzpatrick IV, or “moderate brown.” Compared with my white friends, I need double or triple the sun exposure to synthesize the same amount of vitamin D, so I supplement with 5,000 international units of vitamin D3 daily, which maintains my level in the normal range. Most African-Americans are Fitzpatrick type V or VI, so they would need even more.

This requires further study, but earlier research is suggestive. In 2018 a longitudinal study by researchers at Massachusetts General Hospital looked at whether vitamin D supplementation had any health benefits, specifically in regard to heart disease and cancer. The overall conclusion was that it didn’t, for most people. Yet buried in the results was one that should have made headlines: Vitamin D supplementation in African-Americans reduced cancer risk 23%. How? Cancer cells develop regularly in most animals, including humans, as the result of toxic injuries or glitches in DNA replication, but a healthy immune system destroys them. There is evidence that low vitamin D levels make the immune system go blind.

The need to treat different people differently may not be fair but it’s real. A major dietary source of Vitamin D supplementation is in milk and other dairy products and blacks tend to avoid those because so many are lactose intolerant (75-95%). As Dr. Thakkar points out, it’s worth investigating.

The editors of the Washington Post remind us that the poorest countries will need help in dealing with COVID-19:

GOVERNMENTS OF the world’s 20 largest economies — the Group of 20 — agreed Wednesday to a debt-service moratorium worth as much as $20 billion for the world’s 76 poorest nations, through the end of the year. The relief applies to government-to-government loans and may be renewed for an additional 12 months. The G-20 called on private lenders to grant similar forbearance; the Institute of International Finance, representing bank lenders to developing-nation governments, has spoken favorably about the idea (but not formally agreed). The International Monetary Fund (IMF) already offered some debt relief and pledged to deploy at least $1 trillion in lending power.

All of the above are steps in the right direction, if likely only the beginning of what it will take to prevent the coronavirus crisis from undoing the past two decades of progress in the world’s less developed countries, during which global poverty rates fell by more than 50 percent. Even as the United States, China, Europe and Japan are themselves reeling from public health and economic calamities, it is a moral imperative to help the developing countries and their people. It is also a matter of self-interest: We need healthy customers in emerging markets; the virus itself cannot be contained if developing countries must spend scarce resources on debt service rather than public health.

If we are really concerned about poor countries, the very best thing we could do for them is to get American consumers back on their feet. Whatever the role of other countries as markets for U. S. goods, it’s dwarfed by the role that U. S. consumers play in the economies of those countries.

We might also consider that American companies’ disentangling their supply chains from China and relocating them in not just one but multiple other countries would be of enormous economic benefit to the rest of the world.

It may also bear mentioning that about 150 countries, most of them poor, are paying debt service to China.

Yesterday President Trump released his plan for “reopening America”. You can read the entire plan here. It won’t take more than 5-10 minutes.

I’m clearly not the target audience for the plan. I would prefer more specific metrics—IMO that’s the only way you can actually measure progress, along with action items for himself, government agencies, states, private corporations, etc. along with metrics for those. But specifics would expose the president to attack so they’re avoided and the sort of detail I’m talking about would bore the pants off most people.

I have found it grimly amusing that nearly the same people who were outraged that Trump would claim the authority to reopen the country are now complaining that he’s dumping everything on the states. Welcome to federalism. Presumably, someone informed the president that he doesn’t actually have the authority to lift governors’ “stay at home” directives. Clearly, whatever shortages there may be in tests, protective equipment, hand sanitizer, and toilet paper, there is no shortage of outrage.