Most briefing on the Covid-19 disaster has understandably focused on the pandemic’s health impact. The briefings have essentially been policy pronouncements that do not feature economic experts’ opinion on the different interventions against the pandemic. The involvement of economists would be necessary to highlight how the government is ensuring cost-minimization, cost-effectiveness and futuristic thinking in their Covid-19 intervention strategies.
Since the public has been listening too much from the health experts without any input from economic experts, individuals, corporations and entire society have missed out on vital inputs that would have helped in the calculation of the costs of the various Covid-19 interventions. For instance, the disruption of trade and transportation, and related disease containment measures continue to inhibit domestic activity, putting at risk people’s livelihoods.
In addition, since schools, universities, restaurants, cafes, salons and barbershops are under restricted operations or shutdown, it means that small businesses that subsist in this ecosystem are badly hurt. This interference with economy has thrown millions out of work, destroyed millions of liquidity and is definitely pushing our GDP into depression. These grave injuries to the economy and possible mitigation trade-offs are not fully appreciated because in ‘the war-room’ where intervention strategies to subdue the pandemic are debated, economists are excluded. The ignorance of the economics of safety protocols has also blinded government from glaring facts such as shutting the capital city out of access to thousands of people is denying people who need diagnostic tests, procedures and specialized scans access to medical attention hence building a health consequence that could ripple out far more than the Covid-19 disaster.
The coronavirus routine public briefing would have had more utility to the public if it was always accompanied by radical practical action plans designed to keep the economy open. In public policy 101, it is taught that government decisions are always a trade-off. Whereas life may not grant people all that they want, it presents them with options to make the best out of prevailing circumstances. The basic tool at disposal of bureaucrats in this kind of decisions is the cost-benefit-analysis, which involves adding up the benefits of a course of action, and then comparing it with the costs associated with it.
The lack of a cost-benefit analysis has denied the public insights on the short to long term economic impacts of the pandemic and a a gauge of isolating and evaluating certain radical, rational and practical alternative mitigation interventions that could have been tried. In addition, it has created a narrative that has made citizenry demand that their government should feed all the poor during this calamity and dispatch planes to all the cities of the world to bring home all Africans affected by the Covid-19 disaster the same way Britain, US or Germany are doing.
Ultimately, the success of the fight against this pandemic will depended on how our bureaucrats shall rationally allocate the scarce resources. The war-room should not be filled with health experts who will just paint a grim picture of the pandemic. We need other experts like economists to highlight economic realities.
Considering the fact that a miracle drug for treating coronavirus is not round the corner and hope for a vaccine is at least more than a year away, it is the pursuit of earning a livelihood and pressure of bills that will force the individual into a ‘new normal’ of learning to live with the virus in our midst. From an economic standpoint, life does not give anyone what they want but only presents options. In this case, before us is an option of staying paralyzed in the bunkers of fear and finally being decimated by lack of supplies or taking a calculated risk of returning to productivity even as we observe safety protocols.
As much as a lot remains unknown about Covid-19, it is clear that the disease is more lethal to some people and relatively harmless to others. In this case, then it would have advisable from a combination of heath and economic standpoint to have more targeted and not uniformly applied protocols. In a more practical sense, the uniform intervention measure has wasted a huge human capital necessary to cushion the economy.
It is now almost established that Covid 19 is deadly among the elderly and physically unfit. It has a higher fatality among those with pre-existing health conditions such as diabetes, high blood pressure, cancer, et cetera. It would thus be prudent for old people and the physically unfit to be put in safe zones where they would be catered for as their work responsibilities are taken over by the young and able.
If such a policy would have been implemented, it would have elevated the youth with education and necessary experiences in various sectors of economy to take a lead for economic stability and growth. Similarly, all essential government functions would have been taken over by young people, those already in government as well as the educated young and jobless on our streets as the old citizens take cover until their safety is assured.
With such rational, radical and practical steps implemented across Africa, Covid-19 pandemic would give youth a chance to drive economy and government and put Africa on the path to some type of ‘The East Asia Miracle’ of rapid economic progress.
By George Nyongesa
Senior Associate at the Africa Policy Institute (Nairobi, Kenya)