The World Is Yours*

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Well, fuck.

alexhern.substack.com

Well, fuck.

Alex Hern
Mar 18, 2020
3
Share this post

Well, fuck.

alexhern.substack.com

I've just finished the second day of working from home as I write this. It's a change which is likely, based on the projections from the Imperial College team behind the UK government's current advice, to last at least three months.

It's gone well so far. I'm trying to gently force my office to us the futuristic communication tools we all have access to, rather than sending endless emails, but in the meantime, I'm at least reassured by the fact that my partner hasn't murdered me.

I'd recommend reading the entire document I just linked, particularly if you're UK based. It's remarkably clear, un-jargony, and open about the problems we're going to face. It also doesn't quite say what you would expect, if you've only been following this from the headlines. 

The starkest section, for me, is about halfway down, where Table 4 shows what a "suppression" strategy actually entails. The idea is you moderate the level of lockdown, triggering it when more than 100 cases enter intensive care in a week, and easing it when the number drops back down to 50.

On the plus side, doing so would limit UK deaths to between 8 and 16,000 over the next two years, compared to an estimated 410,000 to 550,000. But the social cost is wild: on the paper's baseline assumptions, we would see school closures and social distancing in place for 66% of the next two years. That's one month on, two months off, until 2022.

Capacity

The limit, as I'm sure everyone knows by now, is the capacity of the UK's intensive care system. "Peak GB ICU surge capacity is approximately 5000 beds", the authors say. Doing nothing would see a peak surge requirement of 160,000 beds. Hence: suppression.

There's no amount of preparation that would enable the do-nothing strategy, of course. No country has an ICU capacity of 260 per 100,000, and it would be extraordinary if they did.

But the fact that we're so close to the limits already is telling. It is, to listen to doctors and healthcare administrators, a symptom of the approach to running the NHS that has become political orthodoxy in the past 20 years: the belief that resiliency is inefficiency, that surplus is waste, and that relentless market-based pressure is the only way to run an organisation.

(For those playing along at home, we're about to move onto a blend of opinions 3 and 6 of the Alex Hern Opinionometer)

If you're a hospital paying for 20 beds that hasn't had more than 5 in use in a year, it makes sense to cut ten of the beds, and reallocate that money, time and space elsewhere. And then next year, after you did such a good job of doing that, it makes sense to cut another three. And then another two. Eventually, you might even cut another one, reasoning that most of the time you only have four beds in use, and if you did need a fifth, you could probably call a bed in from a neighbouring trust, or try and shift a recovering patient out of the unit slightly earlier than you would otherwise.

Of course, the health service didn't even exist last time that hospital needed not just 20 beds, but 50. The administrators who currently work there weren't even born. So who is going to make the case for keeping all that wasteful capacity just lying about? 

It's not just about pandemic preparedness, though it wouldn't be justifiable if it were; we've known this was coming for decades, yet our practical preparation for it began weeks ago. You sometimes hear stories of hospitals that were working fairly well on constrained resources, until one day, a surge came that just… broke them. The limits were reached, and the system fell apart. A friend's mother still talks, apparently, of New Years Eve 2001.

The problem is visible in healthcare, because, for all the marketisation of the NHS, there are still fundamentally the same hospitals, in the same locations, as there have been for years. The Royal London doesn't shut down because an upstart hospital opened up around the corner with fewer ICU beds and undercuts it on price.

But for many, that fact is a problem with the health service, not a benefit of it. The threat of exit, and the power of competition, is supposed to encourage businesses to push for ever greater efficiencies.

In practice, that often means cutting resiliency. It's no good to tell your customers that you're more expensive than your competition because your competition has cut the stockpiles that will keep them afloat in case of disruption: the invisible hand guides, and you either have to follow course, or go bust. But then the disruption comes, and both you and your competition fail at the same time, and your customers are left without recourse.

One answer to this is supposed to be the financial sector. Insurance and hedging allow businesses to take on the risk that they want, and avoid the risk that they don't. If your business will be drastically affected if the cost of widgets rises higher than it has done in the past fifty years, you don't need to stockpile widgets; you can just buy insurance against widget disruption, and the insurer then goes and and invests some of your money in financial products that are countercyclical to the price of widgets, hedging its exposure accordingly. 

But the problem is that, in serious disruption, money still can't buy resilience. If, to bring it back to the here and now, you have no surgical masks because of a sudden and unanticipated shock to the demand for masks, then your insurance firm paying out against the surgical mask insurance you took out is second best to actually having enough masks. In theory, you can go out and buy those masks yourself; in practice, though, you are left waiting for the factories to churn out new products like everyone else.

Capitalism is a gigantic engine for engineering this sort of problem. The state is, sometimes, good at limiting the damage. Building regulations for homes, capital requirements for banks, redundancy protections for employees: all work to inject long-term resiliency into an economy, at the cost of preventing some derring-do entrepreneurs from engineering out perceived inefficiencies in the system.

But what we've seen this week, and what we're going to see far far more over the coming weeks and months, is that it's nowhere near enough. Our economy is engineered to fall apart in a crisis, and governments that feel they can only step in after the problems have already begun are going to cost lives.

Updates

Sorry about all that. I'll stay in my lane next time, and write about how we're all watching esports now that football's died, or that everyone has RSI from doing all our work on bad laptops.

Anyway, I've been keeping myself sane with some remote boardgames on Board Game Arena, a freemium site that is currently struggling under the load of "exceptional circumstances". If you want to play with me, reply to this email, and add me on the site – I'm paulnewmanseyes. I want to give Terra Mystica a go, people have said good things about it.

I'm still playing through Pokemon but also I now have Divinity: Original Sin II on Switch, a ferociously deep CRPG that I've already restarted once because I felt like I didn't full understand what I was doing. Hit me up if you have tips.

Lastly, unsurprisingly, I'm not going to be going to Japan next month. Pour one out for my holiday, and pray for me as I try to sort out refunds and travel insurance pay outs.

That's enough of that,

Alex

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