Sunday, May 17, 2020

Three virus-related thoughts for Sunday

 - by New Deal democrat

There are a few posts I have been working on, but haven’t had the energy to complete.  But since I wanted to make the point, let me use this opportunity to quickly set forth a few thoughts.

1. I suspect that the virus has been “burning through the dry tinder” in March and April. At least 1/3, and possibly 1/2, of all deaths from the disease have been at nursing homes. When you consider this disease thrives on indoor spaces, recirculated air, repeated dosing with the virus, compromised immune systems, and those who already have cardiovascular disease, that ought to be no surprise.

What I suspect, but don’t have good sourcing for yet, is that a huge percentage of all residents at such facilities have already been infected. Since the turnover at these facilities is on average about every 2.5 years, once the disease has “burned through” this population, that source of fatalities immediately vanishes. Which means that the number of infections and fatalities would presumably decrease.

How much of the decrease in infections and fatalities we have seen in the past month is due to coronavirus burning through this dry timber? I suspect it plays a significant role. Which would mean that the next phase would be determined by how much community spread can occur without these facilities being part of the outbreak.

2. I have read dozens of reports since March of wages being cut. This trend was overwhelmed in the April jobs report by the fact that low wage workers were those who took the brunt of the virus-related shutdowns. Professional workers and other higher-wage employees who could work from home were much less affected.

It appears that somewhere over 10% of all of these workers have had to deal with cuts in pay. In States that are “reopening,” are these wage cuts going to be reversed? Frankly, I doubt it.

Since the monthly mortgage, rent, and vehicle and other installment loan payments for these workers remain the same, many of them are going to be in deep trouble. That is a recipe for a wage/price deflationary spiral, just as was set off in 1929.

3. The appearance of armed “brownshirts” in this pandemic is alarming. At first they only appeared for gun-related issues, but things like business closures and mask-wearing are totally unrelated to that. This is the use of armed force for intimidation, plain and simple.

At some point it is going to have to be confronted. And there will probably be violence. The appearance of such brownshirts has been a flashing-red warning sign for republics going all the way back to Rome, and not coincidentally the Weimar Republic of Germany. Levitsky and Ziblatt pointed to this as one signpost in “How Democracies Die.” Joanne Freeman wrote about this as to the 1830s-50s as to the Congressional chambers themselves in “The Field of Blood.”

This is not a good sign for the health of the American Republic at all.