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Don’t Let Fear Drive COVID-19 Policy

8/4/2020

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The media loves to portray Americans as stubborn—refusing to abide by the measures that could help address the COVID-19 pandemic. Yet the data show that Americans were already doing their part, long before measures became mandates.

The Institute for Health Metrics and Evaluation has a measure of social mobility. Based on anonymous cell phone data made available by phone companies to help fight the pandemic, the measure shows how much people get out, get around and even mingle.

This measure shows that the U.S. was running at about a 2% rate of mobility compared with a typical 0% before March 2020. That’s our pre-pandemic base rate.

By March 10, that positive mobility rate had turned to a negative 1% and fell further to negative 13% by March 15. Then many state and local governments started locking down society, which the mobility rate fell to a low of negative 51% by March 31—end of the first quarter.

In other words, people were already voluntarily practicing social distancing before governments made it mandatory.

But the mandates meant that many businesses had to close, so no matter what people were voluntarily doing, much of Americans’ action and interaction stopped. Though the economy was surging in January and February—reaching historic bests in the labor market, things fell off of a cliff in March as the economy cratered at an annual rate of 5%.

For comparison, the economy hasn’t contracted that much since the depths of the Great Recession when it fell by 8.4%. This time that 5% was just the beginning as the second quarter will be much worse.

More than 22 million Americans lost their job through April. Fortunately, though, job creation has turned around some as there have been 7.8 million jobs added back. But there’s a long way to go.

This recovery is going to be unique because some states that didn’t make as extensive lockdowns or started reopening faster will have more economic rebound.

This was apparent in the latest state-level jobs report which showed that Texas led the way in getting folks back to work, and other states that have been reopening faster also had more jobs added.

While Texas has been in the news lately from increasing infections (even though hospitals aren’t overwhelmed and the death rate remains relatively low), the full context of the situation in the Lone Star state must also include the effect on livelihoods.

Tracking social mobility in Texas, IHME shows that the state had a higher level of mobility than the U.S. going into March. This turned negative on March 11 from voluntary social distancing, and then was at negative 49% by March 31 after the shutdown. This contributed to the economy contracting by just 2.5% in Texas, or just half the rate of the nation as a whole.

South Dakota, on other hand, is a rural state that did not lockdown its citizens. Their social mobility turned negative on March 12 and was at negative 36% by the end of the quarter. The lack of a mandate by government helped the state to contract by only 2.2% in the quarter.

California’s social mobility was running slower than Texas or South Dakota going into March, turned negative on March 7 from voluntary social distancing, and negative 52% by the end of March after mandates. California’s mobility fell faster and remained lower from a more extreme lockdown.

This decline in mobility contributed to California’s drop of 4.7% in economic output—almost double the rate of Texas in the first quarter.

The key here is to understand people act rationally.

The rates of social mobility show people were practicing social distancing before mandates were imposed. Wearing a mask, practicing social distancing, and taking care of the elderly and vulnerable will be the norm for the vast majority of people without the destructive effects of government mandates and lockdowns.​


https://www.texaspolicy.com/dont-let-fear-drive-covid-19-policy/
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    Vance Ginn, Ph.D.
    Chief Economist
    ​TPPF
    ​#LetPeopleProsper

    Vance Ginn, Ph.D., is founder and president of Ginn Economic Consulting, LLC. He is chief economist at Pelican Institute for Public Policy and senior fellow at Young Americans for Liberty and other institutions. He previously served as the associate director for economic policy of the White House’s Office of Management and Budget, 2019-20.

    Follow him on Twitter: @vanceginn

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