Focus on the Covid-19 Death Rate

n the saga of the virus and the lockdown, the wisdom of the crowds, that is the wisdom of each of us, was thwarted by bad data, perhaps intentionally bad. On the other hand, the ersatz wisdom of the collective bureaucracy in federal, state and local health agencies was based on crafted data. In the end data didn’t matter, as the bureaucracies were more concerned with their natural territorial imperative, which is to rule and control.

The most frightening aspect of the coronavirus-19 (COVID-19) epidemic in the US is that it brought about exaggeratedly heightened fear of death. That fear, once magnified to proportions which become palpable to the individual, became the basis for dreadful economic and medical policies from governments and crushed the natural optimism of the public.

In early days, we were caught in a squeeze of conflicting information. Was COVID-19 a bioweapon gone rogue and destined to indiscriminately wipe out young and old? Or, was it another bad flu or perhaps an extremely bad flu? After all, initial information showed the victims were concentrated in a nursing home in Kirkland, Washington.

No cases were reported amongst the homeless on West Coast streets. No deaths among children were reported. And in the closed world of cruise liners and later a military ship, there were lots of early cases and some deaths. As time passed, there was little more bad news. We should have been suspicious of the data.

We were mainly focused on the case fatality rate (CFR: deaths as a percent of diagnosed cases) which were frighteningly high. We worried about the infection fatality rate (IFR), but there was too little data and testing available to have any idea how many people were or ultimately would be infected.

But those concepts – CFR and IFR – are not the most important strategic measures of the severity of the disease. It is the death rate, properly defined and understood, that should matter for long-term policy makers, our erstwhile more level-headed thinkers, in determining policy.

In the past few weeks, we have obtained more useful data in the US. There were secrets lurking in the data, waiting to be uncovered, that could help ascertain what was really happening. The purpose of this report is to do just that – to ascertain what the data are telling us. It also gives us the basis for judging the appropriateness of past and present policies

So, let’s begin with a simple question: what is the relevant death rate due to COVID-19? There are many definitions in the epidemiological world such as the CFR and IFR mentioned above. My focus is on the overall death rate – actual and projected. Until we have more widespread testing for COVID-19, we cannot know with any accuracy how many people were infected by the virus. We cannot know what proportion of the population has some sort of natural or acquired immunity. 

We do not even have accurate data on how many people have died from COVID-19 alone versus COVID-19 plus some other complications that were already present such as diabetes, morbid obesity and prior respiratory complications, any one of which might equally have been the proximate cause of death. There is ample evidence, especially in the Northeast region that there has been “over classification” (a euphemism for data bias). We do not have the demographic details for those infected and those who died. But we do have death data, and it is more accurate than the number of cases and the number of infections.

To understand how our minds have been misdirected in understanding the real risks associated with COVID-19, let’s begin with a brain teaser. It will awaken our numerate minds in preparation for understanding the data deception and misunderstandings that prevail.

When is 1.7% greater than 98.3%?

In the bizarro world of COVID-19 reporting that is the case – 1.7% is greater than 98.3%. Specifically, deaths among a narrow 1.7% group of the population are greater than deaths from the other 98.3%. Numerically a death may be a death, but from a policy point of view, to be blunt about it, not all deaths are the same.

Fact #1: 1.7% of the population in the US resides in long-term medical care facilities (LTMCFs) and total 5.7 million. 

Fact #2: The residents of LTMCFs accounted for 38,800 or 53% of all COVID-19 deaths (based on recent data). The rest of the country, the 98.3%, have experienced approximately 34,600 deaths, or 47% of the nation’s total COVID-19 deaths.

The Death Rate at LTMCFs Is Stunning

That means the death rate, deaths expressed as a percent of those living in medical care institutions, is 0.682%, more than 50 times the death rate of the rest of the population at 0.012%. The death rate for the overall populations is 0.022%.

That should leave you speechless.

We have a COVID-19 problem, but we have an even greater and more serious LTMCF problem that is clouding our understanding of the contagion and therefore what our best public health policies should be. Shutting down the economy, the world wherein the 98.3% live and prosper was too draconian. The feared overloading of the hospital system with emergency patients, which was short-lived, was disproportionately coming from the residents of LTMCFs, not the general public.

The data have been there all along, but they were not properly collected, catalogued and analyzed.

Much of the data in this report came from a landmark study by Gregg Girvan and Avik Roy of the Foundation for Research of Equal Opportunity. Their work was based on data collected through May 10th, 2020 for most states. Since their publication, revisions have been incorporated as states have corrected or updated their data since the original report. The calculations given above are imputations from the updated data.

At this point, we do not know what the ultimate count of deaths and the death rate will be, but what we have in hand are statistics that are very indicative and telling of the gross misunderstanding that the public and federal, state and local decision-makers have been working with on which to base their decisions.

Long-term medical care providers to the aged and medically infirm (per the Girvan-Roy study) consist of: Nursing homes and skilled nursing facilities; Assisted living facilities, i.e., residential care communities or personal care homes; Adult day service centers; Home health Agencies; and Hospices.

The first two medical care providers for seniors are referred to as long-term medical care facilities (LTMCF) and are the source of the data. Data for the other three elder care facilities are not collected or were not available for the Girvan-Roy study. In fact, it has been acknowledged that there continues to be underreporting of deaths related to LTMCFs. Some providers are just not reporting. In other cases, the residents die in hospitals and they are not categorized as LTMCF deaths. Nonetheless, the data are sufficient to draw some useful if not stark observations.

What about the Flu and Pneumonia Death Rates in Earlier Years?

To even better understand these death rate figures, it is useful to put them into the context of what we know about death rates from the flu before the arrival of COVID-19. Is the COVID-19 death rate worse, better or about the same as prior flu seasons? We should expect the rates to be worse because there is no vaccine whereas most people get a vaccine shot for the routine flus that are expected each year.

In 2017 the Centers for Disease Control (CDC) reported that annual deaths from all causes were 2.8 million or 0.866% of the population. The leading causes of death, in order of magnitude, were heart disease, cancer, accidents, respiratory disease, stroke, Alzheimer’s disease, diabetes, flu & pneumonia and suicide.

Just looking at the Flu & Pneumonia (FP) cause, in 2017 it accounted for 55,672 deaths or 0.017% for the population as a whole. Death from FP, as you would expect, fell hardest on people over 75 totaling 38,078 deaths. That translates into a FP death rate of 0.180% for those over-75 group, which is a little more than 10 times the death rate for the overall population. For the rest of the population under 75 the death rate was only 0.006%, or or 1/30th of those over 75 (0.006% vs 0.180%).


2020 COVID-19 2017 Flu & Pneumonia
Overall Death Rate 0.022% 0.017%
Over 75 DR 0.161% 0.180%
LTMCFs DR 0.682%
Non-LTMCFs DR 0.011%
Under 75 DR 0.010% 0.006%
Data from CDC and FreeOpp.

What this means at this point is that in the aggregate the overall COVID-19 death rate is slightly worse than the flu death rate in a prior year (0.022% vs 0.017%). However, for seniors in LTMCFs, the COVID-19 death rate is 100 times greater than the flu and pneumonia DR was for those under 75 in 2017 (0.682% vs 0.006%) and nearly 4 times greater than those over 75.

In summary the COVID-19 death rate is far more skewed to those older than 75 and those residents in medical care facilities for the aged.


What Does the Future Hold?

Looking ahead we obtained the most recent forecast from the Institute for Health Metrics and Evaluation (IHME) at the University of Washington. They are considered by many medical professionals as the most thorough modelers. On May 18, 2020 the IHME released the results of the third run of its new model. They predict that by August 4, 2020 a total of 143,357 Americans will die of COVID-19. That forecast nearly doubles the number of COVID-19 deaths. It is worth noting that each run of the model has produced lower forecasts for future deaths. There are detractors of their modeling procedures, but it is the best we have at the moment.

One interesting medical research report suggests that a significant portion of the population has natural immunity to COVID-19. In the May 14 edition of Cell, published by Elsevier, the researchers found:

T cell responses were detected in 40-60% of unexposed individuals. This may be reflective of some degree of cross-reactive, preexisting immunity to SARSCoV-2 in some, but not all, individuals… suggesting cross-reactive T cell recognition between circulating ‘common cold’ coronaviruses and SARS-CoV-2.

This might be why there are so many reports of asymptomatic cases of COVID-19. That also may mean the IHME forecast will be revised down even more.

However, COVID-19 has brutal consequences for people over 75. That detail cannot be minimized. But what policies would that suggest?

Did We Adopt the Right Policies?

What do these data suggest about the medical and economic policies that have been adopted by the federal, states and local governments?

The carnage of COVID-19 is concentrated in elder care facilities not in the population at large. The policies and procedures, including lockdowns and state-of-the-art personal protection practices for those facilities, should have been more thoroughly thought out based on useful data.

Keep in mind, about 70% of the elder care facilities are for-profit. Yet they are not free-market enterprises; enterprises free to do what they think is best. These for-profit facilities are licensed and regulated by the several Departments of Health of the states. They do what the state tells them to do.

The governors and mayors, and their medical and science advisers, made the decision to pack them in, force them to house and retain infected and returning infected patients. They chose to divert PPE supplies to hospitals, not the elder care facilities. This characterization is based on reports in the press. One certainly hopes there were some communities that did a better job. There is reason to believe that is the case because some assisted living facilities have reported no deaths.

As COVID-19 deaths mounted, not a word was officially spoken about where they were occurring. Fear was stoked that it was a population-wide epidemic. We should ALL lock down.

What a costly mistake, a mistake that continues to this day. Governors and mayors with fresh data insights into the truth still want to be central planners and determine which businesses can re-open and to what degree, who should still shelter or socially distance. They send out teams to draw circles in the grass defining where groups can camp out and place police monitors in all the parks to warn people to stay within the circles. At this point they are just imaginary prisons, but they are prisons.

Madness, sheer madness.

Though that is an easy and superficial observation to make, what is really unsaid, and not easy to admit, is that large numbers of politicians and bureaucrats have revealed their true nature. Speeches decorated with declarations of “better safe than sorry” and “planning is better than no planning” reveal they are authoritarians by nature; central planners of the worst kind. 

In conclusion, the relevant death rate for policy purposes has been obscured. The consequence has been inappropriate policies. They have resulted in a bizarro world of highly restricted commercial functioning and immense economic destruction, alongside no evidence that lives were saved and growing evidence of second-tier loss of life resulting from lockdown.

Gregory van Kipnis

Gregory van Kipnis

Gregory van Kipnis is Chairman of the Board of the American Institute for Economic Research. He was President and CEO of Invictus Partners, a statistical arbitrage hedge fund manager from 1997-2007, prior to that he was EVP at Jefferies & Co., in charge of proprietary trading from 1993-1997; Managing Director of NatWest Financial Products (London) and Executive Director of County NatWest (London) responsible for derivatives issuance and proprietary trading from 1990-1992; and Principal at Morgan Stanley responsible for proprietary statistical arbitrage trading, 1985-1990. His earlier career was as an economist and research director at Donaldson Lufkin & Jenrette (1973-1985) and IBM Corporation 1966-1973. He studied with Ludwig von Mises at New York University where he obtained his MBA in economics and finance.
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Is Bitcoin the Future of Money? Peter Schiff vs. Erik Voorhees

On July 2, 2018, Reason and The Soho Forum hosted a debate between Erik Voorhees, the CEO of ShapeShift, and Peter Schiff, CEO and chief global strategist of Euro Pacific Capital. The proposition: “Bitcoin, or a similar form of cryptocurrency, will eventually replace governments’ fiat money as the preferred medium of exchange.”


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It was an Oxford-style debate in which the audience votes on the resolution at the beginning and end of the event, and the side that gains the most ground is victorious. Voorhees won by changing the minds of 15 percent of attendees.

The Soho Forum is held every month at the SubCulture Theater in Manhattan’s East Village. At the next debate, which will be held on August 27, William Easterly, professor of economics at NYU, and Joseph Stiglitz, a Nobel Prize Winner in economics and professor at Columbia, will discuss whether free markets or government action is the best way to eliminate global poverty. You can buy tickets here.

The Contrarian Coronavirus Theory That Informed the Trump Administration

President Trump, who at one point called the coronavirus pandemic an “invisible enemy” and said it made him a “wartime President,” has in recent days questioned its seriousness, tweeting, “WE CANNOT LET THE CURE BE WORSE THAN THE PROBLEM ITSELF.” Trump has said repeatedly that he wants the country to reopen by Easter, April 12th, contradicting the advice of most health officials. According to the Washington Post, “Conservatives close to Trump and numerous administration officials have been circulating an article by Richard A. Epstein of the Hoover Institution, titled ‘Coronavirus Perspective,’ that plays down the extent of the spread and the threat.”

Epstein, a professor at New York University School of Law, published the article on the Web site of the Hoover Institution, on March 16th. In it, he questioned the World Health Organization’s decision to declare the coronavirus outbreak a pandemic, said that “public officials have gone overboard,” and suggested that about five hundred people would die from COVID-19 in the U.S. Epstein later updated his estimate to five thousand, saying that the previous number had been an error. So far, there have been more than two thousand coronavirus-related fatalities in America; epidemiologists’ projections of the total deaths range widely, depending on the success of social distancing and the availability of medical resources, but they tend to be much higher than Epstein’s. (On Sunday, Anthony Fauci, the director of the National Institute of Allergy and Infectious Diseases, estimated that there could be between a hundred thousand and two hundred thousand deaths in the U.S.) In a follow-up article, published on March 23rd and titled “Coronavirus Overreaction,” Epstein wrote, “Progressives think they can run everyone’s lives through central planning, but the state of the economy suggests otherwise. Looking at the costs, the public commands have led to a crash in the stock market, and may only save a small fraction of the lives that are at risk.”

Epstein has long been one of the most cited legal scholars in the country, and is known for his libertarian-minded reading of the Constitution, which envisions a restrained federal government that respects private property. He has also been known to engage with controversial subjects; last fall, he published an article on the Hoover Institution Web site that argued, “The professional skeptics are right: there is today no compelling evidence of an impending climate emergency.” Last Wednesday, I spoke by phone with Epstein about his views of the coronavirus pandemic. He was initially wary of talking, and asked to record his own version of the call, which I agreed to. During our conversation, which has been edited for length and clarity, Epstein made a number of comments about viruses that have been strongly disputed by medical professionals. We have included factual corrections alongside those statements.

What did you want to achieve with your pieces?

What did I want to achieve with my pieces? First of all, I am not a politician. What I did is that I looked at the standard model that was put out in the New York Times [in an Op-Ed by Nicholas Kristof and Stuart A. Thompson, published on March 13th], which was backed up by other models in other places, and it occurred to me that I just did not think that the underlying assumptions there were sound. The single most important thing to me was not to get my own estimate of what the number is. The most important thing was to look at that curve, which seemed to suggest that there would be ten million cases a day during a ten-day or so band in the middle of July, and to explain why, in relationship to all other things I know about evolutionary theory, that this just has to be wrong. The better way to have phrased the paper would have been to say that the traditional models, which were used for the last flu season, for the 2009 H1N1 situation, are much better approximations of what is likely to happen than these rather scary kinds of projections.

You wrote last week, “In the United States, if the total death toll increases at about the same rate, the current 67 deaths should translate into about 500 deaths at the end.” We are currently at eight hundred deaths—over eight hundred deaths. [This was true when we spoke; the number is now over two thousand.]

First of all, let me just say I wrote an amendment to that, the thing I regret most in that whole paper. But I was not so much interested in explaining why my number was right. I was interested in explaining why the other projections were wrong.

O.K., but your number was surpassed in about a week, and now we’re already—

I understand that, but the point about that is that, first of all, there was a simple stupid error, which is you would never want to put it in a model that total deaths in the United States relative to the world would be one per cent. So if you just inflated it to five per cent or ten per cent, then all of a sudden you’ve got a number which is either five or ten times as high.

Secondly, suppose I should have been wiser in this and said, as I referred to the flu vaccine and later on to the H1N1 situation, if those are your benchmarks, then the number goes up to say between fifteen thousand and forty thousand deaths, as opposed to the one million-plus that are projected. [The Times model projected, without interventions by governments or citizens, a million deaths in the U.S.; with such interventions, the model showed that number dramatically decreasing.] And, remember, the one million-plus is on a model which is universal and worldwide, and you should expect to see something like that somewhere else. And there’s no evidence whatsoever that any of the situations, even in Italy, is going to approach the kinds of numbers that you had there. And so I am truly sorry about that [five hundred] number. I regard it as the single worst public-relations gaffe I’ve made in my entire life. But the question to ask, Isaac, is not whether I chose the right number but whether I had the right model.

Something else you wrote, in an earlier piece, was, “Why has there been such a dramatic mismatch in the responses to ordinary flu and the coronavirus?” Is that a question you’re still unsure about?

Look, the basic problem is, I think, in effect, that the tendency on the part of many people to treat this particular thing as unique is a mistake. There’s an underlying, standard model that you want to use, and the question is how you stuff it full of parameters. That is, numbers you add into it to make what’s going on. And, so, the situation that you get is you cannot use any exponential system because essentially then everybody is going to be dead, because things just keep doubling, doubling, and doubling.

So you have to develop a model which is going to explain why there’s a fairly rapid increase at the outset, and then why the thing starts to turn flat, ultimately down, and then disappears. That’s the strategy that you have to do. And so the theory here is one that I actually worked with and I thought worked pretty well in the AIDS stuff, which I worked on back in the early nineteen-eighties. And the model goes something like this. You start off with this virus, and there’s a range, some of which are very serious and some of which are less, so it’s a theory of natural selection with a normal distribution set. And, if you’re moving into a new environment like the [Life Care Center] of Kirkland or like the cruise ship, what happens is you have people who are completely unaware of what is going on. And so you take a population like in Kirkland, which is fragile and old, you get somebody in who has a strong version of the virus, and the thing will just absolutely rip through the population and kill everybody in it within a very short period of time. [Daniel Kuritzkes, the chief of the infectious-diseases division at Brigham and Women’s Hospital, in Boston, said, after being read this passage, “There’s no evidence that there are strong and weak variations of the coronavirus circulating. There may be minor variations person to person or location to location in the actual genetic sequence, but there is no evidence that they have different virulence or that a less virulent version is overtaking a more virulent version.”]

And Washington State had a very high peak early on. And, probably, most of the deaths that we have today, if you went through and chased them down, were either people who are in the facility or people who have family members who hugged and kissed people in the facility. So they got large doses of intense viruses. [Albert Ko, a professor of epidemiology and medicine and the department chair at the Yale School of Public Health, responded, “There is no evidence that you have a higher risk of dying from contact from someone in the facility than if you had contact from some other source.”] But then adaptation starts to set in. And, in my view, adaptation is a co-evolutionary process in which things change, not only in human behavior but also change in genetic viral behavior. So, on the human side, once you see that these things are really going to happen in this particular form, people take steps to avoid contact.

You write, “I fully understand the need for immediate responses to immediate threats, like fires, but not for crises that may last for three months or more.”

Yes. Well, I’m saying in effect, by this particular point—this is not the medical side—is after you start declaring emergencies you have time for reflection and adaptation and modification, which you don’t have in a fire case. So the political point is one which essentially says when you see governors of three major states putting out statements that their experts have said this, that, and the other thing is a result, and you don’t see the studies and you can’t question the assumption, I regard that as a serious breakdown in the political process. So my view on that particular point is I’d like to know which of these studies they’re relying on. If it’s the New York Times studies, then I thought that that study was mistaken for the reasons that I was trying to give you a moment ago, which is that as the virus becomes more apparent, adaptive responses long before government gets involved become clear.

You wrote, “The adaptive responses should reduce the exposures in the high-risk groups, given the tendency for the coronavirus to weaken over time.” What tendency are you talking about, and how do we know it will weaken over time?

Well, what happens is it’s an evolutionary tendency. [“There is absolutely no evidence for that,” Ko told me. According to Kuritzkes, “There is no proof that this is the case. To the extent we see that evolution taking place it is usually over a much vaster timescale.”] So the mechanism is you start with people, some of whom have a very strong version of the virus, and some of whom have a very weak version of the virus. If the strong-version-of-the-virus people are in contact with other people before they die, it will pass on. But, if it turns out that you slow the time of interaction down, either in an individual case or in the aggregate, these people are more likely to die before they could transfer the virus off to everybody else.

On the other hand, those people have the more benign version of the virus that will allow them to live longer, which means that they have the chance to make a connection with somebody else. And so what happens is, if it turns out you think something like the coronavirus is ten times as strong as another virus, what that means is that the distancing is going to be more violent, which means that the evolutionary process should be more rapid than that for the ordinary flu.

But you stated as fact that the coronavirus has a tendency to weaken over time.

Isaac, let me just explain it. This tendency takes time. It could be a week. It could be a month. It could be longer. But, in the end, you should expect something of this particular sort to take place. More importantly, on the other side, where there’s no dispute, it’s clear that people will start to evolve away from these things so that the rate of transmission will start to go down. And, as that starts to happen, whether you have just private or social responses, you’d expect the rate of transmission to go lower. So the question then is, How quickly will this thing peak? And, if you looked at the standard model, it basically postulated a very long buildup and a peak which is about three months away from now. And that just strikes me as being too high and too far relative to everything else that we have.

So, in the United States, if you start looking at yesterday’s figures, it was about two per cent higher than the day before, which is already indicating that the speed-up is slowing down. We’re going to have to see what the next days do. But we’re talking ten thousand cases a day at the current maximum, and the flu was vastly larger in terms of its number and its extent. And my sense is, given the reactions that you’re going to have, this thing will peak earlier and start to decline earlier than the common models start to say, because they don’t seem to build in anything by way of adaptative responses.

You keep talking about your “sense.” I think that’s the word you’re using. But you’re stating as a fact that the virus is going to weaken over time. It seems like we do not know that. We can turn to other viruses and how they’ve—

No, that is not what I said. I said there’s a long-term tendency in these ways. Over time, yes. And is this a hundred-per-cent tendency? No. Is there any known exception to it? No. [“We did not see SARS or Ebola weaken over time,” Kuritzkes said. “It is only appropriate public-health measures or vaccines that have helped to control those epidemics.”] It seems to me that if you do this, what you’re trying to do is to figure out what the probabilities are, and I think the answer is, if you look at all of the cases that we’ve seen, no matter what’s going on, even if you subtract out the coercion that was used in China and in Korea and so forth, you cannot come up with a credible story that those places in Korea would have had, say, a half a million cases a day. Or in China you would have had, say, thirty million cases a day. And so I do think that the tendency to weaken is there, and I’m willing to bet a great deal of money on it, in the sense that I think that this is right. And I think that the standard models that are put forward by the epidemiologists that have no built-in behavioral response to it—

And you’re not an epidemiologist, correct?

No, I’m trained in all of these things. I’ve done a lot of work in these particular areas. And one of the things that is most annoying about this debate is you see all sorts of people putting up expertise on these subjects, but they won’t let anybody question their particular judgment. One of the things you get as a lawyer is a skill of cross-examination. I spent an enormous amount of time over my career teaching medical people about some of this stuff, and their great strengths are procedures and diagnoses in the cases. Their great weakness is understanding general-equilibrium theory.

O.K., so your expertise in the subject I guess comes in part from your work with AIDS, which you just referenced, is that right?

AIDS, and I’ve worked on evolutionary theory for forty years in its relationship to law.

You write, “There are two factors to consider.

  1. One is the age of the exposed population, and the other is the
  2. rate of change in the virulence of the virus as the rate of transmission slows, which should continue apace. By way of comparison, the virulent AIDS virus that killed wantonly in the 1980s crested and declined when it gave way to a milder form of virus years later once the condition was recognized and the bath houses were closed down.” [I read this passage to Kuritzkes, who responded, “It’s completely inaccurate. It had nothing to do with the change in the virus. We were able to do it by safe-sex practices and the like, and we saw the explosive growth of H.I.V. during the nineteen-nineties in sub-Saharan Africa and more recently in Eastern Europe. There is nothing about the virus that has become less virulent.”] What milder form of the virus are you talking about?

Look, all it is is it’s a distribution. What you do is you figure out what this toxicity strength is and if it’s X at one point, then it’s going to be some fraction of X down the road. And it’s quite clear that that is what happened with AIDS. And then, when it comes along and you start getting [the antiretroviral drug] AZT and other conditions, it’s easier to treat them because all of a sudden AIDS is evolved in much the same path as syphilis. If you go through the history of syphilis, it starts off, it’s essentially a deadly disease and kills most people. And then those who survive have the milder version of it. And so after a while what happens is it becomes a tamer disease. [Syphilis is a bacterial infection, not a viral infection. “One doesn’t have anything to do with the other,” Kuritzkes said. Ko told me, “That’s not something that is based in empirical evidence, so the fallacy in his argument is the over-all lack of scientific rigor in his analysis.”]

You’re saying that there’s a milder form of the H.I.V. virus than what was around in the eighties and nineties. That’s what you’re saying?

Well, I mean, there’s always been a continuous distribution from severe to less severe. What I’m saying is the probability distribution switches so that the medium becomes a little more mild. And, if it becomes more mild, it kills fewer people. And, after a while, it becomes something that becomes a chronic disease of some sort or another instead of something that’s virulent.

O.K., but you used the phrase a “milder form” of the virus, which I could find no scientific backup for, so I wanted to clarify that point.

Well, I’m just telling you, I’m giving you this as a theory.

Oh, it’s a theory.

No, look, I’m not an empiricist, but, again, let me just be clear to you, because you’re much too skeptical. The evolutionary component has not been taken into account in these models, and so before one is so dismissive, what you really need to do is to get somebody who’s an expert on this stuff to look at the evolutionary theory and explain why a principle of natural selection doesn’t apply here.

What I’m doing here is nothing exotic. I’m taking standard Darwinian economics—standard economic-evolutionary theory out of Darwin—and applying it to this particular case. And, if that’s wrong, somebody should tell me. But what happens is I just get these letters from people saying, “You’re not an expert. The H1 virus differs from this one in the following way.” What I don’t get from anybody is a systematic refutation which looks at the points parameter by parameter.

I guess my point is that shouldn’t you be careful about offering up these theories before they’re printed?

No. It turns out in this particular world if you become quiet about this stuff it never gets heard. And what we’ve had now is very loud talk on one side. I think most of it is incorrect. I’m always willing to debate somebody on the other side who wants to say this is the way the model works. In fact, I have several of my Hoover colleagues who have done exactly that.

Richard, with all due respect, your article is apparently circulating in conservative circles in Washington and the White House.

I didn’t write it as a conservative article. Donald Trump’s name is not mentioned in it.

I grasped that.

I’m not interested in politics.

I know, but we have a responsibility when we put our name on something, no?

I absolutely do. And I told you I’m willing to debate anybody and anywhere at any time on this particular topic, and we’ll see how it comes out. What was the last sentence in that article? Would you care to read it again?

I’ve got it right here, I believe. “Perhaps my analysis is all wrong, even deeply flawed. But the stakes are too high to continue on the current course without reexamining the data and the erroneous models that are predicting doom.” Are the stakes too high to publish articles with basic errors?

This is not a mistake. It’s an open challenge. I’ve spent my entire life as a lawyer taking on established wisdom. My view about it is what you’re asking me to do is, when I think everybody is wrong, to remain silent, and the stakes are too high. So my view is there’s all these experts on the other side. Somebody come up and explain why it is that they think the results are going to be different. Looking at the data thus far, both theories tend to predict a sharp rise at the beginning, mine less sharp than the one that’s coming out.

In the next week or so, we’ll see. I will be, shall we say, much more compromised if we start to see a continuing explosion of deaths going on for two or three weeks. But, if the numbers start to level off, the curves will start to go downward.

I was just asking about—

I’m saying what I think to be the truth. I mean, I just find it incredible—

I know, but these are scientific issues here.

You know nothing about the subject but are so confident that you’re going to say that I’m a crackpot.

No. Richard—

That’s what you’re saying, isn’t it? That’s what you’re saying?

I’m not saying anything of the sort.

Admit to it. You’re saying I’m a crackpot.

I’m not saying anything of the—

Well, what am I then? I’m an amateur? You’re the great scholar on this?

No, no. I’m not a great scholar on this.

Tell me what you think about the quality of the work!

O.K. I’m going to tell you. I think the fact that I am not a great scholar on this and I’m able to find these flaws or these holes in what you wrote is a sign that maybe you should’ve thought harder before writing it.

What it shows is that you are a complete intellectual amateur. Period.

O.K. Can I ask you one more question?

You just don’t know anything about anything. You’re a journalist. Would you like to compare your résumé to mine?

No, actually, I would not.

Then good. Then maybe what you want to do is to say, “Gee, I’m not quite sure that this is right. I’m going to check with somebody else.” But, you want to come at me hard, I am going to come back harder at you. And then if I can’t jam my fingers down your throat, then I am not worth it. But you have basically gone over the line. If you want to ask questions, ask questions. I put forward a model. But a little bit of respect.

O.K. Let me ask you this question. All my questions are asked with respect.

That’s not the way I hear it.

O.K. Let me ask you this question. This is an important point, so I want us to come to some sort of resolution on this, because I think it gets to the crux of what you’re saying. You write, “Moreover, it is unlikely that the healthcare system in the United States will be compromised in the same fashion as the Italian healthcare system in the wake of its quick viral spread. The amount of voluntary and forced separation in the United States has gotten very extensive very quickly, which should influence rates of infection sooner rather than later.” Here is what confused me. Are you saying we are overreacting, which seems to be the tone of the rest of the article, or are you saying that the measures we are taking are going to prevent an Italy-like disaster, in which case, why the complaints about the overwhelming response?

Well, I think the answer is all of the above. If what I’m saying is correct, we should not expect to see many replications of what has happened in New York, where in fact the caseload here is actually lower than it was during the height of the flu season last year. [At the time of this interview, Epstein was correct. Now, however, the number of COVID-19 cases surpasses it.] What’s happening is the amount of quarantine that we’re putting in has created strain on the system, because what we do now is we spend much more money per case than we did in the summer, because we have more respirators, more isolation, more special uniforms, more special ambulances, and so forth.

But also on the other side we’re going to see a very strong reaction. The self-quarantine that you’re seeing taking place in New York, where I live, this is hugely voluntary. I have so many friends, not only are they going into quarantine, anybody who has a house in Connecticut or New Jersey, in the suburbs, they go out and they’re spreading this thing out there. It’s like the days in England when people would leave London during the plague and head off to Oxford.

So I think all of these forces are going to take hold fairly quickly. And the Italian situation, well, what’s the problem there? This is a national health-care system, and the way in which national health-care systems ration, since they typically do not devote enough resources and they charge no prices, is they ration by queuing, which is they have people wait. And so the stories that come out of Italy, there was one in the Jerusalem Post, said that they had a consistent policy of not giving a respirator treatment to anybody who got the virus who was over sixty. Well, that’s going to clearly change the mortality rates. [Italy does not have a consistent policy on ventilators but has had to ration their use. New York City officials have warned that they, too, may run out of equipment. On Sunday, Mayor Bill de Blasio said, “We’re going to need at least several hundred more ventilators very quickly.”]

And, if you start looking at the mortality rates in Italy, ninety per cent or eighty-five per cent of the deaths are from people over seventy, which suggested something like this is going on. [The number appears closer to seventy-five per cent.] In the United States, we don’t have quite the skew, and we have a little bit better supply on things. I think we have a greater ability to ramp up in terms of things. So my guess is you will see real stresses in the short run in the New York area, but that given the time that’s available, I first of all did not think that the runoffs will be as great anywhere else throughout the system. All right? But, on the other hand, I think there’ll be more preparedness. My fear is that there will be overpreparedness if it turns out that the numbers that they’re preparing for are too high. Illinois declared that the state was on lockdown when they had twelve cases. By the way, Bill Gates agrees with me, I’m happy to say.

What does he agree with you on?

He thinks you have to relax the economic, lockdown restrictions. They are too severe.

Just to clarify, this is from a Vox Recode article, “Bill Gates rebuked proposals, floated over the last two days by leaders like Donald Trump, to reopen the global economy despite the Covid-19 coronavirus outbreak, saying that this approach would be ‘very irresponsible.’ ” Gates said, “There really is no middle ground, and it’s very tough to say to people, ‘Hey, keep going to restaurants, go buy new houses, ignore the pile of bodies over in the corner. We want you to keep spending because maybe there’s a politician who thinks GDP growth is all that counts.’ It’s very irresponsible for someone to suggest we can have the best of both worlds.”

I misread him then. Whatever Mr. Gates said, that’s fine. That strikes me as more populist than I am. The question is we managed to survive all of these things during the periods of flu vaccine. Nobody wants to trivialize death. You’re trying to minimize them. The point that I’m making is, you shut down the economy and put it on lockdown, you’re going to get medical deaths, when people don’t get adequate supervision and care for other kinds of conditions that also kill.

Right. I think the point that Bill Gates and others are making is that if we don’t shut down the economy or large parts of it, we’re going to get the economic devastation anyway down the road, because we’re not going to stop the virus.

That presupposes that the basic model is correct, that they’re relying on it. I think it is wrong. And the whole point of writing that article was to attack that model. Let’s put it this way: if in fact that model is right, it’s not at all clear that shutting down the economy will do any good, because it may well just be so devastating. And, if it’s wrong, it’s absolutely clear that the model is devastating.

If Elizabeth Warren really wants to unrig the system, she should focus on the Dream Hoarders

Odds are that you have not been following the recent libertarian dust-up over the merits of an Elizabeth Warren presidency. To give a brief recap: The main contenders were Will Wilkinson and Jerry Taylor of the “liberaltarian” Niskanen Center, who have been Warren-friendly to varying degrees; their opponents were colleague Samuel Hammond, along with Tyler Cowen of the more traditionally libertarian Mercatus Center, who touched off the whole debate with a withering critique of Warren’s policies.

A point-by-point exploration of their arguments would exceed the space allotted for this column by several thousand inches. But I think one can sum up the libertarian approach to Warren with a single question: How big a problem do you think billionaires, and the mega-successful corporations they helm, pose to the average American? Actually, come to think of it, I think that’s about how you’d sum up the question of Warren from any angle.

Which is why this debate ultimately matters to a lot more people than just some cranky libertarians: It speaks directly to a whole lot of young people who see that the economy doesn’t work for them the way it did for their parents and grandparents, and therefore conclude that somewhere along the way, the people it is working for — the barons of finance, the giants of Silicon Valley — must have rigged the system in their favor.

To be fair, they’re not entirely wrong. As Adam Smith once wrote, “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” Bankers and tech executives very much included. So I find myself nodding in agreement with Wilkinson — and, by extension, with the progressive base of the Democratic Party — when he says: “Warren’s general diagnosis of the problem — it’s a rigged system of anticompetitive rent-seeking enabled by insufficiently democratic and representative political institutions — is broadly similar to my own.”

Yet they’re not entirely right, either. Are big corporations, or billionaires, or banks, or tech giants, or health insurers and pharmaceutical firms — to name some of Warren’s favorite targets — really the reason that young people are struggling

  • with enormous student loans? Are they the reason that millennial homeownership lags that of their parents? Are they the
  • reason that recent college graduates are more likely than their elders to be underemployed? Have they
  • driven the cost of health insurance to its current stratospheric levels?

Sure, Warren may be eager to sic her Consumer Financial Protection Bureau on your mortgage lender if you fall afoul of some obscure clause, but that’s not the problem for most Americans. They’re much more likely to struggle with finding affordable housing in prosperous cities. In fairness, Warren does have a plan to ease the zoning regulations that cause the shortage — but for some reason she rarely talks about it on the campaign trail, possibly because it’s constitutionally dubious, but more likely because it would alienate her affluent suburban base.

Similarly, Warren is eager to forgive student loans — a $1.6 trillion transfer to some of the most affluent members of society — but not to attack degree creep, which has walled off most of the best jobs for those who hold a bachelor of arts while enriching a lot of colleges. She targets insurers and drugmakers, but not the hospitals and medical workers who drive most of our health-care costs.

Too many of her proposals are like this; they focus on corporate villains or billionaires while ignoring the much broader class of people that Richard Reeves of the Brookings Institution dubbed the “Dream Hoardersthe well-educated upper-middle-class people who are desperate to pass their privilege onto their kids, and are unhappy about the steadily mounting cost of doing so. They’re Warren’s base.

Unfortunately, the Dream Hoarders — and I include myself in their number — are a much bigger problem for the rest of America than the billionaires whose wealth Warren promises to expropriate. Those billionaires got that way by building companies that disrupted cozy local monopolies, and they fund coding camps for high-school dropouts; Dream Hoarders

  • protect their professional licensing regimes and
  • insist on ever more extensive and expensive educations in the people they hire. Dream Hoarders also
  • pull every lever to keep their own housing prices high — and poorer kids out of their schools — while
  • using their wealth to carefully guide their children over the hurdles they’ve erected.

Which may be why the best predictor of a neighborhood with a low degree of income mobility is not the gap between the top 1 percent and everyone else — the gap that Warren focuses on with all her talk of taxing billionaires — but

If you really want to unrig the system, you need to focus less on a handful of billionaires than on the iron grip that the Dream Hoarders have on America’s most powerful institutions — including, to all appearances, Elizabeth Warren’s campaign.

William Dalrymple on the ruthless rise of the British East India Company

The outrageous story of a group of financiers from a poor and damp island on the outer rim of Europe, who created a private company that became the biggest military and political power in all of India

Planet Money: Episode 945: The Liberty City

Art Martinez de Vara had a dream: To build a whole new kind of city, one with as few taxes and regulations as possible. That city is Von Ormy—a one-exit kind of place on the outskirts of San Antonio, Texas.

On today’s show, how Von Ormy went from being an unincorporated stretch of land, to a so-called “Liberty City.”

Charles Murray: Why America is Coming Apart Along Class Lines

Charles Murray, one of America’s most influential social policy thinkers, has come out with a widely discussed new book called Coming Apart: The State of White America, 1960-2010, which argues that Americans are splitting into two divergent classes, and that this growing divide could end American life as we have known it.

A self-described libertarian, Murray started his career as a liberal Democrat who spent six years in the Peace Corps and voted for Jimmy Carter in the 1976 presidential election. His political transformation came while he was researching his landmark 1984 book, Losing Ground: American Social Policy 1950-1980, which marshaled exhaustive evidence that American welfare programs were harming the very people they were supposed to be lifting out of poverty.

Losing Ground was fiercely denounced by the political left, but soon won mainstream acceptance that the War on Poverty was failing. The simple fact is there wouldn’t have been welfare reform in the 1990s without Losing Ground.

The Bell Curve: Intelligence and Class Structure in American Life, Murray’s 1994 collaboration with Harvard psychologist Richard Herrnstein, was more controversial. The book maintained that differences in genes contribute to differences in IQ, which in turn play a significant role in the life outcomes of individuals. Most controversially, Herrnstein and Murray argued that various ethnic groups have distinct differences in inherited intelligence. (Economist James J. Heckman reviewed The Bell Curve for Reason back in 1995: .)

Murray has written more than 20 books, including What It Means to Be a Libertarian: A Personal Interpretation, and he’s currently the W.H. Brady Scholar at the American Enterprise Institute .

Reason’s Ronald Bailey sat down with Murray in March for a wide-ranging discussion of how his earlier work informs Coming Apart, why he remains libertarian in his outlook, and whether younger Americans face an relentlessly negative future.

Approximately 35 minutes.

Written and produced by Jim Epstein.