Thread by @jasonfurman

Russia has had more excess mortality from COVID than almost any other country in the world--more than double the US deaths and vastly greater than the Chinese deaths.

But you wouldn't know it from looking at Russian economic data: GDP back or even above pre-COVID foreacasts.

This shows the limits of the "control the virus to save the economy" thesis--both as a positive theory that predicts economic growth & as a normative recommendation.

Look at the vast differences in *reported* deaths for China and Russia and their economies look roughly the same.

Russia's excess deaths are also well above their officially reported numbers too and second only to Bulgaria with more than 1 million excess deaths. China likely underreports COVID deaths but would still be a tiny number compared to Russia. economist.com/graphic-detail…

As a POSITIVE theory, the problem is that *initially* people reduced their economic activity even before the government mandated social distancing. But that was only true initially. By 2021, for example, as Red states reopened in the spring their job growth rose.

The virus is indeed bad for the economy.

But steps to curb the virus have two effects: a direct effect that is bad for the economy and an indirect effect of reducing the virus which itself is good for the economy. The net is not obvious.

Here is @greg_ip noting this in the context of U.S. states where blue states are lagging economically because they have imposed more COVID limits--but they have also saved a lot of lives. wsj.com/articles/omicr…

Moreover it is not like you can ever declare victory. Look at the rolling Australian lockdowns. Or China now taking steps now that are almost certainly bad for the economy in the short run and likely even in the long run in order to keep COVID down. wsj.com/articles/china…

In contrast Russia has adopted an approach that has mostly denied the death toll the virus is wreaking, not impose any limits, and just muscle through economically. This is a perfectly fine way to maximize GDP growth but an appalling approach considered overall.

Which brings me to the limits of this as a NORMATIVE theory. One of the best reasons to save lives is to... save lives. It is worth doing that even if it doesn't help the economy. And it is worth doing that, to a point, even if it hurts the economy.

There are, indeed, interventions that are win-win and help the economy and save lives (vaccines!!!). But you don't want to limit yourself to just those. It can be worth paying something to save lives.

https://twitter.com/jasonfurman/status/1322196501666344960?s=20