This is based on an October 20, 2020 editorial in The Journal of The American Medical Association by David Cutler, PhD and Lawrence Simmons, PhD, both economics professors at Harvard University.
SARS-CoV-2 (Severe acute respiratory syndrome coronavirus 2) Pandemic is the greatest threat to prosperity and well-being in the United States since what we encountered in the great depression.
The following statistics are based on present (overly) optimistic United States predictions that the virus will be substantially contained by the end of 2021.
The monetary loss to the US is based on unemployment claims, people having less money to spend, business revenue decline, death, and reduced quality of life.
If we follow our current trajectory, 650,000 cumulative deaths will occur through the end of next year in the US. The value of a statistical life is controversial but is conservatively estimated at $7 million dollars per life. Therefore, the economic cost of premature deaths expected through next year is an estimated $ 4.4 trillion.
Long term impairment occurs in approximately 1/3 of survivors of severe or critical disease. (Double the number of deaths). This yields an estimated loss of $2.6 trillion through the end of next year.
Mental health toll is an additional component. It is estimated that an additional 80 million people will have mental health issues as a result of Covid. The cost of these conditions is estimated to be about $20,000 per person per year, or $ 1.6 trillion.
Let’s add up the numbers:
Category Cost (Billions of US dollars)
Lost GDP 7,592
Premature deaths 4,375
Long term health impairment 2,572
Mental health impairment 1,581
Total 16,121 (trillion)
This is a loss of 90% of the US Gross Domestic Product (GDP). This means each family of 4 loses $200,000. As a comparison, the total loss from the Great Depression was 1/4 as large.
The Congressional Budget Office predicts $76 Trillion in additional losses over the next decade if we don’t have another pandemic.
If we instituted wide scale testing, contact tracing and isolation (even assuming many will not quarantine), projected economic return is approximately 30x the cost. (i.e. $6 million invested averts $176 million in costs).
The Rockefeller Foundation estimates that 30 million tests per week plus contact tracing would cost around $100 billion ($100 billion times thirty equals $3 trillion in savings).
Currently, we spend most of our resources on acute care treatment (reactive care) with very little on public health services and infrastructure (proactive care).
A minimum investment of 5% of any covid economic relief should be devoted to such health measures as testing, contact tracing, and isolation and should remain in place indefinitely. We need the political will to make it happen.
~Dr. Mike Tremblay & Action Medicine team
