Government policy has been a catastrophic muddle in countries like the UK and US. With eradication now impossible and proper control far less likely, the trade-offs associated with lockdown are far more difficult.
I want to examine more closely some of the relaxation arguments I outlined previously, it may be that no lockdown is a better policy than a mismanaged one.
- Free-rider
One could as an individual, including perhaps your friends and family, act as you like while everyone else stays in lockdown. You have the freedom and no risk of infection. From the outrage as Cummings’ behaviour and the clear selfishness, I think it is clear this is not a common viewpoint.
- Let’s all do it
If you are happy to take the risk and also happy for everyone else to do the same, this seems much more reasonable as you get the benefit of freedom but the cost is that you are likely to be infected with Covid.
How risky is COVID?
I have previously written about how the Infection Mortality Rate is around 1%. As we have received more information about the disease, this remains a decent estimate, but it is also potentially misleading as it’s an average across a population, disguising a huge skew in the risks across age. The risks of dying are very low for anyone under 60 and climb sharply for older people. 
A young person’s view
The most common cause of death for people in their 20s is accidents. In fact the risk of someone in their 20s dying from Covid if they catch it this year is about the same as them dying in an accident in the next year. The risk of dying in an accident is not something to ignore so we try to minimise risks through the wearing of seatbelts etc, however it does not stop young people from driving or going to work, school or university.
Given the low risk it is not immediately obvious why young people are so in favour of lockdown. It may be that younger people are more inclined to focus more on care and society than on individual liberty. It may also be the case that they overestimate their personal risks as the large death toll and confusing presentation of the numbers creates the impression that the virus would be just as deadly for them. They are young and a 1% chance of dying sounds far too high to live with as it is perhaps 50 times higher than your chances of dying this year from other causes.
In fact, for anyone under the age of 60, the risk of dying from Covid is lower than the risk of dying from other causes this year. I would like to find a poll which asks people under the age of 60 about this risk to Covid. Do they feel it is higher than other causes or perhaps feel it is low but in a similar way to being scared of flying, it is the perceived randomness and lack of control that drives the anxiety.
How about older people
It is striking that the people most at risk from the virus are in the age category most against lockdown. It may be more driven by issues of civil liberties, but it might also relate to an acceptance of the risk of death. Their risk of death for older people from catching Covid is high but so is their risk of death this year from other causes. In fact, they are remarkably similar.
Opportunity costs
Perhaps the costs of lockdown are not the same for people of different ages either. If you have a life expectancy of 60 more years, then losing 6 months to lockdown may seem reasonable. If you have a life expectancy of 6 years then perhaps losing 6 months to lockdown being isolated from your family is a much higher price to pay.
The problem
What I have tried to outline is a case for why younger and older people might both choose to exit lockdown. Despite this, I do not think people are in favour of lockdown because they misunderstand their personal risks. It is because they feel a sense of responsibility to others. From the chart below, we can see that people put the risk to others as far higher than to themselves. People are aware that if they break guidelines, it is not just themselves they put at risk but also everyone else. The outrage at Cummings showed many people feel that it was not acceptable.
Consent and Confidence
Imagine we had a large majority in favour of retaining much looser restrictions and willing to take the increase in personal risk. The problem is that they are imposing a higher risk of death on a significant number of people who have not consented to it.
A possible route for dealing with consent is a policy of shielding those who are vulnerable and who wish to be shielded. I would like to read a paper that explains how this might be possible as I have not come up with a way to do it. As I wrote previously Sweden was the country closest to pursuing this policy but effective shielding proved very difficult to achieve, with large numbers of care home deaths.
Confidence is perhaps even harder to achieve in divided countries like the UK and US with low levels of trust in the government. It might be more possible in countries with higher levels of cohesion and trust but most of those have already chosen the path of controlling the virus.
Can we go down this path?
As I wrote in my May 23rd post https://appliedmacro.com/2020/05/23/3-paths-forward-for-the-economy/ there are ways a society can choose to move forward without lockdown. There is no reason that Pakistan (average age 24) should necessarily take the same path as Germany (average age 47). But the key to success for either a lockdown or a herd immunity strategy is ongoing consent and participation.
The policy mix in the US and the UK appears to be to back into the herd immunity approach by muddled incompetence without consent. The rhetoric of public health with the actions of a libertarian leads to the worst possible outcomes for both public health and the economy.
Applied Macro 