Some Monday Links

Tale Spin (Real Life)

People, Not Science, Decide When a Pandemic Is Over (Scientific American)

Good Citizens (Orion)

I flee on sight.

Ivy League Justice (Law & Liberty)

Insularity issues have also been raised for the top EU Court: Political appointees and the dominance of French language.

The Political Economy of Classical Music (Jacobin)

China, Covid, and economic slowdowns

China’s economy faces a number of challenges — three in particular:

  1. the spread of the covid19 pandemic
  2. the country’s ambitious zero-covid approach (which has resulted in severe lockdowns)
  3. and a grave real estate crisis arising out of the crackdown on the property market

The slow down of China’s economy was acknowledged by Chinese Premier Li Keqiang. In a meeting he is reported to have said: “It is necessary … to further cut taxes and [administrative] fees to ensure a stable economic start in the first quarter and stabilize the macro economy.”

During a meeting in December 2021, Chinese leadership flagged ‘stability’ as its key aim for 2022. This was in stark contrast to targets for 2021, which was focused on ‘the disorderly expansion of capital’ driven by President Xi Jinping’s objective of reducing inequalities in Chinese society.

China’s zero-covid strategy is impacting its economic links with the rest of the world as international air travel is restricted, and even the stringent lockdowns applied in the country are likely to take their toll on global supply chains. A lockdown in Xian, for instance, has already prompted Samsung Electronics and Micron Technology, two of the world’s largest memory chip makers, to red flag the possibility of their chip manufacturing bases in the area being hit.

As a result of its zero-covid strategy, and its aim of controlling the spread of the pandemic in Xian, and also before the Beijing winter Olympics next month, China has further tightened regulations for the import of products from neighbouring countries in Southeast Asia. Trucks with agricultural products from Vietnam and Myanmar have been stranded for weeks (some for well over a month), and as a result products have been rotting (especially fruits like mangoes and jackfruit) and exporters in both countries have had to face losses (exports of non-agricultural products, such as rubber and minerals, from Laos to China, have also suffered). Apart from stringent checks, exporters of commodities are supposed to carry Chinese trucks across the border – the unloading of goods and transfer is a time consuming process and this leads to further delays.

It is not just mainland China but also the important financial hub of Hong Kong that has been following a zero-covid policy, which has impacted its economy – especially the tourist sector. The fact that Hong Kong will be opening to China before it opens to the rest of the world has also not sent out a positive message to international businesses.

China faces the onerous responsibility of not just keeping covid19 under check, but also preventing a further slow down in its economy. Economic challenges and the zero-covid approach will lead not only to domestic problems, but also impact its economic linkages with the rest of the world, especially neighbouring countries in Southeast Asia (China is an important market for agricultural products of Vietnam and Myanmar). The slow down in China’s economy and the remarks by Li Keqiang with regard to the same also highlight the limitations of Xi Jinping’s economic vision and the fact that there is a growing concern with regard to the country’s possible economic challenges over the next few months.

An Alternative to Chasing New Variants of SARS-CoV-2

In discussing the push to vaccinate against COVID-19 in developed economies like the US, UK, etc., what gets lost in political rhetoric is the importance of effective vaccination among the immunosuppressed, especially the HIV+ group.

In groups with underlying immunosuppression [i.e., people with hematological malignancies, people receiving immunosuppressive therapies for solid organ transplants, or other chronic medical conditions], there have been reports of prolonged COVID-19 infection. The latest one is from South Africa, where an HIV+ patient experienced persistent COVID-19 infection –of 216 days– with moderate severity. The constant shedding of the SARS-CoV-2 virus accelerated its evolution inside this patient. This is possible because suboptimal adaptive immunity delays clearance of the SARS-CoV-2 virus but provides enough selective pressure to drive the evolution of new viral variants. In this case, the mutational changes of the virus within the patient resembled the Beta variant.

The largest population of immunosuppressed [HIV+] is in South Africa. So an alternative to chasing variants like Delta and Beta after their largescale emergence or trying to convince people who reject vaccination in the Global North is to tackle super-spreading micro-epidemics of novel variants among the immunosuppressed in the Global South. Since Novovax and J&J are demonstrably ineffective among the immunosuppressed, the Moderna vaccine is the best bet to slow down the emergence of future variants.

Who has millions of unused mRNA Covid-19 vaccines that are set to go to waste? The answer is the United States. As demand dwindles across the United States and doses will likely expire this summer, why not use them in the Global South, especially South Africa, by a concerted international effort?

US and China: Knowledge Deficit or Trade Deficit?

The problems with headlines such as this: “US Trade Balance With China Improves, but Sources of Tension Linger” are twofold. 

https://www.wsj.com/articles/u-s-trade-deficit-narrowed-in-december-as-exports-outpaced-imports-11612532757

A: It furnishes support to the notion that trade surpluses are FOREVER safe and trade deficits are INVARIABLY grave. That is not accurate because foreign countries will always wish to invest capital in countries like the US, which employ it relatively well. One clear case of a nation that borrowed massively from abroad, invested wisely and did excellently well is the United States itself. Although the US ran a trade deficit from 1831 to 1875, the borrowed financial capital went into projects like railroads that brought a substantial economic payoff. Likewise, South Korea had large trade deficits during the 1970s. However, it invested heavily in industry, and its economy multiplied. As a result, from 1985 to 1995, South Korea had enough trade surpluses to repay its past borrowing by exporting capital abroad. Furthermore, Norway’s current account deficit had reached 14 percent of GDP in the late 1970s, but the capital it imported enabled it to create one of the largest oil industries.

B: The headline makes a normative claim while equating bilateral trade deficit with the overarching narrative of bilateral tensions. Such normative claims follow from the author’s value-based reasoning, not from econometric investigation. China and the US may have ideological friction on many levels, but the surplus or deficit has much to do with demographics and population changes within a country at a given time. Nonetheless, a legacy of political rhetoric relishes on inflating and conflating matters. We hear a lot about the prediction that China is forecasted to become the largest economy by 2035, provoking many in the US to bat for protectionist policies. But we ignore the second part of this prediction. Based on population growth, migration (aided by liberal immigration policies) and total fertility rate, the US is forecasted to become the largest economy once again in 2098. 

Therefore, it is strange that a lot of the “trade deficit imbalance” headlines neglect to question if the borrower is investing the capital productively or not. A trade deficit is not always harmful, and no guarantee that running a trade surplus will bring substantial economic health. In fact, enormous trade asymmetries can be essential for creating economic development.

Lastly, isn’t it equally odd that this legacy of political rhetoric between the US and China makes it natural to frame trade deficits with China under the ‘China’s abuses and coercive power’ banner but intimidates the US establishment from honestly and openly confronting the knowledge deficit in SARS-CoV-2’s origin? How and when does a country decide to bring sociology to epistemology? Shouldn’t we all be concerned more about significant knowledge deficits?

Vaccine Apartheid and Intellectual Property

Introduction

In recent weeks there has been a growing clamor with regard to addressing the issue of vaccine ‘apartheid’, or the inequity in access to vaccines (as of April 2021, the more affluent countries, which account for less than 20% of the global population, had bought 60% of confirmed orders – well over 4.6 billion doses).

African leaders have red-flagged the issue of lack of access to vaccinations and also how, due to poor access, rate of vaccination is slow. South African President Cyril Ramaphosa has commented

…no one is safe until everyone is safe, so all of us must be treated equally across the world and vaccines must be treated as a public good, available at affordable prices right across the board.

The rise in daily cases (more than 20 million Indians have been infected) and mortalities (in the month of April itself, there have been an estimated 40,000 casualties) as a result of COVID-19 in recent weeks in India has further brought this issue to center stage. Apart from the government being ill-prepared for the second wave, and the virtual collapse of the health system (even in the national capital there has been a shortage of beds and oxygen), the third wave is being attributed to the slow rate of vaccination: only 2% of the population has been fully inoculated with both doses, while less than 10% has received one dose. One of the reasons cited for the slow rate of vaccination has been India’s inability to ramp up its vaccine production which could be eased out if the World Trade Organization (WTO) provides an intellectual property waiver.  

During an online address, US Trade Representative Katherine Tai underscored the point that addressing the issue of vaccine inequity is important not just from the point of public health but also from an economic standpoint.

One of the ways for increasing vaccination, as discussed earlier, is increasing the production and for this an Intellectual Property (IP) Waiver is essential. Both the Chief of the World Health Organization (WHO), Tedros Adhanom, as well as former British Prime Minister Gordon Brown, have repeatedly made this point. Both Brown and Tedros said that removing a waiver during an emergency situation was essential and this should be on the agenda of the G7 Summit to be held in June in the UK.

South Africa and India have, since October 2020, been seeking a waiver on certain provisions of the WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).   

Pressure on the US to provide Intellectual Property waivers

There has been growing pressure on the Biden administration to address the issue of vaccine apartheid and this has grown in recent days and weeks. 

More than 170 heads of state and several Nobel Laureates wrote to US President Biden in favour of removing US IP rules for production of vaccines. This includes former French President Francois Hollande, Former British PM Gordon Brown, and Nobel Laureates Professor Joseph Stiglitz and Professor Francoise Barre-Sinoussi.

10 Democratic Senators have also written to Biden to support the temporary TRIPS waiver.

Biden administration assistance to India and possibility of intellectual property waiver 

In recent weeks, with the increasing number of cases in India, the Biden administration has unequivocally stated that it will assist India in dealing with the COVID-19 threat. Apart from President Biden and other senior officials from his administration who have assured all necessary help, Anthony Fauci, the Chief Medical Advisor to the President, has asked pharmaceutical companies to help out either by ramping up their production or by transferring their technologies. Said Fauci:

You can’t have people throughout the world dying because they don’t have access to a product that rich people have access to.

US National Security Advisor Jake Sullivan, in a media interview, also stated:  

We believe that the pharmaceutical companies should be supplying at scale and at cost to the entire world so that there is no barrier to everyone getting vaccinated.

On Wednesday, May 6, 2021, the Biden administration announced that it supported the waiver on Intellectual Property protections for COVID-19 vaccines. US Trade Representative Katherine Tai, in a statement, said:

This is a global health crisis, and the extraordinary circumstances of the COVID-19 pandemic call for extraordinary measures. The Administration believes strongly in intellectual property protections, but in service of ending this pandemic, supports the waiver of those protections for COVID-19 vaccines.

Why this announcement is important 

The announcement is a significant development, given the pressure from numerous quarters, especially pharmaceutical lobbies. Founder of Microsoft and philanthropist Bill Gates, in a media interview, spoke against waiving patents. Said Gates:

It’s not like there’s some idle vaccine factory, with regulatory approval, that makes magically safe vaccines.

Gates, through the Bill and Melinda Gates Foundation, has sponsored Gavi: the Vaccine Alliance, a public-private global health partnership which seeks to increase low-income countries’ access to immunization. Gavi, alongside WHO, runs the COVAX to improve access to vaccines in low- and middle-income countries.

A trade group, PhRMA, has also warned against an IP waiver, and a number of Republicans have argued against such a step and wrote a letter to US Trade Representative Katherine Tai.

Conclusion 

In conclusion, the Biden administration’s decision on May 6, 2021, needs to be hailed; it is important to address all issues which are obstructing the ramping up of global manufacturing of vaccines and preventing a faster rate of vaccination in less affluent countries. All stakeholders need to act fast to prevent the pandemic from spreading and taking more lives. Globalization, multilateralism, and talk of liberal values are of no use if the issue of vaccine apartheid is not addressed on a war footing.

Health policy is a less mature field in India

The raging second wave of Covid-19 hasn’t just collapsed the Indian healthcare, it has devastatingly uncovered preexisting public health policy deficits and healthcare frailties.

[As of May 3, 2021]
[As of May 3, 2021]

In India, there is a need to revive a serious conversation around public health policy, along with upgrading healthcare. But wait, isn’t the term ‘public health’ interchangeable with healthcare? Actually, no. ‘Public health’ is the population-scale program concerned with prevention and not cure. In contrast, healthcare essentially involves a private good and not public good. Most public health experts point out, the weaker the healthcare system (such as in India), the greater the gains from implementing public health prevention strategies.

India focused its energies on preventing malaria by fighting mosquitoes in the 1970s and then regressed to treating patients who have malaria, dengue or Zika ineffectively. A developing public health policy got sidelined for a more visible, vote-grabbing, yet inadequate healthcare program. Why? Indian elites tend to transfer concepts and priorities, from the health policy debates of advanced economies, into Indian thinking about health policy without much thought. As a result, there is considerable confusion around terminologies. There is a need for a sharp delineation between: ‘public good,’ ‘public health’ and ‘healthcare.’ The phrase ‘public health’ is frequently misinterpreted to imply ‘healthcare.’ On the contrary, ‘healthcare’ is repeatedly assumed as a ‘public good.’ In official Indian directives, the phrase ‘public health expenditure’ is often applied for government expenditures on healthcare. It is confusing because it contains the term ‘public health,’ which is the antonym of ‘healthcare.’

Many of the advanced economies of today have been engaged in public health for a very long time. As an example, the UK began work on clean water in 1858 and on clean air in 1952. For over forty-five years the Clean Air Act in the U.S. has cut pollution as the economy has grown. Therefore, the elites in the UK and US can worry about the nuances of healthcare policy. On the other hand, the focus of health policy in India must be upon prevention, as it is not a solved problem. Problems such as air quality has become worse today in India. Can the Ministry of Health do something about it? Not much, because plenty of public health-related issues lie outside the administrative boundaries of the Ministry of Health. Air quality—that afflicts North India—lies in the Ministry of Environment and internal bureaucracy—“officials love the rule of officials”—deters the two departments from interacting and working out such problems productively. Economist Ajay Shah points out, Indian politicians who concern themselves with health policy take the path of least resistance—to use public money to buy insurance (frequently from private health insurance companies) for individuals who would obtain healthcare services from private healthcare providers. This is an inefficient path because a fragile public health policy bestows a high disease burden, which induces a market failure in the private healthcare industry, followed by a market failure in the health insurance industry.

In other words, Ajay Shah implies that the Indian public sector is not effective at translating expenditures into healthcare services. Privately produced healthcare is plagued with market failure. Health insurance companies suffer from poor financial regulation and from dealing with a malfunctioning healthcare system. No matter the amount of money one assigns into government healthcare facilities or health insurance companies, both these routes work poorly. As a consequence, increased welfare investment by the government on healthcare, under the present paradigm of the Indian healthcare, is likely to be under par.

The long-term lessons from the second wave of COVID-19 is that inter-departmental inefficiencies cannot be tolerated anymore. Public health considerations and economic progress need to shape future elections and the working of many Indian ministries in equal measure. India deserves improved intellectual capacity in shaping public health policy and upgrading healthcare to obtain a complete translation of higher GDP into improved health outcomes. This implies that health policy capabilities—data sets, researchers, think tanks, local government—will need to match the heterogeneity of Indian states. What applies to the state of Karnataka will not necessarily apply to the state of Bihar. The devastating second wave is not arguing for imposing more centralized uniformity in the working of healthcare and public health policy proposals across India, as it will inevitably reduce the quality of executing these proposals in its diverse states with various hurdles. Instead, Indian elites need to place ‘funds, functions and functionaries’ at the local level for better health outcomes. After all, large cities in India match the population of many countries. They deserve localized public health and healthcare policy proposals.

The need to address the foundations of public health and healthcare in India around the problems of market failure and low state capacity has never been greater.

Nightcap

  1. Pfizer-Biontech: Firstcomers and latecomers Irfan Khawaja, Policy of Truth
  2. Alienation and double-think Chris Dillow, Stumbling & Mumbling
  3. It’s not just housing… Scott Sumner, EconLog
  4. Winters in medieval Europe Lucie Laumonier, Medievalists

Nightcap

  1. The closing of New York City, again (podcast) John Calvin Batchelor Show
  2. Catastrophic events vs infectious disease outbreak (pdf; 2015) May et al, Reason Papers
  3. The international dimension of subnational self-government (1984) Ivo Duchacek, Publius
  4. 2020 is unlikely to be an inflection point” (2020) Dan Drezner, International Organization

Nightcap

  1. How American couples are struggling through the pandemic Rafael Nam, NPR
  2. The thing party (GOP) vs. the idea party (Dems) Scott Sumner, EconLog
  3. Karl Marx was right (pretty much) Jacques Delacroix, NOL
  4. Does Max Weber’s theory hold up today? Corey Robin, New Yorker

Nightcap

  1. American elections: what’s at stake? Branko Milanovic, globalinequality
  2. Covid-19, risks, and rights violations Irfan Khawaja, Policy of Truth
  3. Reading 150 books on Donald Trump Alex Shephard, New Republic

Nightcap

  1. Conceptions of politics Chris Dillow, Stumbling & Mumbling
  2. From bootleg liberalism to Trumpist McCarthyism Irfan Khawaja, Policy of Truth
  3. Follow the social science, too Horwitz & Stephenson, EconLog
  4. Inequalities and Covid-19 Branko Milanovic, globalinequality

Nightcap

  1. Hypocrisy, racism, and MBA candidates Natalie Solent, Samizdata
  2. Naive realism and the pandemic Arnold Kling, askblog
  3. A brief chat on world government Evan Huus, Grand Unified Empty!
  4. Portrait of an ordinary Nazi Malcolm Forbes, American Interest

Nightcap

  1. Adele and the local nature of social norms Lauren Hall, RCL
  2. The evolution of a legal rule (pdf) Niblett, et al, Journal of Legal Studies
  3. Covid and the counterfactual, and the longer term Eric Crampton, Offsetting Behaviour
  4. The last great theorist of history Stefan-Ludwig Hoffmann, Aeon

International students, international trends

Introduction

In the aftermath of the COVID-19 pandemic, there have been numerous discussions with regard to the impact it will have on the sphere of international higher education. Recent decades have witnessed a rise in the number of international students pursuing higher education in the US, the UK, and Australia (in recent years, Chinese and Indian nationals have been the two largest groups within the international student community in these countries).

According to UNESCO, there were over 5.3 million international students in 2017. This was nearly thrice the number of 2000 (2 million). The rise of globalization, which has led to greater connectivity and more awareness through the internet, have contributed towards this trend. It would be pertinent to point out that the global higher education market was valued at a whopping $65.4 billion in 2019.

In a post-corona world, a number of changes are likely to take shape in terms of higher education.

Likely changes in a post-corona world

The first change likely to occur in a post corona world is a drop in the number of Chinese students seeking to enroll at higher education institutions in not just the US, but also in Britain and Australia.

In the case of the US, a number of changes have been introduced with regard to student visas for Chinese students. In 2018, certain changes had already been introduced for Chinese students enrolled in Science, Technology, Engineering, and Management (STEM) courses. Only recently, further changes have been made in the context of student visas for Chinese nationals. According to the new policy, F1 and J1 visas cannot be issued for graduate level work to individuals involved with the People’s Republic of China’s military-civil fusion strategy.

China has warned students planning to pursue higher education in Australia to reconsider their decision given both the COVID-19 pandemic and instances of racism against Asians. Chinese students account for a staggering 28% of the total international community (estimated at 750,000).

And, in Britain, where students from China were issued a total of 115,014 visas in 2019 (a whopping 45% of the total), recent tensions with China after the imposition of the National Security Law in Hong Kong could mean a significant drop in the number of Chinese students enrolling at British universities.

Second, given the disruptions in international travel, a number of students have revised plans with regard to pursuing higher education overseas. According to estimates, international student enrollment in the US could drop by 25%, which will have a significant impact on the economy (in Britain and Australia too, there is likely to be a drop in the number of students enrolled).

Third, universities have made concessions in terms of entrance tests, waiving application fees and even financial assistance, so as to ensure that there is not a drop in take. A number of universities have already confirmed that they are shifting to an online mode of education for the academic year 2020. This includes top universities like Harvard (USA) and Oxford (UK).

Fourth, countries that have an open door immigration policy, like Canada, are still likely to be attractive for international students — especially from India.

Importance of international students

What has also emerged from recent developments is that while governments may not be sensitive to the concerns of international students, universities (and companies) realize the value which international students add by way of talent and skills. Two US institutions, Harvard and MIT, filed a law suit against the US government (Department of Homeland Security and Immigration and Custom Enforcement) for bringing out a notification which stated that international students studying at institutions where classes were being held online would either need to transfer or return home.

All Ivy league institutions and 59 other private colleges signed a court brief supporting the law suit. The Presidents’ Alliance on Higher Education and Immigration, which includes 180 colleges, also lent support to Harvard and MIT. As a result of this law suit, the Trump Administration had to rescind its decision, which would have impacted 1 million students.

Commenting on the judgment, Harvard University President Lawrence Bacow said:

“We all recognize the value that international students bring to our campuses, to this nation, and to the world.”

Conclusion

In recent decades, the free movement of students has been taken for granted. Higher education was an important bridge between countries. In the aftermath of the pandemic, and the souring of ties between China and the rest of the world, international higher education is likely to witness major changes. At the same time, the use of technology also provides opportunities, and there is space for greater collaborations between higher education institutions in the US, the UK, Canada, Australia, and those in the developing world.

Wat’s On My Mind: Immigration and Voting for Redistribution

When COVID first started spreading more widely in the US, I began worrying that this would lead to an upsurge of anti-immigrant sentiment. I worried that people would draw the wrong lesson from this experience and return to the isolationism of the 1920s, closing our borders on a more permanent basis to both people and goods. This would slow economic growth and lead to a poorer nation. It seems particularly ironic that just now Americans are becoming the unwelcome foreign visitors abroad, particularly from my home states of Texas and California.

Nowrasteh and Forrester at CATO discuss some papers by Giuliano and Tabellini on the question of if increased immigration moves the median voter to the left. They also add a few suggestive regressions of their own. Their summary is interesting and nuanced. First, they find that closing the borders to immigrants in the 1920s encouraged much greater government spending (as a percent of GDP) while allowing more immigrants in the 1960s has slowed the growth of government spending. This effect seems to work both ways: American voters are more willing to vote for welfare benefits, etc, when there are fewer immigrants getting them, and the larger the welfare state is, the more concerned voters are about allowing immigrants into the country. So it may not be so much that adding immigrants from more left-leaning countries shifts the median voter as much as it moves native voters further to the right? (See also Rosenthal and Eibner 2005, who also conclude that “a voter of a given income is less eager to redistribute given that redistribution has to be shared with the non-citizen poor.”)

This suggests an interesting line of argument, that these feedback effects can work in the opposite direction as well. I imagine a friend who is very concerned about the size of government and also would prefer to have fewer immigrants. To that friend, I would suggest that allowing more immigrants can help slow or even reverse the growth of government and the welfare state. Using their aversion to one issue could potentially reduce their aversion to the other. <epistemic status: highly speculative>