Sunday, March 29, 2020
written 22 March 2020
published 29 March 2020
Logic is based on axioms: fundamental assumptions. Given a different set of axioms, the logical conclusions are vastly different. Capitalism assumes all people are selfish and autonomous, that all values can be reduced to a fiscal quantity, and the only goal of business is maximum profit.
The logical consequence of these assumptions is a globalized economy constantly striving to reduce fiscal costs. Union busting and automation have reduced labor costs, but eliminated living wage jobs. "Just in time" shipping has eliminated stored inventory costs. The result is an economic infrastructure that has little capacity to rapidly respond to changes in demand. "Free market" philosophy says that when demand exceeds supply capacity, prices will rise, reducing demand to a level that production can satisfy. But that assumes the demand is flexible and totally driven by cost. While this works relatively well for most goods and services, it is totally inadequate for robust public health.
We have a private capitalist health system in America, which is lean enough to make it profitable most of the time. As a result, we have less capacity per capita than other industrialized nations, with fewer than one million hospital beds for a population of 325 million. The "just in time" production model means essential materials are not stockpiled anywhere. All spare capacity in the system has been intentionally removed for increased profitability, but it is incapable of rapidly increasing capacity when needed. In normal conditions this makes sense, but leaves the healthcare system vulnerable to collapse, with lethal consequences, when dealing with an accelerating pandemic.
The current demand for acute health care is not price driven, but needs driven, so the limited supply will have no effect on reducing the demand. Instead, the health consequences will be much worse, as people who could survive if given some health care will die without it. As I write this on 22 March, the health care system in New York city is on the verge of being overwhelmed, with over 9,000 cases so far.
The market theory of supply and demand is incapable of meeting the needs of public health because the assumptions are wrong. In the face of pandemic, we are all in this together, not autonomous. We are all vulnerable to infection if anyone is infected, so the solution must be inclusive. A public health system must take into account what might happen, not just what is likely or desirable, so "profitability" must look long term, not just this quarter. It makes sense to have excess capacity that can be utilized quickly when needed. Stockpiles of critical materials make sense, even if the need is very intermittent. Long term, large scale, planning is necessary in order to have the capacity to deal with rapidly changing circumstances. Learning from the past helps prepare for future events.
Unfortunately, none of these essentials are part of American healthcare today. In addition, we have federal leadership that incapable of dealing with any reality that reflects poorly on the president.
After the 2014 Ebola outbreak in Africa, the government established apermanent epidemic monitoring and command group inside the White House National Security Council and another in the Department of Homeland Security, informed by scientific and public health advice. In 2018, Trump shut down the entire group, reassigned the leaders, which have not been replaced, and laid off most of the staff. He stated at the time that "he didn't want to pay for thousands of people to sit around." The White House has also reduced national health spending and cut global disease-fighting budgets.
Rather than taking a leadership role, coordinating federal, state and local responses to the virus, guided by knowledgeable scientific and public health experts, the president has made things worse. From the beginning he minimized the issue, more concerned with his image than the unfolding disaster. As the stock market reacted to reality, he focused on the financial collapse rather than the pending medical collapse. He has consistently given out wrong or misleading advice, forcing staff "corrections". He has abandoned all responsibility, ceding effective leadership to state governors.
The wrong economic model, combined with incompetent federal leadership, means that America will have a worse experience with this virus than most of the rest of the world.
Sunday, March 22, 2020
written 15 March 2020
published 22 March 2020
One of the standard discussions in financial planning is the "magic of compound interest". If you put $1000 in a jar and add another $1000 every year, after a decade you will have $10,000. But the same savings rate invested at 5%, compounded monthly, will produce $14,587 at the end of the decade, almost 50% increase. That is an example of exponential growth.
There is an old story that the inventor of chess asked his king to reward him for his discovery with a quantity of rice. A single rice grain was to be placed on the first square of the chessboard, two grains on the second square, four grains on the third, doubling on each square. The reward could not be paid. By the time you get to the 64th square, there are over 18 quintillion (million trillion) grains of rice on the board, weighing over 300 billion tons, 400 time the current annual planetary rice production. This is an example of extreme exponential growth.
Life produces exponential growth routinely. A single apple seed grows to become a mature tree that can produce 500 apples a year for 20 years, an increase of ten thousand. A single grain of rice will produce as many as 100 new grains when it matures in as little as four months. Three crops a year would give an annual return of one million to one.
When we get down to the cellular level, things happen very rapidly. Humans grow from a single cell to 37 trillion cells in 18 years, an amazing exponential growth rate. Human cells take about 5 hours to divide, and our bodies produce about 10 billion cells every hour, for our entire life. In a healthy body, this production balances out the number of cells that die, so our body size and weight remains relatively stable over time.
Viruses, such as the flu, are one thousand times smaller than our cells. An individual is called a viron, which is very simple in construction, consisting of a small quantity of nuclear material encased in a protein shell. A single viron can infect a cell. Once it penetrates the cell wall, it hijacks the cell systems to replicate the parts of itself. This lysogenic cycle takes about 6 hours, then it moves into the lytic cycle, where the parts self-assemble into new virons, and burst out of the cell, generally killing the host cell. Different viruses have different burst sizes. Flu produces at least a thousand new virons in each infected cell, giving a possible growth rate of a trillion to one every day. That is the challenge our immune system faces when we become infected.
COVID-19 appears to be twice as infectious as normal flu, with estimates that an infected individual can infect 2-3 other people within two weeks. Most infected people will have a mild case and may not even know they have the virus, but 15%-20% will have serious symptomatic responses, perhaps requiring hospital care. Reported global case numbers are generally people diagnosed as a result of showing symptoms such as fever. Of that group, almost 4% have died. This means that the overall lethality rate may be 0.6% - 0.8%, which is 6 to 8 times greater than normal flu. A precise lethality rate can't be determined at this time, since we have no idea how many people are actually infected, only how many show symptoms, and how many of those die. Finally, estimates are that 40%-70% of the global population could be infected by the time this runs its' course. The evidence so far is cause for concern and preparation, because exponential growth can rapidly change the magnitude of the problem, potentially overwhelming health care capacity.
The first case of US community transmission was reported on 27 February. I am writing this on 15 March, 17 days later. Today's reported US case total is 3,273, a 774 case increase from yesterday. Like the single grain of rice on the first square of the chess board, these first few days of reported cases seem modest, but exponential growth indicates an impending tsunami. So far, our federal government's response has been to minimize the problem, because it reflects poorly on the president. Unfortunately, reality always prevails over self-serving denial.
Sunday, March 15, 2020
written 8 March 2020
published 15 March 2020
"Since the start of Donald Trump's presidential run, one question has quietly but urgently permeated the observations of concerned citizens: What is wrong with him?" This is the first line of the inner cover notes on the book "The Dangerous Case of Donald Trump: 27 Psychiatrists and Mental Health Experts Assess a President", by Bandy Lee, published in 2017.
Psychiatrists have a code of ethics which prohibits diagnosis without detailed personal examination. The so called "Goldwater rule" states "it is unethical for a psychiatrist to offer public opinion on a public figure without examination." But, like physicians, they have an obligation to the welfare of the larger society, and are mandated to report, or incapacitate, a person who poses a danger. "Dangerousness" evaluates how the individual acts, not why they act as they do, and an assessment can be made without a clinical diagnosis of the underlying cause. Thus, a person can be disarmed, incarcerated, or protected, if their actions are a danger to themselves, their family, or their community.
In April, 2017, a symposium was held, and "The Dangerous Case" is a publication of the proceedings, with two presentations excerpted here.
Zimbardo and Sword: "Unbridled and Extreme Present Hedonism."
"An extreme present hedonist will say or do anything at any time for purposes of self-aggrandizement, with no thought of the future effects of his actions. Impulsive thoughts lead to an impulsive action that can cause him to dig in his heels when confronted with consequences."
"Narcissistic people think very highly of themselves, simultaneously thinking very lowly of everybody else. Narcissists are emotional, dramatic, and lack compassion and empathy. What lies underneath narcissist personality type is very low self-esteem, unable to handle criticism of any kind, becoming enraged or condescending."
"When an individual is psychologically unbalanced, everything can fall apart. We are gravely concerned about Trump's abrupt, capricious 180-degree shifts and how these displays of instability have the potential to be dangerous to the point of causing catastrophe."
Schwartz: "I Wrote The Art Of The Deal."
"Trump's sense of self-worth is forever at risk. When he feels aggrieved, he reacts impulsively and defensively, constructing a self-justifying story that doesn't depend on facts and always directs the blame to others. Many of the deals in The Art Of The Dealwere massive failures, but Trump had me describe each of them as a huge success. Trump doesn't value empathy, generosity, reflectiveness, or an inner sense of right and wrong. Facts are whatever Trump deems them to be on any given day. His aim is never accuracy; it's domination. He reacts rather than reflects, and damn the consequences. This is what makes his access to the nuclear codes so dangerous and frightening. The more he feels at the mercy of forces he cannot control, the more resentful, desperate, and impulsive he becomes."
The COVID-19 outbreak is beyond Trump's control. Trump's reaction has been to minimize the risk, which he views as an attack on his presidency. Last week the president claimed that the virus would “go away” once the weather gets warmer. “We’re probably down to about 10 cases." Instead, it has increased around the world, with cases now in 104 countries, up from 66. In the US, the case count has jumped from 73 to 474 (with 22 dead), and is now in 33 states. The US has tested only 5,800 people so far, while South Korea tests more than 10,000 every day.
When the head of the National Institute of Allergy and Infectious Diseases said it could be up to 18 months before a vaccine is available, Trump responded: “I mean, I like the sound of a couple months better.” Trump then said the World Health Organization’s figure of a coronavirus death rate of 3.4% is “really a false number” and that his “hunch” is that the level is “way under 1%.”
After the Center for Disease Control urged employees to stay home if they are sick, President Trump said he believes people infected with coronavirus may get better "by going to work."
Trump plays a president on TV, but his mental condition precludes him being a real leader at a time when the country needs one. As the virus spreads, Trump will get more unstable.
Sunday, March 8, 2020
written 1 March 2020
published 8 March 2020
Reality is whole. Whether we believe it or not, whether we like it or not, we are all in this together. The new coronavirus, named COVID-19, has gotten everyone's attention.
Viruses barely qualify as being "alive", since they can't reproduce on their own. Whole cells have biochemical 3D molecular printers which take nuclear code and produce the proteins and molecules cells need to function, repair, or reproduce more cells. Viruses lack that function, being just nuclear material in a protective casing. To make more virus copies, it must invade a whole cell and highjack the printing function. Viruses that infect humans don't discern race, religion, sexual orientation, or wealth. To a virus, we are all potential dinner.
On December 31, 2019, China reported to the World Health Organization that several cases of an unusual pneumonia were detected in the city of Wuhan. China's centralized government responded swiftly. Businesses were closed, travel was suspended, and two 1,000 bed hospitals were constructed within 10 days. Massive food convoys supported those in quarantine, and testing was implemented everywhere.
By January 24, 2020, human to human transmission had been confirmed, cases in China had increased to 830, and 13 cities were locked down, affecting over 40 million people. By February 14, the numbers had risen to 75,000 cases, 50 cities locked down, affecting 500 million people. This helped limit the spread of the virus, but at great economic cost.
China is the second largest economy, with 13% of global trade, growing at 6% a year, stimulating the rest of the world. The effort to contain the virus has affected 50% of the country, reducing growth in China by 25% for the first quarter. The economic impact of the virus in this one country slowed global economic activity, and caused a slump in oil prices.
In addition to being a large economy, China is a manufacturing powerhouse, the result of decades of investment capitalizing on cheap labor. As a result, it is the sole source for critical parts in key industries, specifically electronics, automotive, and pharmaceutical. The world has shifted to "just in time" manufacturing, which eliminates warehouses of inventory, but depends of global shipment of parts arriving "just in time" for production. The disruption of this system means that companies all over the world have to shut down, or reduce production, for lack of parts or feedstock material. No other country has this disproportionate economic impact.
New cases in China have peaked and are declining, but their economy is still disrupted indefinitely. Since the virus is now widespread within their population, there is no telling how long it will be before "normal" production can resume. Despite China's extraordinary public health response, the virus was not contained. Incubation takes as long as 2 weeks, and not all infected people are symptomatic. By the time the first case was identified, global travel had taken the virus outside China. Additional countries reported cases generating growing alarm.
I am writing this on Sunday, March 1. The first impact in the US occurred last Monday, February 24, 2002, when the DOW index dropped over 700 points. By the end of the week, it was down over 3,500 points, wiping out two years of increase. Goldman Sachs suggests the American economy will stagnate this year.
Three days ago, the first case of "community transmission" was detected in the US, with no know contact with previously infected people. This means the virus is already within the community. As of today, there are four American cases of "community transmission", two in California, and one each in Oregon and Washington, for a total case load of 73, including infected people evacuated from overseas. The virus is now detected in 66 countries, and as many new cases were reported today in both South Korea and Italy as in China.
In a pandemic, people need health care, not health insurance. Public health is an essential socialist structure, since the health of everyone is at risk if anyone in our community is ill. This virus is no hoax. Thoughts and prayers won't get it done, we need competent leadership and effective action, not bluster and hostile sound bites. COVID-19 will test our national leadership in a manner visible to all.
Sunday, March 1, 2020
written 21 February 2020
published 1 March 2020
Wikipedia defines corruption as "a dishonest or criminal offenseby a person or organization, to acquire illicit benefit for one's private gain." A second definition is "the process by which a word, expression, process, or artifact, is changed from its original use or meaning to one that is debased."
The belief in absolute separation within a unity reality is the fundamental dysfunction of our species. In economics, this expresses as a drive for exclusive gain. In politics, it manifests as corruption. The combination is killing the planet for short term profit. Rachael Maddow's book, "Blowout", describes the operation of the oil and gas industries as the penultimate expression of this corrupt economic model.
The Soviet Union fell in 1991, and the Russian economy reorganized as a collective of corrupt oligarchs owing allegiance to Vladimir Putin. Russia's primary assets are massive oil and gas deposits. Profits from those industries enriched the select few, and access to oil and gas was used as leverage on the rest of the world, particularly Europe. However, their energy infrastructure is aging and inefficient, and the established fields are depleting.
The richest undeveloped reserves are in the Arctic Ocean, a difficult region always, but now more accessible due to climate change. Western oil companies have developed deep water operations, and hydraulic fracking with horizontal drilling, allowing development of previously unattainable reserves, technology Russia desperately needs. Overtures were made to western companies, particularly ExxonMobil.
ExxonMobil is an international company with no loyalties other than maximum financial return to their investors. Dealing with corrupt governments simplify matters. Paying off just one autocrat assures there are no legal, labor, or environmental barriers to doing business as profitably as possible. Thus, the kleptocracy that Russia has become is an asset, not a liability.
Oil companies are like sharks, needing to keep moving by developing new reserves in order to stay alive, and ExxonMobil is the biggest shark, with a voracious appetite. An ExxonMobil/Russian deal helps both parties. Russia needs technology and financing, and ExxonMobil wants a piece of the Russian bonanza. But Russia has other problems.
For decades, Soviet gas and oil was shipped to Europe through the Ukraine. But after the breakup, Ukraine became an independent nation, aligned more closely with Europe, and began developing gas and oil reserves in their eastern provinces with the help of western oil companies. This competition threatened Russia's energy monopoly, as well as its' leverage over Europe. In 2005, Russia cut off gas supplies, fomenting division within Ukraine. By 2010, an autocratic pro-Russian leader came to power, and the gas resources were controlled by a corrupt oligarch. But Ukrainian civil unrest grew, and a pro-western leader was elected in 2014.
Putin responded by invading the oil rich eastern provinces of Ukraine, forestalling oil development there. However, Europe and the United States were so concerned by this aggressive move they put heavy sanctions on Russia, specific to Putin's inner circle, and banned all oil and gas technology investment, putting Putin and ExxonMobil in a critical bind. Putin's response was to double down, and work to destabilize western democracies.
Russia interfered in the political process leading up to the Brexit vote in early 2016, which has distracted and disorganized all of Europe ever since. This was a prelude to their interference in the American presidential election later that year. History will eventually reveal the details of Russian leverage over Trump, who had already built an empire on corrupt practices.
Once elected, Trump named the former CEO of ExxonMobil as Secretary of State, helping pave the way for removing sanctions on Russia. Trump sided with Putin against American intelligence about Russian 2016 election interference. Last week it was revealed to Congress that Russia is already interfering in the 2020 election. Trump was furious, not at the Russians, but that Congress had been informed. He fired the head of National Security and replaced him with Richard Grenell, who has no intelligence experience, and used to consult for the Ukrainian gas oligarch currently under anti-corruption sanctions by the State Department. Most of the 11 people Trump recently pardoned were convicted of corruption.
Russia, with Trump's enthusiastic compliance, has injecting corruption deep into the American political system, an active destruction of our integrity as a nation.