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  • rmacculloch

Is economics the kindest profession of them all?

We're often hurt in the economics profession by the jibes that say we put money ahead of human lives, that "neo-liberal" economists care only about GDP growth. That we don't give a damn about the human costs of policies. Well, here's an example of how (un)true are those claims. A simple cost-benefit analysis that could've been done in a day by any competent economist would have shown that the cost of putting in early 2020 orders for vaccines, even when their relative efficacy was in some doubt, would have been easily justified by the potentially massive expected benefits.

Why? Since the vaccine cost was relatively tiny compared to the costs of lock-downs & restrictions. Of the order of 1%. For example, this lock-down, which could easily last a good six weeks, will probably end up costing at least $12 billion. And that doesn't include the ongoing costs of closed borders. By the time NZ is 80% vaccinated & can open up more, I'd estimate the extra costs incurred by not ordering vaccines earlier at more than $20 billion.

Now that's the entire annual budget of our health system. How many lives, in terms of drugs for Pharmac, reduced waiting list times at our hospitals, better pay for doctors & nurses and hiring top notch health professionals, could have been saved by that extra $20 billion being spent on health? In a word. Lots. Yes, the lack of barely a single influential high quality economist working in Wellington today (they've been mostly pushed out in favor of political appointees & promoting folks with other "skills") has cost the country dearly.


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