Insights from Quadrant

The damage done
and yet to come

Cooped up in quarantine, contributor Marc Hendrickx put on his actuary’s hat to consider Australia’s on-again/off-again lockdowns and their cost. He writes:

If we use Sweden, a country that instituted minimal restrictions in response to the pandemic as a base line, then on a population basis, if Australia had instituted similar measures (and made similar mistakes in not adequately providing for people in aged care), we would likely have had about 36,000 COVID deaths by now. As it stands, as of August 2021, we have seen less than 1000. But what is the cost of those 35,000-or-so lives “saved” by our authoritarian approach to managing the pandemic — an approach not recommended in previous government-approved pandemic plans but one inspired by the example of China, the source of the virus.

While Sweden has continued to open up and reduce restrictions, after 18 months Australia still has over half the population under house arrest and the rest locked into their state boundaries under the threat of lockdowns should a handful of positive COVID-test results arise. Schooling has been disrupted, putting the education of many tens of thousands of children at risk. The damage being done to our youth in the name of saving the old and frail will see many of our young carrying psychological scars into adulthood.

Small businesses, sole traders and family enterprises have been smashed. Hospitality, tourism and entertainment businesses are dropping like flies. Normal screening for other diseases has been disrupted , so there are deaths from cancer and other causes that should have been caught but weren’t. There is no prospect of international travel in the medium term as the government chases vaccination targets that have not been met by any other nation. What is the cost of those 30,000+ lives claimed to have been saved?

Prior to COVID the value of a quality-adjusted life year (QALY – a statistical tool that applies a price on life to help assess the costs and benefits of various policy options), in Australia was between $50,000 and $100000. According to budget figures, the impact on the economy due to restrictions and the outlay for various government measures is around a trillion dollars-and-growing. This does not include, by the way, costs for state government programs, additional future spending likely required to deal with mental health issues, increased health costs due to missed medical screening, business losses, the cost of damage done to children’s education and wellbeing, and the cost of future interest payments. Multiply all of the above by the millions of Australians who have been put under heavy stress by government actions and, suddenly, the scale of the damage done by our various governments comes into sharp focus.

Using the figures above, governments in Australia have spent an astonishing $28.5 million per ‘saved’ life. Given the average age of death has been 85, more than  standard life expectancy, and a person this age can expect to live another seven years, the cost is a staggering $4 million per life year. This is 40 to 80 times the accepted figure for a QALY in Australia.

How many more lives could have been saved if the government had undertaken a simple cost-benefit analysis and looked at where it would get the best outcome for our precious tax dollars? How many more, in the long term, if we had of stuck with the recommended pandemic response, a plan that may have involved $3-4 billion targeted at protecting the vulnerable? Instead as they gave control of the country to a narrow-minded class of health bureaucrats and no thought of the bigger picture, not only have they gifted our children a revolving door in and out of the cuckoo’s nest, they have burdened them and their kids with entire lifetimes of debt.


2 thoughts on “The damage done
and yet to come

  • en passant says:

    I wrote an article for QoL called “Resurrecting the Dead: Why the Australian Economic Corpse will not be Resuscitated”. I submitted it on 27th April 2020, but it was rejected as too radical, yet 15-months later you have just come to the same conclusion. Here are a couple of excerpts:
    “It is an article of Australian Government political faith that one day, like magic, they will lift the ‘social distancing’, travel restrictions and enforced business closures and the economy will spring back to life. …
    we will know in a relatively short period whether or not the Australian economic corpse can be resurrected. My bet is that it cannot.”
    “The argument put forward for closing the Australian economy is that it was a matter of ‘public safety’ (the same catchcry that Robespierre used to inflict terror on the French population and his political enemies). We were assured that the destruction of the Australian economy was ‘for our own good’ – and would save lives.”
    “For arguments sake, let me deal with what I accept is an unacceptable approach as an example of how lateral thinking might engender new ‘out-of-the-square’ ideas.
    “What would have happened if the Government had advised the public of the best approaches to avoid becoming infected and then let the people themselves make their own decisions? If they want to party, go to the beach, go to work, get married, attend a funeral – then as they have been advised of the risks and precautions, it is now up to them what decisions they make and the approach they take.”
    ” Of course this adult approach may have increased the miniscule death toll to ‘miniscule+x’ , but the lateral-thinking answer to this increase would have been a $10M payout to the estate of the deceased. So far that would have cost the taxpayer a manageable $830M. [NOW 9.35bn]. Even that could be bureaucratically adjusted down as most cases so far were elderly with pre-existing other issues. The families need not rejoice at their relative’s death, but the windfall should help ease the pain of what was inevitable anyway. Of course, if they are appalled at the idea, they have the right to refuse the money and condemn the government for its callousness. No prizes for predicting what percentage would take the latter option.”
    Australia has been divided into the ‘V’ and ‘UnV’m with the totalitarians using this tool to condemn anyone choosing freedom.

  • Peter Marriott says:

    Good analysis. The basic statistics demonstrated by Peter Smith some time ago can also shed another light, if I’ve got it right. It’s almost certain that the overall yearly death rate will fall in coming years in countries that have experienced the higher death rates among the infirmed with morbidities, in their nursing homes, but the average over a given basket of years, say a dozen or so, will remain the same. Ours will probably remain approx. the same as well, without the same fall….but statistically over the dozen or so years we’ll all be the same anyway….except they’ll have been a lot freer than us, with fewer down the track problems, and lower costs.

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