The Dispatch Podcast - Paul Romer Has a Plan

Episode Date: May 15, 2020

Nobel Prize-winning economist Paul Romer joins Sarah and Steve to discuss his plan to safely and responsibly reopen the U.S. economy amid the coronavirus pandemic. Show Notes: -Roadmap to Responsibly Reopen America Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to a special Friday Dispatch podcast. I'm your host, Sarah Isgird, joined by Steve Hayes. This podcast is brought to you by The Dispatch. Visit the dispatch.com to see our full slate of newsletters and podcasts and make sure to subscribe to this podcast so you never miss an episode. Today is a real treat for me personally. We are talking to Nobel Prize winning economist Paul Romer about his plan to reopen the economy safely amidst the pandemic. He was the chief economist and senior vice president of the World Bank and is now what I can only imagine is the favorite professor at New York University's economics department. I really think you're in for something special today.

Let's dive right in. Paul Romer, you are the man with a plan. have been making the rounds, discussing your plan. Just give us your explanation of your plan to reopen the economy, get people back to work as an economist. So I find it it's important when you face a complicated problem to strip things down to the essence and ask what's the key here? The key is we've got a small number of people, a few percent of the population. who are infectious and pose a threat to others. We want to isolate them to keep them from infecting others. The problem is we don't know who they are,

so that means we're trying to isolate everybody. The obvious way to address that problem, and the problem, of course, with isolating everybody is that it's causing a huge depression for the economy. The obvious solution is let's figure out who those people are who are infected and infectious. Let's isolate just them and then everybody else can go about life as usual. So testing is the mechanism we could use to figure out who's infectious and then isolate them without interfering with the activities of everyone else. And we've done about 10 million tests so far in the United States.

That's nowhere close to what you're recommending. No. If you think about it, the ideal would be if we tested everybody in the United States at the same time, on the same day. You know, it's all 330 million of us. Then we'd isolate the people with the infection. And then there would be nobody who's infected who's circulating in the United States. within a few weeks after the people in isolation had recovered, there would be no one in the United States who's infectious.

Now, of course, we'd have to worry about people kind of coming in from outside. Right. But it's not, even I understand that there are things that limit what's feasible. We can't actually test all 330 billion people on the same day. But if we tested everybody every two weeks, that gets pretty close. and puts you on a path where the virus doesn't go away within a few weeks, but it declines very substantially and has gone within a few months. And you've thought about the cost of this as well.

Yep, yeah. What's the price tag? Well, I think the first thing to say is the value of each test is extremely high compared to the cost. So when something's worth more than it costs, the usual economic answer is, well, we should have a lot more of that. Now, the cost currently for tests, the U.S. government is reimbursing firms at $100 per test, but until recently they were paying only $50 per test. So it was at least worth doing when it was 50. Given the opportunities to speed up the way we test and to get efficiencies in this system, I think we could get down

to $10 per test. So if it were $10 per test, to test everybody every two weeks in the United States, it would cost this about $100 billion a year, which is a lot. If in normal times it would seem like too much to spend. But the thing we have to remember is that right now, spending $100 billion could offer benefits that are just hundreds of times bigger than that $100 billion. So we're suffering costs right now at the rate of $500 billion a month, like $6 trillion a year, I think, in losses for the economy because of the presence of this virus. So if you could spend $100 billion and get back

$6 trillion, that's a pretty good rate of return. Steve, let me get you in here. Is there a sense that we might be starting to lift the lockdowns prematurely already? You wrote in the original rollout of the plan, you wrote lifting the lockdown without a plan, surrendering to the virus and letting it return to its path of exponential growth would be devastating in both economic and human costs. Is that what's happening now? Are we sort of on the front end of that? No.

No, I think what's happening is that we're making, we have some measures in place that have reduced what they refer to as R not, the reproduction number of this virus. They've reduced R not to about one. So that says if you've got, say, you know, like 300,000 new infections per day right now in, you know, in a month, it'll still be 300,000 per day in six months. So R not equals 1 means everything stays about where you are. We've gotten to that point. If we start to remove a few restrictions, most of the restrictions stay in place. Maybe R not moves a little bit above one. Maybe the number of infections starts to grow.

That's not the same as just completely surrendering and going back to where we were in January. But I find this debate about one side saying we should just open up now, the other side saying, no, we need to stay the course, keep doing what we're doing. I disagree with both sides on this one, because either path is not going to get us a quick recovery. So I don't want to kind of take sides in that debate. I want to say, there's a better path. And the thing that's unfortunate is I can't say there's a better path that solve things this week. It takes some investment. It might take us a few months to get there.

But if we start making the right investments right now and freeing things up, then in a few months we could follow this much better path. So I don't really even care how we get through the next couple of months, whether we keep opening up gradually to see what happens or whether we tighten things back down. way, what happens in the next two months isn't what matters. It's having a better option very soon because on the existing paths, either one is going to, I think, oppose just totally unsustainable social, political, economic costs. One of the things that's built into your plan, though, is this assumption that testing works. The FDA released a press release, yes, about the Abbott Labs rapid test that said that 15 to 20 percent could be giving false negatives. They said up to 48 percent could be false negatives.

I'm assuming you have built into your assumptions a certain amount of false negatives or false positives, but surely that number is a lot lower than 15 to 20 percent. You know, when I actually started working on this plan, I was using 30 percent as the false negative rate, because that was what some of the reporting out of China suggested was the false negative rate. It turns out that testing people frequently, even with that high a false negative rate, works. Because what we're trying to do is get most of the people who are infected into quarantine and isolated, or isolated, so they don't infect others. If we miss some, we can still get enough into isolation to get on a path where the R not is less than one and the number

of new infections is decreasing. But this is part of why it's so important to keep retesting because, one, somebody could get infected by somebody else. So you have to, even if they're negative today, you may want to test them in the future. And two, especially in the early stages, you could get a false negative. So when you dig into the details, the steady state I've proposed is test every 14 days. But I've suggested, for example, for health care workers, we should start by testing them every day so that there's no nurse or doctor who's infected at work, who's going to infect his or her colleagues. I think we should also start testing every resident and every employee in nursing homes every day. And then once we get a reasonable handle on who are

the ones who are infected, how can we isolate them, then you could scale back to a surveillance kind of mode where you're testing every week or every two weeks. One of the things that skeptics of universal testing have raised is this lag. The fact that we won't catch all of the asymptomatic spreaders, or even maybe a majority of the asymptomatic spreaders, even with the kind of universal testing that you're proposing or near universal testing that you're proposing. There was a piece this morning, actually, by a Dr. Michael Hochman, who's a physician and a professor at the Keck School of Medicine at USC, and this is piece ran in stat news.

And he says, even with testing every two weeks and a 24-hour lag in results, universal testing would catch less than half of asymptomatic carriers during their most infectious period. Is that a problem with the way that you're approaching this? And how would you address that? Yeah. Well, I think what I think is it's interesting is when people make these points and everything he's saying is correct. But you want to ask them, okay, so what's the alternative. What would you do? It is a problem in containing this virus that we have a symptomatic spread and that this comes very early in the window. And there's a few days where people seem to be very infectious. So that means you may need to actually test more frequently than once every

two weeks to keep R0 below one. But the thing to keep in mind is, so what are the alternatives? Contact tracing is the main alternative that people in public health point to. So we don't have to test everybody. We're just going to go out and test the contacts. But the facts he's describing make contact tracing much harder to succeed as well. And the problem I have with the people who say, we should just go with what we know, which is contact tracing, that'll figure out who you test. We don't have to test everybody. You just do that. This was the method we were using in January when we were completely overwhelmed by this virus. So the people who say, we're going to do contact tracing, but this time we're going to have a do-over. We're going to wait until we get way down

to their very few infections. We're going to do contact tracing. This time, we're going to do it right. I want to know, okay, well, what's your evidence that persuades me that this time it's going to work better than it did it did last time? Yeah, what does that look like in a practical sense? Can I just to follow up, how much of this, I mean, one of the things I think is, let me make sure. Sorry, let me make sure I answered for your readers your question. If it turns out that, for example, the infectious period for an individual is concentrated in a very small number of days, just a few days. we may indeed have to test more frequently than every two weeks. But again, my point is that if we need to do that, we could afford to do it.

And that still seems to me to be the most cost-effective method. And, you know, if you test frequently enough, you know that it will work. Yeah. One question I had is I read this was a couple weeks ago when I first read your plan. And you seem to be addressing sort of an economic problem, a public health problem, but also in a sort of a more abstract way, a knowledge problem. I mean, big part of what we're trying to address today is to give people a sense that they could have the confidence to go back out into society and be reasonably safe in doing so. When you were building this plan, how much of that factored into the way that you conceive this and laid it out? Yeah. I think when I first, I do remember the point when I first got curious about testing,

which is when I heard that the government could but had not yet adopted some provisions that existed in the law for emergency use authorizations to make various kinds of the tests readily available. So this was back in the early stages back in March. At that time, I don't think I thought of this as the core solution or the key to doing everything. I thought it just would be one of several related measures. Over time, when I looked at all the alternatives, I got more convinced that this really is the most important one.

Although I should mention, the other one, which seems to be very promising is wearing masks. So masks and then test and isolate, I think, are the two lowest cost, most promising ways to contain this. But as I worked on this, I realized that this was more than just how do you find a technical solution to this problem. As you said, this is really an issue about giving individuals confidence. And we live in a time, frankly, when there's a lot of skepticism. of experts. I think there's several contributions to this. One is, I think, the experts haven't always been fully transparent and forthcoming. So those of us who make our living as experts need to do a better job, I think, of communicating clearly and not spinning things to achieve

some outcome that we're not being transparent about. But in an environment where there is such skepticism of the experts. I think a solution that gives information to the individuals is more likely to succeed. So if I use this example of me going back to my dentist, what will it take to make me comfortable sitting in the dental chair and make the dentist comfortable working on my teeth? It could be that the experts tell us we've got a much better system of contact tracing now. Trust us. We're really on top of it this time. The prevalence is way down. It's okay for you to go back to the dentist's office. I think both my dentist and I are going to be a little bit worried about that message from the public health types. They've been overly

optimistic. They've been overselling what they've done in the past. So I'd feel a lot better if I could see a certificate where the dentist says, look, I was just tested yesterday. I was negative yesterday, and he might want to see something for me where I say, yep, I was tested yesterday and I was negative. It's kind of, instead of an expert top-down solution, the idea here is partly to put the information in the hands of the people who need to act on it. And I should say that some of my colleagues that I've been working on this issue, this topic with have been arguing that it may be that the only thing we need to do is give the individuals

the information, are you infected or not, and maybe a certificate that they could show others to validate whether or not they're infected. We may not need any rules that force quarantine. Most people don't want to infect the people they know. So they'll self-quarantine or self-isolate if they have that information. So I think we don't need to worry too much about kind of a heavy-handed government imposition of restrictions on people. We may not need to worry about even centralized collection, tracking, monitoring of what people are doing, but it would be enormously helpful to just give people information that they can act on.

You touched on two of the things I wanted to talk about, which was, sort of the, we're heading into the political realm, I guess, is what I would say, which is government mandated isolation. I've gotten some emails, even just this morning, of people who are concerned, you know, things on Reddit are spreading through the internet about bills, you know, that you would do these rapid tests for your whole family, and then your daughter test positive, and they take your daughter away. And now she's in a isolation camp of some kind, sort of the nightmare scenario. And so a lot of people could resist testing if that sort of rumor, whether it's true or even not, comes out.

And I think you have the same problem with contact tracing. Again, emails that I've gotten from listeners where they believe that in order to go back to work, private companies could mandate that you download a government app to be traced in all of your private time and whether that's constitutional and all the sort of concerns around civil liberties, that and that it wouldn't ever go away, that even your method of testing and set aside the contact tracing, that it would turn into, once you've habituated a population to sort of checking in with the government, it would be replaced by something else down the road. So you're an economist, not in politics necessarily, although as head of the World Bank, I'm sure you dabbled.

How do you start wading into these political problems? I think these are, I have a little mantra that I use. I have a few of these when I'm trying to explain things to people. But one is feelings are facts. People feel these feelings. And the experts have this tendency to say, oh, it's wrong to feel that. Like, you're stupid. You shouldn't feel that.

That's, I think, totally unacceptable. What we need to say is people feel these feelings. We need to work with that fact and find a way to a way to accommodate it. I think the feelings you're describing, the fears, are very real. And it's information that we should take account of as we make a plan for going forward. In the first pass, my recommendation is let's figure out how to get the information about who's infected. And then let's start to experiment gradually with how we use that information. But let's remember that very simple, you know, unobtrusive, you know, very, very mild measures can often get the right outcome when you give people the information.

Another mantra I've used is good measurement and small stakes. Don't make the stakes be really high when you're trying to get measurement and then get people to act on it. So, for example, I'm not optimistic about the digital contact tracing because I think it's going to be very hard to get a broad consensus that something like this is worth doing. And it'll be very hard, I think, to know what the longer term ramifications of that will be. So I would say, let's just downplay the digital contact tracing part. On the testing part, there may be good reasons to push aggressively for the solution where people can get tested at home. You get a device, you let them test themselves at home, and in the first pass, you don't even have any public visibility into what those test results are. This would let people know, am I infectious?

Is anybody else in the family infectious? If I don't want to care about my colleagues, if I don't want to infect my colleagues, I'm going to test my colleagues, I'm going to test. to isolate myself, but it would be very valuable for us, even to have private information where just the individuals know. Now, if you wanted to do a little more, like Steve Levitt and I wrote an op-ed where we said, you know, a good thing to do would be actually to pay people to go into isolation. So if they get a positive test result, you actually pay them like $1,000, $2,000 a week to isolate because it's a valuable contribution to the society to isolate. A true economist solution. Yeah, yeah. Steve, I mean, Steve wanted to go further. He wanted to make it a lottery where,

you know, if you say, I'm tested, I'm willing to go into, you know, isolation, then you get, I don't know, like a one in a thousand chance at a hundred thousand dollar prize or something. I don't know. Not a cruise, though. Yeah, but the point is, in that case, you'd need some way to make publicly verifiable what the information was. But I think it's worth saying in answer to the people who are worried about the things that you're describing, if those are very significant fears, let's find a way to get that information where the information is privately held by the individual. The individual can still act on it.

Then we can see if as a society we can get comfortable with some ways to make it a little bit more public and get some more value out of that. Has anyone from the White House or the Coronavirus Task Force reached out to you about your plan? I've been in contact indirectly. I worked with the Rockefeller Foundation. They have been in contact. I've been in contact with some other intermediaries. I haven't been like personally in contact with the White House. How about members of Congress or others? You have to explore this? Yeah, I have actually had some conversations with people in Congress, both Democrats and Republicans. It's actually been kind of reassuring to have those conversations.

The people I've spoken to, and I suppose it's a selected group, but the people I've spoken to all are interested in understanding what the options are, all appreciate the seriousness of the moment, and genuinely want to try and. and do what's what's best for the for the nation so there's you know there's always uh reasonable people can differ on a lot of dimensions um here but i think it's it's important for someone like me to be available as uh kind of the the technical person who can talk about well for example how many tests per day would we need to do under various assumptions about the you know the infectivity of the virus. And it's actually, if you think about it, it's odd that I'm being asked about this, because the epidemiologists would be better positioned to answer this question.

But what I, as an economist, bring to this, is this observation that the tests are incredibly valuable to us right now. The epidemiologists are so used to working in an environment where people don't think that the measures they're talking about are valuable. they've never even considered the possibility of spending something like $100 billion a year to support measures to get information about infection. So I think their recommendations are much too cautious and modest, given the context. What's interesting about the conversations with the members of Congress,

they understand how serious things are, how big what the magnitudes are. I mean, they're passing these bills with trillions of dollars of spending. So they get the significance and the magnitudes. And what we need is people from the epidemiological side who can kind of get with the program and think at that kind of a scale. So the country is ramping up testing. No question. Those numbers have continued to increase. At the same time, the president this week said, so we have the best testing in the world.

It could be the testings, frankly, overrated. Maybe it's overrated. And so my question to you is, let's. assume that we're on just a steady trajectory to increase testing, but no, we don't adopt the Romer plan. Where does that lead economically, bringing your insights to bear? Where is the country in two months, four months, six months? Well, I think one of the things I decided to do was to really reset the conversation. And, you know, by talking about we need 23 million tests a day, just way more than anybody was willing to say publicly. I was perfectly willing to look

foolish, but to keep saying something that was different than everybody else was saying, to create space for, oh, maybe we do need quite a few more tests, and maybe they would be valuable. So I understand that it's going to take a while to get people to think on that kind of scale, but there are things we could do as steps along that path, which every one of which would generate enormous value, it's finally dawning on people that we should be testing everybody who's a resident of a nursing home and testing them frequently. We should be testing the staff who work there. And we should be thinking about the fact that it's important for visitors to go see their relatives. So we've got to be ready to test every visitor when they come into a nursing home. This could, this could,

could cut the loss of life by a third to a half because so much of the death is concentrated in nursing homes. And there aren't that many of them. They're about a million people in nursing homes. So if we wanted to scale up to test them all for every day for several days and then to scale back to, say, once a week, test the staff, test the visitors, this could be one of the highest valued places where we could use an additional couple million, one or two million tests per day. And I think it's very likely that we will ultimately develop that capacity to at least test several million a day and use them in these very high valued uses like saving lives in nursing homes. And the nursing home one is really pretty clear cut because

there's no contact tracing solution there. There's no, you know, masks would help, but none of the measures that people have been trying to use in nursing homes have actually stopped them from being these concentrated places where people die. So I think it's almost certain that we will develop more testing capacity and we'll use it to save lives in nursing homes. I think as people get more tuned in to the fact that healthcare professionals are infected, and the more they focus on how do we restart the kind of the usual process where

people are comfortable going to the doctor to get a vaccine for their kids, going to get an elective surgical procedure. I think we're going to discover that you need to show people test results for your health care providers to get people confident returning. There was one study that showed that 7% in the early stages of this outbreak, 7% of the doctors and nurses in several academic hospitals were actually tested positive for this virus. Now, it could be that these doctors and nurses are careful about masks and gloves, and maybe they don't infect many patients. But as this information gets out there, I think people are going to be hesitant about going back to the health care system. And the health care system's going to have to

find a way to credibly reassure people that it's safe to come back. So I think nursing homes, health care, and then you can go down the list as well. If you think about reopening schools, it would be a really good idea to reopen schools. Good for kids, good for their educations, good for parents. There is some fear that may be exaggerated, that schools, kids will become kind of vectors for increasing the spread of the virus. But if that's what you're worried about,

test the kids, test the teachers, test them frequently, and use the same kind of strategy. Find a way to isolate them so they don't keep spreading the virus when you find someone who's positive. And then if you're doing this testing, you can also see, are we really causing more spread throughout the country

when we open schools. I think we won't, I think we'll discover that that won't be much of a problem because the kids don't seem to be key sources of infection that from child to adults doesn't seem to be a very strong path in the transmission of this virus. But if we had the testing,

instead of wringing our hands and worrying about whether we open schools, we just start testing, start opening the schools, and then we might find we don't even need to do that much testing going forward. And one last example, you know, if we just had the test, we could restart Major League Baseball. Just play the games in empty stadiums, but just test the players every day. Test the coaches, test the umpires, test the people who, you know, work with them, like serve them food.

Just test everybody every day. Some of them, they're out in the public. Some of them are going to get infected. Just have them spend a couple weeks in isolation when they get infected. we could, it's no reason we have to live without, you know, something that, you know, that could provide value to people, which is what an economy does. That feels like maybe also a, yeah, pet, per homer issue. And also maybe a way to get people behind the plan, right?

We can bring back baseball through this plan. I know, I know, it's a little bit, this sounds a little callous, but it's, I think we're all so beaten down almost by the numbers. It's like, yeah, yeah, yeah, save lives in nursing homes, you know? It's like, yeah, yeah, start school. Oh, yeah, it would be good to get the kids out of the house, but then baseball? Oh, yeah, I can watch baseball again? Cool. I'm in, I'm in. Even my kids, I think even my kids at this point would submit to being tested regularly to get back to school. I mean, that's how long this is going on. Let me just follow up on that. So let's say that something approaching what you just described comes to pass, and that we have maybe not

the full roamer, but we've taken a number of these steps that allow us to do this somewhat more aggressive reopening. Just thinking about where we are as an economy right now and the negative GDP growth and 33 million plus people unemployed, there was a lot of talk in the initial weeks from the experts, from, from economists, from people that we all assume know a lot about this, about a V-shaped recovery. And as someone who's decidedly not an economist, that struck me at the time as wildly optimistic, just looking around and honestly just having conversations with people I know who are losing jobs and seeing their businesses crush. are we at the point, I guess number one, are we at the point where any prospect of a V-shaped

recovery is now dashed? And two, how long are we looking at? Again, assuming that what you've just described more or less comes to pass, how long are we looking at until we start to see the economy adding back jobs at, you know, a robust pace and the economy growing in the way that you might expect on the other side of a calamitous occurrence like this. Yeah. Well, first, I think your instinct was right. The people were talking about the V-shaped recovery, their instinct was wrong. And I think it's a sign of a potential problem here, which is this kind of siloed approach

to these issues. So if you're an economist saying, well, so this virus caused a recession, as soon as the virus is gone, we'll recover. So, from my perspective, as percing with the economy, no reason why we couldn't have the V-shaped recovery. The problem is they weren't talking to the people who know about the virus and hearing them say, you know, this virus is not going away. This is a sudden change, but it's here forever. And so, you know, we're only going to recover, we're going to at least recover from the virus only when we got an effective plan for managing it. So I think the silo, the silence.

nature of this, I think, has made it hard for people to be realistic about the timeframes. I think there's also an inherent human tendency to fall back into a bit of denial. I mean, it's just hard to believe that things could change so drastically. 2020 now looks incredibly different than the world looks, looked in 2019. And so at some emotional level, we keep thinking, oh, surely we can go back to the way it was. I mean, what's really changed? You know, unfortunately, what's changed is that a virus jumped from some animals into humans. And then as soon as that happened, our future, our world just changed permanently.

And it's hard to comprehend that, but it's the reality we face. So now, to be specific in answering your question, there's two stark, there's a really fundamental choice that we haven't talked enough about, which is that with this virus is here forever, and we may not get a vaccine for a long time, you either commit that we're going to let the virus spread throughout the whole population, or you commit we're going to take active measures to suppress the virus. this virus, but we're going to do it forever because if you ever let go, you just go right back to having it spread through the whole population. And if you were going to do that anyway, you might as well have just done it right from this start. So it's either we're just going to let it go through the population or we're going to suppress it forever. If we're going to suppress it forever, it's got to be with methods that we can live with forever. And if we get a vaccine, fine. But if we don't, we've got an approach that can work.

So because we haven't come to terms with this, and we're still hoping somehow for something that will just solve the problem, make it go away, we may be stuck in something like the current impasse for a long time. It could take 24 months to get a vaccine. Unfortunately, it could take longer. Sometimes it's taken 10 years to get an effective vaccine for a new viral threat. So, and I don't think any society can sustain the current level of economic distress that we're facing right now. So that's what convinces me that ultimately, you know, maybe it'll take another few months, another six months of just pain and thrashing about.

But at some point, it's going to be so obvious to us if we just produce the tests, if we know how to do it, and actually the president is right in one sense, the United States developed all of this technology. Everything that everybody's doing all around the world in testing, our universities developed all of this. So we really are the best of this. At some point, it's going to dawn on us. We should just use what we know how to do, and we should restart baseball,

and we should save lives in nursing homes, and we should go back to school. because just waiting in the hopes that somehow this problem is going to go away, it's just not going to work. As you look at the next few years, what's your biggest fear? There were already signs that the U.S. and many modern societies were having trouble making decisions. things happen as a group. Many things can be decided by individuals, so we're good at that,

but sometimes at the level of the group as a society you need to make a decision. Just simple things like, okay, we need a high voltage power transmission line. Where are we going to put it? We got to the point where it was taking us 10 years to make a decision that was as trivial as where to put a power line.

I'm afraid that the polarization, the animosity, the activated emotions that will follow on from these two crises is going to make it even harder for us to make simple decisions. We can't make a decision right now about how we're going to fight the virus, but we're not going to, this is going to make it even harder to make decisions about like where will we put the, the power lines. So I think our capacity to do anything as a society is at risk here. And this is part of why for coverings, we really need to show that we can make a decision and act on it as a society. And let me say that I think a very important part of the path forward. I mean, I gave you the examples of what we'll do once we figure out we could

pay for tests and get huge value from it. But part of doing this is going to mean that we're going to break free of a regulatory system, which right now is doing far more harm than good. The FDA's regulation of tests is just like by orders of magnitude doing more harm than good. We need to take this kind of whatever we call it, like screening testing or surveillance testing, you want to call it, take it totally out from under the supervision of the FDA. And the way to do that, I think, is to say to the governors, if you want to purchase tests from anybody, you can purchase any kind of test you want and you do not have to go to the FDA

and say, mother, may I, and wait a month while they mull it over. The governors can decide to do testing differently, to source the tests from different places like these universities, and they don't need to ask permission from the FDA, and we just need to just accept that. And I think this will be part of a broader rethinking of the fact that sometimes regulation is important and valuable, but sometimes it's just getting in the way. I'll just ask you the flip side of Sarah's question, and you sort of hinted at it, I think, in your response to her about what you fear most. Is there anything that we should, is there anything that makes you feel optimistic at this moment, things that we can look forward to pulling through

on the other side, maybe polarization decreases. What is it that makes you upbeat about the future? So I think one thing that's important to remember, and we should be reporting and talking to each other about this, is that a few people behave badly in a crisis, and they tend to get a disproportionate share of the attention. But a lot of people behave very well. And the people of the United States, Americans are good people. So I think there's a lot of goodwill and desire to do the right thing that we're seeing right now. And I also think that we will come together and break through some of these regulatory and process bottlenecks that are holding us back. We will get our act together and do the right thing. It may be that it happens at the state level. A few states

take some reasonable actions, but we'll get through this, and I think we'll feel better about ourselves as long as we just don't let the, you know, the people who are the negative attention getters dominate the discussion and dominate what we're reading about and seeing. Churchill had this quote that the United States or Americans always do the right

thing after they exhaust all the alternatives. And I think that's about right. You know, it takes us a while.

But when Bush comes to shove, we eventually do the right thing and can actually lead the world. I mean, we can do this in a way

that protects freedom, that protects individuals, that isn't heavy hand, that doesn't leave us with this legacy of authoritarian government. And I think, you know, in that sense, we have a chance to be the world leaders once again.

So it just takes, it's going to take some patience and some, you know, some confidence until we get there. But we'll get there. Okay. Last question. And this one is to Paul Romer, the Nobel Prize winning economist in his personal life. You're familiar with the concept of Moneyball? Yeah. Yeah.

So what is the thing that, like, is your biggest pet peeve or that you think needs to be money-balled in your, like, day-to-day life, like grocery store lines or whatever else? Where do you say, like, oh, as an economist, this is driving me crazy that Netflix does this? Yeah. I have to think of a specific. There was one just recently, but I guess in, frankly, for me right now, it's in discourse about policy. I think there's a lot of responding to kind of feelings and responding that we should go in that direction. And there's just not enough of doing a little bit of math. Just a little bit of math can bring enormous clarity to a conversation.

Let me just give you one example. There are some people, and we should be open to this discussion. There are some people who say, this virus is going to spread throughout the whole population. We can't stop it, so let's just let's just let it happen. I think they're wrong, but it's a reasonable position we should talk about it. But what they're not doing is the calculation. Well, so let's agree that, say, we sustain the level of deaths that we saw during the peak in April, like 2,500 deaths a day, and we let this virus spread throughout the whole U.S. population.

We know what the infection death rate is now. It's around like a half a percent. We know how many people have to get infected before herd immunity kicks in. That implies about a million people will die as it spreads through the population. If you're having people die at 2,500 a day and you've got to get to a point, get through a million deaths, it takes you 400 days. And, you know, it would be horrific if we had to accept them any deaths, but it might be something we have to accept. the people talking about just let the virus spread make it sound as if, well, that will get us to hurt immunity this summer and then the economy will recover.

Unfortunately, it doesn't. It takes you, you know, a long time. So I wish we could use a little bit of just simple math to work through the consequences. And also, think forward. It's just not, it's not a plan to say, do this and then we'll figure something else out. That's a stalling tactic. That's not a plan. A plan is we do this, and then we do this, and we do this, and if X happens, we'll do that.

But we need to have a clearly articulated plan, and we just need to make sure that the numbers make sense. And then if we did that, I think in many parts of our lives, we'd be better off. Okay, I lie. There's one more question. You have lived in some of the greatest baseball cities in the country. You went to University of Chicago, Boston for MIT, and, of course, New York. where you are now, what is the best baseball stadium in the country? And this is a hard question, because I also have lived in Chicago, Boston.

I have not lived in New York, but I have strong feelings about this. Yeah, so I need to make a confession. I'm all big on science and truth and no spinning and all of that. I'm not really much of a baseball fan. I'm trying to kind of like empathize with people who understand baseball. Use baseball to make the argument. It's perfectly reasonable, yes. So I could tell you about the baseball spadia, but I think I need to be, just fess up and be honest here.

And actually, there's a epidemiologist named Carl Bergstrom, who I've gotten. in touch with, because his dad was an economist, so I knew his dad. Carl's kind of prominent out there. You've probably seen his name. Carl's son is a huge baseball fan. So I was having a conversation with Carl about some of this stuff about the epidemiology, and his son came in and started talking about how we could reopen Major League Baseball. And I thought, cool, that's a good idea.

I guess I was not fully forthcoming about the fact that I'm, I'm kind of an outsider to that, that world. That's all right. The correct answer is Wrigley Field. But you've given me a chance to kind of walk the walk about our job as experts is to be honest. And you just let the facts, you just let the facts be what they are. I like it so much. Thank you so much for joining us.

This has been incredibly enlightening. One of my favorite conversations I have had in a long, long time. and I can't tell you how much we appreciate your time in joining us, and I'm sure our listeners will appreciate this. Okay, but it's going to cost you. So what's your favorite baseball stadium? Oh, Wrigley Field, no question. Oh, interesting.

I think Riggly beats Fenway, you know, six days a week and twice on something. I was thinking maybe like in San Francisco or some of these new parks. You like the old school. Well, and I come from Houston. So we do have, well, what used to be a Minutemate Park. and it's a good baseball stadium, but you just can't beat the beauty and history of Wrigley. Yep, good.

Well, thank you for, you know, now I know a little more about this world I don't really understand. Thank you very much for your time. Have a wonderful weekend.