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One of the questions of economics teaches you to ask is ‘compared to what?’ Someone might tell you that a job paying $10 an hour is bad, but any reasonable…
It was in March that top health officials recommended all states to shut down. In original reasoning, the shutdown was intended to delay the spread of Covid-19 so that states would not be overwhelmed. However, slowing down the spread turned to “completely eradicating COVID-19” and the lockdowns continued for months. And regardless of the number of cases each state had, shutdowns were recommended for every state. And with drastic lockdown measures, most states disrupted businesses, travel.
Lockdowns have come at a costly price. A lot of states saw businesses shutdown and unemployment skyrocket. However, according to some individuals, this was all necessary in order that the coronavirus be eradicated. According to some shutdown proponents, “choosing not to shut down would be choosing to sacrifice lives for the economy”.
With most states opened up, we can judge the truth in this statement. In the united states, seven states did not choose to lockdown. These are North Dakota, South Dakota, Nebraska, Iowa, Utah, Arkansas, and Wyoming. And an analysis from the American Institute of Economic Research (AIER) shows that when these states are compared to states that shut down, they come out on top. Not only did these states have some of the lowest Covid-19 death rates, but they also fared much better economically.
When it comes to death rates from the coronavirus states that stayed open are among the best performing states. According to Covid-19 data, Wyoming, Utah, South Dakota, and North Dakota are among the top ten states with the lowest COVID-19 deaths per 100,000 people. These numbers are a representation of a number of other factors and policies but they go to show that lockdowns did not greatly impact COVID-19 outcomes. In fact, states with the highest COVID-19 deaths per 100,000 people were among the ones with the most restrictive shutdown rules.
The same is true economically, as to be logically expected. As illustrated in the AIER article,
Alongside having a poor correlation with any sort of desirable health outcomes, states that avoided stay at home orders also fared far better economically than those that embraced them. Provided below are unemployment numbers from July 2019 and July 2020 from the Bureau of Labor Statistics. Despite COVID-19’s role in the decline of the fossil fuel industry which is a key component in states like North Dakota and Wyoming that didn’t issue stay at home orders, they still managed to maintain better employment rates than many states that did lock down.
The rest of the states that didn’t issue stay at home orders (Utah, South Dakota, Nebraska, Iowa, and Arkansas) fared just as well if not better than other states. In particular, Utah and Nebraska did extraordinarily well maintaining a 4.5% and 4.8% unemployment rate, respectively while keeping death rates low.
In contrast, pro-lockdown states like New York, California, and Massachusetts saw catastrophic unemployment numbers, 15.9%, 13.3%, and 16.1% respectively, alongside high COVID-19 death rates.
When compared to its neighboring states, Minnesota had the most restrictive shutdown rules. Yet Minnesota has fared worse compared to its neighboring states. Minnesota currently has the highest unemployment rate among the neighboring states. And Minnesota’s Covid-19 death rate is only slightly less than that of Iowa and more than that of its other three neighbors. This just goes to show how little effect the shutdown had on COVID-19 outcomes.