These people are mad

Saez and Zucman that is. Their solution to coronavirus:

The most direct way to provide this insurance is to have governments act as payers of last resort, so that hibernating businesses can keep paying their workers (known in economic terms as idle workers) instead of laying them off, and can keep paying their necessary bills such as rent, utilities and interest instead of going bankrupt.

In practice, in the US, the unemployment insurance system is already up and running, making it possible to compute and deliver compensation to idle workers. Workers should immediately start receiving special unemployment insurance benefits so they are no longer a cost to their employers – even though they stay formally employed – and no re-hiring process is needed once they can come back to work.

Self-employed individuals (such as gig workers) could report themselves as idle and be eligible for this special unemployment insurance. In case of partial idling – if someone’s working hours have been cut – unemployment insurance benefits would be prorated.

These benefits would be progressive if they replaced a higher fraction of earnings for low-paid workers. This is a desirable feature, as low-paid workers are more likely to be affected by the lockdown (ie less likely to be able to work from home) and less likely to have savings to replace a temporary loss in earnings.

In the payer-of-last-resort programme we envision, businesses on lockdown would report their monthly necessary costs of maintenance and receive payment from the government. Necessary costs are rent, utility payments, interest on debt, health insurance (in the US) and national insurance contributions (in the UK) of idle workers, and other costs that are vital for the maintenance of businesses. For partially shut down sectors, governments would pay a fraction of the maintenance costs. The amounts don’t need to be exact; verification and correction can take place once the lockdown is over. Any excess government payment could be transformed into an interest-free loan that could be recouped over several years.

Hands up everyone who thinks that the bureaucracies of the US or UK could actually do this in less than many, many, months?

Quite, so that’s not going to work then, is it?

52 thoughts on “These people are mad”

  1. Key point: The amounts don’t need to be exact; verification and correction can take place once the lockdown is over.

    Just throw funny money at everyone until the virus goes away, then sort it out. With any luck, the 500 trillion dollars you just spaffed will be the cost of a family holiday in 2023.

  2. I do insurance for a living and there will be almost no Con Loss pay outs on ordinary Policies. When I hear the government claim they have agreed with “Insurance” there will be, I wonder if the rest of is a similar level of gibberish.
    These are individual legal contracts made my a zillion entities which are, quite obviously, not drafted to cover a generalised catastrophe.
    Similarly I hear them claim to have agreed to mortgage breaks? Wot? There were already mortgage breaks and then they have offered to make me back loans to companies with no income who cannot afford to take on debt anyway. Does that have any meaning at all ?
    Then it hits you.These people are now younger and stupider than me and I`m out of ideas.They probably don`t even understand the words they are parroting.

    I`ll make my own decisions for myself thanks

  3. MC, seems like in extremis we are all socialists. All the bloody rats emerging from their holes now riding on their favourite hobby-horses. Universal basic income! I can assure you, the quality of conversation and arguments are exactly the same in finland so I would assume in other european countries too.

    So there was a money tree after all, “whatever it takes”. It’s the same nonsense train companies always say “safety is our top priority”.

  4. Fucking idiot poeple everywhere. Looking for answers and certainty. Nick Ferrari: “how long are these airport restrictions going to be in place?” Nobody knows! It’s changing every day!

    Many things change every day so the actions must adapt too. It doesn’t necessarily mean that the government made a mistake a week ago.

    Please mr Govt, come and hold my hand, please make the boo-boo go away.

  5. Newmania, I was thinking thay yesterday, you make a good point, Chancellor guaranteed insurances which are not actually in the contracts. So I expecting LGENs etc taking a dump this morning…down 8.2% now. Thanks, Chancellor.

  6. Jussi:“Please mr Govt, come and hold my hand, please make the boo-boo go away.”

    We are now seeing just how many of the talking heads and local politicians are, frankly, sub room temperature IQ morons…

  7. We’re in for a very deep recession already. Perhaps. the govt can do something at the margin to make it short as well as sharp, but how could we tell?
    The scientists say that locking up OAPs and vulnerable people is a good idea. Good for the NHS but it’s not obvious that it’s good for actual individuals.
    As for the ambition to limit deaths to under 20,000 this isn’t just a result, it’s a Roman triumph to eclipse them all, given that there is usually a 50,000 excess mortality in winter anyway.The govt clearly doesn’t know anything, and 300 billion is just pub talk. Trouble is, no one else knows anything either.

  8. BlokeInTejasInNormandy

    The French government announced las Friday a package of goodies which come down to we have a giant fund and will use it to ensure every employee who cannot be paid because we shut down their employer, and every business we’ve shut down, and every body else losing money because of guv actions will be funded directly by the state without any bulldhit paperwork…

  9. That was my first thought when the Chancellor announced grants for small businesses. How long will it take to get through the paperwork and actually get my hands on the money?

    Cancelling business rates is easier, you just instruct the billing agency not to bill people.

  10. Newmania,

    Then it hits you. These people are now younger and stupider than me and I’m out of ideas. They probably don’t even understand the words they are parroting. I’ll make my own decisions for myself thanks.

    Welcome to the Right. We’ve been expecting you for some time now.

  11. BiTiN – I liked the report I read yesterday whereby a Frenchman who wants to go out to take his dog for a walk must download and print a form which he must first complete before setting out.

    On the form he declares his name, address, time of departure, purpose of absence from home and estimated time of return. Should he be challenged by a gendarme, he has to produce his declaration form for verification that he is not simply wondering about aimlessly.

    One must surely be a very highly qualified administrator indeed to formulate a policy that supposes all dog owners to have computers and printers.

  12. Andrew I have been a member of the Conservative Party for most of my life and have never been any more left wing than John Major Michael Heseltine George Osborne and latterly David Gauke who continues to show that the Conservative Party currently excludes anyone with half a brain from its ranks.

  13. Ecks, that video is very reminiscent of the sane scientists reaction to the Great Climate Panic. It seems that since the climate emergency has taken too long to destroy the capitalist economy, they’re trying the virus emergency.

    And of course, our dumb media and political class are happily going along with it.

  14. Newmania

    Insurance +1. I don’t know the answer, but could that mean that Boris has indicated that government may underwrite in some yet to be determined way – but which makes it possible for comments to be said with a straight face?

    Ecks

    What I got from that video is that the uncertainty lies with regard to the ultimate contagion / spread rate. Ie, will the virus (we know very little) ultimately fall within the normal realm or will it fall outside of the normal annual effect (as is currently being declared).

    In this context, forget all the masks, MSM, politics – I can look at real things actually happening: Italy, with their makeshift hospital tents, Lombardy shipping people to the south because they’ve run out of ICU beds, and the question I have to ask is: “is that normal (each year)”, and “are we about to see it get a whole lot worse”? If the answer to the second in particular turns out to be yes, then this chap might have to consider that this particular coronavirus could be different in some way to what he is describing?

    He also didn’t make any reference to the earlier coronaviruses (Sars etc) in the context of his “annual routine”? Did he regard those as “within the usual 7-15% of annual coronaviruses”?

  15. BTW, I’m just going out for my morning walk and a couple of things crossed my mind. First, should I take a shopping bag in case the shop across the road has baked beans and second, I better be careful not to cough when I’m out since the police have now been given powers to detain the infected.

    Welcome to Moscow, 1970.

  16. BlokeInTejasInNormandy

    TMB

    It’s not *quite* as idiotic as that – you can handwrite it if you want. FWIW, it seems to be the same strategy as Northern Italy had…

    I suspect its goal is twofold
    – to offer the happy citizen a moment’s opportunity for reflection before doing something which is Officially Hazardous
    – to somewhat reduce the incidence of folk doing Truly Forbidden Activities (like selling hand sanitizer and used TVs out the back of their Ford Transit) because at some point the fuzz will note that they have the same attestation saying they were off to buy some balding cream from the pharmacie, but have somehow had to drive 300 miles to do so; or that there’s a different attestation at every police stop.

    I also rather suspect that this sort of thing is seen as perfectly normal in France…

  17. I wonder how many people will die in the future because governments have borrowed trillions to alleviate this ‘crisis’?

  18. I guess catching the virus isn’t fun, but surviving it is going to be worse given what governments are now doing!

  19. Insurance +1. I don’t know the answer, but could that mean that Boris has indicated that government may underwrite in some yet to be determined way – but which makes it possible for comments to be said with a straight face?

    No the government has not and cannot made any such promise and ‘representatives’ of the Insurance Industry are not empowered to compromise the legal position of large and small insuring entities by in any way whatsoever.
    That said I have had a number of wordings on my desk today some of which are so badly drafted it is entirely possible a court action may succeed in putting the ultimate insuring entity out of business .
    Those who think that is a good thing will no doubt applaud
    It is not

  20. All this don’t waste a crisis can work both ways. suspend foreign aid to space faring nations. Suspend arts funding. Suspend Tariffs/qoutas and Non tariff barriers. Suspend all zoning laws (not just pubs being allowed to be take-aways). what else?

  21. The U.S. already has a vast unemployment compensation program. It seems politicians – including Trump – don’t know it.

  22. ‘The early selling comes as the Trump administration and Congress hammer out the details of a $1 trillion stimulus package designed to prop up the most harshly pummeled sectors of the U.S. economy and give cash to those out of work.’

    GFD. There’s no fvcking economy to stimulate, you idiots! Cure coronavirus, and the economy will take care of itself. This trillion dollar shtick is just taking advantage of the crisis to give money to people you want to. Borrow from the kids to pay your friends today. Just like Obama did 10 years ago.

  23. The Director of the Italian National Institute of Healthy has announced that the number of people killed by the Corvid-19 virus without ANY other pre-existing aliments helping out–on its own, solo, on its todd, alon-e-o is …..TWO.

  24. If your computer killer is still on the payroll Tim a chance to amend mistakes in posts would be a nice idea amongst all the bad ones.

  25. Ecks

    Do you have a link for that at all. And is that cumulative (surely not), or just a particular recent day. Even if the latter, at the numbers the the Italians are currently trending, that’s staggering. Because, if it’s true, that more than anything should be determining policy for any number of countries.

  26. A world without insurance companies seems quite good to me. The concept of insurance is a good one: pay a small amount of money to cover you in case something unfortunate happens. The reality, however, is that insurance companies hoover up premia and do absolutely everything they can to ensure that they never ever on any account pay out on any claims. English contract law is full of stuff that arose from insurance bastards not paying claims.

    Perhaps the best one was Macaura v Northern Assurance –

    Mr Macaura owned the Killymoon estate in County Tyrone, Northern Ireland. He sold the timber there to Irish Canadian Sawmills Ltd for 42,000 fully paid up £1 shares, making him the whole owner (with nominees). Mr Macaura was also an unsecured creditor for £19,000. He got insurance policies – but in his own name, not the company’s – with Northern Assurance covering for fire. Two weeks later, there was a fire. Northern Assurance refused to pay up because the timber was owned by the company, and that because the company was a separate legal entity, it did not need to pay Mr Macaura any money.

  27. PF–https://translate.google.com/translate?hl=en&sl=auto&tl=en&u=https%3A%2F%2Fwww.agenzianova.com%2Fa%2F5e6bcf1da7fbe3.23491954%2F2851060%2F2020-03-13%2Fcoronavirus-iss-in-italia-i-decessi-accertati-finora-per-causa-del-covid-19-sono-solo-due

    I see now that it is the reports on the first one hundred deaths –but it is also ALL the hard data they have so far.

  28. Can’t get a working link but here is the copied text:

    “Rome, 13 March 19:12 – (Agenzia Nova) – There may be only two people who died from coronavirus in Italy, who did not present other pathologies. This is what emerges from the medical records examined so far by the Higher Institute of Health, according to what was reported by the President of the Institute, Silvio Brusaferro, during the press conference held today at the Civil Protection in Rome. “Positive deceased patients have an average of over 80 years – 80.3 to be exact – and are essentially predominantly male,” said Brusaferro. “Women are 25.8 percent. The average age of the deceased is significantly higher than the other positive ones. The age groups over 70 years, with a peak between 80 and 89 years. The majority of these people are carriers of chronic diseases. Only two people were not presently carriers of diseases “, but even in these two cases, the examination of the files is not concluded and therefore, causes of death different from Covid-19 could emerge. The president of the ISS has specified that “little more than a hundred medical records” have so far come from hospitals throughout Italy.

    These are the first minimum detailed data provided so far by the Civil Protection on the causes of death of coronavirus patients. At present, in fact, the authorities are unable to distinguish those who died from the virus, from those who, on the other hand, are communicated daily to the public, but who were mostly carriers of other serious diseases and who, therefore, would not have died from Covid-19. In response to a question from “Agenzia Nova”, in fact, Brusaferro was unable to indicate the exact number of coronavirus deaths. However, the professor clarified that, according to the data analyzed, the vast majority of the victims “had serious pathologies and in some cases the onset of an infection of the respiratory tract can lead more easily to death. To clarify this point , and provide real data, “as we acquire the folders we will go further. However, the populations most at risk are fragile, carriers of multiple diseases “. (Rin) © Agenzia Nova – Reproduction reserved”

  29. Some of (my outfit’s) customers are people who know people, and word is circulating of an enforced euro style lockdown starting in the UK this weekend. Make of that what you will.

  30. Well we might get to see how the first part works as the Canadian govt has said people can just apply for standard EI payments as if out of work and they will waive the waiting period and some of the eligibility criteria
    I can see that adapting an existing system is better than putting in a new one, but given govt typical legacy systems and response to changes it should be interesting

  31. There is talk of closing the schools this weekend–also stupid–is there a single child recorded as having died from coro? And if they have it many will end up having to be looked after by Grandparents –if they are lucky enough to have Grandparents.

  32. Guido has for the last couple of days been hinting about that happening in London.

    To do that everywhere would be a good way to stoke more panic buying, but accomplish little else.

  33. BniC –UK food banks exist cos the shite-useless state takes about 16 weeks to do the paperwork and get cheques out. Good luck issuing all these new payments –esp with ANY criteria at all beyond name and address.

  34. Just had a look at the process and they have a big notice saying we are waiving need for medical certs and 1 week waiting time, but process for applications hasn’t been updated steps are

    -Gather supporting documents ( so might need recent payslips which are now online and can’t be printed unless you go to work)
    -complete the online application
    -provide supporting documents (the icon shows an envelope but let’s be kind and assume you can scan them and attach to application)
    -a benefit statement and code will be sent by mail
    login to review you application status once you have the code

    Sounds like fun, still something to do while stuck at home for a couple of weeks

  35. As always with bureaucracy the problems are at their end BniC. You might complete your bit and be in the gutter or something by the time they get back to you.

  36. BiW–Guido –Seaman Staines–Fawkes is a prime scumbag.

    His comments have gone from being the often funny Wild West to garbage. He now has some shower of shite called Vuukle who want to review everything you have ever put online before you can comment.

    The degeneration mirrors his ever-growing role as an Establishment cocksucker.

    Hope he puts himself out of business or cirrhosis finishes the fat bastard soon.

  37. @ Newmania
    Governments can and do legislate to over-ride the specific and mutually agreed terms of contracts, even insurance contracts. That is why Lloyd’s now has limited liability capital. The US Congress changed the terms of contracts that Lloyd’s had reinsured and many Names were bankrupted. If you can’t remember that you must be younger as well as stupider than Boris Johnson (whose many faults do not include stupidity).
    Governments can also bully companies into agreeing to do things that are not in their interests, hence we have the pool that pays out on damage caused by uninsured drivers. It is quite plausible that Aviva, L&G, Pru and RSA have agreed to compensate businesses under their “Business Interruption” policies (NOT the same as Consequential Loss) outside the terms of the policy.

  38. Having the insurers pay out on Business Interruption under relaxed rules and then having the insurers claim relief from the govt where the relaxed rules applied sounds more sensible than a govt scheme to reimburse individual businesses

  39. Bloke in North Dorset

    Fucking hell, Ecks, calm down, if the virus doesn’t get you a heart attack or stroke will.

    Oh, and btw, when you’re comparing to normal flu deaths don’t forget to factor in the fact the all the elderly and high risk get vaccinated, us do a large part of the working population eg heath care workers, and private industry and any number of people who for their own. I pay for my own because I’m on the margins of risk.

  40. Looking for 79°F tomorrow.

    BMW R 1200 R gassed up. Aria helmet face mask cleaned.

    Golf in the AM. Road pounding in the PM. Fvck all this other $#|+!

  41. @TMB

    Perfectly illustrates what Gov functionaries think is most important and, of course, it’s pointless

    @BlokeInTejasInNormandy

    “I also rather suspect that this sort of thing is seen as perfectly normal in France…”

    That crossed my mind too, Europe operates under “banned unless permitted” laws

    @Newmania

    John Major PM post 1992 was when Conservative & Unionist Party morphed into Conservative Socialist Party

    Insurance: it should fall under same as terrorism/riot and Gov responsible as during ‘The Troubles’/Op Banner in NI

    My instinct suggests this why Gov won’t order shops, offices, hospitality, leisure etc to close

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