Hong Kong: o que a RPC prometeu e o que ela não cumpriu - Lindsay Maizland, Eleanor Albert (Foreign Affairs)

 A promessa (de 1997) e a atual realidade: a natureza autoritária, senão totalitária, não apenas do PCC, que controla a China desde 1949, mas das características básicas do sistema político chinês desde sempre, fo Império do Meio, não permitem o estabelecimento de um regime de liberdades individuais, tal como ocorreu nas sociedades da Europa ocidental herdeiras do mundo greco-romano e cristão da Antiguidade e da Idade Média. Mas essa evolução ocorrerá em algum momento do futuro: o espírito de Hong Kong prevalecerá no futuro previsível (e já ocorreu, nas revoltas estudantis de 1919 e de 1989).

Paulo Roberto de Almeida 

Hong Kong’s Freedoms: What China Promised and How It’s Cracking Down

Beijing has tightened its grip on Hong Kong in recent years, dimming hopes that the financial center will ever become a full democracy.

Daniel Wong Kwok-tung, a lawyer, is arrested by Hong Kong police in January 2021. Tyrone Siu/Reuters

WRITTEN BY

Lindsay Maizland and Eleanor Albert

UPDATED

Last updated February 17, 2021 12:00 pm (EST)

    

Summary

• Before the British government handed over Hong Kong in 1997, China agreed to allow the region considerable political autonomy for fifty years under a framework known as “one country, two systems.” 
• In recent years, Beijing has cracked down on Hong Kong’s freedoms, stoking mass protests in the city and drawing international criticism. 
• Beijing imposed a national security law in 2020 that gave it broad new powers to punish critics and silence dissenters and could fundamentally alter life for Hong Kongers.

Introduction

China pledged to preserve much of what makes Hong Kong unique when the former British colony was handed over more than two decades ago. Beijing said it would give Hong Kong fifty years to keep its capitalist system and enjoy many freedoms not found in mainland Chinese cities. 

But it seems that these promises are fading. In recent years, Beijing has taken what critics say are brazen steps to encroach on Hong Kong’s political system and crack down on dissent. These moves sparked massive protests in Hong Kong and have drawn international condemnation. In 2020, Beijing passed a controversial national security law and arrested dozens of pro-democracy activists and lawmakers, dimming hopes that Hong Kong will ever become a full-fledged democracy.

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Hong Kong Under China’s National Security Law, With Victoria Tin-bor Hui

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Is Hong Kong part of China? 

Hong Kong is a special administrative region of the People’s Republic of China that has been largely free to manage its own affairs based on “one country, two systems,” a national unification policy developed by Chinese leader Deng Xiaoping in the 1980s. The concept was intended to help integrate Taiwan, Hong Kong, and Macau with sovereign China while preserving their unique political and economic systems. After more than a century and a half of colonial rule, the British government returned Hong Kong in 1997. (Qing Dynasty leaders ceded Hong Kong Island to the British Crown in 1842 after China’s defeat in the First Opium War.) Portugal returned Macau in 1999, and Taiwan remains independent.

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The Sino-British Joint Declaration of 1984 dictated the terms under which Hong Kong was returned to China. The declaration and Hong Kong’s Basic Law, the city’s constitutional document, enshrine the city’s “capitalist system and way of life” and grant it “a high degree of autonomy,” including executive, legislative, and independent judicial powers for fifty years (until 2047).

Chinese Communist Party officials do not preside over Hong Kong as they do over mainland provinces and municipalities, but Beijing still exerts considerable influence through loyalists who dominate the region’s political sphere. Beijing also maintains the authority to interpret Hong Kong’s Basic Law, a power that it had rarely used until recently. All changes to political processes have to be approved by the Hong Kong government and China’s top legislative body, the National People’s Congress, or its Standing Committee. 

Hong Kong is allowed to forge external relations in certain areas—including trade, communications, tourism, and culture—but Beijing maintains control over the region’s diplomacy and defense. Under the Basic Law, Hong Kongers are guaranteed freedoms of the press, expression, assembly, and religion, as well as protections under international law. But in practice, Beijing has curtailed some of these rights. 

Is Hong Kong a democracy?

Although Hong Kong has certain freedoms, it is not a full democracy [PDF] by international standards. China is a one-party state and is reluctant to allow Hong Kong to hold free and fair elections. Experts say that ambiguity in the Basic Law heightens this fundamental tension. The document states that the “ultimate aim” is to have Hong Kong’s leader elected by a popular vote, but it does not give a deadline for this to occur.

Since the handover, there have been no free votes by universal suffrage for the chief executive, who is the head of the Hong Kong government. Instead, an election committee composed of representatives from Hong Kong’s main professional sectors [PDF] and business elite has selected them. During the most recent election, in 2017, only candidates vetted by a nominating committee chosen by Beijing were allowed to run. Carrie Lam, viewed as an establishment candidate, won and became Hong Kong’s first woman chief executive. 

Thirty-five members of Hong Kong’s legislature, the Legislative Council, are elected by direct voting, while the other thirty-five members are chosen by groups representing different industries and professions. Hong Kong residents also get to vote for members of their local district councils, which handle day-to-day community concerns. 

Unlike China, Hong Kong has numerous political parties. They have traditionally split between two factions: pan-democrats, who call for incremental democratic reforms, and pro-establishment groups, who are by and large pro-business supporters of Beijing. The latter have typically been more dominant in Hong Kong politics, but pro-democracy groups have increasingly garnered more support from voters. 

Traditionally, only a small minority of Hong Kongers have favored outright independence. However, in recent years, student protesters demanding a more demoractic system have formed political groups, including more radical, anti-Beijing parties, such as Youngspiration, and Hong Kong Indigenous, and Demosisto. These parties tapped into the phenomenon in which more and more people see themselves as Hong Kongers or as Hong Kongers in China as opposed to identifying as Chinese nationals. Several of these groups disbanded in 2020, however, as Beijing cracked down on political opposition.

How has Beijing eroded Hong Kong’s freedoms?

Beijing has been chipping away at Hong Kong’s freedoms since the handover, experts say. Over the years, its attempts to impose more control over the city have sparked mass protests, which have in turn led the Chinese government to crack down further. 

“In the fifteen years after the handover, there was a series of official initiatives aimed at enhancing Beijing’s control in ways that would undermine both the autonomy and the rule of law,” Michael C. Davis writes in his book Making Hong Kong China.

For instance, in 2003, the Hong Kong government proposed national security legislation that would have prohibited treason, secession, sedition, and subversion against the Chinese government. In 2012, it tried to amend Hong Kong schools’ curricula to foster Chinese national identity, which many residents saw as Chinese propaganda. And in 2014, Beijing proposed a framework for universal suffrage, allowing Hong Kongers to vote for the city’s chief executive but only from a Beijing-approved short list of candidates. Protesters organized massive rallies, known as the Umbrella Movement, to call for true democracy.

In the years following the 2014 protests, Beijing and the Hong Kong government stepped up efforts to rein in dissent, including by prosecuting protest leaders, expelling several new legislators, and increasing media censorship.

Hong Kong Since the Handover

A military aide salutes Chris Patten, the last British governor of Hong Kong, at a departure ceremony on June 30, 1997.

David Gray/Reuters

In the summer of 2019, Hong Kong saw its largest protests ever. For months, people demonstrated against a Beijing-endorsed legislative proposal that would have allowed extraditions to mainland China. Many protesters believed Beijing had eroded Hong Kong’s freedoms to such an extent that they thought, “either we stop it now, or it’s just basically going to be hell,” says Victoria Tin-bor Hui, a political science professor at the University of Notre Dame. Reports of police brutality, including the excessive use of tear gas and rubber bullets, exacerbated tensions. Chief Executive Lam withdrew the bill in September, but the protests, which garnered international attention, continued until the outbreak of COVID-19 in early 2020.

What is the national security law Beijing imposed on Hong Kong?

Beijing took its most assertive action yet on June 30, 2020, when it bypassed the Hong Kong legislature and imposed a new national security law on the city. The legislation effectively criminalizes any dissent, and adopts extremely broad definitions for crimes such as terrorism, subversion, secession, and collusion with foreign powers. It also allows Beijing to establish a security force in Hong Kong and influence the selection of judges who will hear national security cases. Pro-democracy activists and lawmakers decried the move and expressed fears that it could be “the end of Hong Kong.” Meanwhile, Chinese officials and pro-Beijing lawmakers said it was necessary to restore stability following the massive protests.

Authorities have used the law to try to eliminate all forms of political opposition. They disqualified pro-democracy candidates from running in the 2020 legislative elections, which were ultimately postponed, and removed elected lawmakers for publicly opposing China’s control over Hong Kong. In addition, police have arrested dozens of Hong Kong’s most prominent pro-democracy activists and former lawmakers, and the government has started to prosecute them. These moves have silenced many Hong Kong residents who had fought for democracy and prompted others to flee the city. The Hong Kong government’s efforts to transform the public education system by introducing so-called patriotic programs have also troubled many parents and students. 

What has been the international response to Beijing’s actions?

Several countries have condemned Beijing’s moves and taken retaliatory measures. The administration of former U.S. President Donald J. Trump imposed sanctions on Chinese officials it alleged were undermining Hong Kong’s autonomy, including Lam; restricted exports of defense equipment to Hong Kong; and started revoking its special trade status. The United States also joined a handful of countries, such as Australia, Canada, and New Zealand, that suspended their extradition treaties with Hong Kong because of the national security law. U.S. President Joe Biden has indicated that his administration will continue to press for Hong Kong’s freedoms. In his first phone call with Chinese leader Xi Jinping, Biden voiced concerns about Beijing’s crackdown.

The United Kingdom, which also ended its extradition agreement with the region, said it would allow three million Hong Kong residents to settle in the country and apply for citizenship. Canada announced measures to make it easier for Hong Kong youth to study and work in the country, creating pathways for permanent residency. The European Union, which expressed “grave concern” about the national security law, limited exports of equipment that China could use for repression and vowed to ease visa and asylum policies for Hong Kong residents. 

However, the opposition has not been unanimous. Fifty-three countries—most of which are participating in China’s Belt and Road infrastructure project—signed a statementread before the UN Human Rights Council in July 2020 supporting Beijing’s national security law, while only twenty-seven countries signed an opposing statement criticizing it.

What does Beijing’s crackdown mean for Hong Kong’s financial status? 

It is too soon to tell whether Beijing’s actions will jeopardize Hong Kong’s role as a global financial hub. Relatively low taxes, a highly developed financial system, light regulation, and other capitalist features have made Hong Kong one of the world’s most attractive markets and set it apart from mainland financial hubs such as Shanghai and Shenzhen. Multinational firms and banks—many of which maintain regional headquarters in Hong Kong—have historically used the city as a gateway to do business in the mainland, owing in part to its proximity to the world’s second-largest economy and its legal system based on British common law. 

“It seems that you really cannot maintain Hong Kong’s international financial standing while stifling its freedom.”

Victoria Tin-bor Hui, University of Notre Dame

However, executives of some companies with large footprints in Hong Kong have recently voiced concerns about the national security law, criticizing the broad powers given to mainland authorities. Some firms are reportedly considering leaving the city or are boosting hiring in other Asian financial capitals, such as Singapore and Tokyo. A majority of U.S. companies surveyed in July 2020 said they were concerned about the legislation. In particular, social media companies, including Facebook and Google, have expressed concerns about part of the law that requires them to surrender requested user data to the Hong Kong government. TikTok, an app owned by mainland-based company ByteDance, suspended operations in Hong Kong. 

“Beijing’s ideal scenario is to keep Hong Kong as a financial center without all the freedom. But it seems that you really cannot maintain Hong Kong’s international financial standing while stifling its freedom,” Hui says. 

Other experts believe that Hong Kong will maintain its commercial status despite its democratic decline. In recent years, Beijing has moved to connect Hong Kong more to the mainland, creating the Greater Bay Area project, an ambitious plan to integrate Hong Kong and cities in neighboring Guangdong Province into a more cohesive economic region. Many firms and investors are betting that this increased connectivity will boost the amount of wealth flowing from the mainland into Hong Kong in the future.

“This dramatic transformation will not be the end of Hong Kong as a global financial hub, as it has already begun to boost economic integration with mainland China. But it is surely the death of the democratic hopes of most of its 7.5 million people,” CFR’s Jerome A. Cohen writes.

Recommended Resources

On The President’s Inbox podcast, Victoria Tin-bor Hui explains the national security law imposed on Hong Kong.

In Foreign Affairs, Michael C. Davis argues that Hong Kong is now part of mainland China.

The Congressional Research Service outlines the national security law for Hong Kong [PDF], the composition of Hong Kong’s legislative body [PDF], and the status of U.S.-Hong Kong relations [PDF].

The Australian Broadcasting Corporation tells the story of the massive protests in 2019.

The Financial Times lays out Xi Jinping’s grand plan for the Greater Bay Area.

Peter Brown: historiador da Antiguidade, historiador universal - Maria Antonia Sanchez Vallejo (El País)

 HISTÓRIA

Peter Brown: “Pior que esquecer a história é distorcê-la para avivar o ressentimento”

Com 36 anos, demonstrou em ‘O Mundo da Antiguidade Tardia’ que a tese da decadência de Roma era falsa. Para muitos, é o maior historiador vivo em língua inglesa. Falamos com ele em sua casa em Princeton sobre sua trajetória, o abandono das ciências humanas e a tendência política de manipular o passado para incutir o medo

O historiador irlandês Peter Brown em sua residência em Princeton, New Jersey (EUA), em 29 de abril.JOANA TORO

MARÍA ANTONIA SÁNCHEZ-VALLEJO

El País, 09 MAI 2021 - 08:30 BRST

O gosto pela astronomia que Peter Brown (Dublin, 85 anos) desenvolveu quando criança foi um presságio da tarefa que o consagraria como historiador: o afã de esquadrinhar na escuridão os pontos de luz que definem a Antiguidade tardia(200-700 depois de Cristo), esse período durante o qual ocorreu o colapso de Roma, ganharam forma as religiões do livro e o cristianismo foi se estabelecendo na Europa. Um período que ganhou status acadêmico graças, precisamente, aos seus estudos.

A reedição em espanhol de O Mundo da Antiguidade Tardia, uma de suas obras magnas, é uma oportunidade de redescobrir não só essa época erroneamente considerada sombria e seus tentadores paralelos com a atualidade, como também de rever a carreira do professor emérito de Princeton que antes lecionou em Oxford, sua alma mater, até 1975, do titã capaz de se rebelar contra Edward Gibbon, cuja tese da ruptura —a bem-sucedida, mas pouco justificada ideia de decadência e queda do Império Romano— teve uma releitura radical no conceito de transformação do Brown.

Venerado por gerações de historiadores, a jornalista o encontra em sua residência de Princeton suscita uma ansiedade pertinente. Assim como tentar descobrir que presente deseja alguém que tem tudo, o que se deve perguntar a um erudito, a um sábio de fama internacional? Tanta riqueza de conhecimento impõe respeito. Mas a cortesia do professor, que aguarda a chegada do táxi para me acompanhar até o interior de sua casa —luminosa e plácida, com torres de livros, porcelanas, miniaturas e cortinas de cretone—, desfaz qualquer acanhamento.

Na soleira, uma mesinha auxiliar coberta de azulejos que reproduzem os motivos florais de Iznik, a cerâmica do período otomano, faz o visitante valorizar sua beleza enquanto pronuncia o topônimo. “Iznik!” e, abracadabra, predispõe ao diálogo. A primeira referência, graças à cerâmica, é a Turquia, um país que Brown e sua esposa, Betsy, conhecem muito bem, como parada obrigatória para quem estudou Bizâncio em todas as suas formas. A Turquia voltará reiteradamente à conversa. “Qual sua opinião sobre Erdogan? Como vê a situação do país?”, pergunta logo o professor, em um exercício de maiêutica. Betsy lembra que Peter estudou turco, “esse idioma tão bonito, com um som lindo”, comenta ele com satisfação. Sobre seu vasto dom de línguas ele falará, entre divertido e modesto, mais tarde. “Agora estou aprendendo etíope”, conta, sem dar importância a isso. “Mas não o moderno, o antigo.”

Para um historiador total como Brown, herdeiro em fôlego de Fernand Braudel e discípulo de Arnaldo Momigliano, que atualidade tem um livro escrito há décadas? “Este livro é de 1971. Obviamente, minhas inquietações mudaram. A razão para me dedicar ao que agora chamamos de Antiguidade tardia era o desejo de estudar uma sociedade que tinha conservado suas raízes no mundo antigo, com o latim e o grego como línguas dominantes, mas ao mesmo tempo tinha começado a mudar. Era o estudo da mudança em uma sociedade inusualmente resistente. Costumávamos descartar esse período por ser um período de ruptura total. Não gostávamos de nada que víamos dele”, lembra Brown sobre a época que ele reabilitou epistemologicamente

“Essa foi minha principal motivação: entender a natureza exata de certas crises, como as mudanças no Governo do Império Romano nos séculos III e IV. Queria descobrir se tinham sido desastrosas ou, na verdade, mudanças de ajuste da evolução; um equilíbrio entre a continuidade e a descontinuidade, a fragilidade e a resistência. Um exemplo: o surgimento de novos estilos de vida aristocrática nas províncias do Império Romano. Devo muito à arqueologia espanhola, aos grandes mosaicos de lugares como Carranque, que conheci naquela época. Achados que nos diziam: ei, as coisas não desmoronaram, mudaram, o foco já não está nas urbes”, a quintessência do mapa-múndi romano junto com sua malha viária espalhada como uma teia de aranha entre metrópoles.

“Acredito que uma das principais preocupações no campo da Antiguidade tardia era minar a noção fácil das invasões bárbaras”, acrescenta. A tentação de ver uma transcrição desse fenômeno para o da imigração irregular é fácil, tanto para um discurso tão raso como o dos populistas a granel como para esse outro, mais rebuscado, que propõe a perversa teoria da substituição. “Se você estiver olhando constantemente para uma imagem falsa do passado, procurando o reflexo de sua própria imagem, isso só o levará pelo caminho do racismo, do obscurantismo. Da xenofobia. Um bom exemplo são as invasões bárbaras. Todo mundo está ciente de que há problemas na Europa por causa da imigração em massa, mas é um terrível abuso histórico tratar um como uma repetição do outro”, explica Brown. Além disso, acrescenta, “o islã jihadista tragicamente protagonista hoje não tem nada a ver com o do profeta Maomé, com o islã de 300 anos atrás, são totalmente diferentes”.

Seu primeiro livro foi, no entanto, uma biografia de santo Agostinho, o norte-africano que o erudito destronou da santidade intitulando sua obra simplesmente como Augustine of Hippo: A Biography (lançada em português como Santo Agostinho: Uma Biografia). “Uma figura muito latina, um homem que representava um cristianismo imensamente opressivo. Lembro-me das críticas em espanhol ao meu ensaio; de como os europeus, principalmente os de origem católica, ainda consideravam Agostinho como parte de seu próprio mundo.”

Por intercessão intelectual do santo, Brown superou o etnocentrismo —ou seja, o eurocentrismo tradicional, que considera a civilização clássica como única fonte do Ocidente— e soube olhar em volta, outra de suas grandes conquistas como historiador. “Teria sido muito fácil continuar estudando só o cristianismo, mas me deparei com as descobertas da arqueologia, aprendi siríaco e hebraico e abri uma área cuja cultura chegava então até as cidades gregas da costa do Egeu, como Éfeso. Continuavam sendo cidades impressionantes, mas foram sendo criadas outras grandes obras, como Santa Sofia em Istambul.”

Portanto, prossegue ele sem abandonar o uso do plural de modéstia e com um levíssimo gaguejo ocasional, imperceptível, “vimos que havia um mundo lá fora e que não era possível escrever sobre ele como se tivéssemos de fechar as cortinas do Império Romano; era uma vida nova para o Império Romano, inclusive o profeta Maomé e o islã surgiram dessa cultura, não vieram do espaço exterior. Parte das raízes da Europa não está apenas na Europa. Também está no Oriente Médio e no sul do Mediterrâneo. Parte da riqueza da cultura europeia é, precisamente, sua abertura ao mundo. Em Santa Sofia, nos escritos dos Padres do Deserto...”.

Economic Lessons From COVID-19 - David Henderson (Reason)

 

Economic Lessons From COVID-19

What the pandemic has re-taught us about the perils of planning, the power of incentives, and the complexities of externalities.

DAVID R. HENDERSON | 

Reason, FROM THE JUNE 2021 ISSUE

(Illustration: Joanna Andreasson) 

One of the most important things economists can do in a pandemic is not forget what we know. We know that central planners don't have enough information and insight about the lives and activities of 330 million people to plan those lives in a thoughtful way. We know the problems that emerge when you distribute something valuable by giving it away. We know that government officials face bad incentives. We know that externalities pose problems for the straightforward "leave it to the market" viewpoint, but that large government interventions create new problems. In the rush to make pandemic policy, too many of these lessons were cast aside.

Central Planning

One of the most important controversies of the 20th century was the economic calculation debate. In his 1922 book, Socialism, Ludwig von Mises argued that without markets, central planners would not know how to "calculate." Specifically, they wouldn't know how many of various goods to produce, how to produce them, and whom to allocate them to. In the 1930s and 1940s, Mises' student Friedrich Hayek advanced the argument by noting the ways an economy depends on dispersed information that exists in the minds of millions of people. This information about individuals' "circumstances of time and place," he wrote, could not be captured by a central planner. Hayek's most famous contribution to the debate was his 1945 article "The Use of Knowledge in Society," published in the American Economic Review. That article led modern Hayekians to use the phrase "local knowledge" as a shorthand for Hayek's "circumstances of time and place."

By the end of the Cold War, most economists—even some socialists—were acknowledging that Mises and Hayek had won the debate: The Soviet planners had failed because they had embarked on a task that could not succeed.

But in the COVID-19 era, a lot of policy makers have let this lesson slip their minds. While few have advocated full-blown state socialism, many have forgotten the more general truth that officials don't have enough information to make detailed plans about people's lives.

Take Gavin Newsom, the first governor to impose a statewide lockdown. The California Democrat listed 16 infrastructure sectors deemed so essential that they would not have to lock down. Restaurants, hairdressers, gymnasiums, and schools, not being among them, were compelled to close. So were large swaths of the retail economy. But Newsom did not base these regulations on a sophisticated understanding of what is essential and what is not. He couldn't. No one has that understanding, for the reasons Hayek laid out long ago. The list of essential industries came from an old script; it was not highly correlated with the relative value of various industries and was not closely based on risks of spread.

What was missing from the discussion is something known only in the minds of the humans involved: the value of what was lost. Measuring the loss of gross domestic product (GDP) doesn't quite do it, because the private sector component of GDP is valued at market prices but the value consumers put on goods and services typically exceeds the sticker price. (Economists refer to the value minus the price as consumer surplus.) Gatherings of more than a few people at funerals, for example, were prohibited; many mourners surely valued the gathering they had to miss at more than the ceremony's price.

Central planners tend to come up with one-size-fits-all policies even when the evidence shows a large range of "sizes." With the lockdowns, the most extreme instance of that may be the decision in various jurisdictions to close schools to in-person instruction. Even if, like me, you aren't a fan of government schools, they arguably create at least one large valuable service: day care. So shutting them down—while paying full, or close to full, salaries to public school teachers—took away one of the most valuable services the institutions provided, while shifting the costs onto parents.

Whether or not one ultimately agrees with it, one can understand the decision to close schools in March and April of last year. But as more data came out, it became increasingly clear that students ages 15 or younger had only a tiny risk of dying from COVID-19. The latest data from the Centers for Disease Control and Prevention (CDC) shows that from January 1, 2020, to February 17, 2021, only 140 U.S. residents under age 15 died from the disease—just 0.03 percent of the overall COVID-19 deaths. During the 2019–20 flu season, according to the CDC, about 434 U.S. children under age 18 died from the flu. Yet no one advocated closing schools over that.

Of course, there is the risk of transmission from children to teachers. But teachers in Sweden, which avoided school shutdowns, had a slightly lower fatality rate than I.T. technicians. That comparison is relevant because many I.T. technicians can and do work from home, and probably did so increasingly after the worry about the coronavirus became widespread.

What about the risk of transmission from school children to their parents or other family members? If you've paid attention to recent protests in California and elsewhere, you'll realize that many families are eager to take that risk.

Moreover, the comparison between private schools and public schools is telling. In a January 2021 article in Axios, Erica Pandey notes that only 5 percent of private schools were "virtual" last fall, with presumably 95 percent being in person. That contrasts with the 62 percent of students in public schools who started school in the fall online. The difference is wonderful for the private school kids and tragic for many of those in public schools, but those with local knowledge and local control were most able to get kids back into classrooms.

The pathologies of central planning also played out with the COVID-19 vaccines. In early May, four economists—Susan Athey of Stanford, Michael Kremer of Harvard, Christopher Snyder of Dartmouth, and Alex Tabarrok of George Mason—wrote an op-ed in The New York Times titled "In the Race for a Coronavirus Vaccine, We Must Go Big. Really, Really Big." It advocated two major forms of federal spending for a vaccine. One, which they called a "pull incentive," was a commitment to buy 300 million courses of vaccine at a price of $100 per person. The second, which they called a "push incentive," was a guarantee of "partial reimbursement for production capacity built or repurposed at risk and partial reimbursement as they achieve milestones."

The authors didn't discuss how the vaccine should be distributed once the federal government paid for it. Presumably they wouldn't favor letting the drug companies sell a vaccine to the public after being paid by the federal government; that would have created an uproar. By default, their not mentioning distribution probably left most readers thinking they wanted the federal government to distribute the vaccine.

The good news is that the feds are not distributing the vaccine. The bad news is that state governments are deciding who gets it. Furthermore, no one pays for it, so we lack a price system. Without prices, there are huge lines to get vaccinated; people who barely value the vaccine sometimes get it ahead of people who value it a lot; and the incentive for those administering the vaccine to do so quickly is lower than it would be in a free market.

Could it have been different? Yes. On January 11, 2020, Yong-Zhen Zhang of China distributed the virus's genetic code; two days later, the Moderna lab in Massachusetts formulated one of the vaccines now being used. That was more than three months before the economists' article in The New York Times. So even without federal subsidies, Moderna would have been ready to sell the vaccine by the time it actually did so in late December. Then it could have distributed it to front-line health care workers and older people in nursing homes for, say, $20 a pop and sold doses to a lot of the rest of us for more. If the prices were too high for some people to afford, the government could have helped low-income Americans pay for the vaccine without involving itself in the distribution process.

The Food and Drug Administration's power to say no to drugs and vaccines that it thinks haven't been sufficiently tested for safety and/or efficacy is also a form of central planning. Without that power, we could have had the vaccine earlier. Even if the agency's power to "just say no" to drugs were restricted to its pre-1962 powers, when it could insist on safety but not on efficacy, we would have had the vaccine months earlier. That would have saved tens of thousands of lives.

Incentives

Another fundamental insight from economics—one that is arguably the basis of almost every other economic insight—is that incentives matter. Decision makers whose rewards are closely tied to the value their decisions create will tend to make decisions that create, or at least allow, a lot of value. They will sometimes fail, but they will try hard to make good decisions.

On the other hand, decision makers whose rewards are unrelated to the value of the decisions they make will make good decisions much less often. Even more perversely, if their decisions benefit only narrowly defined interest groups, such as government workers, their decisions might well destroy value.

Does this sound familiar? Consider Anthony Fauci's guidance to the American public early in the pandemic, from his perch on the White House Coronavirus Task Force, that there was no need to wear a mask. Later, Fauci conceded that this wasn't true; he had said otherwise, he maintained, to ensure an ample supply of masks for health care workers who needed them more than the average American. He didn't seem to take account of the damage that would do to the federal government's credibility.

Credibility is particularly important during a fast-moving pandemic. But Fauci would be paid the same $417,608 annually no matter what he said.

Moreover, the issue of incentives is relevant to the school opening issue discussed above. Private schools depend on tuitions and gifts to stay in business. Public schools, by contrast, get funded whether they teach in person or on Zoom. And public school teachers are typically paid full salaries even if they teach from home.

Externalities

The strongest argument for lockdowns is that when one person passes the virus on to another, he creates a "negative externality"—economists' term for a cost that someone imposes on others that wasn't accounted for when the person decided to act. The classic example is air pollution from a factory. The plant spews smoke into the air; it makes its way to tens of thousands of lungs; and, absent liability, fines, or agreements, the factory owner has little or no incentive to care.

If the factory's smoke entered the lungs of workers voluntarily laboring at the factory, though, that would not be classified as an externality. Whatever the lowest wage they would have been willing to work for in the absence of the smoke, that wage will be somewhat higher with the smoke. The factory owner can then decide whether it's cheaper to reduce the smoke or to continue as usual but pay higher wages.

Why do I note that caveat? Because what is sometimes described as a COVID-19 externality is not necessarily one.

Consider a customer going to a bar and knowing that there's a risk he could get infected. He has an incentive to take account of that risk. The other customers in the same position have an incentive to take account of the risk. The owner, knowing that some customers will be worried, has an incentive to take account of the risk. Private property helps "internalize" the externality.

It doesn't fully internalize it, because there are many bars, many restaurants, many gyms. So people leaving the first bar might spread the virus elsewhere, imposing a cost on patrons and workers at those other bars, restaurants, and gyms. But much of it is internalized.

In a recent paper, the George Mason economists Peter T. Leeson and Louis Rouanet note another way COVID-19 externalities differ from pollution. The polluter typically doesn't worry about the pollution that blows downstream. Many people, by contrast, do worry about being in contact with others and either infecting or getting infected by them. One need only look at the huge voluntary changes people made in their lives to see how important this factor is. Well before the first lockdown, Americans canceled trips and conferences and quit going to indoor restaurants and bars. On a smaller scale, people going about their business in town wear masks, and if they don't—and sometimes even if they do—they try to maintain a decent space between themselves and others, especially if those others are unmasked.

To the extent there is an externality, we should also remember a point made by Nobel-winning economist Ronald Coase: The person who suffers from pollution downwind from a factory would not suffer if he weren't there. That observation has led economists in Coase's tradition to the concept of "least-cost avoider." Economists tend to focus on the efficient outcome, and the efficient outcome requires looking at who has the lower cost of reducing or eliminating the externality. When people live near an airport, for example, the cheaper solution might be to have airplanes produce less noise. But it might instead be for homeowners to install double-pane or triple-pane windows.

In this pandemic, governments have chosen to prevent a huge number of interactions among people who are at low risk of suffering from the disease. Given that the risk of death by COVID-19 for older people with comorbidities is orders of magnitude higher than the risk for the general population, the lower-cost solution would probably have been for the elderly to isolate themselves.

That has a lower cost for two reasons. One is sheer numbers: It's easier for 40 million people to isolate than for more than 300 million people to isolate. The other reason is that elderly people with comorbidities are more likely to be retired or to work from home. So their loss from staying in their homes is low.

Moreover, it wouldn't necessarily require a mandate that the elderly isolate. They could do so if they wish, and most probably would choose to do so. But governments should not insist—as New York, New Jersey, and Pennsylvania did—that nursing homes readmit people who test positive for the virus.

Just as even paranoids can have real enemies, even optimists can have real grounds for hope.

I think almost all of us were surprised at how quickly most governors and many mayors moved to close down major sectors of the economy. This was a really large attack on economic freedom, the largest in my lifetime, and it happened within days. In most cases, executives did it with zero consent from legislatures. They used existing law to the limit and, some legal scholars say, beyond the limit. I doubt those officials typically thought in March 2020 that we would still be locked down in January 2021. But the lockdowns took on a life of their own.

Recall, though, an earlier anti-liberty episode that was not nearly as shocking as the lockdowns. In 2005's Kelo v. New London, the U.S. Supreme Court gave its blessing to a city government's use of eminent domain to expropriate property from homeowners and transfer it to a private entity, the New London Development Corporation. This sent shockwaves through the country. The Institute for Justice, which represented the losing side before the Supreme Court, has noted that the decision "sparked a nation-wide backlash against eminent domain abuse, leading eight state supreme courts and 43 state legislatures to strengthen protections for property rights."

Could we see a similar response to the lockdowns? Already there have been some moves at the state level to limit governors' lockdown powers. A bill that passed both the House and the Senate in Ohio would have limited the Ohio Department of Health's power to quarantine and isolate people, restricting it to only those who were directly exposed to COVID-19 or diagnosed with the disease. Similarly, in Michigan, the Senate and House passed a bill to repeal a 1945 law that Gov. Gretchen Whitmer had used to impose the state's rather extreme lockdowns. Both bills were vetoed, but I doubt that will be the end of the story.

Even if it doesn't happen until this particular pandemic is over, there's good reason to believe that some state legislatures will want a say in future decisions. Whatever the case for letting governors move so quickly early last year, that case gets weaker and weaker the longer the lockdowns last. At some point, legislators just might roll back those powers. Or so we can hope.

DAVID R. HENDERSON is a contributing editor at Reason, a research fellow with the Hoover Institution at Stanford University, and the editor of The Concise Encyclopedia of Economics.

Gustavo Franco: Lições Amargas - novo livro

A primeira, e mais que amarga, lição é a de que, na verdade, não aprendemos nada com as lições passadas, todas desaprendidas: assim foi com o tráfico e a escravidão, a não educação, etc., etc., etc.

A maior das “lições amargas” que talvez sejamos obrigados a aceitar de nossa trajetória como nação nas últimas decadas — provavelmente válido para os duzentos anos desde a independência — é justamente o aprendizado de que não aprendemos nenhuma lição com nossas frustrações contínuas em matéria de reformas de nossas mazelas: fazem 200 anos que estamos procrastinando as soluções, primeiro com o tráfico, depois a abolição da escravatura, em seguida a não reforma agrária, a não representação política, a ausência completa de educação republicana, a indiferença para com as desigualdades nacionais, regionais e sobretudo sociais, a não inserção na economia mundial pela manutenção do mercantilismo e do protecionismo, uma casta política que se tornou predatória em relação ao cidadão contribuinte, a irresponsabilidade geral das elites, as velhas e as novas. De fato, amargas lições...

Paulo Roberto de Almeida

Gustavo Franco: Lições Amargas: Uma História Provisória da Atualidade

Edição Português

 Após um ano perdido, de uma década perdida, Gustavo Franco traz um balanço lúcido e provocador da situação do país

Gustavo Franco, economista renomado e um dos formuladores do Plano Real, mobiliza sua conhecida independência intelectual, domínio dos dados e capacidade analítica para refletir não apenas sobre os problemas do país, mas sobre como a nossa forma de pensar a respeito deles vem se transformando, com profundas e imprevistas consequências.

Sob o espectro da pandemia de covid-19, o autor toma as controvérsias que se impuseram ao longo de 2020 e 2021 como ponto de partida para uma análise eclética e inovadora, que abrange desde as razões da estagnação econômica durante o Império até as consequências da adoção do bitcoin e outras moedas digitais. Gustavo disseca também a questão das reformas, sempre presentes na discussão nacional, reconhecidas como necessárias pela maioria dos protagonistas da vida pública, mas que ficam velhas antes mesmo de serem aprovadas. Com lógica implacável, ele demonstra como o próprio conceito de reforma foi cooptado pelo estamento político para a construção de um discurso pretensamente modernizador, mas, na prática, voltado para o adiamento de qualquer mudança que contrarie poderosos interesses. “Tudo parece ter ficado mais agudo e urgente, assim como parece ter reduzido a nossa tolerância com a procrastinação. Ou não?”, ele provoca.

Lições amargas transborda de ideias originais, mercadoria escassa no cenário atual dominado pelo debate raso, dissociado dos fatos, prisioneiro dos dogmas. É menos um livro sobre as nossas dificuldades, e mais sobre a nossa incapacidade secular de enfrentá-las. Com fina ironia e genuína erudição, Gustavo Franco tira lições amargas dos anos de estagnação e da nossa inelutável tendência aos remédios milagrosos, para traçar os caminhos acidentados, porém ainda possíveis, de um reencontro com a nação que desejamos ser.