Analysis |

If Israel Tightens Coronavirus Lockdown Further, It Will Risk a Total Collapse

Some $39 billion of possible lost GDP translates into hundreds or thousands of people potentially committing suicide

Meirav Arlosoroff
Meirav Arlosoroff
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A sign reads "Don't panic" above the Carmel Market shops closed during Israel's coronavirus lockdown in Tel Aviv, March 25, 2020.
A sign reads "Don't panic" above the Carmel Market shops closed during Israel's coronavirus lockdown in Tel Aviv, March 25, 2020.Credit: Meged Gozani
Meirav Arlosoroff
Meirav Arlosoroff

The deputy director general of the Health Ministry, Itamar Grotto, was unusually direct last week. He revealed to journalists the ministry’s working assumption: 10,000 to 20,000 Israelis will die of COVID-19. But Grotto added an important sentence: Most of the victims are likely to be elderly or people with serious preexisting conditions near the end of their lives anyway.

Haaretz Weekly Ep. 72

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Every year in Israel some 40,000 people die, but the country isn’t likely to see 50,000 or 60,000 deaths this year. Grotto said there would be a net increase of three to four months of deaths. We can presume he means 7,000 to 10,000 more deaths than average.

When asked why the Health Ministry was imposing a harsh lockdown on the entire country, Grotto answered, “This number of deaths is a traumatic event more significant than Israel’s wars.”

That’s not exactly right. First, even the Health Ministry’s working assumption of an extra 7,000 to 10,000 deaths is disputed. Some senior health officials say this prediction is totally absurd, others say there is no certainty it will turn out right.

Second, to repeat: Even if we assume that 10,000 more Israelis will die than in an average year, these people wouldn’t be losing many years of their lives.

Third, the solution – shutting down the entire economy or nearly the entire economy – will cost many lives, probably pretty near the 7,000 to 10,000 victims of the coronavirus.

All people are worlds unto themselves and their families. Liberal democracies sanctify human lives, regardless of their age, and this is a good thing.

Still, we can’t avoid a discussion on the cost of a life, particularly when the alternative cost is so massive – shutting down the entire economy and putting the country at risk of collapse, at an estimated price tag of 100 billion to 140 billion shekels ($39 billion), using conservative estimates.

Imagine it this way. Suppose the committee responsible for evaluating which medicines are subsidized or covered by the health maintenance organizations received the following proposal: There’s a treatment for a disease that will kill 10,000 people, but it costs 140 billion shekels. Would treatment for this disease be funded?

The answer is obvious to anyone who has any experience with health economics: It would not be approved; the committee would reject this option out of hand. It’s simply too expensive.

It’s a cruel dilemma, but it’s crucial. We’re essentially debating a similar dilemma every day. Some 140 billion shekels of lost gross domestic product translates into hundreds or thousands of people who will lose their source of income, sink into depression and potentially commit suicide. Tens of thousands of people will have their quality of life critically impaired by an economic collapse.

This also means higher rates of domestic violence. There will be more deaths on the roads because planned investments in infrastructure will have to be delayed. There will also be more crime and violence as less money goes to welfare spending, and more at-risk youths will be neglected.

I can continue listing the risks, but the main risk is the country’s collapse. The forecast, which the Finance Ministry has presented to the Knesset Finance Committee, addresses the effects of a full shutdown of the economy – the deficit will shoot up to 15.5% and the national debt will jump to 86.5% of GDP, which will contract by 17%. Contrary to what Grotto said, this is even worse than what happened during the Yom Kippur War.

“The deficit could even reach 200 billion shekels,” a senior economist said. “We wouldn’t have a way to fund it. The country could be at risk of collapse. Human history has no record of a willingness to sacrifice the entire economy as a means of preventing illness.”

Another economist forecast that given the gap in COVID-19 mortality between the young and the old, the disease could trigger a war between the generations. We can hope he’s wrong: Human society is built on mutual responsibility, and the young need to look out for the old.

But responsibility for others has to be reasonable – you can’t ask an entire generation to sacrifice itself financially and potentially even physically. That’s not mutual responsibility, it’s national suicide.

Israel, like all the countries of the world including authoritarian states  such as China, will fight for the lives of its elderly and sick, and will pay a significant price for this. Israel is already in a partial shutdown, which is expected to continue for a significant period. Unemployment has soared to 20%, and the state has taken on the massive burden of 6 billion shekels a month in unemployment benefits.

The Finance Ministry has unveiled a handful of measures – only a few of them from the state budget – that already total 40 billion shekels. A recession is probably unavoidable, and not just in Israel. The price of saving as many people as possible is a heavy one, but the price also needs to be conditional. The price of 140 billion shekels and the risk of Israel entirely collapsing is too much to pay.

A further tightening of the lockdown would be irresponsible. We need to continue with the existing population-wide restrictions, and we need to consider a new policy that calls for isolating the most high-risk people (the elderly and the sick). And of course we need widespread testing.

Research shows that such a policy would be more effective than a total lockdown. The price of a tighter lockdown, even if it can’t be immediately quantifiable in human lives, will still be worse than what the coronavirus has in store for us. The price must be up for discussion.

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