It has been nearly 4½ years since I began writing this column, which works out at roughly 240,000 words altogether. As these will be my last words in these pages, it’s time to look back and take stock. If part of your job is to be a pundit then, as the Pennsylvania University political scientist Philip Tetlock argues in Superforecasting: The Art and Science of Prediction, you need to keep score.
As Tetlock had a dig at me in that book — which was published in 2015, before I began writing for The Sunday Times — this is also a good opportunity to settle a score.
Tetlock was, of course, quite right about most public intellectuals (a term that always makes me think of public conveniences). They seldom hold themselves to account. Nor do they get fired if their predictions are consistently wrong, as long as they are entertaining enough to engage readers.
Since I set up an advisory firm nine years ago, though, my approach has been different — out of necessity, as fund managers differ from newspaper editors in their attitude to predictions. Not only do they notice when you’re wrong, because one or more financial indicators make that clear; they also let you know about it (with grim relish, usually). If you’re wrong too often, it’s goodbye.
So at the beginning of each year we at Greenmantle make predictions about the year ahead, and at the end of the year we see — and tell our clients — how we did. Each December we also rate every predictive statement we have made in the previous 12 months, either “true”, “false” or “not proven”. In recent years, we have also forced ourselves to attach probabilities to our predictions — not easy when so much lies in the realm of uncertainty rather than calculable risk. We have, in short, tried to be superforecasters. And with some success.
Now it’s time to apply the same retrospective scoring to this column. So as to meet my deadline, I’ve picked my first full year at The Sunday Times, which was the annus mirabilis — or horribilis, depending on your politics — beginning on November 1, 2015, the date of my first column.
Three minor themes are worth mentioning. I argued repeatedly that the twin problems of Islamic extremist networks and mass migration from the Muslim world were not likely to go away: “Think of Isis as the Facebook of Islamic extremism” (March 27, 2016). I also began warning, as early as May of that year, that the rise of Silicon Valley’s big tech companies was not an unmitigated boon: “What the state knows is just a fraction of what Facebook knows about you” (May 15). I also noted the dire implications for Labour of the antisemitism of Jeremy Corbyn and his circle (May 1).
But by far the biggest issues of my first year on this page — and subsequent years too — were Britain’s vote to leave the EU and the election of Donald Trump. How did I do?
On Brexit, I was wrong. From the outset, I was a remainer. “The idea that we can . . . separate ourselves from Europe is an illusion,” I wrote on February 21. “For the future of Europe without us would be one of escalating instability.” Impolitely, I called Brexiteers “Angloonies” and “happy morons”. When the remain side lost, I predicted a “stairway to hell”— or at least a recession (June 26). Wrong.
At the end of the year, on December 11, 2016, I made a confession. I had been motivated to back remain more because of “my personal friendship with [David] Cameron and George Osborne” than out of any deep allegiance to the EU. I regretted — and still regret — not urging Cameron to reject “the risible terms that the European leaders offered him back in February on EU migrants’ eligibility for benefits”. That was the moment he should have called their bluff by backing Brexit.
Yet the humiliation of Brexit gave me an advantage over American commentators on the 2016 presidential race. I had moments of doubt, admittedly. I compared Trump to unsuccessful Republican candidates Wendell Willkie (December 13, 2015) and Barry Goldwater (January 31, 2016). On April 3, 2016, I predicted the bursting of the Trump bubble in the Wisconsin primary. Ted Cruz won that, but it didn’t burst the bubble. Far more often, I went against the conventional wisdom that Trump was doomed to lose.
“Trump has the face that fits the ugly mood in America,” was my headline on November 1, 2015. “Trump has both the resources and the incentives to press on. In the current national mood of disaffection with professional politicians, he could seem an attractive alternative to Hillary Clinton . . . The point about Trump is that his appeal is overwhelmingly a matter of style over substance. It is not what he says that a great many white Americans like — it is the way that he says it.”
I was against Trump. I was a signatory of a “never Trump” letter. I repeatedly condemned his “open expressions of racial prejudice and xenophobia”, his isolationism (December 13, 2015) and his fishy bromance with Vladimir Putin (May 8 and October 16, 2016). I regretted that Mike Bloomberg chose not to run (October 23).
But I also saw clearly the strength of his appeal. “Trump is winning,” I wrote on February 28, 2016, “because no other candidate has a more convincing explanation of why so many Republican voters genuinely are worse off today than in 2000 . . . But no one can rule out Democratic defections to Trump when it comes to the crunch on November 8.” On March 6, I imagined Trump winning and running for an unconstitutional third term in 2024. “Trump can beat Hillary Clinton,” I wrote on May 8.
“Can Trump succeed where [Mitt] Romney failed?” I asked on July 21. “Yes . . . many young voters will fail to show up for Clinton. Meanwhile, the white lower class, especially the older cohorts, will turn out for Trump in droves, just as their English counterparts turned out for Brexit.”
The choice between Clinton and Trump was a choice between “snafu” and “fubar”, I wrote on September 18, “but wouldn’t you risk being fubar . . . if it was your only shot at avoiding four more years of snafu?”
“This rage against the global,” I wrote a week later, “is why Trump could win this election. It is why Brexit happened. It is why populists are gaining ground wherever free elections are held.”
I marked my first anniversary at this paper with a column that compared Trump to the Chicago Cubs, the outsiders who had just won the baseball World Series. “He can win,” I wrote, “if there is a differential in turnout between his supporters and [Clinton’s] in the battleground states comparable to the age and ethnicity-based differentials in the UK referendum” (November 6).
Now, dear reader, you are burning to know what I think will happen this November. Bad luck. You will have to seek my superforecast in another publication.
Niall Ferguson is the Milbank Family senior fellow at the Hoover Institution, Stanford, and managing director of Greenmantle
Social mores change more than you think. If a time machine could take you back to 1981, you would be shocked by how much people smoked, for example, and how much time they spent standing outside telephone boxes that stank of urine, jingling coins in the pockets of their nasty flares or drainpipes, grinding their nasty yellow teeth. If you are a woman, you would be appalled by the overt sexism of male conversation. If you’re not white, you’d be revolted by the casual racism. And if you’re gay . . . well, more about that later. Not that these prejudices have been eradicated, but they were worse then.
So let’s ask ourselves how much social mores are going to change as a result of the Covid-19 pandemic. In the past week, I’ve had several conversations on the topic of “the world after Covid-19”. My immediate response has been: “Why do you use the word ‘after’? Why not ‘with’?”
Yes, there is undoubtedly a benign scenario in which one of the more than 70 teams working on a vaccine against Sars-CoV-2 collects the prize. If all goes well, that vaccine could jump through all the scientific and regulatory hoops, go into mass production and be available some time in the second half of 2021.
In this same happy-ever-after scenario, there are also breakthroughs in Covid-19 therapies. New research confirms that the disease doesn’t do anything much to endanger the lives and health of younger people, and if they do get infected, they get lasting immunity. Summer comes to the northern hemisphere and the contagion recedes. As lockdowns are lifted and people return to their normal gregarious habits, there is no second wave of the pandemic. Far from devastating the southern hemisphere, the disease proves a minor event in Africa.
And — still looking on the bright side — stock markets rally and economies surge to a high-speed V-shaped recovery that makes me, and others who worry about a protracted depression, look silly.
All this is possible, and devoutly to be hoped for. But it is by no means a 100% certainty. Just consider the odds against a successful vaccination. Do we have one for malaria? No. Tuberculosis? No. HIV-Aids? No. (After 40 years of toil, there have been just a handful of phase 3 clinical trials, one of which made the disease worse. The best had a success rate of just 30%.) How about rotavirus, the most common cause of diarrhoea among infants? Yes, they did find a vaccine for that — after 15 years.
Even if a vaccine is found, there will be multiple risks associated with the current rush to devise and deploy one. And even if there are no setbacks, it might turn out to be like influenza: you can get your flu shot each year, but there’s no guarantee you won’t get some other strain than the ones you were vaccinated against.
That’s why we need to give at least some thought to the not-so-nice scenario of living with Covid-19 — at best, the way we live with flu, which delivers its regular seasonal bump in the mortality rate; at worst, the way we have slowly and painfully learnt to live with HIV-Aids.
Which takes us back to being gay in 1981, the year the New York Native newspaper published the first article about gay men being treated in intensive care units for a strange new illness. (The headline was: “Disease rumours largely unfounded.”) It was more than a year later that the term Aids (acquired immune deficiency syndrome) was proposed for the all too real disease.
Here’s a thought experiment. Imagine a world in which Covid-19 — which still has a long way to go before it catches up with Aids as a killer — has the same effect on social life as Aids had on sexual life. That would be quite a different world, and more visibly so (as changes in sexual behaviour largely take place behind closed doors).
Imagine a world in which we routinely wear masks on public transport and in offices; a world in which we greet one another with a wave, not a hug or a handshake; a world in which grandparents see their grandchildren only on FaceTime; a world in which to cough or sneeze in public is as shameful as to fart; a world in which we rarely eat in restaurants or fly; a world without theatres and cinemas (other than a few retro drive-ins); and a world in which football is played in silent, empty stadiums. (Will there be canned cheering, just as there used to be canned laughter in sitcoms?)
I’m not the first person to notice that there are some lessons to be learnt from the last really lethal pandemic caused by a virus, despite the important differences between HIV and Sars-CoV-2, and between Aids and Covid-19. One nurse has recalled the similar ways the authorities responded — at first with complacency and then by stigmatising victims (for “the Chinese virus”, read “the gay plague”). Last month, The New York Times published an article asking “Are facemasks the new condoms?” — destined to become “ubiquitous, sometimes fashionable [and] promoted with public service announcements”.
Yet the lesson of HIV-Aids is not quite that it “changed everything”. The really striking feature of the history of the Aids pandemic is that behaviour only partly changed after the recognition of a new and deadly disease spread by sex, needle-sharing and blood transfusions. An early American report noted “rapid, profound but . . . incomplete alterations in the behaviour of both homosexual/bisexual males and intravenous drug users”, as well as “considerable instability or recidivism”. By 1998, just 19% of American adults reported some change in their sexual conduct in response to the threat of Aids.
The advent of antiretroviral drugs that stop HIV carriers succumbing to Aids has somewhat diminished the fear factor. Even so, one might have expected a bit more fear to persist. A 2017 paper showed that fewer than half of at-risk men had used a condom last time they had sex. According to a recent British study, sustained campaigns of public and individual education are necessary to discourage gay men from having sex without condoms. In Africa, the “ABC” — abstain, be faithful and “condomise” — approach has had limited success.
Yes, there have been changes in sexual behaviour. According to the psychologist Jean Twenge, millennials have fewer sexual partners on average than earlier generations. Another American study concluded: “Promiscuity hit its modern peak for men born in the 1950s.” And let’s not forget the invaluable UK National Survey of Sexual Attitudes and Lifestyles, the most recent version of which revealed a marked decline in the frequency of sex in Britain.
Yet few if any of these changes can be attributed to HIV-Aids. The return of “No sex, please, we’re British” mainly affects married and cohabiting couples, and, according to the definitive analysis in the BMJ, is most likely due to “the introduction of the iPhone in 2007 and the global recession of 2008”.
Social mores change more than you think. In the face of a deadly disease, however, they also change less than you might expect.
Niall Ferguson is the Milbank Family senior fellow at the Hoover Institution, Stanford, and managing director of Greenmantle
One of my favourite cartoon characters from the 1970s was the little Japanese-Italian chick Calimero, whose constant, plaintive refrain was: “It’s an injustice, it is!” I have been hearing modern versions of Calimero’s lament a lot recently.
“It’s true that more men are dying than women from Covid-19 around the world,” wrote Ryan Heath and Renuka Rayasam in Politico, “but that’s not exactly cause for celebration.” Not exactly? Then there was the Atlantic journalist Annie Lowrey, who wanted to persuade us that the economic burdens of the pandemic were disproportionately falling on millennials.
Growing up in Glasgow, my friends and I liked to quote Calimero sarcastically at anyone who complained about their lot. “It’s an injustice, it is!”
Let’s get one thing straight: the principal losers in a pandemic are the people the contagious disease kills before their time. They are disproportionately old and (to a lesser extent) male.
The latest provisional figures for deaths registered in England and Wales show significant excess mortality, relative to five-year averages, in the first three weeks of last month. In the week ending April 17, for example, there were nearly 12,000 excess deaths, more than double the five-year average. Deaths attributed to Covid-19 were equivalent to three-quarters (74%) of the excess; 88% of Covid-19 deaths were of people older than 65; and 58% of Covid-19 victims were men.
As we learn more about the excess deaths not attributed to Covid-19, we shall see that most were directly or indirectly attributable to the pandemic — people in care homes who probably did have the virus, or people dying of heart attacks because they were afraid to go to hospitals — so the basic story will not change: this is no virus for old men.
But what about the economic injustices of the pandemic? Hans Holbein’s Dance of Death series makes it clear that death in the era of plague was no respecter of rank. By contrast, cholera pandemics in the 19th century waged class war against an urban proletariat living cheek by jowl in filthy slums.
Covid-19 is different. It began with the relatively well-off jet set — the kind of people who fly to conferences in Singapore and then to ski chalets in the Alps. As soon as it got out of the airports, however, the virus went downmarket, spreading rapidly wherever people are tightly packed indoors — subways in big cities, for example. The mortality rate in poor areas of England is double that in rich areas, according to the Office for National Statistics. In Britain and America, the non-white population is being harder hit. Yet it has been the responses of government that have principally determined how the costs of the pandemic have been distributed.
Wherever you look, the economic data is the worst of our lifetimes. In America, about 30 million jobs have been lost in the space of just six weeks. Donald Trump’s economic adviser Kevin Hassett warned last week that the unemployment rate could reach between 16% and 20% next month, the highest since the early 1930s.
And yet the US stock market has rallied so much since its low on March 23 that it ended last month just 14% below its pre-pandemic peak. In other words, investors think it’s as bad as . . . early October 2019, when the S&P 500 index was last at Thursday’s level. The market has actually rallied 30% since the nadir of March 23.
We are simultaneously a) suffering a public health disaster, with a second wave of infections and illness likely at some point when we go back to work and school; b) inflicting a deep and probably long recession on ourselves, with lockdowns that are the bluntest possible instrument for controlling contagion; and c) breaking the record for an equity market rally. How can we resolve this huge paradox?
The answer is that unconventional monetary policy is being used on an unprecedented scale with the principal aim of shoring up the prices of financial assets. For that is the principal effect of near-zero interest rates and quantitative easing, which has led to a 60% expansion of the Federal Reserve’s balance sheet.
Backstopping Wall Street is not in the Fed’s statutory mandate, admittedly, but it has been the Fed’s practice since the days of Alan Greenspan’s “put” option, which established an implicit floor — but not a ceiling — for stocks. Since Ben Bernanke, the Fed has also done the job of shoring up the rest of the world’s financial assets, via international swap lines.
Under Jerome Powell, all restraint has been cast aside. If the market blinked, even at full employment, he cut rates. Now he is conducting repo operations as well as swaps with foreign central banks. The amount of swaps outstanding is now $446bn (£357bn). I can’t find data on the repos.
It doesn’t hurt that about 20% of the S&P is made up of big tech companies that may ultimately make more money as a result of the pandemic, because we’re all now strongly incentivised to do more in their virtual world than in the real one (Amazon is up 24% year-to-date).
It also helps that we’re getting good news about therapies (remdesivir, for example) and vaccines (Moderna’s, for example), though I can’t help noticing that Wall Street screens out bad news about Covid-19, such as the story about people in their thirties and forties suffering strokes after contracting the disease. And, of course, we’ve flattened those curves of confirmed cases. So the stock market’s rally is not wholly illusory.
Really smart guys tell me that the second wave that I wrote about here last week is already “priced in”. Maybe. But what’s not priced in is the enduring effect the pandemic will have on demand as older consumers steer clear of shopping malls and anything else involving crowds even after lockdowns end. What’s not priced in is the political backlash as people see big companies getting bailed out — the airlines, notably — and the loans intended for small businesses also going to the big boys. What’s not priced in is the psychological depression that will follow when people in America and Britain go back to work without enough reliable testing or contact-tracing capacity to limit the size of the second wave.
At a mid-March press briefing, Trump was asked: “How are non-symptomatic professional athletes getting tests while others are waiting in line and can’t get them? Do the well-connected go to the front of the line?” The president replied: “No, I wouldn’t say so, but perhaps that’s been the story of life.”
Inequality is just “the story of life” — especially when it comes to US healthcare. Well, maybe so: as my father liked to tell his children, nobody said life was going to be fair. But that doesn’t sound like an election-winning slogan to me. Sometimes it’s possible to echo Calimero without being sarcastic: “It’s an injustice, it is!”
Niall Ferguson is the Milbank Family senior fellow at the Hoover Institution, Stanford, and managing director of Greenmantle
Everyone knows The Great Wave, the most famous of all Japanese works of art, even if they don’t know the name of the artist. His name was Hokusai and he published The Great Wave off Kanagawa (Kanagawa-oki nami-ura) at some point between 1829 and 1833. It’s a woodblock print of the genre ukiyo-e, which translates, rather beautifully, as: “Picture of the floating world.”
Look closely at The Great Wave and you will see that it towers above the cowering oarsmen in three wooden fishing boats. They are on their way back to Kanagawa (now Yokohama). Mount Fuji is just visible in the distance. These days we are all a bit like those Japanese fishermen, cowering beneath a giant wave. The wave in question is the pandemic created by the virus Sars-CoV-2 and the deadly disease that it can cause, Covid-19.
For the past two months, ever since the epidemiologists persuaded the politicians to take the threat of Covid-19 more seriously than the usual winter wave of influenza, we have been captivated by wave-like images: graphs depicting the early, exponential growth of infections and deaths, and then the flattening of the curve as we practise social distancing and implement economic lockdowns.
These graphs were at first generated by the epidemiologists’ models. Now, however, we have the actual numbers of confirmed cases and deaths. They don’t perfectly fit the predicted curves — no model is perfect — but they roughly do.
In most of the worst-affected places in the developed world, such as New York, it now seems that the great wave has crested. In terms of new cases, hospitalisations, intubations and deaths, the peak is now behind us. For America as a whole, the great wave of new cases has clearly reached a plateau since the first week of April.
In the UK, too, it seems probable — making all the necessary adjustments for lags in the data — that April 8 was the peak of the wave in terms of mortality.
The situation is even more encouraging in a number of European countries, notably Austria, Denmark and Germany, which is why their citizens — unlike New Yorkers and Britons — can now look forward to a partial return to normality in a matter of days.
A number of American states are already moving in the same direction. In Montana, the beautiful and thinly populated state to which I retreated six weeks ago, churches will reopen for worship today and most retail businesses will be able to resume work tomorrow.
So is that it, then? The wave crested; most of us survived; now back to normality? These were the words of the US vice-president, Mike Pence, on Wednesday: “We truly do believe, as we move forward with responsibly beginning to reopen the economy in state after state around the country, that by early June, we could be at a place where this coronavirus epidemic is largely in the past. Americans are going to be able to enjoy a good summer.”
Hang on, not so fast.
In history, all the great pandemics have come in waves, including the Black Death of bubonic and pneumonic plague in the 14th century and smallpox in the 18th century. The first recorded plague outbreak — in Athens in the 5th century BC — had three waves: in 430BC, 429BC and 427 to 426BC.
In some cases, the second wave was worse than the first. Take the great influenza of 1918-19. The first official recorded outbreak was at a Kansas army base, Camp Funston, in March 1918. But the global peak of mortality was in the second wave of October and November. A third wave affected some areas of the world in early 1919, principally England and Wales and Australia.
The 1957-58 influenza pandemic hit Hong Kong in mid-April 1957. It reached America in June and produced a surge of deaths among teenagers that autumn. But there was a second wave in January-March 1958. There were further spikes of excess mortality in early 1960 and early 1963.
The main reason to expect a second wave of Covid-19 in 2020 is that we are nowhere near herd immunity anywhere. Even in New York state, the worst-affected part of North America, the infection rate is little higher than 21%, according to the most recent testing.
As lockdowns ease and people return to work and school, it is almost inconceivable that we won’t see rising infections, illnesses and deaths. Indeed, we are already seeing that in some parts of Asia, notably Singapore and northern China.
The only real debate is how far warmer weather is going to dampen the contagion in the northern hemisphere. I have read all the academic papers on this subject and remain unconvinced. We are learning that this virus spreads most rapidly indoors, in confined spaces such as subways, restaurants and hospitals. (Hence closing parks and beaches was pretty pointless and probably, on balance, harmful.) So it’s possible summer won’t radically reduce the infectiousness of the virus, unless we all move our desks outside.
Alternatively, if weather does matter, then the second wave may come in October, when the weather cools and when most schools and universities attempt to go back to normal.
“There’s a possibility that the assault of the virus on our nation next winter will actually be even more difficult than the one we just went through,” said the director of the Centres for Disease Control and Prevention, Robert Redfield, in an interview last week. “We’re going to have the flu epidemic and the coronavirus epidemic at the same time.”
Now, just think of the political implications of that scenario. A second wave would be the death blow to the happy talk of a “V-shaped” economic recovery. And it would arrive just in time to discourage elderly voters — who lean Republican, remember — from going to vote.
A poll published last week showed the Democratic nominee, Joe Biden, neck and neck with the US president, Donald Trump, in six key states: Arizona, Florida, Michigan, North Carolina, Pennsylvania and Wisconsin. On three key issues — handling the pandemic, preventing another one and making healthcare more affordable — Biden narrowly leads Trump. And this after weeks when Biden has been more or less invisible, Trump ubiquitous.
We have all heard far too much in recent weeks about bending the curve, as if there were only one curve. In the history of pandemics, I am afraid to say, there are very few cases of “one and done”. The only questions that remain open are exactly when the second wave will come, how big it will be and if it will be followed by a third.
Look closely at Hokusai’s The Great Wave, which depicts not a tsunami but a so-called rogue wave. The artist is most certainly not implying that, after the great wave breaks, the sea will be a millpond.
Until we reach herd immunity or find and distribute a vaccine, the same will be true of Covid-19, alas.