Fear-mongering and tunnel vision in Ardern’s New Zealand

Shaun Hendy, the self-styled expert in Covid 19 modelling, who sometimes teaches physics in Auckland.

Auckland, New Zealand, remains in lockdown, six weeks into a Covid outbreak that has so far only cost one person their life. Nonetheless over 1 million people remain behind the newly created border around the city. Meanwhile the crack team of Covid 19 modellers at the University of Auckland, led by Professor Shaun Hendy, have been commissioned by Jacinda Ardern to help her sell her new message of maximising vaccination, before she allows the lockdown to end. Hendy provided the numbers for her resort to scare tactics: if we open the borders 7000 people die, unless 90% of the population accept two doses of the Pfizer vaccine. Hendy’s modelling became the top news item yesterday on all media.

Hendy is usually paraded as one of the public health experts by the news media, but, in fact, he was appointed as a Physics lecturer at Auckland University. It seems that anybody in academia with an opinion, or some modelling experience, can be called an expert and automatically get deferential treatment in the media. However, we hear today that another modeller, Rodney Jones, has criticised Hendy for raising fears based on dodgy data, and unrealistic assumptions. Jones is an economist, and so is probably good at number crunching, although econometric models are also known for being based on limited data, and simplifying assumptions. But at least his opinion got reported in some of the media. When I was attempting to do an earlier PhD thesis, before being enrolled at AUT in Auckland, I came across an interesting article comparing physics and the kind of metaphors used in economic theory and policymaking. Rather than rehearse that here, I want to make an analogy using monetary policy.

The new monetary policy following the 1984 change of government was enshrined in the 1989 Reserve Bank Act. This was seen as groundbreaking by economists around the world, because it was based on the theory of inflation expectations, and sought to restore sound monetary policy by setting a level of annual inflation (up to 2%) that the central bank was required to meet. This was the ultimate in the ‘ends justifying the means’: the Reserve Bank no longer had to limit the growth of the money supply to set targets, or commit to any other measurement, as long as inflation was not over 2%. Central bankers talked about establishing credibility, and as their monetary policy resulted in interest rates going over 20%, they dogmatically stuck to the task. This involved a rigid adherence to the policy goal, and was based on their underlying theory that monetary policy did affect anything in the economy other than prices, in the long run. Of course, in practice this tight monetary policy helped cause unemployment to rise to over 10%.

Anyway, both of the governing parties remained committed to this policy despite the collateral damage, because of the fear of inflation. And the central bankers would not reduce the base interest rate until they determined that the markets would not expect a loosening, i.e. their expectations factored in a stable inflation rate. Of course, in practice the monetary policy was not officially loosened till the global financial crisis in 2008. This was because removing inflation had been portrayed as some kind of disease that had been crippling the real economy: so, once the disease had been beaten the economy would thrive. But there still had to be a ‘tight’ monetary policy in case the inflation disease returned.

For those still reading after this short summary, I now want to draw an analogy with the type of Covid policy response that Ardern is pursuing, and the mentality that produces lockdowns which aren’t even necessary based on actual evidence rather than made-up models. Firstly, Ardern’s policy evinces the same dogmatic type of theorising as the monetary policy of the 1990s. This involves a form of tunnel vision, where a theory is composed with simplifying assumptions, and where the collateral damage is not included, and then dogmatically pursued just in case there is any doubt about the rigid adherence. Thus, the so-called Elimination strategy created by Michael Baker and friends, based on complete lockdowns in Covid hotspots, has to be pursued until zero cases is reached. However, secondly, getting to zero cases does not mean Elimination has been achieved. Baker has another narrative in which there is always Covid 19 lurking out there undetected in the community. This is why the Ardern government continues to run advertising which claims that the common cold could be a symptom of Covid, and testing is required. So, like inflation, Covid is always out there and policy settings have to be tight.

Nonetheless, Hendy’s modelling results are really over the top. Ardern obviously wanted him to soften up the public for the results of opening up the country, and therefore allowing Covid to creep in, so as to scare the vaccine hesitant into getting the Pfizer jab twice. But Hendy’s 7000 projected deaths, in a country where only 27 have been lost to Covid, isn’t even credible. In practice, Ardern is still committed to Elimination, and if the country is opened up to Covid, she will have to act to save the obviously inadequate health system with, you guessed it, another total lockdown. Then she can continue to have her daily press conferences, where she promises to restore the people’s civil liberties. But only if they are being good, and following her theory of Elimination, and the resulting self-isolation in ‘bubbles’. Being a completely docile and subservient people, who do not defend our rights, we will no doubt comply again.

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