The Dynamics of Panic

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I read an interesting article this morning by Ivan Jankovic called The Political Economy of Mass Panic
Here is a short excerpt.

The optimal level of risk is never zero. Otherwise, nobody would ever get up in the morning. But even staying in bed is risky (people die in their sleep). When you drive from home to work your risk of dying is nonzero. When you fly from New York to Los Angeles your risk of dying is nonzero. When you cross a traffic-heavy street your risk of dying is nonzero. When you ride a bike your risk of dying is nonzero.

However, it is much more interesting to study what happens when the risk is unclear, when the information about relevant circumstances affecting the risk level is highly uncertain and incomplete, or at least more complicated to assess. In these situations, human society, especially when politics gets involved – and this politics is a democratic one – tends, as if almost by rule, to make horrible and self-destructive decisions, all of which create and perpetuate irrational panic and excessive risk aversion.

People act excessively scared and do many stupid and irrational things to alleviate unnecessary fear that they feel. There are multiple psychological and political mechanisms that create this dynamic that could be described as “the political economy of hysteria and panic.” It involves psychological mechanisms of availability bias, action bias, broken window illusion, as well as the widespread ethical view of pathological altruism and political dynamics of democratic shortsightedness. All these factors often conspire together in a sinister fashion to create a hysterical and irrational frame of mind towards risk, leading to wildly irrational decisions.

The recent Covid-19 epidemic in the USA is a tragic cautionary tale. The respiratory disease, for everything we know, is similar to a severe, pandemic flu. The symptoms are similar, and the death rate according to the initial estimate of the Centers for Disease Control is between 0.16% and 0.33% (later estimates don’t provide a unique IFR, but a range of different IFR for different age groups show an extremely strong age gradient after 70 and an exceedingly low death rate for those younger than 40). A comprehensive review of all antibody studies done so far by world-renowned epidemiologist John Ioannidis found that the average death rate of Covid-19 is about 0.27%, with some regional variations.

This is certainly higher than the seasonal flu, but very close to a severe pandemic flu, like the one the world experienced in 1957 and 1968 (without doing anything to “tackle” them). Indeed Dr. Anthony Fauci himself, the President’s principal scientific adviser for epidemics, in co-authorship with Dr. Robert Redfield, director of the Centers for Disease Control, published a paper in the New England Journal of Medicine on March 26th of 2020, saying: “If one assumes that the number of asymptomatic or minimally symptomatic cases is several times as high as the number of reported cases the case fatality rate may be considerably less than 1. This suggests that the overall clinical consequences of COVID-19 may ultimately be more akin to those of a severe seasonal influenza (which has a case fatality rate of approximately 0.1%) or a pandemic influenza (similar to those in 1957 and 1968) rather than a disease similar to Spanish flu, SARS or MERS, which have had case fatality rates of 9% to 10% and 36%, respectively.”

An overwhelming majority of people who died of Covid were older than 70 and already had other significant ailments like heart disease, diabetes or obesity. Among children and young people the disease is much less severe than seasonal flu. Additionally, children are far less likely to transmit the virus than older people, which is in stark contrast to the flu, where children are the main spreaders and sufferers.

All of these facts were known for a long time and are not disputed seriously by most experts. Yet, they’ve had almost zero influence on how people reacted to the disease and what politicians did in response to it. Schools and colleges were promptly closed in March 2020, almost all businesses were ordered to shut down and most of the population was forced to lock themselves up at home for months, pushing the country into the deepest economic depression since the 1920s!

The same Dr. Anthony Fauci, who wrote on March 26th that the Covid death rate was likely “similar to severe seasonal influenza or pandemic influenza” the very next day said on television that “The mortality of [Covid-19] is about 10 times that of the flu”. Obviously, the reasons for this were not “scientific:” whatever the cause of this dramatic change in assessment might be, we have some doubts that Dr Fauci studied the problem so thoroughly in the night between March 26th and March 27th and discovered that Covid-19 was not similar to the flu, but ten times worse. We think it’s far more likely he did this for political or other, nonscientific, reasons, while ignoring science.

The reason everything was shut down was mass psychosis and hysteria, fueled by media “reporting,” creating a powerful political pressure to “do something.” Media drumbeat of fear and panic, in a typical “if it bleeds it leads” fashion, using anomalous cases of young people dying or becoming severely ill, exaggerated or highly speculative projections based on models and not on the empirical data, and experts like Fauci and Redfield cooperating in lending their scientific credentials to the propaganda machine, even when their scientific findings did not justify alarmism.

This helped spread panic among the population, by breathlessly pushing and promoting the outlandish forecasts by some irresponsible “experts” about millions of people who will die and so on.

This constant drumbeat of apocalyptic fear mongering “convinced” (or rather scared) the majority of people that the end is indeed nigh, that everybody will die and soon and nobody is safe. As a predictable consequence, people started acting increasingly irrationally. The infamous scenes of toilet paper and hand sanitizer disappearing from the shelves are the most dramatic illustration of what happened, shortages of ordinary merchandise that developed in many parts of the country was another.

The great psychologist Carl Gustav Jung noticed long ago that these collective psychic epidemics can have much more frightening effects than real disasters: “It is becoming ever more obvious that it is not famine, not earthquakes, not microbes, not cancer, but man himself who is the greatest danger to man, for the simple reason that there is no adequate protection against psychic epidemics, which are infinitely more devastating than the worst of natural catastrophes.”

Hence, availability bias is the major reason why people tend to severely overestimate the level of risk they are facing. If they are bombarded with the news about different real instances of disease and death they will certainly start believing that these instances are much more widespread than they really are.