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Hurricane Maria and Puerto Rico 5 Years Later

Now seems a useful time to re-assess some of the pronouncements made in the wake of the tragic disaster that struck Puerto Rico in September 2017. First,…

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Now seems a useful time to re-assess some of the pronouncements made in the wake of the tragic disaster that struck Puerto Rico in September 2017. First, fatalities of Americans (contra Mr. Trump’s seeming assertion these were not American) were much higher than some commentators claimed. Second, arguments that economic policies undertaken in 2016 and 2017 (i.e., the austerity measures associated with PROMESA) caused more deaths than Hurricane Maria are incorrect. Finally, the economic challenges that existed before the hurricane struck — including insufficient tax revenues — remain, even as the economy has rebounded.

The Impact on Excess Mortality

First, let’s recall that some commentators argued in the wake of the Hurricane that no more than 200-400 deaths occurred. Even after being tutored in terms of what the data meant, some continued to provide unrealistically low estimates.

From Sandberg, et al. (July 2019) in Epidemiology:

Now compare against shoot-from-the-hip comments on Econbrowser, such as this from Steven Kopits on 5/31/2018:

Excess deaths in PR through year end, those recorded by the Statistics Office, numbered only 654. Most of these occurred in the last ten days of September and the whole of October. While the power outages there were exacerbated by the state ownership of PR’s utility, a large portion of the excess deaths would likely have occurred regardless, given the terrain and the strength of the hurricane. Thus, perhaps 300-400 of the excess deaths would have occurred regardless of steps anyone could have made to fix the power supply. The remainder can be attributed essentially to the state ownership of the power utility.

I would note that excess deaths fell by half in December. Thus, the data suggests that the hurricane accelerated the deaths of ill and dying people, rather than killing them outright. I would expect the excess deaths at a year horizon (through, say, Oct. 1, 2018) to total perhaps 200-400. Still a notable number, but certainly not 4,600. [emphasis added-MDC]

Mr. Kopits’ updated (6/4) analysis concludes, even with updated data:

Thus, the year-end excess death toll of 1,400 may be treated as a firm number in practice.

I think “firm” is an adjective to be avoided in these situations. Here is a graph presenting selected estimates, from this April 2019 post, which includes some of the earlier estimates.

Figure 1: Cumulative excess deaths from September 2017, for simple time dummies OLS model (blue), OLS model adjusting for population (green), and Quantile Regression model adjusting for population (red), Milken Institute point estimate (black square) and 95% confidence interval (gray +), Santos-Lozada, Howard letter (chartreuse triangle), Cruz-Cano and Mead (pink squares), Kopits (teal triangle). Not pictured: Kopits estimate of 300-400 for October 2018. Source: author’s calculations, Milken Institute (2018), Santos-Lozada and Howard (2018), Cruz-Cano and Mead (2019), and Kopits (2018).

Austerity Killed More than the Hurricane?

What about arguments that austerity measures associated with PROMESA caused more excess mortality than the hurricane [extensive argument here] . In order to assess this argument, first consider mortality data through February 2018.


Figure 2: Mortality per month (blue). Gray denotes in-sample period; orange shading denotes Hurricane Maria and post-hurricane period; dashed line at PROMESA legislation. Source: Santos-Lozada and Howard, 2017, June release of Vital Statistics data.

Second, now consider constructing the counterfactual not incorporating austerity measures both before and after PROMESA implementation (legislation passed as of in July 2016, control in effect as of October 2016). I accomplish this by estimating two equations: (1) a simple averaging over the 2010-2015 period, and (2) a log-log OLS regression specification incorporating population estimates (as well as a dummy for October 2014). 2016 seems an appropriate break point for austerity given Brad Setser’s discussion of Puerto Rican finances. These specifications are discussed in this post. I show in Figure 3 the implied excess mortality figures.


Figure 3: Excess mortality per month calculated using averages 2010-15 (blue), and population adjusted using 2010-15 sample (red), population is cubic interpolation from IMF World Economic Outlook database data. Gray denotes in-sample period; orange shading denotes Hurricane Maria and post-hurricane period; dashed line at PROMESA legislation. Source: Santos-Lozada and Howard, 2017, June release of Vital Statistics data, IMF WEO April 2018 database, and author’s calculations.

Notice in neither case are most of the pre-Maria deviations statistically significant at the 10% msl. In other words, one could not typically reject the null hypothesis of no austerity-induced excess mortality, pre-Maria.

Third, it’s instructive to consider excess mortality from 2016M01-2017M08, and how it compares to excess mortality to that 2017M09-2018M02. If one assumes zero population change from 2016-17, then one gets the estimate of cumulative deaths (“avg. ’10-’16”) in red line, which indicates minimal impact of austerity.


Figure 4: Cumulative excess mortality per month using population adjustment specification (blue) using cubic interpolation of IMF World Economic Outlook database data, and using 2010-15 average (red). Orange shading denotes Hurricane Maria and post-hurricane period; dashed line at PROMESA legislation. Source: Santos-Lozada and Howard, 2017, June release of Vital Statistics data, IMF WEO April 2018 database, and author’s calculations.

However, the more realistic assessment relies upon adjusting the counterfactual for population. This leads to the blue line, labeled “log-log”), seemingly verifying the proposition that excess deaths began before the hurricane made landfall. However, interestingly, neither approach directly contradicts the point that most of the excess mortality since 2016M01 is due to the impact of Hurricane Maria.

I conclude that using statistical analysis, the inference that excess deaths due to pre- and post-Maria austerity exceed that of the aftermath of Hurricane Maria is extremely fragile.

Buttressing this view, I also find that, using electricity grid outage data reported in Shermeyer (2018), excess mortality as calculated using a population adjustment matches very closely outage data, derived either from PERPA (the public utility) or from Suomi National Polar-orbiting Partnership Visible Infrared Imaging Radiometer Suite (NPP VIIRS).


Figure 5: Excess mortality per month using population adjustment specification (black) using cubic interpolation of IMF World Economic Outlook database data, and electricity outages as proportion of total, from PREPA (pink) and from VIIRS as reported in Shermeyer (2018). Orange shading denotes Hurricane Maria and post-hurricane period; dashed line at PROMESA legislation. Source: Santos-Lozada and Howard, 2017, June release of Vital Statistics data, IMF WEO April 2018 database, personal communication from Jacob Shermeyer, and author’s calculations.

A regression over the 2007M04-2018M02 period, the slope coefficient on outage is 826 using Puerto Rico Electric Power Authority (PREPA) data, and 950 using VIIRS data, both statistically significant using HAC robust errors, with adjusted R2 = 0.83 and 0.72, respectively. That means 639-690 excess mortality attributable to power outages (and correlates) in October, for instance. (The excess mortality could be due directly to electricity outages, or due to communication outages and water service breakdowns correlated with the electricity outages.)

Exactly how bad was the Federal response to Maria in Puerto Rico?

Skipping the optics of paper towels, several reports (e.g., DHS OIG) have document exactly how poorly FEMA performed. In addition, academic analyses have documented the differential response that occurred in the same period — that is much larger responses to hurricane landfalls in Texas and Florida.

The economic outlook

After the catastrophic disaster response failure, the Puerto Rican economy recovered to pre-hurricane levels, only to be laid low by the Covid pandemic. Figure 6 below shows GDP and the Economic Activity Index.

Figure 6: GDP in mn Ch2012$ (blue bar, left log scale), and Economic Activity Index (EDB-EAI) s.a. (blue, right log scale). NBER defined peak-to-trough recession dates shaded gray. Source:  BEA, Economic Development Bank for Puerto Rico, and NBER.

The broadest measure of activity — GDP — is only reported up through 2020, while the Economic Activity Index –based on employment, electricity generation, gasoline consumption and cement sales — which extends to August 2022 only measures part of the economy. As shown, while there is a rebound, in (measured) economic activity, it’s tailed off in recent months. This pattern shows up in civilian employment (although not in series from the establishment series).

Figure 7: Puerto Rico nonfarm payroll employment (blue), private nonfarm payroll employment (tan), civilian employment (green), all in 000’s, s.a.. NBER defined peak-to-trough recession dates shaded gray. Source:  BLS, and NBER.

Federal assistance associated with the pandemic is ending. This fiscal drag adds to the central long term challenges of an uncompetitive economy (in part due to shipping and other transportation regulations) and a large government debt mired in restructuring (see CRS). See also Gregory Makoff and Brad Setser’s 2017 economic analysis.

Some of these challenges are intractable, while other could be relatively easily remedied. For instance, waiving the Jones Act for Puerto Rico would in some estimates lower prices by $1 billion, which is substantial for an economy measured at about $103 billion in 2020.

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Survey Shows Declining Concerns Among Americans About COVID-19

Survey Shows Declining Concerns Among Americans About COVID-19

A new survey reveals that only 20% of Americans view covid-19 as "a major threat"…

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4 hours ago

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March 11, 2024

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Survey Shows Declining Concerns Among Americans About COVID-19

A new survey reveals that only 20% of Americans view covid-19 as "a major threat" to the health of the US population - a sharp decline from a high of 67% in July 2020.

(SARMDY/Shutterstock)

What's more, the Pew Research Center survey conducted from Feb. 7 to Feb. 11 showed that just 10% of Americans are concerned that they will  catch the disease and require hospitalization.

"This data represents a low ebb of public concern about the virus that reached its height in the summer and fall of 2020, when as many as two-thirds of Americans viewed COVID-19 as a major threat to public health," reads the report, which was published March 7.

According to the survey, half of the participants understand the significance of researchers and healthcare providers in understanding and treating long COVID - however 27% of participants consider this issue less important, while 22% of Americans are unaware of long COVID.

What's more, while Democrats were far more worried than Republicans in the past, that gap has narrowed significantly.

"In the pandemic’s first year, Democrats were routinely about 40 points more likely than Republicans to view the coronavirus as a major threat to the health of the U.S. population. This gap has waned as overall levels of concern have fallen," reads the report.

More via the Epoch Times;

The survey found that three in ten Democrats under 50 have received an updated COVID-19 vaccine, compared with 66 percent of Democrats ages 65 and older.

Moreover, 66 percent of Democrats ages 65 and older have received the updated COVID-19 vaccine, while only 24 percent of Republicans ages 65 and older have done so.

“This 42-point partisan gap is much wider now than at other points since the start of the outbreak. For instance, in August 2021, 93 percent of older Democrats and 78 percent of older Republicans said they had received all the shots needed to be fully vaccinated (a 15-point gap),” it noted.

COVID-19 No Longer an Emergency

The U.S. Centers for Disease Control and Prevention (CDC) recently issued its updated recommendations for the virus, which no longer require people to stay home for five days after testing positive for COVID-19.

The updated guidance recommends that people who contracted a respiratory virus stay home, and they can resume normal activities when their symptoms improve overall and their fever subsides for 24 hours without medication.

“We still must use the commonsense solutions we know work to protect ourselves and others from serious illness from respiratory viruses, this includes vaccination, treatment, and staying home when we get sick,” CDC director Dr. Mandy Cohen said in a statement.

The CDC said that while the virus remains a threat, it is now less likely to cause severe illness because of widespread immunity and improved tools to prevent and treat the disease.

“Importantly, states and countries that have already adjusted recommended isolation times have not seen increased hospitalizations or deaths related to COVID-19,” it stated.

The federal government suspended its free at-home COVID-19 test program on March 8, according to a website set up by the government, following a decrease in COVID-19-related hospitalizations.

According to the CDC, hospitalization rates for COVID-19 and influenza diseases remain “elevated” but are decreasing in some parts of the United States.

Tyler Durden Sun, 03/10/2024 - 22:45

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Rand Paul Teases Senate GOP Leader Run – Musk Says “I Would Support”

Rand Paul Teases Senate GOP Leader Run – Musk Says "I Would Support"

Republican Kentucky Senator Rand Paul on Friday hinted that he may jump…

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March 10, 2024

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Rand Paul Teases Senate GOP Leader Run - Musk Says "I Would Support"

Republican Kentucky Senator Rand Paul on Friday hinted that he may jump into the race to become the next Senate GOP leader, and Elon Musk was quick to support the idea. Republicans must find a successor for periodically malfunctioning Mitch McConnell, who recently announced he'll step down in November, though intending to keep his Senate seat until his term ends in January 2027, when he'd be within weeks of turning 86. 

So far, the announced field consists of two quintessential establishment types: John Cornyn of Texas and John Thune of South Dakota. While John Barrasso's name had been thrown around as one of "The Three Johns" considered top contenders, the Wyoming senator on Tuesday said he'll instead seek the number two slot as party whip. 

Paul used X to tease his potential bid for the position which -- if the GOP takes back the upper chamber in November -- could graduate from Minority Leader to Majority Leader. He started by telling his 5.1 million followers he'd had lots of people asking him about his interest in running...

...then followed up with a poll in which he predictably annihilated Cornyn and Thune, taking a 96% share as of Friday night, with the other two below 2% each. 

Elon Musk was quick to back the idea of Paul as GOP leader, while daring Cornyn and Thune to follow Paul's lead by throwing their names out for consideration by the Twitter-verse X-verse. 

Paul has been a stalwart opponent of security-state mass surveillance, foreign interventionism -- to include shoveling billions of dollars into the proxy war in Ukraine -- and out-of-control spending in general. He demonstrated the latter passion on the Senate floor this week as he ridiculed the latest kick-the-can spending package:   

In February, Paul used Senate rules to force his colleagues into a grueling Super Bowl weekend of votes, as he worked to derail a $95 billion foreign aid bill. "I think we should stay here as long as it takes,” said Paul. “If it takes a week or a month, I’ll force them to stay here to discuss why they think the border of Ukraine is more important than the US border.”

Don't expect a Majority Leader Paul to ditch the filibuster -- he's been a hardy user of the legislative delay tactic. In 2013, he spoke for 13 hours to fight the nomination of John Brennan as CIA director. In 2015, he orated for 10-and-a-half-hours to oppose extension of the Patriot Act. 

Rand Paul amid his 10 1/2 hour filibuster in 2015

Among the general public, Paul is probably best known as Capitol Hill's chief tormentor of Dr. Anthony Fauci, who was director of the National Institute of Allergy and Infectious Disease during the Covid-19 pandemic. Paul says the evidence indicates the virus emerged from China's Wuhan Institute of Virology. He's accused Fauci and other members of the US government public health apparatus of evading questions about their funding of the Chinese lab's "gain of function" research, which takes natural viruses and morphs them into something more dangerous. Paul has pointedly said that Fauci committed perjury in congressional hearings and that he belongs in jail "without question."   

Musk is neither the only nor the first noteworthy figure to back Paul for party leader. Just hours after McConnell announced his upcoming step-down from leadership, independent 2024 presidential candidate Robert F. Kennedy, Jr voiced his support: 

In a testament to the extent to which the establishment recoils at the libertarian-minded Paul, mainstream media outlets -- which have been quick to report on other developments in the majority leader race -- pretended not to notice that Paul had signaled his interest in the job. More than 24 hours after Paul's test-the-waters tweet-fest began, not a single major outlet had brought it to the attention of their audience. 

That may be his strongest endorsement yet. 

Tyler Durden Sun, 03/10/2024 - 20:25

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The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While “Waiting” For Deporation, Asylum

The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While "Waiting" For Deporation, Asylum

Over the past several…

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9 hours ago

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March 10, 2024

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The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While "Waiting" For Deporation, Asylum

Over the past several months we've pointed out that there has  been zero job creation for native-born workers since the summer of 2018...

... and that since Joe Biden was sworn into office, most of the post-pandemic job gains the administration continuously brags about have gone foreign-born (read immigrants, mostly illegal ones) workers.

And while the left might find this data almost as verboten as FBI crime statistics - as it directly supports the so-called "great replacement theory" we're not supposed to discuss - it also coincides with record numbers of illegal crossings into the United States under Biden.

In short, the Biden administration opened the floodgates, 10 million illegal immigrants poured into the country, and most of the post-pandemic "jobs recovery" went to foreign-born workers, of which illegal immigrants represent the largest chunk.

Asylum seekers from Venezuela await work permits on June 28, 2023 (via the Chicago Tribune)

'But Tyler, illegal immigrants can't possibly work in the United States whilst awaiting their asylum hearings,' one might hear from the peanut gallery. On the contrary: ever since Biden reversed a key aspect of Trump's labor policies, all illegal immigrants - even those awaiting deportation proceedings - have been given carte blanche to work while awaiting said proceedings for up to five years...

... something which even Elon Musk was shocked to learn.

Which leads us to another question: recall that the primary concern for the Biden admin for much of 2022 and 2023 was soaring prices, i.e., relentless inflation in general, and rising wages in particular, which in turn prompted even Goldman to admit two years ago that the diabolical wage-price spiral had been unleashed in the US (diabolical, because nothing absent a major economic shock, read recession or depression, can short-circuit it once it is in place).

Well, there is one other thing that can break the wage-price spiral loop: a flood of ultra-cheap illegal immigrant workers. But don't take our word for it: here is Fed Chair Jerome Powell himself during his February 60 Minutes interview:

PELLEY: Why was immigration important?

POWELL: Because, you know, immigrants come in, and they tend to work at a rate that is at or above that for non-immigrants. Immigrants who come to the country tend to be in the workforce at a slightly higher level than native Americans do. But that's largely because of the age difference. They tend to skew younger.

PELLEY: Why is immigration so important to the economy?

POWELL: Well, first of all, immigration policy is not the Fed's job. The immigration policy of the United States is really important and really much under discussion right now, and that's none of our business. We don't set immigration policy. We don't comment on it.

I will say, over time, though, the U.S. economy has benefited from immigration. And, frankly, just in the last, year a big part of the story of the labor market coming back into better balance is immigration returning to levels that were more typical of the pre-pandemic era.

PELLEY: The country needed the workers.

POWELL: It did. And so, that's what's been happening.

Translation: Immigrants work hard, and Americans are lazy. But much more importantly, since illegal immigrants will work for any pay, and since Biden's Department of Homeland Security, via its Citizenship and Immigration Services Agency, has made it so illegal immigrants can work in the US perfectly legally for up to 5 years (if not more), one can argue that the flood of illegals through the southern border has been the primary reason why inflation - or rather mostly wage inflation, that all too critical component of the wage-price spiral  - has moderated in in the past year, when the US labor market suddenly found itself flooded with millions of perfectly eligible workers, who just also happen to be illegal immigrants and thus have zero wage bargaining options.

None of this is to suggest that the relentless flood of immigrants into the US is not also driven by voting and census concerns - something Elon Musk has been pounding the table on in recent weeks, and has gone so far to call it "the biggest corruption of American democracy in the 21st century", but in retrospect, one can also argue that the only modest success the Biden admin has had in the past year - namely bringing inflation down from a torrid 9% annual rate to "only" 3% - has also been due to the millions of illegals he's imported into the country.

We would be remiss if we didn't also note that this so often carries catastrophic short-term consequences for the social fabric of the country (the Laken Riley fiasco being only the latest example), not to mention the far more dire long-term consequences for the future of the US - chief among them the trillions of dollars in debt the US will need to incur to pay for all those new illegal immigrants Democrat voters and low-paid workers. This is on top of the labor revolution that will kick in once AI leads to mass layoffs among high-paying, white-collar jobs, after which all those newly laid off native-born workers hoping to trade down to lower paying (if available) jobs will discover that hardened criminals from Honduras or Guatemala have already taken them, all thanks to Joe Biden.

Tyler Durden Sun, 03/10/2024 - 19:15

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