SARS

For all of those columnists out there like Mike Littwin, who can't understand the difference between markets and incentives, here's an object lesson. This is from a Wall Street Journal Op-Ed from last April 25, written by Donald Burke, epidemiologist at Johns Hopkins:

As summer approaches and the SARS epidemic declines, there will be an understandable urge to celebrate. But history teaches us that the devastating 1918 influenza epidemic began with a modest "herald wave" in spring that faded away during the summer, only to explode and wreak global devastation the following fall and winter. It is possible that SARS, now seeded around the globe, could follow a similar pattern and fade away this summer, only to erupt again next winter.

The coming summer lull in SARS affords an extraordinary opportunity. If we can detect, diagnose and effectively isolate every contagious case during the period when the infection rate is at its lowest, it is possible that we can truly eradicate SARS, not just for the short term, but permanently.

Now China has seen a couple of SARS cases, and while they're not walling up the towns and posting guards, they're been, shall we say, pretty responsive. The one thing the Chinese government fears more than papier mache Statues of Liberty is loss of foreign capital. Their expansion, their ability to keep their bad banks afloat, all depend on foreign capital. One whiff of SARS, they fear, and the foreigners are gone for good, maybe to Dehli.

The point is, China has a great incentive to make sure SARS doesn't show up. They have, in fact, a great incentive to be a very good world citizen, for the moment. The problem is, this only goes so far. Business has always valued stability of the moment over real democratic institutions, which are almost always more stable. There's no evidence that big business has learned this lesson, and the more heavily invested they are in China, the less likely they'll be to tolerate any sort of social upheaval.

Make no mistake about China's long-term intentions - they want to kick us out of Asia for good. They see us much as we saw the old European empires around the turn of the century. Meddling in their hemisphere, and riding for a fall. They're playing for time, confident that it's on their side. Right now, China holds an increasing, although not decisive, portion of our outstanding Treasury debt. The deficit is now a national security issue. We're right to run onw short-term, but long-term, we can't let a hostile foreign power gain that kind of leverage over us.