A big story regarding Covid in the past month or two has been how slowly Europeans are getting vaccinated. The graph below depicts how vaccinations in the EU are lagging behind the U.S. and U.K.
Image source: Foreign Policy
It wasn’t supposed to be like this. Europeans have been critical of U.S. policies since the start of the pandemic, taking pride in protecting their citizens with more extensive lockdowns. (And indeed, the total death rate per million has been lower in major EU countries than in the U.S. or U.K.)
But the EU was more deliberate in their negotiations with vaccine manufacturers, taking time to come to internal consensus, then trying to use their bloc size for negotiating power, pushing for lower prices and more stringent liability on the manufacturers. In contrast, the U.S. essentially threw money at the pharma companies and their biotech partners, allowing them to keep the intellectual property, and minimizing their liabilities.
Foreign Policy notes:
The biggest problem is lack of supply. Europe bought far too few doses of Moderna, Pfizer, and AstraZeneca when the companies started taking their first orders last summer, favoring less-promising European companies instead…It seemed for a time that Johnson & Johnson would be Europe’s saving grace. Its vaccine performs moderately well at preventing symptomatic COVID-19 and extremely well at reducing severe cases, hospitalizations, and deaths. And the formulation requires only a single dose, which makes it much faster and easier to administer. On March 11, the European Medicines Agency approved the shot, but the company now says it may not be able to meet its 55 million-dose delivery target in the second quarter. In any case, deliveries will not start before mid-April at the earliest.
Regarding those European vaccine candidates, The New York Times notes:
It didn’t help that Europe backed the wrong horse in some cases. It spent billions on a vaccine candidate from French drugmaker Sanofi and Britain’s GSK that was delayed by over a year after disappointing results.
So the bloc relied heavily on AstraZeneca for its early rollout plans, a bet that had repercussions from the beginning. Italy, for example, embraced Europe’s bet on AstraZeneca doses because they were cheaper and did not require extreme storage temperatures.
Now, with its hopes pinned to a large extent on the AstraZeneca vaccine, the EU has further delayed and even compromised its vaccination progress by flipping and flopping on the safety and efficacy of this vaccine:
The final nail in the coffin came this week when several EU countries, including Germany, Italy, France, Spain, and the Netherlands, halted the administration of AstraZeneca vaccines, citing scattered reports of blood clots in individuals who had received the vaccine. As of March 17, European regulators had received a total of 30 reports of blood clots out of 5 million people vaccinated with AstraZeneca.
This decision is unscientific. “There is currently no indication that vaccination has caused these conditions,” the European Medicines Agency, the top regulator, concluded last week. Blood clots are very common: In the United States, they kill 60,000 to 100,000 people every year, out of about 2.8 million total annual deaths. And if you’re afraid of blood clots, getting COVID-19 is just about the worst risk factor you could think of. Ten percent of hospitalized non-intensive care unit COVID-19 patients are diagnosed with venous thromboembolism, a blood clotting disorder. Among COVID-19 patients admitted to the ICU, fully 28 percent get clots. The potential risk from the AstraZeneca vaccine is extremely minor in comparison. In short, if you live in Europe and are afraid of getting blood clots, you should be rushing to get the AstraZeneca vaccine.
But European leaders have had it out for the company since it first announced delays in its supply schedule to the EU. For example, in late January, French President Emmanuel Macron falsely claimed that the AstraZeneca vaccine was “quasi-ineffective” for people over age 65. (In clinical trials, the AstraZeneca vaccine was 100 percent effective at preventing severe cases of COVID-19. New studies indicate it is ineffective against the “South African” B1351 variant, but few cases of this variant have been identified in Europe.) Despite the country’s health authority flatly contradicting Macron in February, Europeans are heeding his words; even before this week’s news, many Europeans had already refused to be inoculated with AstraZeneca. Even if governments resume administering AstraZeneca next week, much of the damage has already been done. Even a slight increase in anti-vaccine sentiment among the high-risk population is terrible news.
Our first concern, of course, is the human cost here. Deaths are surging in some EU countries, especially in the eastern nations like Hungary and Czechia. There will be economic and political repercussions, as well. Europe’s recovery will stall as it stays in lockdowns well into the summer, and the prestige of the EU as an institution has suffered mightily. The Eurocrats had hoped to put on a model performance, but are now looking incompetent next to those breakaway Brits.
EU threats to prevent European vaccine makers from fulfilling their agreements to ship vaccines to other countries will doubtless also have long term repercussions – – other nations will now want to ramp up domestic vaccine production capacity so as not to be dependent in the future on European manufacturers.
In contrast, the U.S. throw-unlimited-money-at-the-problem approach was enabled by having a captive central, national bank. The EU was constrained by having a budget that is a result of negotiations among the member nations, all with different interests. The European Central Bank does tamp down interest rates on EU national bonds, but there are always ongoing negotiations, consisting largely of the Germans (who control things) pressuring the profligate southern European nations to keep their budget deficits under control.
In America, it seems that all thoughts of budgetary limitations have been almost entirely banished from political consciousness. You want to spend an extra trillion on short notice? Two trillion? Four trillion? Blam, no problemo, no real discussion, even. The U.S. Treasury still has to sell bonds to finance the deficits, but that is not the constraint that it once was. The Fed used to be considered an independent institution, whose role in part was to chastise profligate government spending by raising interest rates. But now the Fed is fully expected to create money out of thin air, and use it to vacuum up any and all government bonds that the public doesn’t want to buy.
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