Lockdowns Versus Herd Immunity--Which Policy Is Best for Israeli Lives and the Economy

In 2022, the world was greeted with what has been the new normal since 2020–COVID infections and uncertainty, but with a difference; now there are several vaccines and a coronavirus-fighting pill from Pfizer introduced into Israel.

News of omicron reached the headlines in early December. Israel immediately imposed travel bans to delay the introduction of this highly contagious form of COVID into its borders, but in a few short weeks, cases rose to 5,000 daily.

The Israeli government begins the new year faced with a choice between lockdowns, which was the dominant policy during the pre-vaccine phase of the pandemic and herd immunity, allowing the virus to run its course, even if it means large numbers of COVID cases in Israel.

The considerations at stake are the health of Israeli citizens as well as the health of the economy. Prime Minister Bennett urged vaccinations instead of lockdowns even as COVID cases surged in the summer of 2021. However, with the omicron variant overwhelming testing sites and amid predictions that 1 out of every 3 Israelis will likely be infected, the dilemma is a serious one.

Pros of the Herd Immunity Policy

“Herd immunity” refers to a situation in which an infectious disease no longer has a serious effect on a population when a crucial majority becomes immune to it, either through vaccinations or because they have built up antibodies through previous infection.

This was termed the “Swedish Model” when Sweden in the first phase of the pandemic did not institute lockdowns but allowed the country to function normally. However, the fatalities that resulted were higher than expected and the model was ultimately not considered a wholly successful one.

However, a modified version of the Swedish model could be an effective policy in Israel, since it will be less hazardous given that the majority of the population is vaccinated and because omicron has led to fewer hospitalizations than previous iterations. It is estimated that those with three vaccinations have an 88% chance of staying out of the hospital if they catch omicron.

The herd immunity model is being floated as a way to deal with omicron, and one of its main proponents is Bar Ilan University professor Michael Edelstein who told the Times of Israel that the herd immunity plan may be more effective and less harmful now than in 2020, “Now, things are different, and we have the tools to give the population a level of protection against the disease that we didn’t have back in the day. There wasn’t and it was much more of a gamble.

In addition, herd immunity would allow Israel’s economy to stay open and operate normally, which is one of the main reasons the government has been opposed, up until now, to lockdowns.

Why Lockdowns May Still Happen

Even though health experts like Professor Edelstein consider herd immunity a possibility, he also points out that hospitals could get overwhelmed. “It’s a matter of math,” he said. “If Omicron is four times more transmissible than Delta but two times less severe, you still end with twice the number of people in hospital.”

In this case, some sectors of the economy would likely shut down by default with the number of people in quarantine, those worried about going out and wanting to protect their children and elderly parents by keeping them at home.

What Is the Likely Omicron Scenario for Israel?

In the first week of January 2022, omicron numbers increase, there are no lockdowns and tests are running out. Many people are going to work and school as usual but are bracing for the need for lockdowns if they have to go into quarantine and hospital numbers increase.

However, it is likely to assume any upcoming lockdown may not be as extensive or severe as those in the past because vaccinations lead to less severe illness, there are now treatments for COVID-19 and the omicron variant is milder.

A short-term lockdown may harm the service sector to some extent, but this can be relieved with deliveries.  Many businesses still operate efficiently with workers doing tasks at home with conferencing software. The fact that Israel was able to emerge from Delta with a 7% economic growth rate bodes well for any situation omicron might bring.

Invest in Israel’s Economic Recovery

Israel has showed economic momentum rising out of the depths of the pandemic, and even through variants, the country’s economy has rebounded significantly. The fact that omicron is milder than earlier versions is a good sign indication for continued growth, particularly in sectors like tech, which are less affected by social distancing and lockdowns, should they occur in 2022.

This scenario looks hopeful for continued growth in Israeli investments, such as stocks or ETFs, which provide a broader exposure to Israel’s economy.

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