  An epidemic carries human and fiscal costs. In the case of imported
pandemics, the first-best solution is to restrict national borders to identify
and isolate infected individuals. However, when that opportunity is not fully
seized and there is no preventative intervention available, second-best options
must be chosen. In this article we develop a system of differential equations
that simulate both the fiscal and human costs associated to different
mitigation measurements. After simulating several scenarios, we conclude that
herd immunity (or unleashing the pandemic) is the worst policy in terms of both
human and fiscal cost. We found that the second-best policy would be a strict
policy (e.g. physical distancing with massive testing) established under the
first 20 days after the pandemic, that lowers the probability of infection by
80%. In the case of the US, this strict policy would save more than 239
thousands lives and almost $170.8 billion to taxpayers when compared to the
herd immunity case.
