“The journey a ponderous one at times, long and slow but necessarily so” – Lockdown

In mid-January, we began to wonder whether a modern-day Oedipus Rex would confront the U.S., but concerns were cast aside. Since the beginning of the 21st century, we’ve beaten SARS, MERS, H1N1 Swine Flu, and other public health threats. In the theater of the mind, one couldn’t imagine that within two months, the entire world would be held hostage to an “invisible enemy” and standing at the edge of a depression. At the time, the stock market was reaching new highs, and unemployment was the lowest in 50 years.

How quickly things have changed!

Today, the health system is struggling under the shock of a virulent disease, and we face grim choices between life, death, and the economy. Over 100,000 lives could be lost in the U.S. by the end of the summer, a number higher than the nation’s total military combat deaths since World War Two, all of this sorrow within six months. If we widen our lens, this crisis is amplified by the potential for widespread famine in Africa, the Middle East, and South Asia, as locust swarms ravage the area, and continuing regional conflicts. The only thing missing is a major natural disaster and foreign policy / military crisis. While we’re not sure how the coronavirus episode will end, it will be necessary to restore confidence in our ability to anticipate catastrophic events, minimize their impact, and regain stability. Covid-19 is the latest appearance of a “black swan,” a supposedly rare event. Once again, we were caught flatfooted.

The Johns Hopkins Coronavirus Dashboard has become our “go-to” website for information concerning confirmed cases, hospitalizations, recoveries, and deaths. We’ve become knowledgeable of the epidemiological curve, the importance of “social distancing”, adequacy of the national strategic stockpile, surge capacity of hospitals, especially ICU beds, PPE’s, distinction between surgical and N95 masks, frailty index-based triage, need for ventilators to treat acute cases, the critical role of respiratory therapists, and other health care professionals, and strengths and weaknesses of the global supply chain. As we move through this crisis, we’re learning a lot from daily briefings, but what is the big takeaway?

Will we return to business as usual in a few months, or will there be a fundamental restructuring of the economic and social order?  When will we be able to assemble without the fear of contracting or transmitting the virus to others? Will quarantine become a regular feature of modern American life? How do we control the risk of a more lethal global pandemic that results from future incidents of zoonosis, engineered pathogens that escape the lab, or malicious intent? Is this outbreak an exception or a preview of a worst-case scenario akin to a nuclear winter that would follow an eruption of a super-volcano? The Yellowstone Caldera continues to rumble! We need to step back, plan and prepare for what is next.

As I’ve reflected on the three “black swan” events that have occurred in the past twenty years, i.e., 9/11, Financial Crisis of 2008, and Covid-19, they share the following common characteristics.

  • We failed to connect the dots on a timely basis and foresee a high impact event, i.e., the situation on the ground moved faster than our ability to gather, organize, distill, evaluate and vet information derived from imagery, human and signals intelligence. At the center of this crisis is the National Center for Medical Intelligence, whose mission includes the identification of foreign disease outbreaks that have implications for national security. Where did the breakdown occur between the premier infectious disease research institute in America and the policy and operational arms of the Federal and state governments?

 

  • Despite warnings from virologists, we weren’t prepared to respond to this latest so-called low probability / high severity event. Now, we’re faced with costs to mitigate the damage and prevent a recurrence. Since 9/11, we have spent $6.4 trillion on the war on terror, plus countless resources in the public and private sectors to implement new security procedures. The economic cost of the 2008 financial meltdown was $12.8 trillion. While we’re in the early stages of the Covid-19 crisis, we have already made a $2.2 trillion down payment to offset the immediate economic injury, with more to come.

 

  • We respond to times of danger by rushing to institute policies that impact individual lives, all in the pursuit of the common good. The reach of the state continues to grow with each crisis! Since 2001, we have sacrificed civil liberties, created the circumstances that have led to greater inequality and are on the cusp of significant societal changes, especially in the realm of personal privacy. Will this new round slip through the Overton Window unchallenged? Will we succumb to the contagion of the crowd demanding this not reoccur?

While the prior two 21st century “black swans” inflicted significant damage, Covid-19 represents a triple whammy simultaneously affecting public-safety, national and economic security, and personal health on a global basis. The key learning from this episode is that in an instant, there is no safe place on the globe. We need to fight this together. The “invisible enemy” doesn’t respect national borders.

As we battle our way through this pandemic, we expect the GDP to drop by double-digits, up to 47 million workers laid off from their jobs, and unemployment reaches to 32%. While these statistics are grim, this plunge is expected (hoped) to be relatively short-lived, but it is not clear how we’ll return to work and school. Unlike the aftermath of a natural disaster, it is not as easy as saying the coast is clear, the workplace has reopened, report to work and the classroom, and resume your normal activities, especially when customers and students may not follow. The immediate future is fraught with challenges, especially as we need to ensure a safe workplace. An army of health status testers, validators, and contact tracers will be mobilized to check our coronavirus immunity health certificates and channel the others through a “health check” turnstile. This, the daily sorting of the healthy versus those at risk, will be routine for U.S. residents and visitors arriving on our shores, at least until we develop effective treatments and vaccines.

On a long-term basis, the wreckage from the crisis, along with the aftereffects of the China trade war, will cause us to strive for greater self-reliance. Economic nationalism will mark our actions. We will localize supply lines, reestablish on-shore production capacity for industries deemed critical to the national wellbeing, including public health, e.g., medical equipment, pharmaceuticals, and protective supplies, and rely to a higher degree on digital services versus the global workforce. As this crisis has unfolded, we witnessed the vulnerabilities of globalization, especially after we’ve optimized every aspect of the flow of goods. We need to restock the national larder and provide necessary surge capacity at the federal, state, and local levels.

As we turn inward, there will be shifts in the trends affecting the “future of work,” most notably a spike in the adoption of artificial intelligence and automation, a reversal of urbanization in favor of less dense locales, the ascendancy of retail titans, Amazon, Costco, Target and Walmart, as critical infrastructure, and adoption of remote work as the norm. All of this to increase resiliency.

While the changes will be disruptive, they’ll provide the means to improve our quality of life. During this unplanned experiment, we learned we don’t need to be tied physically to the workplace. For many, remote work is enabled by mobile, internet, computer, social media, and video conference tools. Apps can connect us with anyone around the world. The ongoing digitization of the world provides us with everything we need and want, including e-commerce, e-health, e-sports, e-groceries, e-learning, e-finance, e-entertainment, etc. The aftereffects of the Covid-19 crisis can help restore the America we were leaving behind. Once again, our hometowns, where we sought refuge from the “big city,” will become our North Star.

One last thought about work.

We need to recognize those that continued to go to the workplace, while we were sequestered in our homes. Despite the danger, doctors, nurses, hospital staff, EMTs, police, firefighters, funeral directors, truck drivers, farmers and food processors, grocery and drug store workers, gas station attendants, mail carriers, delivery people, transit workers, continued to meet our needs. The list is long!  Without their efforts, we would not be “flattening the curve.” They allowed us to stay home and remain safe. Perhaps, this crisis will lead to a renewed respect for those essential workers, many of them low paid.

As I return to the theater of the mind, Independence Day, a sci-fi disaster film is playing. An unknown enemy is attacking the world, and an epic event suddenly stilled great cities. In the end, imagination, cooperation, endurance, and ironically, a virus overcame the threat. Soon, we’ll be free to attend church services, return to favorite restaurants, root for favorite teams, shop at the small businesses in town, go to the movie theater, take a vacation, ride a roller coaster, i.e., resume our normal lives albeit wearing a mask.

Till then, remember the essence of an old English poem – we are wounded but not slain, we’ll lay ourselves down and bleed a while and rise and fight again.

 

Joe Smialowski

April 12, 2020

 

Follow at Twitter @joe_smialowski

The Road to Autarky

One thought on “The Road to Autarky

  • April 14, 2020 at 7:59 am
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    As you point out, the frequency of black swans in this century is frightening and becoming almost routine. It is very hard to anticipate and avoid these supposedly rare events, and the cost to do so is staggering. How many times can we afford to spend trillions to avoid these disasters/disruptions? I fear we will be able to address fewer going forward unless we vastly improve our governing processes.

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