Chapter 2
Normal was a problem in the first place
The pandemic also can be understood as a warning sign, a probe into the structural weaknesses of our existing systems. It shows how futile it is to insist on facing 21st century challenges with the institutions and methods of 20th-century global governance.
The pandemic has made evident the scale of the climate catastrophe, so too the scale of work required to manage and mitigate the impending tsunami of risks. Even a near complete shutdown of the global economy has resulted in only 5.6% CO2 emission reductions relative to the 7.6% required annually︎︎︎ to keep within the 1.5°C temperature-rise target. While much has been made of the potential benefits of the pandemic on the environment, COVID-19 has also highlighted the limitations of international environmental law︎︎︎. It has merely hit a pause button on emissions that are likely to return to or even exceed pre-pandemic levels, particularly if economic stimulus packages are invested in road, air, and other infrastructures that support fossil fuels.
COVID-19 has exposed the fragility of the social contract between state and citizen, risking state failures across the globe. For years, there appeared to be a lack of public finances for the poor, the homeless, and marginalised. Now, in the COVID era, what was previously considered politically impossible, such as universal healthcare and basic income, has become politically inevitable︎︎︎. The understanding of the state as both projection and architecture of our collective needs︎︎︎ will be tested as citizen expectations rise in the post-pandemic period. Indeed, the ability of governments to provide for their people will be constrained by rising debt︎︎︎. The resulting whiplash could lead to civil strife and political instability︎︎︎, the seeds of which are already evident in various surveys relating to public perception︎︎︎ of government crisis management.
The pandemic has revealed the systemic injustices of highly concentrated markets that do not allocate fairly or freely. We have witnessed how those with money outspend and deprive the poor of critical medical supplies with acts of modern piracy, hoarding, and price gouging︎︎︎. The immediate consequence of the predatory purchase of medical supplies during a period of worldwide shortages is to render it impossible for low- and middle-income countries to adequately respond at the scale that is required. As such, the crisis is likely to accelerate inequality︎︎︎, increasing the vulnerability of some people, cities, and states to the health, economic, and social fallout of the pandemic.
The pandemic has revealed the systemic injustices of highly concentrated markets that do not allocate fairly or freely. We have witnessed how those with money outspend and deprive the poor of critical medical supplies with acts of modern piracy, hoarding, and price gouging︎︎︎. The immediate consequence of the predatory purchase of medical supplies during a period of worldwide shortages is to render it impossible for low- and middle-income countries to adequately respond at the scale that is required. As such, the crisis is likely to accelerate inequality︎︎︎, increasing the vulnerability of some people, cities, and states to the health, economic, and social fallout of the pandemic.
COVID-19 has compounded underlying systemic inequities︎︎︎ in communities where poverty and inequality levels are high, access to services like medical care is low, high pollution industries are present, and demographics include migrants, people of color, and minorities. Informal workers are particularly at risk of drifting into permanent poverty as they are currently unable to sell their products. Without sales, they are unable to purchase what is required for the next phase of production, selling what assets they possess in order to survive, and thereby removing the opportunity for future revenue streams post-lockdown. The possibility of investing in education or healthcare for either themselves or their families, inevitably, is greatly diminished. These deep structural weaknesses have now become visible to all, exacerbated by numerous pre-existing factors, such as the climate crisis, automation, and urbanization. Recent research illustrates the compounding nature of these risks, establishing the connection between poverty and COVID-related death. There is an estimated 32% increase in the probability of death︎︎︎ when comparing the poorest quintile with the wealthiest.
The pandemic has exposed the fragility of logistics infrastructures across the globe. The demand for the critical production of food, medicine, and protective equipment, among other things, has raised questions about distribution and re-localisation. This has coincided with the increased automation that has impacted geographic job distribution, as well as the demise of ailing and fragile industries. Some countries are shoring up their production of critical assets, such as pharmaceuticals︎︎︎, while others are paying companies to relocate their operations from abroad, as is the case in Japan︎︎︎. We may see an acceleration of the de-globalisation trend, following a global trade fall of 0.4%︎︎︎ in 2019, with supply chains becoming shorter and national resilience gaining prominence on the political agenda.
The pandemic has exposed the fragility of logistics infrastructures across the globe. The demand for the critical production of food, medicine, and protective equipment, among other things, has raised questions about distribution and re-localisation. This has coincided with the increased automation that has impacted geographic job distribution, as well as the demise of ailing and fragile industries. Some countries are shoring up their production of critical assets, such as pharmaceuticals︎︎︎, while others are paying companies to relocate their operations from abroad, as is the case in Japan︎︎︎. We may see an acceleration of the de-globalisation trend, following a global trade fall of 0.4%︎︎︎ in 2019, with supply chains becoming shorter and national resilience gaining prominence on the political agenda.
COVID-19 is disrupting global food production. Already subject to massive inefficiencies and the effects of the climate crisis, global food waste amounts to almost $1 trillion a year︎︎︎. National restrictions on the export of grains︎︎︎, price spikes, and shortages mean that the number of people facing a severe food crisis is doubling︎︎︎. Most of these people are in Africa, and are dependent on the food they grow for both nourishment and income. They now find themselves exposed to broken supply chains and disrupted cross-border trade.
The pandemic has triggered a new essentialism. That is, a collective, global transformation in what and why we buy and consume. Historically, this is unsurprising, with economic contractions leading to a drastic decline on consumer durables︎︎︎, and a negative relationship between stock market variability and the production of consumer durables. Cross-country research︎︎︎ from May 2020 shows similar patterns in consumer spending, irrespective of the strictness of national containment policies, and points to personal choice as the biggest factor behind the drop. This has been significantly worse for those who are more exposed to COVID-triggered economic or health risks.
COVID-19 has made evident the need to reconfigure the structural relationship between the household, the state, and market economies︎︎︎. For households, the usual means of smoothing income shocks︎︎︎ – such as casual work, the gig economy, and migration – are not possible in a lockdown situation. Many households, especially those involved in the informal economy, are unable to access any form of state support or insurance. Their fragility is further affected by where they live, their dwelling space, and their social networks. It is people – families, friends, neighbours – that currently carry a premium value, rather than the goods and services that the market provides. Our response to the pandemic has prioritised health and wellbeing over the economy. Is it possible, then, that in the future we might see the gap between what the market values and what citizens value close? Crucially, the pandemic has made visible the foundational role of the state in relation to markets. To date, the state has been the underwriter of market failure and risk. What we have witnessed in recent weeks opens up a new possibility for changes in the social contract. We can alter how we live, how corporations operate, and the role and responsibility of government.
COVID-19 has made evident the need to reconfigure the structural relationship between the household, the state, and market economies︎︎︎. For households, the usual means of smoothing income shocks︎︎︎ – such as casual work, the gig economy, and migration – are not possible in a lockdown situation. Many households, especially those involved in the informal economy, are unable to access any form of state support or insurance. Their fragility is further affected by where they live, their dwelling space, and their social networks. It is people – families, friends, neighbours – that currently carry a premium value, rather than the goods and services that the market provides. Our response to the pandemic has prioritised health and wellbeing over the economy. Is it possible, then, that in the future we might see the gap between what the market values and what citizens value close? Crucially, the pandemic has made visible the foundational role of the state in relation to markets. To date, the state has been the underwriter of market failure and risk. What we have witnessed in recent weeks opens up a new possibility for changes in the social contract. We can alter how we live, how corporations operate, and the role and responsibility of government.