Building Back Better?

The opening up of European and US economies, despite the large scale prevalence of the Coronavirus in the later, has sparked a plethora of conversations as to how much COVID-19 has changed our societies and economies and how can we ‘build back better’.

That phrase has become almost ubiquitous in country’s like the United Kingdom where they have been adopted by the political leadership as a way of charting an optimistic roadmap out of the dark times of a pandemic. The full impact of how the Coronavirus will change us as a modern species is hard to fathom. This is partly due to the fact that the disease is not behind us but is instead continuing to spike across the globe.

President Trump has regularly repeated his belief that the virus will one day ‘disappear’, but hope is not a strategy and every day that the pandemic grips the world is another day in which changes will be made that could mean we never go back to pre-virus reality but instead chart a very different direction for humanity.

Increased working from home, the rise and rise of online shopping, more controls on movement between countries and the development of shorter supply chains and more domestic productivity are just a snapshot of some of the lifestyle changes that have defined the response to COVID-19 in the UK. The reverberating effects of each of these trends has a myriad of impacts.

Take working from home, if this becomes the new normal what does this mean for the future of cities? Large offices in the centre of London stay dormant. They require no cleaning, no transport nodes to connect workers from around the city and beyond. The local food shops are not needed and already firm are shedding jobs. House prices will adjust and suddenly the cleaner, greener spaces outside of the city may become more desirable. Could commercial property in London suddenly find itself transformed into residential? Already the Government is promising the biggest changes to the planning system in a generation.

Schools being closed has forced parents to become teachers, perhaps changing their relationship with their children forever in a positive sense. These children may have utilised access to online learning that will stay with them throughout their lives, already Universities are offering more virtual spaces for completing degrees. Yet inequality will almost certainly be widened by these trends as those who have access to the technology and the space to use it will plough ahead whilst those who don’t are missing out of chunks of their education that they may never catch up from.

This kind of crisis may also prompt a new type of global empathy with those undergoing difficult times in other parts of the world. Recently an entirely organic effort made by people connecting across Instagram prompted a surge of donations to help the humanitarian situation in Yemen. Could the fear and disruption felt by people in Britain change how their view long term conflicts in places like Syria? Shared experience can often build bridges between people who would otherwise never meet in unique ways.

Interestingly the crisis has provided a mirror to the state of how resilient societies are. In the UK panic buying of toilet roll was a particular low point whilst in America gun sales are through the roof. Meanwhile in Indian slums local community organisation was able to grip the crisis and conflict-wrought African countries with experiences of dealing with Ebola were able to channel their COVID responses with far less in the way of panic.

Economies will change as some sectors may shrink beyond recognition. Airlines are currently shedding thousands of jobs, the global tourism sector – worth almost $8bn and countless jobs – is holding its breath to see if European policies allowing travel sees people confident enough to book holidays. On the other hand, could new green industries find their moment to push for a radical rebalancing of countries carbon outputs

The globalised economy that existed pre-COVID was already having to adjust to de-globalisation led by populist nationalist leaders like Trump and Johnson. The adjustment has been accelerated by COVID. Where we live, how we work, what we do, how we educate our children; these are all the fundamental questions that it is rare for any country to fundamentally question. Yet that is exactly where we are today.

Looming behind these questions are the terrible prospects of what a global recession and countries having staggering levels of debt could look like. Lebanon may be a particularly virulent example of state disfunction but the rapid collapse in its currency is pushing large numbers of people into poverty, last week the Government even announced that it couldn’t afford to feed its army meat.

Levels of unemployment and poverty will remain key metrics of how countries are managing their COVID recoveries and whether they are truly able to ‘build back better’ or whether the political rhetoric is writing cheques that their economies can’t cash.