I have just posted this long thread on Twitter. It's about the thinking required to adapt to the changes that I think Covid is now going to impose on us as a new lockdown becomes inevitable:
The time for pretence is over: the reality is that the UK is facing another Covid outbreak at least as serious as that earlier this year. This has massive economic consequences. So, a thread on what we need to think about this time.
First, the Treasury has to realise we lockdown to protect the economy. We don’t do it to harm it. We lockdown, provide support and accept the costs because the alternatives are worse.
What’s worse is not just in lives lost, or blighted by long Covid and racked by concern, although they are all bad enough. The alternative is bigger economic cost resulting from health care created chaos.
We have an NHS for a reason in the countries of the UK. That reason is to make sure that all who require healthcare get it, come what may and whatever their circumstance. One justification for that free delivery is exactly circumstances like this.
Covid does not care about the circumstances of the person it infects. We know it’s not entirely random: it has hit poorer communities harder than other parts of society, but the fact is that anyone can get this.
And what we are also learning is that the delta Covid variant is much more transmissible, and potentially more severe, than previous variants. It may also escape vaccines. In other words, this is deadly. Maybe worse than January.
At the same time we’re also learning that AZ isn’t as good as Pfizer against it, but Pfizer seems to have a short effective life in the elderly of maybe only a few months at most. There is, then a need for massive continuing vaccine roll out to the young and elderly alike.
And remember that for all the talk, only 40% of people in the UK are actually vaccinated: a single dose does not mean vaccinated, as is now becoming very clear when single doses do little to help tackle this variant. They were always just politics.
So, there are real health risks in this variant, and big public health issues too that need to be addressed. On top of that there’s a worn out NHS suffering burn out from previous waves of Covid when most staff will have had little chance to recover before this wave hits.
And then note that nothing will have changed about people’s attitudes to Covid: Cummings discovered to his shock that people really do not like the government being indifferent to their granny’s dying. They will expect a government response when the risk is appreciated.
And let’s leave aside the government’s continued and very obvious attachment to the far-right wing’s Great Barrington Declaration which effectively says ‘just let it rip and get it over with that way’ because that naively ignores that another variant will come along anyway.
Let’s instead face facts. And that fact is that unless measures are taken to protect the economy it’s not just the NHS that is going to be overwhelmed by this next wave of Covid. The economy and society is too.
Despite the fact that when everything is working in our deeply inter-connected economy it looks like a pretty formidable machine, immune to most potential failings, it has, like so much that looks so strong, profound weak points.
Most of the time our economy hangs by a thread. The threats are enormous. Power supply disruption. Changing climate. The loss of trust if corruption became endemic. Civil disorder if crime was not managed. There are many threats.
But in the current situation the loss of a healthy workforce is another threat. The economy is pretty dependent upon people being able to work. Covid is now a long term threat to that.
Covid, if let rip, could also threaten a skills shortage, which could happen unpredictably, almost anywhere.
What we also know is that Covid really can threaten trade simply because crossing borders is going to remain pretty difficult in the Covid era for some time to come.
It seems unlikely that we’ve seen the last major variant as yet. The world is largely unvaccinated and developed countries are hindering the process of supplying vaccines to all countries by enforcing patent rights. To assume the risk of disruption is over as yet would be naive.
The fact is that the economy looks powerful when all of it works in sync. When it gets out of sync, and that’s what Covid is doing to to it, then everything changes. We are already seeing supply shortages and their impact. We face a great deal more.
The issue is, then, that Covid is in and of itself deeply disruptive to the economy, posing massive risks within a fragile system as a result. We may face health, law and order, social, economic, education and other breakdowns now. The aim has to be to manage these risks.
Right now the government is exacerbating some of these risks (from corruption, for example, and of Covid transmission by relaxed border controls). And the risk is that it is unprepared for another Covid wave because it swore that the last lockdown would be the last.
I do not think that the last Covid lockdown was the last. I am sure we will have another soon, and that maybe that will not be the last. It would be unwise to presume that it will be. We simply cannot know. So what we have to do is make decisions on what we’re trying to do.
We’re trying to minimise health risk, of course. That means locking down as soon as possible. Nothing else can do more to prevent the spread of this disease than that. If we want the NHS - with all its obligations to us all - to function that’s a necessity now.
The ‘will it, wont it’ debate on whether this variant will spread like wildfire is over now: the evidence that it is growing exponentially is now there. The sooner we don’t just abandon the June 21 relaxations but put other restrictions back in place the better off we will all be.
And for all the Tory MPs who say we can ignore this issue now because deaths haven’t happened yet, of course they have not: they are always lagged by at least 4 weeks. Almost no one gets Covid and drops dead. There is a delay. And so waiting for deaths is to simply increase risk.
To simply prevent health risk we need to move towards lockdown again, then. Stage 4 of the unlock should be cancelled now. Stage 3 should be reversed. Even stage 2 must be in question.
And school opening has to be reconsidered: the evidence is that this variant is being caught and transmitted by young people and is therefore spread by schools being open is very strong.
I hate the idea of closed schools, but in the long run I also want healthy young people with living parents and even grandparents.
More than that, I want opportunity for all as we go through this process and acclimatise to what it means, and it seems to me that we are a very long way from this as yet. Hence this thread on the process of change.
If we’re going to lockdown again we need to understand why, how to manage it and how to manage the implications.
A third major lockdown (some might say it’s a fourth) tells us something, and that is that for all the talk of vaccine success Covid is going to be a part of our lives for some time to come. Whatever the old normal was will not be in the future.
All our assumptions that we can ‘go back’ to the way it was may well be unfounded. Presuming the current variant is not the last, and presuming that worldwide Covid vaccination is going to take some time - and end 2022 looks wildly optimistic - then we are going to live with it.
By ‘living with it’ I mean that Covid measures are going to remain a part of life; the freedom to socialise in the way that we did will be restricted for some time to come and maybe for a very long time; travel will be constrained and so might trade.
So holidays abroad as we knew them may still not happen. Zoom will continue to be a part of life. The hospitality industry may be constrained. And because of trade issues - because crossing borders will remain hard - some goods and services are going to be hard to get.
I am aware that this is not the widespread assumption as yet. I am saying that I think that the widespread assumption by economists and others that all will go ‘back to normal’ is wrong. It is wishful thinking on their part.
I should stress that economists always think that everything ‘returns to normal’. Most economists do mathematical work that assumes there is a ‘normal’ and that after any disruption ‘normal times’ are restored. That’s what they’re trained to do.
I am saying that this may well not happen. Although vast numbers of charts have been produced looking at how soon this will happen - and every sign that it might be after any reopening is seized upon with glee - this does not mean ‘normal’ will be restored.
In fact, I am saying I do not think it will be. I think we have suffered a major disruption that will create a new normal that will not be the same as the old one.
What will change? A great deal. First, there will be an angry transition as people will realise what they have been led to think is ‘the good life’ is no longer that.
Changes in holidays will be a part of that. Since the 70s the annual trip abroad has been a part of life for many. It may not be. Holidaying at home may be the norm now. That is going to be very stressful for many. Expect stress.
We may also have to spend much more to do some things. Entertainment, eating out and drinking out may all go up in price: ultimately the additional costs of Covid protection will have to be factored into their cost.
Then we will need to get used to waiting for things, which is something almost entirely forgotten in an online, on demand economy. Supply chains may simply not permit our every whim to be met by tomorrow morning’s delivery: the goods we want may not be there.
And, most especially, we are going to need to realise that government and what it supplies is going to cost more. This may be an especially difficult adjustment in the UK where almost every aspect of government is failing.
Law and order is under dire stress. So is education. Local government is at breaking point and social care has been for a long time. Defence is almost being closed down. Environment and climate change have too little attention. I could go on. The message is they’re all failing.
There is another big change in attitudes required. If we want a successful society we must have a well functioning government. It’s as simple as that. And ultimately that means that there must be some degree of economic balance between the value created and the taxes paid.
I am not saying taxes must pay for government services. That’s not true: borrowing and money creation are also part of that equation. But there will need to be better balance between resources allocated to government that reduce consumption and those resources it actually uses.
In other words taxes will have to change. But this has to reflect capacity to pay, and the tax system hasn’t been doing that: we’ve all paid much the same proportion of income in tax over all unless you’re very poorly off, when you pay more, or very rich, when you pay less.
There is little capacity for those on average and lower incomes to pay more tax now. But those on higher and very high incomes have done very well out of Covid. Their savings and asset values have sky-rocketed. So they will have to pay more in tax, like it or not.
There will also need to be an investment revolution. If how we consume, what we consume and where we consume it is going to change then whole markets will need to transform to a new normal.
It’s a good question to ask whether markets are up to that change, because they too assume that everything returns to ‘normal’. If it is not going to do so how investment is going to be directed in the way that we want is a big question, and requires government engagement.
Given that ‘home’ is a big part of this new normal how to ensure people have good homes is a key question for the post-Covid economy. So too is how people access more of what they need near their homes. Public amenities are going to be key to ensuring people can live good lives.
So good housing, local parks, Covid safe activities, schools, workplaces and universities, and Covid safe socialising spaces are all going to need to be created. It may be a great deal of our built space requires rethinking after Covid. This is a massive change to ‘normal’.
Some of these changes do align with environmental need: it does feel like we have had a shot across the bows.
But my point is to highlight that I think that the lockdown we are facing within weeks is something much more significant than many might want to think. It represents the end of the ‘return to normal’ thinking that has prevailed, most especially in government.
What we need is new thinking. Thinking about how to adapt to this. Thinking about what is really important. Thinking about how our economies really do need to adapt. Thinking about retraining. And new investment. And new taxes. Plus new measures of wellbeing.
This is not about going back. Back was not working anyway for many people. And the old order was killing the planet. But few had thought change might come so soon or in this way. I think they were wrong though: I suspect that the next lockdown in a couple of weeks will be the end of the old order.
My message is simple: the pretence that Covid is just a blip is going to become painfully apparent soon. It is not. It is demanding change that will continue to impact large parts of our lives in ways that require considerable thought and planning.
I am not as yet sure that almost any of that planning is happening. I am not sure the willingness to even think about it exists. And so we keep getting Covid wrong. But that’s due to our arrogance. We think we can control nature, and not it us.
We need to rethink the very essence of what being is all about now and how living together, more locally, and in more obviously dependent relationships changes the way that the future looks. It may well be radically different from the old ‘normal’.
What we have to do is imagine how that could be better. I think that possible because what we had was not the panacea marketing people made it out to be. But this is a massive task. And I wonder whether we have a government even remotely up to the challenge?
Maybe changing politics might be the biggest challenge of all.