David Steven, Alex Evans
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In just a few months, the tightly connected systems of a globalized world have transformed the novel coronavirus from a handful of cases in China to a global pandemic. But we have yet to see an international response that matches the scale of the threat.
The contrast with the 2008 financial crisis and subsequent economic crash is stark. Then, governments vastly upgraded the G-20 from a somewhat obscure forum of finance ministers to a new global decision-making bloc in order to steer the world to safety. Don’t hold your breath for a similar response to COVID-19. The outbreak has hit at a time when the international order’s immune system is badly compromised.
A decade ago, in a Brookings report titled “The Long Crisis of Globalization” that we co-authored with Bruce Jones, we warned that global vulnerability to shocks was exacerbated by “our own tendency to weaken the systems on which we rely through folly, ignorance or neglect.” The past decade has seen as significant of an erosion in our capacity for collective action. The Trump administration is actively hostile to global systems, while the European Union turned inward during the eurozone crisis and still lacks vision and unity. The United Kingdom has been fixated on Brexit for the past four years.
Nor are there many glimmers of light beyond the G-7. The 2008 crash saw the rise of the BRICS—Brazil, Russia, India, China and subsequently South Africa—as a major forum of emerging powers. But today, most of the countries that once looked like new global leaders have slid toward authoritarianism, populism or both. Many of them have also seen their once-promising emerging economies slow down considerably or even contract.
The outbreak has hit at a time when the international order’s immune system is badly compromised.
Former British Prime Minister Gordon Brown, who was at the forefront of the response in 2008, has called for “a concerted global, governmental response” to COVID-19, but with Saudi Arabia and the United States chairing the G-20 and G-7, respectively, neither forum is likely to produce the global action plan we need.
Instead, we must look for innovations in the multilateral system of the kind that are only ever triggered by systemic crises. And this time, the impetus for change must come not just from governments, but from ordinary people and businesses, too. Space must also be carved out to look beyond the acute phase of an emergency whose impacts seem certain to reverberate throughout the 2020s, and probably beyond. It is already time to begin thinking about what comes next.
Layers of Change
In the 1990s, Stewart Brand, editor of the Whole Earth Catalog and one of the founders of the Long Now Foundation, proposed the concept of “layers of change.” A building, for example, is filled with ephemeral objects, like food and furniture, that are moved around or replaced regularly. But it also has systems, like heating and plumbing, that must be maintained or replaced every decade or so, and a structural foundation that could last a century or more.
The 2008 financial crisis had three of Brand’s layers of change. The first layer—the immediate emergency—lasted for a couple of years. Initially, as liquidity vanished, there was much complacency. We remember presenting to a summit in the spring of 2007 at which Dominique Strauss-Kahn, then the head of the International Monetary Fund, told a group of national and international leaders that the worst was over. Lehman Brothers collapsed six months later.
But after a slow start, politicians sprang into action. After all, leaders love a good crisis, for all the drama, media attention and sense of purpose that it brings. Ultimately the global economy was saved from collapse.
The second layer of change—the consequences of the initial consequences—emerged more gradually as the slow-burning eurozone debt crisis, and the international response to it was much less effective. Global measures were fragmented, as eurozone governments squabbled among themselves and with the International Monetary Fund. The crisis was not brought under control until mid-2012, when Mario Draghi, then the head of the European Central Bank, made his famous promise that the bank would do “whatever it takes to preserve the euro.”
Ordinary people suffered greatly from the austerity cure imposed in response to the crisis, as did institutions and critical national infrastructure. Greece, for example, saw “the gradual destruction of the public health system,” stripping the country of its resilience to the next shock. The country is intensely vulnerable now that COVID-19 has come to call.
But it was the third and slowest layer of change following the 2008 crisis that caused the most insidious and most persistent damage, as trust in governments collapsed, politics became increasingly polarized and the basis for global collective action was undermined. Here, there was almost zero global action, giving populists free rein as governments, traditional political parties and international institutions all stuck their heads deep into the sand. This wave was easy to see coming. In 2009, we warned that collapsing trust was creating conditions in which “populist movements are certain to thrive.” But almost nothing was done to respond to a widespread and profound sense that the 1 percent had crashed the economy and the 99 percent had paid for saving it.
COVID-19’s Layers of Change
Three similar layers are emerging as this pandemic closes the world down. The first is a public health emergency that is likely to last for two years. The virus will remain a threat until a vaccine is developed, so countries are struggling to “flatten the curve” of new infections and keep their health systems afloat.
Italy has by far the world’s highest infection rate, but fewer than 1 percent of Italians have been infected so far, even allowing for many undetected cases. With zero immunity to the new virus, 60 percent or more of any given population may eventually get the disease, so there’s still a long way to go. The big variables are obviously how quickly a vaccine can be tested, manufactured and widely distributed; how quickly a new generation of treatments can cut the lethality of the virus; and whether rigorous contact tracing and testing can be used to replace a blanket lockdown with more targeted—and less disruptive—restrictions.
Then we have the pandemic’s second-order effects. We have already seen how rapidly an infectious disease can devastate financial markets. While British Prime Minister Boris Johnson told the media not to worry about systemic risks, it would come as no surprise if the eurozone again finds itself in trouble. Even China may suffer, as its export markets disappear and global supply chains fray.
Further out, we will face unpredictable interactions between the COVID-19 outbreak and our response to other global issues like refugee flows, conflict hot spots or climate change. In particular, there is a timebomb ticking in the world’s “forgotten places”—refugee camps, prisons, shanty towns and the like. When people are packed together, viruses spread fast and illness may be exacerbated by a host of preexisting health conditions. Help for the furthest-behind will be slow to come, with well-founded fears that the official response will exacerbate patterns of discrimination and, in the worst cases, lead to serious human rights abuses.
President Donald Trump during a pressing briefing on the coronavirus at the White House,
Washington, Feb. 29, 2020 (AP photo by Carolyn Kaster).
Third, there is the slow-burning social emergency that will build over the coming years and against which we have few defenses. Governments entered this crisis with trust levels already depleted and their societies polarized. They also have less money to invest in an effective response, as public finances are in much worse shape than they were in the runup to the 2008 shock. High levels of corporate and household debt further exacerbate the vulnerability of many countries.
In the U.S., President Donald Trump is already fueling fires by railing against the “Chinese virus” and blaming his own administration’s incompetence on his predecessor, former President Barack Obama. In the coming months, we can be certain that a diversity of disruptive actors, with Russia in the lead, will be working hard to widen such divisions.
Collective Action in the Age of Coronavirus
International cooperation is needed for each of these layers, and we must make sure that the urgency of a public health emergency does not crowd out the need for slower-moving but still important priorities.
The public health emergency
A shared global response provides governments the cover they need to take and sustain painful public health decisions. One of us—David—is living in the midst of Italy’s lockdown, and while there’s currently widespread support for a radical reduction in freedom of movement and association, it’s going to be hard to sustain if people are locked at home for a month or more. Politicians will be much better able to stay the course if they can show they are acting in lockstep with a group of like-minded governments.
Collective action is also needed to clear barriers to the development, manufacture and equitable distribution of a vaccine. International supply chains must be put on a wartime footing to produce the supplies needed, from masks to ventilators, to treat rapidly growing numbers of patients who need intensive care.
At times, forms of rationing may also be necessary, given panic-buying in some countries, notably the U.S. and the U.K. Indeed, this is already being instituted informally, with the responsibility for who gets what falling on the private sector. As in wartime, this is an opportunity for governments to call for equitable sacrifice and for people to rally behind the idea of “fair shares”—building a sense of collective responsibility and reinforcing a commitment to the common good.
Economic shocks and aftershocks
Governments have now launched the first of what will be many waves of fiscal stimulus. This will be most effective if they act together and direct their resources toward those who need it most. The world faces a demand shock, not a liquidity or supply crisis, which can only be solved by helping working- and middle-class people, not the elites who benefited disproportionately from the quantitative easing that helped pull the world out of the global financial crisis.
Many sectors of the global economy will demand—and need—a bailout, and a wave of nationalizations is now beginning. By working together, governments can institute measures where shareholders and creditors take most of the pain, while public funds are used to keep people solvent and get them back to work as soon as it is safe to do so. We certainly cannot afford to see a surge of evictions and repossessions as has been seen in previous crises.
The world’s international development actors must also move onto a crisis footing. Poorer countries are younger demographically, so they may not see death rates comparable to those of China and Europe. But their populations are sicker, their health systems weak and their economies vulnerable. Even some—and perhaps many—rich countries are in the early stages of a humanitarian crisis.
We must not repeat the mistakes of 2008 and allow popular anger to fester.
With the global humanitarian system already on its knees due to unprecedented demand, an injection of resources will be urgently needed. Development organizations and institutions should already be retooling for a future where fewer developing countries will be able to thrive from export-driven economic growth.
Above all, this is the time to move beyond mere rhetoric about building more equal societies. Historically, war has often led to sharp reductions in inequality, as the wealthy pay a higher share of taxes and governments intervene in ways that cut the slice of the cake taken by investors.
With Treasury Secretary Steven Mnuchin warning that 20 percent of Americans could soon find themselves unemployed, cash transfers are needed in the short term, and a basic income in the medium term. Debt forgiveness should also be considered.
Initially, these measures can be paid for through public borrowing, but eventually the rich will have to foot much of the bill, with more of the burden of taxation shifting from labor to wealth. Otherwise, we believe it is inevitable that capitalism itself will increasingly be called into question.
Rebuilding hope and cohesion
We must not repeat the mistakes of 2008 and allow popular anger to fester. Neither can democracies afford to let a sentiment take hold that authoritarian governments were better at responding to this challenge.
China is already contrasting its decisive response to the COVID-19 outbreak with the blundering of democratic systems. Chinese media are now showering President Xi Jinping with praise for saving the nation, while the country’s embassies have launched a global propaganda campaign that seeks to deny that the virus originated within its borders. Written out of this revisionist history is how the government suppressed a wave of protest triggered by its early coverup of the epidemic.
The Chinese health system has valuable experience to offer and should, of course, be embraced as a partner. But democratic governments must build models that are true to their own values, fighting the pandemic not just with the consent of their citizens, but through the active participation of all parts of society.
That means bringing leaders from civil society, faith groups, youth organizations and businesses into the heart of the emergency response from the beginning, with key individuals given the security clearance needed for them to contribute to strategic planning. Global business can help by creating new standards for productive virtual working; ramping up production of life-saving products, as a group of CEOs convened by the World Economic Forum is already trying to do; and proposing plans for protecting jobs in industries at risk of being destroyed by the pandemic.
Kenyan nurses at the infectious disease unit of Kenyatta National Hospital,
Nairobi, Kenya, Mar. 6, 2020 (AP photo by Khalil Senosi).
Social media companies and news organizations will have an especially important role in framing how we think about the outbreak, particularly when it comes to countering the spread of misinformation and conspiracy theories on their platforms. They will help determine whether people move into “fight-or-flight” mode, favoring the individual over the collective, or instead “tend-and-befriend,” in a way that promotes empathy and insulates us from extremist views.
Grassroots organizations are mobilizing in impressive numbers and must be funded so they can be most effective in protecting the vulnerable, providing virtual services, offering psychosocial support in tackling loneliness and starting on the hard work of rebuilding community-level resilience.
Those who, having been infected, have developed immunity will become a precious resource, as soon as a serological test can be used to detect antibodies. Democratic governments should invite them to join a global network of volunteers—call it the COVID-Positive Corps—exempting them from social distancing and freeing them to help vulnerable people and communities survive.
Governments must also scale up their communication expertise. Many are doing a horrible job of explaining to their citizens what they are doing and why. Very few, if any, have thought about the need to listen to people and communities during the crisis.
Finally, we must start mitigating the intergenerational impacts of the pandemic and renewing the social covenant between old and young. The world has shut down in order to protect its older people. If we were all under the age of 65, the most effective strategy might be to allow the virus to spread, while trying to protect those with preexisting conditions.
As it is, the young are being asked to sacrifice and step up for the old. The vast majority accept that their parents and grandparents are rightly our immediate priority, but solidarity between the generations must work both ways. The redistribution of wealth from older people with assets to younger people with little to their name is part of the answer. As young people are asked to sacrifice their education, it is essential that school and university budgets are protected and not diverted to pay for urgent health needs.
This is also the time for older generations to support the decisive action on climate change and on more sustainable, equitable and resilient patterns of development that many younger voters desperately want. Space must be kept open for these priorities in a critical year for the Paris Agreement on climate change and for the United Nations’ Sustainable Development Goals, which offer the closest thing we have to a global blueprint for future resilience.
As in 2008, the urgent is highly likely to crowd out the important. Decision-makers should create space to plan for the medium- and longer-term challenges.
As industry and travel grind to a halt, leaders around the world should declare 2019 the year of peak emissions and launch a Green New Deal that turns this downward trend into accelerating progress toward decarbonization. This is the time to make tough decisions—for example to prevent short-haul air travel from ever returning to pre-pandemic levels—while also creating jobs at the scale needed to build zero-carbon economies.
Without a doubt, powerful vested interests will lobby for their own bailouts, while arguing that pro-climate measures are too expensive and should be delayed once again. By cooperating across borders, progressive governments, global civil society and green businesses can face these interests down and give us all much-needed hope in a better future.
Next Steps
In 2008 and 2009, a series of emergency summits were held in quick succession to address the global financial crisis. In today’s world, although collective action should not be taken for granted, we anticipate that, as in 2008, governments will manage to pull together to coordinate responses, and that this will lead to improved availability of the supplies needed to prevent infections and treat the sick.
We also expect that new treatments will become available—perhaps more quickly than expected—and hope that a vaccine will be available and widely deployed within 18 months. Mass testing may also allow a shift from a blanket lockdown to more targeted restrictions.
But as in 2008, the urgent is highly likely to crowd out the important. We urge decision-makers to create space to plan for the medium- and longer-term challenges identified here, and to start immediately developing options for a world after the pandemic has been brought under control.
In the past, systemic crises have led to major moments of multilateral innovation. The United Nations and International Monetary Fund were created in the wake of World War II; what would become the G-7 after the 1973 oil shock; and the G-20 as a heads of state and government forum after the 2008 financial crisis.
As yet, it is too early to say what form this innovation should take, but it is time to begin addressing this question. The COVID-19 pandemic is a new kind of crisis, one that involves the behaviors and beliefs of billions of people and that has public health, economic, political, social, psychological and cultural dimensions.
In a networked world, new forms of cooperation will be needed that thoroughly blur the line between state and nonstate actors. We must all decide whether to see ourselves as separate islands or as part of “a Larger Us” that understands, and acts on, our irreversible interdependence. As other global crises press in, this is a test we can’t afford to fail.
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