Economics

Shut-in economy

The Shut-in Economy has started. It’s a sad time for me personally I have to say. To think this might be the new normal for my family and children. Trying to remain optimistic but the science and data side of my personality overwhelms the optimistic side. There is a relentless barrage of evidence suggesting this will become a repetitive situation, not just a one off.

I, like many, am hopeful an anti-viral or cure may be found in the next 12-18 months. I’m even optimistic that a treatment may be found. The sheer volume of dollars and people on this suggest its more probable than not. However, I have since come to realise that it is not relevant anymore because a change just happened that can’t be undone. Not unlike 9-11, it is a fear that will persist beyond the cure. It will be addressed in an ongoing way by authorities however illogical and lacking in science it may be. The next silent enemy will always be just around the corner.

Governments are notorious for controlling society using fear and that has implications for how we design our lives and small businesses.

In this post I will leave aside the incredible burden that faces small business for the next decade in future taxes to pay for today’s decisions. It is a completely valid reason to not start a new business. I have had this conversation with my teenage and young adult children already.

Did you know that four seasonal corona viruses cause about a quarter of our common colds. Estimates are anywhere from 10-30%. We have all been exposed to them since children. So nearly all of us have antibodies for these already. Estimates are that you only get immunity for 1 to 2 years but it is unclear. I’m not sure why the media ignores this important point. That we may not get permanent immunity.

I don’t want to get too detailed here because it is not my area of expertise but I understand people. The 12 to 18 months quoted as a time frame to get a virus commercially ready does buy the industry some time. I think the long timelines are intentional. The industry knows full well this is a difficult problem (they even admit this regularly) given they haven’t found vaccines for previous versions of the coronavirus.

It may be that we are facing an enemy more like Malaria, that can readily re-infect or reactivate and where treatments using drug repurposing or Convalescent Plasma (Antiserum) are the only avenues short term. There are re-infections already. Recent news suggest that 14% of people tested in China are on their second case of Covid19. The evidence outside of China is also building. There are already 2 to possibly 3 strains I have read about in articles and papers. That is another aspect of complexity.

So here is the critical point. If it does re-infect, or our immunity is only held for a short time, say 1 to 2 years, then this changes the game entirely. The current government strategy is deeply flawed under this scenario. We cannot repeat the current lifelines year after year.

We will also see a change in tack by government if the pressure to admit it can’t be solved quickly and in a permanent way becomes too great for the medical and research communities.

There are new dangers, new threats. A new dystopian world is arising that will soon seem normal.

Even after we flatten the curve it will restart until there is herd immunity. We just delay and stretch the problem into multiple shutdowns. What is more likely, is a second waive of localised shutdowns. Third we will see restrictions at the identity level. Those with immunity having a leave pass to move about and socialise.

Our children may never go back to school the way it was. Home learning may normalise. It would free up real-estate and save government funding. Parents can’t avoid getting involved in the process of home schooling for primary so in theory the teachers numbers can be less. If you have primary level children schooling at home you will understand this. It is extremely hands on.

There will be conditions and expectations attached to receiving basic income style welfare. Jobseeker and Jobkeeper are proxies for Universal Basic Income (UBI).

Will we be wired into the machine at home in our pens like Neo in the Matrix? Food, entertainment and socialisation delivered in new forms to reduce and prevent health risks. Facilitated by social media, zoom and the like. We are already prepped for this.

Physical work spaces will adapt to reduce infection rates. Manufacturing will normalise at lower production levels having to allow micro-quarantine areas for each person. Only when robotics can do most things will it recover and pass old highs in productivity. There is an enormous incentive now to accelerate manufacturing into robotics based models.

If you have to exist in a feedlot like cattle, due to the threat of force, you certainly want to be in a big one. If so rural and large urban block sizes will be at a premium. Coastal and vista land types (virtual or stolen landscape space) will be pricy also. Shared air and space dwellings will suffer the biggest de-valuation hit. Multi-dwelling high-rises in dense urban areas.

We are going to give up many of our remaining freedoms in an exchange for global health outcomes. I’m a libertarian so I hate this idea but I’m the minority. I know the majority will apathetically (or pathetically) will accept and fold to this demand just like everyone did on the issue of privacy. We accepted big brother and we will accept this also.

There is a strong chance we will allow tracking of people via phones and other devices. Location data is already being used in Israel to track, trace and enforce bio-security measures related to Covid19. Australia is now considering it. That’s already in the news.

Freedom of movement will be the new expression of power. We may see a world where governments allow controlled exposure and socialisation with others basis their risk factor. Data from contact tracing systems and technological tracking of devices (phones, payment cards, tollways etc) might become your gate pass to services like airline flights, public transport, sport stadiums etc. Your health and disease resistance and inoculation data may determine your travel permission level.

We may have to report vital signs while working in offices if not at home or register them to get movement passes.

I think it’s likely we will see the socialisation commoditised. Permission to socialise, buy, move and borrow may be attached to some form of identity digital certificate. Your health, security and credit situation becomes far less private and becomes a way for governments to control people. This is already happening in China. This is not a theory.

Your right to freedom of movement will be conditional on vaccination, permission to track location, permission to monitor health.

We will make payments using biometric identity to avoid touching devices, cards etc. The cashless society will be accelerated. China will be the first to go cashless and go to sole digital currency. That is already work in progress for them. Those of you have travelled to China know this from WeChat payments domination.

From here its adoption and acceptance. Not enough people will fight this. Your right to be with others on your own terms is gone forever if you do fight it.

This all sounds dystopian but you need to wake up as we are living this right now. I can’t leave my pen without the threat of force hanging over me. I can move through the cattle gates to other areas to do just what I need to and then return. Cattle don’t see or understand the fences and gates as oppsession and control. They just see an obstacle and move away from it. That’s how we will behave.

I think the next phase is unavoidable. The fear will remain. The controls and powers will be kept by the state. They do not give these back. The invisible viral boogieman will always be there as a possibility. Restrictions and UBI will be sold as your safety net provided by the state.

Welcome to 1984.

Photo by Sanni Sahil

Categories: Economics

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