Go Lean Commentary
There is a Clear and Present Danger threatening the world’s economic establishments – Coronavirus. Everyone will be affected! If you catch this flu, you are affected. If you do not catch this flu, you are still affected!
Travel, transport and systems of commerce are preparing for the worst-case scenario. This is the …
Things will get worse before it gets worst. Expect a global recession!
For the 30 Caribbean member-states, the dangers are starting to materialize in this region and among the Diaspora:
- Travel alerts are going up; with restrictions to/from countries like: China, Italy, South Korea, Singapore, Iran, Spain, France and Germany – Consider this instance in the Bahamas:
Updated Border Control and Quarantine Measures for Persons Coming from Selected Countries
- Jamaica has Coronavirus incidents:
BREAKING: 2nd case of COVID-19 confirmed in Jamaica
- Cruises are being cancelled: https://www.nbcmiami.com/on-air/as-seen-on/coronavirus-impact-on-the-tourism-industry/2202976/
See Appendix VIDEO below.
- Events are being cancelled: https://www.nbcmiami.com/news/local/coronavirus-concerns-in-south-florida-a-guide-to-which-events-are-cancelled-which-arent/2201679/
All in all, there is impact on the Caribbean region, and the whole world for that matter. These are not our words alone; these are the words of the cover story of this week’s edition of the globally iconic journal The Economist Magazine (March 7, 2020). This story looked at how governments should prepare for the spread of this virus, COVID-19. In truth, the pandemic threatens an economic crisis as well as a health crisis and both will need fixing. So far, as of this publication date, the disease is in 85 countries and territories, up from 50 a week earlier. More than 95,000 cases and 3,200 deaths have been recorded. See the full “The Economist” article here and a related VIDEO:
Title: COVID-19 – The right medicine for the world economy
Sub-Title: Coping with the pandemic involves all of government, not just the health system
It is not a fair fight, but it is a fight that many countries will face all the same. Left to itself, the COVID-19 pandemic doubles every five to six days. When you get your next issue of The Economist the outbreak could in theory have infected twice as many people as today. Governments can slow that ferocious pace, but bureaucratic time is not the same as virus time. And at the moment governments across the world are being left flat-footed.
The disease is in 85 countries and territories, up from 50 a week earlier. Over 95,000 cases and 3,200 deaths have been recorded. Yet our own analysis, based on patterns of travel to and from China, suggests that many countries which have spotted tens of cases have hundreds more circulating undetected (see Graphic detail). Iran, South Korea and Italy are exporting the virus. America has registered 159 cases in 14 states but as of March 1st it had, indefensibly, tested just 472 people when South Korea was testing 10,000 a day. Now that America is looking, it is sure to find scores of infections—and possibly unearth a runaway epidemic.
Wherever the virus takes hold, containing it and mitigating its effects will involve more than doctors and paramedics. The World Health Organisation has distilled lessons from China for how health-care systems should cope (see Briefing). The same thinking is needed across the government, especially over how to protect people and companies as supply chains fracture and the worried and the ill shut themselves away.
The first task is to get manpower and money to hospitals. China drafted in 40,000 health workers to Hubei province. Britain may bring medics out of retirement. This week the World Bank made $12bn and the IMF $50bn available for COVID-19. The Global Fund, which fights diseases like malaria and tb, said countries can switch grants. In America Congress is allocating $8.3bn of funding. The country has some of the world’s most advanced hospitals, but its fragmented health system has little spare capacity. Much more money will be needed.
Just as important is to slow the spread of the disease by getting patients to come forward for testing when outbreaks are small and possible to contain. They may be deterred in many countries, including much of America, where 28 [million] people are without health coverage and many more have to pay for a large slug of their own treatment. People also need to isolate themselves if they have mild symptoms, as about 80% of them will. Here sick pay matters, because many people cannot afford to miss work. In America a quarter of employees have no access to paid sick leave and only scattered states and cities offer sickness benefits. Often the self-employed, a fifth of Italy’s workforce, do not qualify. One study found that, in epidemics, guaranteed sick pay cuts the spread of flu in America by 40%.
Sick pay also helps soften the blow to demand which, along with a supply shock and a general panic, is hitting economies. These three factors, as China shows, can have a dramatic effect on output. Manufacturing activity there sank in February to its lowest level since managers were first surveyed in 2004. In the quarter to March the economy as a whole could shrink for the first time since the death of Mao Zedong. The OECD expects global growth this year to be its slowest since 2009. Modelling by academics at the Australian National University suggests that GDP in America and Europe would be 2% lower than it would have been in the absence of a pandemic and perhaps as much as 8% lower if the rate of deaths is many times higher than expected. Financial markets are pricing in fear. The S&P 500 has fallen by 8% from its peak on February 19th. Issuance of corporate debt on Wall Street has more or less stopped. The yield on ten-year Treasuries dipped below 1% for the first time ever.
In rich countries, most of the economic effort has been directed towards calming financial markets. On March 3rd America’s Federal Reserve cut rates a fortnight before its monetary-policy meeting, and by an unusually large half-a-percentage point (see article). The central banks of Australia, Canada and Indonesia have also acted. The Bank of England and the European Central Bank are both expected to loosen policy, too.
Yet this slowdown is not a textbook downturn. Lower rates will ease borrowing costs and shore up sentiment, but no amount of cheap credit can stop people falling ill. Monetary policy cannot repair broken supply chains or tempt anxious people into venturing out. These obvious limitations help explain why stockmarkets failed to revive after the Fed’s cut.
Better to support the economy directly, by helping affected people and firms pay bills and borrow money if they need it. For individuals, the priority should be paying for health care and providing paid sick leave. The Trump administration is considering paying some hospital bills for those with the virus. Japan’s government will cover the wages of parents who stay at home to care for children or sick relatives; Singapore’s will help cab drivers and bosses whose employees are struck down. More such ideas will be needed.
For companies the big challenge will be liquidity. And although this shock is unlike the financial crisis, when the poison spread from within, that period did show how to cope with a liquidity crunch. Firms that lose revenues will still face tax, wage and interest bills. Easing that burden, for as long as the epidemic lasts, can avoid needless bankruptcies and lay-offs. Temporary relief on tax and wage costs can help. Employers can be encouraged to choose shorter hours for all their staff over lay-offs for some of them. Authorities could fund banks to lend to firms that are suffering, as they did during the financial crisis and as China is doing today. China is also ordering banks to go easy on delinquent borrowers. Western governments cannot do that, but it is in the interest of lenders everywhere to show forbearance towards borrowers facing a cash squeeze, much as banks did to public-sector employees during America’s government shutdown in 2018-19.
There is a tension. Health policy aims to spare hospitals by lowering the epidemic’s peak so that it is less intense, if longer-lasting. Economic policy, by contrast, aims to minimise how long factories are shut and staff absent. Eventually governments will have to strike a balance. Today, however, they are so far behind the epidemic that the priority must be to slow its spread. ■
This article appeared in the Leaders section of the print edition under the headline “The right medicine for the world economy”
Source: Retrieved March 5, 2020 from: https://www.economist.com/leaders/2020/03/05/the-right-medicine-for-the-world-economy?cid1=cust/ednew/n/bl/n/2020/03/5n/owned/n/n/nwl/n/n/NA/420030/n
VIDEO – Coronavirus | Plunging stocks on Wall Street over COVID-19 outbreak anxiety – https://youtu.be/Boof8NfPQRI
SABC Digital News
Mar 10, 2020 – A chaotic trading day on Wall Street ended with plunging stocks coupled with collapsing crude oil prices as the global anxiety from the Coronavirus continues to take hold. The Dow Jones industrial average ended over 2000 points lower while other indexes also followed suit. The stock deluge was intensified after a dispute between OPEC members and Saudi Arabia’s decision to slash its oil prices while boosting output in an angry response to Russia’s refusal to reduce production due to a fall in Chinese demand. For more news, visit sabcnews.com and also #SABCNews on Social Media.
- Category: News & Politics
The present Caribbean region is short-handed for the kind of cross-border coordination that is needed to manage this pandemic – and others like it. This is truly the Sum of All Our Fears. This is a crisis …
… alas, according to the noted Nobel-prized winning Economist Paul Romer, a crisis is a terrible thing to waste.
Now, more than ever, we need a super-national organizational structure, a technocracy, to shepherd the protection for the people and trading partners in the region.
You see the trend, right? The Coronavirus is appearing on the radar screens for the world’s community of Economists. The world in general, and the Caribbean in particular, is about to “get hammered with the surge and tides of an economic tsunami”. Be afraid; be very afraid. (See the related experiences in the Appendix VIDEO below).
We have been here before …
This is very similar to the events of 2008, the exigency of the Great Recession and International Financial Crisis. This actuality inspired the composition of the 2013 book Go Lean…Caribbean. The book traced that crisis, and availed the opportunity to propose strategies, tactics and implementations to mitigate against future crises. The premise was that the Caribbean status quo was not equipped to contend with trans-border crises alone; that not one of the 30 member-states that constituted the political Caribbean is fortified for any serious economic upheavals or threats to homeland security.
This is our actuality today!
We need those mitigations, those strategies, tactics and implementations. We need “them” now!
The book presents a roadmap to introduce the Caribbean Union Trade Federation (CU), to empower the economic, security and governing engines of the region for when there is a “Clear and Present Danger”. We are there now!
We must not delay in confederating this regional technocracy.
This will not be the last. We must prepare for global, regional and national crises as the New Normal.
This was the assertion in many previous Go Lean blog/commentaries, that highlighted the theme of a “Clear and Present Danger”; see this sample list here:
|http://www.goleancaribbean.com/blog/?p=18195||Disaster Planning – Rinse and Repeat|
|http://www.goleancaribbean.com/blog/?p=16836||Crypto-currency: Here comes ‘Trouble’ – Clear and Present Danger?|
|http://www.goleancaribbean.com/blog/?p=15796||Lessons Learned from 2008: Righting The Wrong|
|http://www.goleancaribbean.com/blog/?p=12348||Caribbean Economists: ‘Region is in Trauma’|
|http://www.goleancaribbean.com/blog/?p=8132||Venezuela: Watching a ‘Train Wreck in Slow Motion’|
|http://www.goleancaribbean.com/blog/?p=7345||The Urgency of ISIS reached the Caribbean Region|
|http://www.goleancaribbean.com/blog/?p=7327||The Exigency of Zika – Lessons Learned on Threat Management|
|http://www.goleancaribbean.com/blog/?p=7119||The Need for a Standby Force for Threats to the Homeland|
|http://www.goleancaribbean.com/blog/?p=6531||A Lesson in History – ‘Exigency of 2008’|
|http://www.goleancaribbean.com/blog/?p=5002||Managing a ‘Clear and Present Danger’|
|http://www.goleancaribbean.com/blog/?p=2397||Stopping the Clear and Present Danger from ‘Ebola’|
|http://www.goleancaribbean.com/blog/?p=1003||Painful and rapid spread of Chikungunya virus in the Caribbean|
|http://www.goleancaribbean.com/blog/?p=623||Harsh Reality: ‘Only at the precipice, do they change’|
This Coronavirus threat will not subside anytime soon. We must prepare!
We are not the only entities around the world with this concern; States and governments everywhere have the same urgency. This is the whole premise of the standard Social Contract:
Citizens surrender some of their freedoms and submit to the authority of the State in exchange for protection of remaining natural and legal rights.
The Caribbean member-states are not equipped on the national level; they need a super-national solution. The CU ascension creates another layer of government hierarchy for the region. This is the long awaited Way Forward for Caribbean survival.
Let’s get to work.
This is very much so the theme of the 1970 song “Lean On Me” by Singer-Songwriter Bill Withers; this became the clarion call for the Go Lean moment. Be reminded of these lyrics, as quoted in the Go Lean book (Page 5):
Sometimes in our lives
We all have pain
We all have sorrow
But if we are wise
We know that there’s always tomorrow
Lean on me, when you’re not strong
And I’ll be your friend
I’ll help you carry on
For it won’t be long
‘Til I’m gonna need
Somebody to lean on
Please swallow your pride
If I have things you need to borrow
For no one can fill those of your needs
That you won’t let show
You just call on me brother, when you need a hand
We all need somebody to lean on
I just might have a problem that you’d understand
We all need somebody to lean on
If there is a load you have to bear
That you can’t carry
I’m right up the road
I’ll share your load
If you just call me
Today’s reality is the manifestation of this song (lyrics). It is time for the Caribbean neighborhood to “lean on” each other, for the mitigation of this Coronavirus. This is how we make our regional homeland a better place to live, work, heal and play. 🙂
About the Book
The book Go Lean…Caribbean serves as a roadmap for the introduction and implementation of the technocratic Caribbean Union Trade Federation (CU), for the elevation of Caribbean society – for all member-states. This CU/Go Lean roadmap has these 3 prime directives:
- Optimization of the economic engines in order to grow the regional economy to $800 Billion & create 2.2 million new jobs.
- Establishment of a security apparatus to ensure public safety and protect the resultant economic engines.
- Improve Caribbean governance to support these engines, including a separation-of-powers between the member-states and CU federal agencies.
The Go Lean book provides 370-pages of turn-by-turn instructions on “how” to adopt new community ethos, plus the strategies, tactics, implementations and advocacies to execute so as to reboot, reform and transform the societal engines of Caribbean society.
Download the free e-Book of Go Lean … Caribbean – now!
Who We Are
The movement behind the Go Lean book – a non-partisan, apolitical, religiously-neutral Community Development Foundation chartered for the purpose of empowering and re-booting economic engines – stresses that reforming and transforming the Caribbean societal engines must be a regional pursuit. This was an early motivation for the roadmap, as pronounced in the opening Declaration of Interdependence (Pages 12 – 13):
ix. Whereas the realities of healthcare and an aging population cannot be ignored and cannot be afforded without some advanced mitigation, the Federation must arrange for health plans to consolidate premiums of both healthy and sickly people across the wider base of the entire Caribbean population. The mitigation should extend further to disease management, wellness, mental health, obesity and smoking cessation programs. …
x. Whereas we are surrounded and allied to nations of larger proportions in land mass, populations, and treasuries, elements in their societies may have ill-intent in their pursuits, at the expense of the safety and security of our citizens. We must therefore appoint “new guards” to ensure our public safety and threats against our society, both domestic and foreign. The Federation must employ the latest advances and best practices of criminology and penology to assuage continuous threats against public safety. …
xi. Whereas all men are entitled to the benefits of good governance in a free society, “new guards” must be enacted to dissuade the emergence of incompetence, corruption, nepotism and cronyism at the peril of the people’s best interest. The Federation must guarantee the executions of a social contract between government and the governed.
xvi. Whereas security of our homeland is inextricably linked to prosperity of the homeland, the economic and security interest of the region needs to be aligned under the same governance. Since economic crimes … can imperil the functioning of the wheels of commerce for all the citizenry, the accedence of this Federation must equip the security apparatus with the tools and techniques for predictive and proactive interdictions.
xxiv. Whereas a free market economy can be induced and spurred for continuous progress, the Federation must install the controls to better manage aspects of the economy: jobs, inflation, savings rate, investments and other economic principles. Thereby attracting direct foreign investment because of the stability and vibrancy of our economy.
Sign the petition to lean-in for this roadmap for the Caribbean Union Trade Federation.
Appendix VIDEO – The Impact of Coronavirus on Tourism Industry – https://www.nbcmiami.com/on-air/as-seen-on/coronavirus-impact-on-the-tourism-industry/2202976/
March 10, 2020 – NBC 6 Investigator Tony Pipitone reports on the Coronavirus’ impact on the cruise industry.