COVID-19: Important Lessons from an Awful Pandemic

Make no mistake, the 2020 pandemic of COVID-19 is a severe threat to our societies and can bring much hardship to those directly or indirectly affected. It is a matter of life and death and governments are right to take unseen and drastic measures to slow down its spread such that public health infrastructure does not collapse. Despite the dramatic situation, there also exist opportunities in this crisis to better manage future global challenges such as climate change:

1. We are all in the same boat. In 2019, many young people went to the streets calling for climate justice. Their generation will be most affected, while older cohorts today will not live to see the consequences. Despite the protests and much media attention, sales of SUVs in Germany were higher than ever before. With COVID-19, the situation is reversed. Older people are at a much higher risk of dying than young ones. Still, everyone is asked to limit her or his daily life in order to protect more vulnerable members of society. These times might help us realize that we are all in the same boat.

2. Solidarity is key. In order to limit economic hardship and to prevent social unrest, governments and institutions must take bold action. The mistakes of the European Debt Crisis (too-little-too-late, no eurobonds, no solidarity) must not be repeated. Instead, international institutions should immediately roll out unlimited emergency lending to countries in need; such that COVID-19 can be combatted and contained. Likewise, the EU should grant unlimited guarantees to its member states. Furthermore, governments are right to support companies and to prevent bankruptcies. But as many people also work as freelancers or in flexible/grey working conditions, a one-time lump sum transfer (helicopter money) of EUR 1,000 to each individual might also be appropriate. This could prevent social unrest. Hopefully, we realize early enough that solidarity is key .

3. Our actions matter. With COVID-19, we can see how our actions matter after only a couple of days. Closing schools and restricting social life slows down the spread of the disease. Not taking any actions can lead to a collapse of public health infrastructure. For climate change, the situation is much different. What we do today (or rather what we fail to do today) manifests only years or decades later. Nonetheless, bold action today is absolutely crucial. Hopefully, COVID-19 helps us realize that our actions matter.

4. We need strong governments. Governments and politicians are often criticized. Some people even question whether we need a government or state at all. With COVID-19, the need for government is evident: central coordination, decision making, and enforcement in times of crisis – all in the best interest of the overall society. For climate change, the situation is very similar. We need governments to prevent damage to our societies, future generations, and the planet as a whole. This can only happen through making new regulations and enforcing them. Hopefully, COVID-19 reminds us why we need strong governments.

5. Profit is not the only important goal. The zeitgeist of the last three decades has been heavily influenced by privatization and laissez-faire economic policies, commonly known as neo-liberalism. It sparked reforms that focused on efficiency, economic profit, and shareholder value. Other aspects like social equity, resilience, or well-being were neglected. Decisions, such as (i) outsourcing almost all pharmaceutical production to India and China, (ii) leaving important research after SARS entirely to the private sector, or (iii) privatizing hospitals to have them focus on commercially attractive operations, were not made to improve health care for our societies. They were made to improve profits and to raise shareholder value. The COVID-19 crisis demonstrates just how bad an idea this was. Therefore, we should now re-evaluate profitability-driven concerns about climate change policy. Yes, profitability is important, but hopefully, COVID-19 convinces us that there are many more aspects and that profit is not the only important goal.

6. Uncontrolled globalization can be bad. High interconnectivity can lead to mass breakdowns in times of a crisis (like now, with all pharmaceutical production being in India and China). Local production might be a bit more expensive but can produce a much safer system. There are many valid reasons to criticize the EU’s subsidies for agriculture, but they ensure that European citizens do not depend on food imports from abroad. This is an important but hard-to-quantify aspect. Additionally, local production reduces (environmental) costs of transport and can strengthen local economies. And there is another important aspect of too much globalization: it creates a few thousand very BIG winners (the global elite), and billions of people that relatively lose out. Members of the global elite often live in their own cosmopolitan bubble, jet-set around the world, can afford sending their children to expensive boarding schools and universities (that cost more than USD 100,000 per student per year), but are completely out of touch with common people in the countries where they originate from. This trend has increased throughout the last three decades and can undermine social stability. It is thus important to realize that uncontrolled globalization can be bad.

7. Digitalization boost for Europe. The old continent has been skeptical and slow in adapting new technologies. Having to work from home for a few weeks will demonstrate the usefulness of laptops, company phones, and mobile working facilities. Likewise, business travel is extremely limited and video conferencing will be used as an alternative. Although not everything will work from the very beginning, employees and companies will quickly get used to these technologies and will see their usefulness. As terrible as this pandemic is, COVID-19 can improve mobile working conditions and limit business travel in the long run. Overall, it can lead to a much-needed digitalization boost for Europe.

8. Kick-start of global climate action. COVID-19 is one of the biggest crises we have seen in our lives so far. But the climate crisis evolving can be much, much worse. To prevent this, we must act now! COVID-19 shows us how fast governments can act if they have to: many international flights were cancelled and traveling dropped dramatically in China and Italy. At the same time, air quality improved in these countries as travel-related nitrogen and carbon dioxide emissions decreased. It is important that governments protect the economy and prevent individual economic hardship. At the same time, governments should use this unique opportunity to impose stricter emission restrictions than before the COVID-19 crash. This could be implemented through daily allotments for international and domestic flights and stricter limits on other ecologically negative and non-life-essential behavior (holiday
cruise ships, etc.). Additionally, they should agree internationally – and if that is not possible, Europe or just Germany should start – with collecting Pigouvian taxes for the damages of the external environmental costs of transports (particularly international shipping and air freight). COVID-19 is a horrible pandemic amidst us and we need to do everything to stop it as soon as possible. But we need to accept it as a reality and can still use it as the kick-start of global climate action.

Jan Radermacher (27) is Data Scientist at ING Analytics and PhD Candidate at Goethe University Frankfurt. The views in this article are his own and do not necessarily reflect those of his employers or JEF.