As an economist, it is my professional opinion that a rampant pandemic free to roam the community along with a consequential decimated health system would not be good at all for "the economy". This holds, whether you have a narrow cost-benefit view, or a much broader perspective on the 'the economy' (for example).
Without doubt we must do our best – and continue to do our best – to eliminate the COVID-19 virus from Aotearoa.
However, we will also have to figure out a way of ‘living with’ COVID-19. Despite the best efforts of our team of five million, COVID-19 will continue to be present in the world without a safe and reliable vaccine for some time. In turn, this means there is a non-zero probability that COVID-19 will re-appear in our community at sporadic and random intervals. Yes, we stick to our eliminate strategy, no argument; because a pandemic free to roam in our community is clearly negative for our wellbeing outcomes.
That means businesses and communities have to get used to:
- Restricted cross-border movements (international and domestic)
- Physical distancing
- Contact tracing
- Changing the severity of restrictions and lockdowns
- Changing risk assessments as the scientists and health professionals learn more about the COVID-19
- Changing risk assessments as COVID-19 mutates
- Working from home
- Home schooling
- Online shopping
- Protecting the vulnerable
- Making sure the health system is not decimated.
The above list signals to me that the days of a microscopic lens on the efficiency of production, procurement, and delivery activities across all value chains are numbered. More important now, and critically so, is the resilience of our production, procurement, and delivery activities.
The spotlight must now shine on the resilience, not the efficiency, of our activities.
Good business and community organisations always undertook risk assessments to highlight how susceptible their outcomes were to changes or certain prescribed events. Some might call this scenario planning.
Now is the time to not only dust off those risk assessments and/or alternative scenario plans, but to implement them. Importantly, those assessments must be reviewed and revised for a world where the risks being faced by some activities are a lot higher than we have ever expected.
Yes, we all accept risks in our daily lives, communities, and businesses. We will continue to do so. But, we also implement strategies to minimise the risks or to mitigate potential negative outcomes.
For example, airline travel is a potentially high risk activity. Further, the consequences of any unwanted incidents are potentially severe. Our communities have assessed that the negative outcomes of unwanted events are so severe that they have imposed extremely stringent safety and security protocols to minimise the risks of adverse incidents occurring. But, there remains a non-zero risk of such incidents.
We prioritise making our activities resilient to unwanted events or incidents. This is the crux of 'living with' risk.
Nevertheless, businesses and communities have learnt to continue to operate under these stringent protocols. In addition, each and every time there is an incident the protocols are re-examined and, if necessary, modified to incorporate what has been newly learnt. Thereafter, businesses and communities have to adapt and adjust.
That is, we learn from our experiences. We prioritise making our activities resilient to unwanted events or incidents. This is the crux of 'living with' risk.
We need to build businesses and communities that are ready and able to react, adjust, and respond to an unwanted COVID-19 incident.
The antithesis of this message are calls for rapid returns to 'normal'. For example, there is no going back to the security protocols of pre-9/11 days. Similarly, there is no going back to the levels of risk we faced in pre-COVID days. The risk environment has changed and we must confront that rather than wish it away.
Alternatively, there is the lockdown versus economy tradeoff that continues to be pedalled again and again. Such a message continues to reflect a narrow view of 'the economy'. Bluntly, we need to ignore the finance experts and listen to health experts. Without the latter, the health system will be decimated. Without a functioning health system, the economy doesn’t stand a chance.
To be clear, our understanding of 'the economy' has been distorted by those who believe and measure in dollars only. It would be good to get a better and broader understanding of the economy, so it can then prioritise wellbeing for the many and not the few. Again, to be clear, the economy is more than production and profits; and more than spending and outputs.
Without a functioning health system, the economy doesn't stand a chance.
If 'the economy' remains your priority, then so be it. But, you should answer the following: for whom? and, for what purpose?
I see it being about kaitiaki o taonga. It is about leaving a legacy for future generations. As such, there is no choice between elimination and living with COVID-19. They are not two different strategies.
Yes, eliminate in Aotearoa, but we have to live with it as it will be present elsewhere for the foreseeable future.
Facing increased risks in a hostile and uncertain world, it makes sense to re-orient our business and community models to prioritise resilience.