You Are Now Experiencing a Global Event

Like 9/11 or the financial crisis, there will be before coronavirus and after

Nicholas Grossman
Mar 12, 2020 · 7 min read
(Getty)

The coronavirus now spreading around the world will directly affect millions. The social, political, and economic repercussions will affect everyone.

No one has experienced anything quite like this. There have been previous pandemics — the Spanish flu, the Black Plague — but this is the first in the age of globalization, with easy international movement, advanced medical science, and rapid spread of information via social media.

First and foremost it is a public health event. As of March 12, there have been over 120,000 confirmed cases worldwide, but that should jump into the millions as the infection explodes in Europe and the United States, and starts appearing elsewhere. It’s probably in the millions already, but poor testing and cases with relatively minor symptoms mean we’re under-counting. On March 11, the World Health Organization officially declared COVID-19 a pandemic.

Like influenza, coronavirus is a respiratory infection, but it’s deadlier and more contagious. In 2018–19, the flu had a death rate of 0.1 percent in the United States. COVID-19 is too new to know the death rate with certainty, but in South Korea, the country with the best public health response, the death rate is about 0.7 percent. In China, it’s 2.3 percent. Anthony Fauci, the Director of America’s National Institute of Allergy and Infectious Diseases, told Congress that coronavirus is “.”

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Many people will get the virus. Many will know someone who died. Everyone will hear of famous people who get it. Yesterday we found out that actor Tom Hanks and NBA player Rudy Gobert are infected. Dozens, maybe hundreds of Iranian government officials have it, and seven have already died. Italian hospitals are overwhelmed, to the point they’re forced by limited resources to pick which sick patients to treat.

Though fatalities will probably (hopefully) remain far short of the 1918–20 Spanish flu pandemic, which killed an estimated 17 million to 50 million worldwide, enough people will be directly or indirectly affected by coronavirus that it will have lasting effects. The world should learn from it, and prepare better for the next one.

Many will experience coronavirus primarily as a societal event. Large gatherings, such as the South-by-Southwest festival, have shut down. Sports leagues are playing without crowds (Italian soccer), or suspending games entirely (American basketball). Universities have canceled in-person meetings and told professors to move courses online. Businesses are shutting down, or at least dealing with shortages of employees and customers. Governments are closing schools, recommending social distancing, and in more drastic cases, ordering everyone to stay in their homes.

It’s already changing the ways we interact. A little more wariness about handshakes, kisses, and hugs; a pang of worry when someone nearby coughs. Fear is spreading along with the virus — some warranted, some excessive, but real nonetheless.

This fear is partially due to the newness of COVID-19, as people have effectively “priced in” deaths from the flu or cancer. Those are known quantities. We’re used to them. For a similar reason, a bomb exploding at the end of the Boston Marathon has a different societal effect than a bomb exploding in Baghdad. Both are tragic, but one is less expected than the other, creating a larger psychological and political reaction.

However, while part of the fear comes from novelty and will subside, some comes from realizing that pandemics really do threaten our globalized world. It’s not all close calls, like Ebola or SARS. That fear will linger after the outbreaks subside.

Societal disruptions are making coronavirus into a major economic event. The travel industry — airlines, hotels, cruise ships, etc. — are getting crushed, dragging down businesses that depend on them. Manufacturing is starting to see supply chain disruptions. Restaurants and retail are losing customers. No one really knows when it’ll end.

And then there are the second-order effects. Millions who work in affected industries will lose income, which means they’ll spend less, affecting other businesses. A lot of shift workers who lose hours won’t get them back. As schools close, parents will have to stay home, further reducing economic activity.

Consumers may be delaying some purchases, which will lead to pent-up demand and the possibility of a quick recovery in some sectors. If you want to buy a car, but don’t want to go to the dealer until this blows over, you’ll still buy one later. But if you canceled your trip to a conference, or stop going out to eat for two months, that economic activity is gone. And then those businesses make less, which means they fire workers or cut back on shifts, and also have less money to spend or invest themselves.

All this means a recession is likely. Stock markets are already acting like it, with various indexes losing over 20% of their value in the last three weeks. Interest rate cuts and fiscal stimulus plans haven’t stopped the crash — which isn’t too surprising, since cheaper borrowing or larger paychecks don’t address the pandemic.

U.S. unemployment and growth numbers from February look good, but coronavirus-related problems should be apparent in sector-level data in March or April. The Dow, the S&P 500, and U.S. GDP have been growing since the end of the financial crisis in 2009. Trump and the Republican-held Congress passed a massive debt-financed stimulus focusing on upper income and corporate tax cuts in late 2017. There’s a decent chance that coronavirus popped a bubble, and isn’t just a temporary disruption from which the economy will snap back. Especially since it’s happening at the same time as a Russia-Saudi oil price war.

Unless we get lucky and the pandemic passes quickly so everyone can get back to school and work, substantial job losses will follow.

The economic damage helps make this a significant political event. Various countries have experienced heightened political division, even as their economies have grown. A recession could bring those tensions to a boil, both within and between states. Some governments are already trying to scapegoat others.

Scholars and policymakers will study the varying governmental responses for decades. China, where the virus originated, started with denial and then shifted to quarantines when the disease became impossible to ignore. South Korea, Japan, and Taiwan quickly implemented social distancing, limiting the disease’s spread. Iran denied it, leading to the spectacle of the Deputy Minister of Health wiping fever sweats from his forehead as he announced on television that it wasn’t a big deal. And when it became impossible to deny, Iran started . Italy ignored it until it reached crisis proportions, and then locked down the Lombardy region, followed by the whole country.

The United States decided not to use the WHO’s coronavirus test, opting to develop its own for reasons that remain unexplained. That contributed to a severe testing shortage, allowing the virus to spread undetected. American President Donald Trump downplayed it and claimed that Democrats and media outlets were exaggerating to hurt him politically. Right-wing media joined in, with , for example, telling listeners that “the coronavirus is the common cold.” The president reversed course on March 11, using a prime time address to acknowledge the seriousness and announce countermeasures — such as banning travel from continental Europe — but the delays increase the risk the U.S. ends up looking more like Italy than South Korea.

It’s unclear how voters will respond — not least because it’s still a long way until November — but the coronavirus has changed the U.S. presidential election. Democratic contenders Joe Biden and Bernie Sanders have canceled rallies. Donald Trump said he wouldn’t, and then changed his mind as the crisis worsened. The parties typically hold nominating conventions over the summer, but packing thousands into an arena might not be safe by then.

When the economy is good, incumbents usually win reelection. But the economy looks substantially weaker than it did a month ago.

All this makes for a major media event. Anyone can get regular updates on how coronavirus is affecting health, society, the economy, and politics, along with predictions about how it will affect those things in the future. The pandemic, crashing markets, and government responses have pushed most other news out of the headlines.

A lot of people are experiencing this global event through social media, which enhances the feeling of shared experience, and provides a flood of information, both good and bad. One result is a greater sense of fear, as media outlets and social media algorithms amplify reports of new cases, strained health systems, politicized commentary, and individual expressions of worry. If you use a smart phone, it’s almost impossible to get away from.

In the last two weeks, the world changed forever. We’ll be talking about it and using it as a reference point for years. How much will depend on how the next few months go.

Arc Digital

The internet’s best opinion page

Nicholas Grossman

Written by

Senior Editor at Arc Digital. Poli Sci prof (IR) at U. Illinois. Author of “Drones and Terrorism.” Politics, national security, and occasional nerdery.

Arc Digital

The internet’s best opinion page

Nicholas Grossman

Written by

Senior Editor at Arc Digital. Poli Sci prof (IR) at U. Illinois. Author of “Drones and Terrorism.” Politics, national security, and occasional nerdery.

Arc Digital

The internet’s best opinion page

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