Global supply chains may not survive the Covid-19 pandemic.
Epidemic diseases, like natural disasters, strike with some frequency and therefore are not impossible to predict. What’s far more difficult is finding the political will to plan for them.
That’s not due to indifference on the part of our elected officials. Mostly it’s because resources are limited and using them involves trade-offs. Politicians can always point to an immediate problem that deserves more attention than something else that will happen at some unknown point in the future. Decades before Hurricane Katrina struck New Orleans, officials knew that the city’s levees and flood walls were too low and weak to withstand a strong storm. And more than 15 years ago, following the SARS outbreak, U.S. intelligence agencies warned that a global health scare was imminent.
“Some experts believe it is only a matter of time before a new pandemic appears, such as the 1918-1919 influenza virus that killed an estimated 20 million worldwide,” reads a 2004 report by the National Intelligence Council. It raises the possibility that such an occurrence could “put a halt to global travel and trade during an extended period, prompting governments to expend enormous resources on overwhelmed health sectors.” Infrastructure repair and pandemic preparation may be vital to a functioning society, but they’re also expensive, unglamorous and not the type of headline-grabbing accomplishments that politicians like to focus on.
The finger-pointing will persist for now because it’s a presidential election year and shifting blame is part of politics. And we should all be wise to lawmakers who want to use the crisis to increase the size and power of government. Millionaires in agriculture today are still being subsidized by taxpayers due to “emergency” policies put in place in the 1930s to help farmers get through the Great Depression.
But the legacy of the coronavirus won’t be that it caught us unawares. Far more likely is that the outbreak will be remembered for how it changed our daily routines and the government’s dependence on global supply chains. Scott Gottlieb, a former head of the Food and Drug Administration, has been one of the more thoughtful voices on mitigating the epidemic. In a recent American Enterprise Institute podcast, he riffed on how we might live post-Covid-19, and it goes well beyond calls for better hand hygiene.
Dr. Gottlieb said common practices like handshaking may be discouraged going forward, and we may see more people wearing masks in public, as is common in other societies, especially during flu season. Crowding into a room or an elevator will be looked at differently, at least in the near term. “We’ll go out to restaurants, we’ll go to theaters, we’ll shop, but we’ll be more careful,” he said. “I don’t know that we’ll ever start having 5,000-person conferences again.”
Dr. Gottlieb also anticipates pronounced changes in government behavior. “I don’t think states will ever rely on a federal stockpile again,” he predicted. “I think you’re going to see states develop their own strategic stockpile of critical health equipment.” Nor can we allow the manufacturing of these components to be fully off-shored. “It’s fine to rely on the grid for your power as long as you have a backup generator,” he said. “We relied on off-shore manufacturing and just-in-time delivery for critical health-care components, but we didn’t have a backup generator. We had no capacity here that we could start, or that was mothballed or that was ready to go or could be expanded in a setting like this.”
We currently have a shortage of the nasal swabs used to test for coronavirus. Most of them are made at a facility in Italy, one of the hardest-hit countries, and Europeans are holding on to supplies that were intended for use here. “We were dependent upon the global supply chain, and . . . that not only got stretched, it got nationalized,” Dr. Gottlieb said. “And we knew it would get nationalized because we had seen it happen before.” In 2009, the vaccine for swine flu was manufactured at a facility in Australia, which made sure that local needs were met before shipments to America were allowed—even though the facility was built to manufacture vaccines for the U.S.
Many on the political left have responded to the pandemic by renewing calls for a single-payer health system and more federal “rescue” packages. But the U.S. is likely to have better outcomes than most countries because our system excels at delivering critical care. And rebooting the economy as we get a grip on infection rates will do far more good than sending out checks. But when all is said and done—when the finger-pointing stops and Americans are back to work—something will have to be done about the nation’s health security in a global economy. Maybe this time our elected officials will be up to the task.
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