Coronavirus is teaching us a lesson

As the new coronavirus, known as COVID-19, continues to spread, it's exposing some uncomfortable truths about our increasingly interconnected and globalized world.

Here are two:

Fragile supply chains: Decades of fine-tuning global manufacturing have given billions of people access to quality consumer goods at affordable prices. That's the upside of globalization. But the same trend has concentrated production of important items in certain countries, creating new vulnerabilities. For example, regions of China and broader Asia that produce most of the world's smartphones have been forced to idle or cut manufacturing because of the outbreak. The decline in Chinese factory activity has been so pronounced, it's actually visible from space. And US officials recently warned of drug shortages due to the shuttering of factories in China that make essential ingredients for some important medicines.


Fragile safety nets: Well before the new virus emerged in China, an annual report by the World Health Organization warned that the chances of a global outbreak were rising and that the world was "not prepared for a fast-moving, virulent respiratory pathogen pandemic." It cited the usual problems – a lack of funding for public health monitoring and prevention, bureaucratic hurdles, and weak medical infrastructure, especially in poor and middle-income countries. But it also warned of "a breakdown in public trust…exacerbated by misinformation that can hinder disease control communicated quickly and widely via social media." In the US, the safety net is further weakened by a lack of mandatory paid sick leave, which some people fear will compel sick people to show up at work, where they can infect colleagues and customers.

It's no big mystery why the world works this way: Money doesn't grow on trees. Taxpayers worry about their wallets, companies worry about the bottom line, and politicians worry about voters or special interests. In normal times, no one has much appetite to fund big investments in public health or other preventive measures. No one wants to build extra factories in far-flung places, "just in case." What's more, reorienting our economic and political systems to be more resilient is a massive and long-term undertaking. As crises recede, it becomes hard to convince people or governments to make sacrifices for the long-run good. In a sense, the efficiency of our 21st century economies in normal times comes at the cost of resiliency in extreme circumstances.

Still, something's got to give. Coronavirus won't be the last global pandemic. And it's part of a bigger trend of looming cross-border challenges like climate change and cyberattacks that will also stress systems designed for simpler times, as severe weather and threats to critical infrastructure grow more frequent. Finding the political will and the money to build stronger, more resilient systems won't be easy, but what will it take to convince a critical mass of voters and leaders that it's essential?

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Learn more in this episode of Eni's Energy SUPERFACTS series.

British economist Jim O'Neill says the global economy can bounce back right to where it was before, in a V-shaped recovery. But his argument is based on a lot of "ifs," plus comparisons to the 2008 recession and conditions in China and South Korea that may not truly apply. Ian Bremmer and Eurasia Group's Robert Kahn take issue with O'Neill's op-ed, on this edition of The Red Pen.

Today, we're taking our Red Pen to an article titled "A V-Shaped Recovery Could Still Happen." I'm not buying it. It's published recently by Project Syndicate, authored by British economist named Jim O'Neill. Jim O'Neill is very well known. He was chairman of Goldman Sachs Asset Management. He's the guy that coined the acronym BRICS, Brazil, Russia, India, China. So, no slouch. But as you know, we don't agree with everything out there. And this is the case. Brought to you by the letter V. We're taking sharp issue with the idea that recovery from all the economic devastation created by the coronavirus pandemic is going to happen quickly. That after the sharp drop that the world has experienced, everything bounces back to where it was before. That's the V. Economists around the world are debating how quickly recovery will happen to be sure. But we're not buying the V. Here's why. W-H-Y.

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Over the past few years, we've seen three major emerging powers take bold action to right what they say are historical wrongs.

First came Crimea. When the Kremlin decided in 2014 that Western powers were working against Russian interests in Ukraine, President Vladimir Putin ordered Russian troops to seize the Crimean Peninsula, which was then part of Ukraine. Moscow claimed that Crimea and its ethnic Russian majority had been part of the Russian Empire for centuries until a shameful deal in 1954 made Crimea part of the Ukrainian Soviet Republic. Americans and Europeans imposed sanctions on Russia. But Ukraine is not part of NATO or the EU, and no further action was taken.

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Nicholas Thompson, editor-in-chief of WIRED, provides his perspective on technology news:

Will the new audit of Facebook civil rights practices change the way the company operates?

Yes. It came under a lot of pressure from civil rights activists who organized an advertising boycott. And then an internal audit on Facebook's effect on civil rights came out. It was quite critical. Those two things, one after the other, will surely lead to changes at the company.

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The United States and the European Union have comparable population sizes, but their COVID-19 death toll trajectories have recently become very different. Since the beginning of July, the average number of both new fatalities and new deaths per 1 million people is rapidly increasing in the US while it remains mostly flat in the EU. We compare this to the average number of new cases each seven days in both regions, where the US trend continues upward but is not surging like the death toll. EU countries' robust public health systems and citizens' willingness to wear masks and maintain social distance could explain the disparity.