While governments around the world were pursuing a flatten the curve strategy to dealing with the medical crisis that is the COVID-19 pandemic they had to pursue a simultaneous economic strategy. That economic strategy was an attempt to freeze the economy is place until the medical strategy had succeeded and then to unfreeze the economy.
This is the single largest economic intervention in human history. My RMIT colleagues and I are not convinced that government can successfully pull it off. I would be ecstatic to be wrong …
The story, however, isn’t all negative. One of our arguments is that there has been a lot of discovery that has occurred during the lock-down. The WSJ picks up the story …
The zeal for a new definition of the traditional office is driven in part by the shrinking economy, as companies look for new ways to cut costs during a downturn that is expected to be the worst since the Great Depression. Many executives also point to the success of an unprecedented work-from-home experiment, and how little productivity appears to have been impacted after millions of employees in technology, media, finance and other industries have been forced to work remotely for months.
“I mean, if you’d said three months ago that 90% of our employees will be working from home and the firm would be functioning fine, I’d say that is a test I’m not prepared to take because the downside of being wrong on that is massive,” said Morgan Stanley Chief Executive James Gorman in mid-April on the bank’s earnings call.
There has been a period of enforced experimentation and adoption of new business practices. Some of those practices will end with the end of lock-down, but others might not and will not. The adoption of the digital economy has been accelerated by about 10 years. Now people have asked me if the technology is up to the task.
To ask the question is to answer it.
No. It isn’t.
But here we are.