In last week’s note I referred to a study that showed that people are the most dissatisfied with political systems over the last forty years, especially so in the two chief Anglo-Saxon countries. Mindful of the Shakespeare quote in Hamlet that ‘When sorrows come, they come not single spies, but in battalions’, more bad news has arrived.
A study from Carbon Brief that has collated data from six different research groups (e.g. NASA) to show that 2020 is the ‘hottest’ year in centuries, the Vix index of stock market stress reached highs only surpassed on a handful of occasions in the last forty years and, two academics in the US (Peter Turchin and Jack Goldstone) have recently highlighted that their political stress index is at a multi decade high, something they feel portends imminent revolution in the USA.
Add to that the re-imposing of lockdowns across Europe and a wave of savage terror attacks in France, and it is all, frankly, too much. I sense that a great many people are truly fed up with 2020.
The outlook might brighten on Tuesday, in the shape of a dashing political cavalry charge by Joe Biden and his team to re-take the White House. If this happens in a convincing way, stock market volatility will be crushed, America might tackle COVID better, the green economy should flourish, and we may even see a sense of collaboration between Washington and Brussels to produce better coordinated recovery plans across the ‘Old World’. Any result other than an emphatic Biden one will likely see us confined to stress-ridden purgatory.
I am not going to spend any more time trying to predict the US presidential election but rather want to focus a little on the nature and consequences of such a stressed world.
One is the propensity for people’s view of the world to be conditioned by stress – in general there is a tendency towards short-termism in the sense that we lose sight of longer term trends, and in addition a tendency to over emphasise dramatic outcomes. It strikes me that the media has been more than usually coloured with warnings of a repeat of the ‘2016 election surprise’, a ‘1987 market crash’, ‘1918 level health emergency’ and impending cyber wars, to note just a few examples. We need to keep at least an eye on the longer term outlook, as outlined in ‘Roaring 20’s’ (17.10.2020).
A more serious side-effect is the way in which this epidemic and its consequences will condition behaviour and mindsets. There is a growing body of research that shows that deep financial crises produce political aftershocks (for instance the ifo Institut has produced research linking the rise of radical and populist parties to financial crises).
In the same way, waves of lockdowns and economic damage will trigger shockwaves in mental health. In previous notes I have suggested that mental health will be one of the major policy issues of the 21st century to the extent that it becomes a pillar of healthcare. This crisis will accelerate that.
In the short-term it’s hard to know what policy makers should do, and it must be appreciated that many of them are under great physical and mental stress. For instance, Emmanuel Macron, having given a very clear and important address on Wednesday evening, found himself in Nice some ten hours afterwards, making sense of yet another terror attack.
One suggestion is that with political classes in both Washington and Brussels having failed to agree a second fiscal stimulus (in the case of the US) and the implementation of the first package (in the EU) that fiscal packages be amended to devote greater resources to mental health (a few countries already incorporate the idea of Wellbeing into budgeting) and the reconfiguration of health services around this, especially if Europe at least will endure a third wave of COVID 19 after Christmas. In this way, longer term societal damage can, to an extent, be avoided.
Another proposal is that as the risk that we suffer repeated, though shorter lockdowns rises (as brakes on the impact of the virus on health systems) the way governments structure these lockdowns and communicate with citizens will change. Future lockdowns – to be glum about it – will need to have a different mix of attention to the economy, focus on mental health and the wellbeing of the vulnerable.
One example is a recent radio advert from Health Ireland that recommended ways in which people can be aware of their mental health, and keep their minds agile by reading and perhaps, learning languages. In that respect it might be that the next stimulus package comes with free access to a language course or subscriptions to online books.
Returning to Hamlet, who stated that ‘What a piece of work is man’, it is becoming clear that this health crisis will be as much about our minds as our bodies.
Have a great week ahead
Mike
The Levelling 