Staunton, October 22 – The Russian Academy of Economics and State Service has released a new study on Society and the Pandemic. Experience and Lessons of the Struggle with COVID-19 in Russia (ranepa.ru/images/News/2020-10/COVID.pdf; summarized at vtimes.io/2020/10/22/novaya-virusnaya-normalnost-ekonomiki-a1127).
Based on a survey of more than 100 specialists, the book concludes that the impact of the pandemic on the economy will remain enormous for a long time but that the effects of the coronavirus on society as a whole will be even greater, ushering in a world of “instability, uncertainty, complexity and ambiguity.”
The book concludes that “the world’s economy was poorly prepared for the onset of the coronavirus” because, largely as a result of governmental responses to the 2008-2009 economic crisis, most countries found themselves in a liquidity trap without the ability to use longstanding fiscal measures to defend their economies against this shock.
But as great as the impact of the pandemic has been on the economies of the countries of the world, its greatest effects have been elsewhere. Unlike earlier crises, this one has been multi-dimensional and profoundly affected both the internal and foreign relations of all countries. “Any return to the former condition is already impossible.”
The pandemic has accelerated both technological development given the use of the Internet, the new study says. It has contributed to a further deglobalization of the world. And it has led to the outflow of capital from developing countries thus leaving them in a far more difficult situation than they were before.
In addition, the pandemic has forced businesses to adapt or be at risk of failing. It has driven an increasing number of people who had been middle class into the ranks of the poor. And it has created “a new normal,” one of “instability, uncertainty, complexity and ambiguity,” the Russian experts say.
Obviously, they argue, governments must provide more money to businesses and individuals who are suffering from the impact of the pandemic and they must not be afraid to evaluate their past policies including on the pandemic. Some of those, like universal lockdowns, may have been counterproductive.
But perhaps most important, governments and societies must be prepared for radical and unpredictable changes and be flexible enough to adapt quickly lest in their efforts to defend what they have had, they undermine their capacity to deal with a future quite unlike any past humanity has experienced.