Coronavirus II: Electric Boogaloo and the long-term impact.

Considering SK's president was impeached and removed from office after she botched the whole response to the Ferry disaster just 2 years ago, it's amazing to think of them having competent leadership.

Focus: Money. Worldwide, there will be Covid-19 fees added to the bottom line of lots of services. Delta Airlines has a security fee they add to everything and it's still called the September 11 fee.

 

The biggest one that comes to mind for me is automation to cut China out of the supply chain. I've heard a massive amount of speculation at how you can't introduce large scale automation and UBI to a population. You can't effectively lay off MILLIONS of people and get them to accept a government handout because the idea of working and having a job is so ingrained in people, they lose their purpose in life if they don't have a job. Enter a pandemic where citizens are under lockdown, businesses are forced closed, millions of people are laid off from their jobs, and bringing in automation to replace those jobs can be viewed from a safety standpoint which is much easier to accept. Some of the backing of this is based on the very odd $600 dollar payment every week the federal government is giving to people who are collecting unemployment. Why $600? Why even offer something like a flat payment for unemployed workers in the first place when the states should be funding this totally and getting reimbursed through federal funds for the spike in unemployed workers.

At the moment it's purely conspiracy theory, but it's one of those conspiracy theories with a lot of truth behind it and may not be a grand scale, "We released this virus, blamed China, and ordered these lockdown measures to enact the new global order", but it seems as if there is a lot of large companies taking advantage of the situation to cut ties with the China based supply chain and cut out workers to bring in more large scale automation.

 

The other side of that equation is that China won't take this sitting down. Large-scale automation that cuts China out of the picture would topple the Chinese Government. Faced with destruction of their economy, who knows how they will react.

Separately, I agree the $600 number is odd, the $600 thing may not be UBI-based in theory but more of a $15/hour minimum wage approach. I have business owner friends trying to reopen, who call their employees to come back and they aren't showing up. It is more profitable to sit on the bench than to take their jobs back. They are almost forcing business owners to pay $15/hour or more to get people back to work.

 

It’ll be interesting to see what this does to schools. The impacts are going to be completely different at the various levels — preschool, elementary and middle, high school, then college and beyond.

Preschool is gonna see a surge across the board I think. Even while work from home increases, they can’t work and be a parent and teacher. Elementary and middle schools around here are talking about doing a hybrid of distance learning and classroom, going to school like MWF and for shortened hours. Kiddos don’t have very long attention spans anyway and it’s better to have more compacted learning in a shorter school day.

high schools should be pretty straight forward where it’s a lot more distance learning/online education which is gonna teach them about self sufficiency along with the actual curriculum. Issue though is gonna be the technology gap along financial lines.

college is a whole other can of worms. I think the public ones should be fine. The private colleges are gonna be fucked though. During this a lot of people looked around and realized the ones with jobs, the essential workers, were in jobs that didn’t necessarily require a higher ed degree. Some trade school sure, but nothing worth going into debt for.

along those lines too, I think voting patterns are gonna change for a VERY long time!

 

That's wonderful that they think that. As a taxpayer, who pays a fucking assload of taxes, I don't support that. Unless, of course, they balance the equation.

 

A lot depends on how long, how bad and what the spin on this ends up being. For the sake of discussion, let's say we're 1/3 of the way through it and we wind up with 400,000 dead over the next 9 months.

It spins our politics a bit to the left. Imagine if this had unfolded a couple of months earlier, when Bernie was in the race. His message would resonate really well with the millions of newly unemployed with no insurance, the students who racked up incredible debt to end up taking an online class, etc. The GOP has focused on unraveling our social safety net for 40 years, and it's failing people left and right. The ostensible benefit to that unraveling, lower taxes, is now laughable, because Trump has racked up $2 trillion in ONE piece of legislation, plus his other debt, and there's likely more to come. It forces us closer to single payer healthcare, if not pitches us into it fully, if for no other reason we're going to have to bail out the insurance companies before this is over with. I think it's similar to 2008, where a Republican administration has a mess, and a Democratic one comes in and cleans it up. However, I think that's a thankless job and Biden is a one-term president.

Our economy will take a decade to recover. We will need some serious investment on economic drivers to power that, and I think some of that will be energy, housing, and automating some of the supply chains imperiled right now. The problem is there are no easy solutions, because there are few infant industries the US is well-poised to dominate for the next few years. Biotech has been the sleeping economic giant for most of my life, and I'm just not seeing it. Drones and automation, perhaps, but that's not exactly a jobs solution. IT to some extent, but I don't know how much bigger the giants can get before they topple.

The global nature of our economy will take a couple of steps to the side. It'll start with supply chain, but I think between some of the bad juju towards China, the increased costs of transportation, and higher scrutiny that implies the benefits of buying cheap shit across the world and shipping it here diminish. I think within the next decade, 40% of the cheap Chinese bullshit I buy can be 3-d printed a few counties away, as opposed to trucked across the globe.

The generation gap will deepen. I'm an older millennial and even with a well-paying, stable job, I couldn't afford a house within 50 miles of my office. My 401k is laughable. And now, as I enter the second phase of my career, in my prime earning and spending years, I'm confronted with ANOTHER global recession. If you think "ok boomer" or "Karen" is an insult now..... That means lots of us will not get married, and have more fragmented family circumstances. I think we will see social unrest without a ton of crime, and the diseases of despair will run rampant. We have more to fear from overdose, the Rona and suicide and that will only get worse.

The volume of travel for business will decline, as will mobility overall. We will quickly grow accustomed to doing more at a distance, and the increased costs for travel sure to come our way will force a consolidation. If I can conduct a quarter's worth of business without leaving the house, it stands to reason my next year's travel budget can take a 25% hit, or more.

All of that combines to imply the economy itself is in for a very turbulent few years. We'll see a weird adoption of social policies and economic policies that do not follow current doctrine for either party.

Possible legislation out of this:
1. Increasing the maximum FDIC protection to $1-5m, or some form of financial protection for individual households above the current limit. Bailout is about to become a bad word, and I think smart legislation would force the companies to take loans, even at no interest, and focus direct cash infusions on protecting personal assets. Also, this takes some of the pressure off of the financial system: you can safely keep cash, and I'd wager a decent chunk of families and investors would beef up liquidity if they knew it was safer.
2. Portable benefits such as a 401k that follows you from employer to employer, or allows for multiple employers to contribute.
3. Tax hike, or at least the revocation of the Trump tax bill.
4. If the tech giants start to slip in value, there will likely be regulation headed their way, especially if they slack off in their efforts to control misinformation.
5. Marijuana movement, likely complete decriminalization. The real question here is when (not if) states start losing money on prosecuting pot crimes. This will result in de facto deregulation, and likely create some jobs and opportunities. It will also result in research rending CBD useless, and thus ends the reign of Joe Rogan.
6. Given the above, you'll see some right-sizing and sanity entering in our law enforcement. There will be an increased demand in accountability for shootings, as well.
7. I am sure this exists in dozens of places, but I can envision a more tactical level of international coordination. We could have learned a lot from SK or NZ and didn't, and since we punted a lot of the decisions around the response to the governors, they should demand at least a forum to learn from other places confronting the same issues.
8. More worker protection, in exchange for higher taxes. Also some "hometown" incentives for manufacturing here, vs. abroad.

 

One thing you touched on, and I think a potential solution to the massive financial problem facing the states and country at large, is marijuana legalization nation wide. That’s a massive amount of extra tax dollars coming in to places that really need it. It shouldn’t be underestimated, and I think you see nation-wide legalization shortly after the November election.

 

The two idiots running your two political parties think it should be illegal and stay that way, as do the Pharma companies who tell everyone what to do.

Look to other avenues, that one is a dead end for you guys for probably another decade, give or take. Hopefully by then my country wises up and makes the rest of the “schedule one” drugs legal.

 

Biden has softened his stance over the years, most recently saying it's for the states to decide not the feds (which I think is 100% accurate). Moreover, just follow the money. The sweet sweet tax revenue is there for the taking, and there's now a history showing that it works in the states where it is legalized, at least for medicinal use. Pre-COVID I thought it was 5 years until it became legalized in all 50 states. Post-COVID, with money running dry at all levels of government, I think the lure of the immediate cash flow infusion is gonna be so appealing that it becomes legalized in all 50 states within the year.

 

well this is topical: Japan sees a DECREASE in suicides, thanks to COVID

 

I dunno, 'Nerds. Something tells me that even if it were legalized on the federal level, Texas Greg Abbott would still have people arrested for it.

 

I don't think we'll see a wholesale abandonment of China as there's too much money to be made there, but I do think we'll see more distributed supply chains to hedge against a problem (political or natural) in any one country. Even if it costs a little more, companies will view it as a type of insurance to know that they can ramp up production more quickly in somewhere like India or Vietnam if something fucky happens in China. Companies got a taste of what it's like to have all their eggs in one basket and they didn't like it.

 

A lot of them are realizing there’s more to life than just pushing yourself along. They are so driven over there, sometimes they just need to kick back and hit up an 80’s rock bar.

 

It's not as clear cut as legalize, then tax, then profit. There is a legitimate concern that the people trafficking illegal substances will switch to more potent substances, or other illegal activities. But it's starting to get challenging with the largest economies in the country producing edibles and weed that then can cross state lines. I think there will be a tipping point at which the federal government switches to "if you want to do it, go for it, but we won't fund it" and states start to lose money on enforcement measures. Once the money to be made is higher via tax revenue than enforcement, smart states will flip the switch.

Another potential piece of legislation out of this: making Election Day a holiday, and pushing voting to accept online or mail-in ballots. I remember the lines in 2016, and there's a big concern about who stays home, versus who goes out and votes. I think we're starting to see the importance of voting, and yet our turnout rates are atrocious. Making it more accessible would be a positive step towards unfucking our system, and if you get the day off, you might have working class folks vote in higher numbers.

To the domestic manufacturing question, it'll start with some tax incentives and some cushy government contracts. From the government perspective, it's not important what you make, it's important that you have the capacity and that you hire people. There are ways to make that balance out at the end of the year that smart places will figure out.

I can also see some new regulation forcing a lot of antique vehicles to no longer be worth keeping, a la boats, farm equipment, etc. You can easily spur the economy by changing the purchasing calculus and making it more appealing to buying new. Hell, one of the wilder ideas I remember in 2009 was "depreciation insurance" that basically said if you buy a new vehicle in the next year, they'll give you a tax credit equivalent to whatever depreciation you incur for the next 5 years, if you take an old one off the road and hit some other criteria.

 

Please, don't give them any ideas. We don't need another "Cash for Clunkers."

That fucked up the used car market, and got a lot of perfectly good cars and classics destroyed by morons who didn't know what they had.

All so some dipshits could MAYBE get a $5,000 credit that they would then use at a dealership that would not negotiate down from MSRP price, meaning that those hapless dumbasses just ended up paying the same price they would have if they hadn't junked an old car.

 

Maybe TicketMaster will go out of business. Let the promoters sell the tickets. That would be fucking awesome.

I am interested to see how much new music arrives in the next year after stuff ramps back up. I know some artists are releasing new content. With home studios and digital technology, it's certainly easy enough to do. But, since artists aren't touring now, all at the same time, and Summer is usually huge for the big star tours, they're all pent up with a need to be creative.

 

yeah all these big stars just sitting there like "damn bro, when's my songwriters gonna send me some new shit?"

 

The wife and I belong to a local winery which had their members pickup this weekend. I was expecting to just swing by, pick up our bottles and leave. I was pleasantly surprised that when we got there they had a food truck and were allowing people to open wine while they were there. I talked to the owners and he said they were basically going rogue. It was either risk it or shut down. They were taking great precautions. All employees wore masks, changed gloves for each group of customers, supplied disposable plastics wine glasses, social distancing, plenty of sanitizer around etc.

I don't understand why that isn't allowed in our county. Wine is a huge industry for this county and something that can be pretty safe IMO