Fractious international order, diminished financial capacity, despondent global society and technologically supercharged environment
The COVID-19 pandemic is a train wreck in slow motion. This crash could turn out to be the spark that ignites a whole-of-global-society meltdown like in the world wars of the 20th century. Those were conflicts within humanity.
Few may have recognized it yet, but the world wars of the 21st century have already begun and unlike those of the past century, the new conflicts are between humanity and nature.
The COVID-19 pandemic is nature’s first global-scale assault on the uber-modern human world. While it was triggered, like World War I, by a cruel twist of fate, it was a case of systemic fragility waiting dangerously to be exposed. Over-population, hyper-globalization, widespread poverty, weak governance, diminishing international cooperation and, most of all, rampant environmental exploitation are the ills of our failing status quo.
Humanity failed to sufficiently reform itself after the World War I. The League of Nations was the half-hearted and, ultimately, futile effort to prevent another universal conflict. It would take the utter devastation of Europe and East Asia and more than 70 million deaths during World War II before the firm foundation of peace and prosperity was laid in those regions.
Today, we are at it again. The COVID-19 pandemic is round one of human civilization vs mother nature, a full-dress rehearsal and wake-up call for the bigger clash ahead. A climate collapse will surely be multiple folds more destructive and protracted. The United Nations warns that the number of climate refugees could reach one billion by 2050. Will we learn from this calamity and avert the next world war of the 21st century?
Let us consider the likely aftermath of this pandemic to get a sense of what our future trajectory could be.
The storms after the storm
A long-drawn COVID-19 debacle has ample gunpower to fire up a series of uncontrollable chain reactions.
The global health emergency and economic devastation, two sides of the same coin, have already sparked the irrational oil market crash and an escalating row between China and the US and other nations.
A prolonged state of viral suppression will invariably heighten the risks of financial crises, political upheaval and societal unrest, destabilizing an already unsettled world.
Should the coronavirus hit developing countries hard, the situation could easily spiral out of control. Without sufficient national fiscal capacity, financial safety net and humane living conditions, the pandemic can be a matter of life or death for billions of people.
The acceleration of the accelerations
The 2020s are poised for three major accelerations. The fourth industrial revolution, international disorder, and conscious capitalism and consumerism are hastening towards mainstream reality. COVID-19 has just applied more pressure on the gas pedal.
The world wars of the 20th century accelerated the industrial age through rapid technological development for military, communications and medical purposes. The 21st-century equivalents will similarly spur progress in the intelligent era and expedite the 4th industrial revolution.
COVID-19 instantly formed the “isolation economy”, where a near-complete variety of remote services and physical goods can be delivered to the consumer, and a pervasive “work, study and play where you live” culture. These are eventualities that have been thrust upon us several years ahead of time.
Expect digital disruption of industries and adoption of 4.0 technologies (for example, smart robotics, immersive media, artificial intelligence) to intensify as battered businesses and consumers demand ever lower costs to stay afloat.
The ongoing geopolitical fragmentation and decline of the US-led international order will come to fruition earlier with the COVID-19 pandemic. It is exacerbating the US-China rivalry, West to East power shift, the crisis of liberal democracies, disunity within the European Union and the erosion of the ailing world order. Many nation-states could fracture, or even fail, in the face of the existential threat the pandemic poses. Global order could descend into international entropy – slowly, slowly and then suddenly, like a house of cards.
In recent years, conscious capitalism and consumerism have been taking root, as society’s reflex to the chronic climate crisis. The COVID-19 pandemic provides a stark reminder of the destructiveness of nature when it goes out of balance. More individual soul searching and societal introspection should energize this movement into the mainstream.
Deeper debt levels
Fanned by years of low interest rates, global debt levels were at a record high of $255 trillion in 2019. This was 322 percent of GDP and 40 percent higher than at the onset of the 2008 financial crisis. Global government debt stands at a whopping $70 trillion.
To date, an estimated $8 trillion has been committed to fiscal stimulus spending, mostly by advanced economies, while 103 countries have sought IMF emergency funding to alleviate COVID-19 distress.
Corporations and consumers are facing the same precarious financial situation. With countries, companies and citizens all plunging into deeper debt, will there be any remaining dry power left to combat climate change? The $8 trillion, with a lot more to come, would have gone a long way in our transition to a climate-friendly future.
After this violent storm, what remains will be a more fractious international order, diminished financial capacity, despondent global society and technologically supercharged environment. Will humanity transform its structures, systems and behaviors in time to avoid the next world war of the 21st century? While that remains to be seen, I posit that we will become more willing but less able to do so after the COVID-19 pandemic.
AI new normal
The article was shared on WhatsApp by one of our readers. Courtesy: Unknown author