The only thing I share with Jack Reacher is that I was born in the same UK Midlands city of Coventry as author Lee Child.
We Midlanders know a thing or two about stoicism, and our cultural DNA is about making things work, and getting things done, without too much grumbling. (Coventry was once the engineering capital of the UK, perhaps the world. The modern bicycle, the jet engine, and the mainstream watch industry were all invented there.)
So we can take a slightly-dispassionate view of the Covid-19 pandemic and its current and likely economic fallout, and make pronouncements with some degree of predictability, which is another word for doom.
That’s not to say we’re wrong, though.
Child’s protagonist has two well-worn phrases. The first is “Hope for the best, plan for the worst.” Of course this pandemic is unprecedented, probably in 100 years. Yet our entire western capitalist system has evolved since the Spanish flu pandemic of 1918/19 to create the expectation that predictable, certainly repeated, dividend payments, corporate growth, and, over the long-term, economic growth, are inevitable. What the current crisis has exposed is the lack of “planning for the worst”. It was always there, and Covid-19 has simply accelerated the inevitable. Instead, we plan assuming that bailouts will eventually shore us up, that supply chains built to deliver just-in-time always will, that national IT networks will deliver bandwidth on demand, and that our superannuation funds will always have either high-growth share returns or high-interest cash returns to meet our needs in retirement. We never expected market crashes and nil-interest savings at the same time.
We set great store in our abilities to pivot. I think we’re gyrating right now.
I think, and worry, that the IT sector, in which I’ve worked for decades, is partly to blame, at the visionary level – IT can fix anything, and the prosaic level – IT makes anything possible. It’s led us to real-time trading, where humans have to insert circuit-breakers to stop markets running away with themselves. It’s created the illusion that we might all work at home when manufacturing and logistics still require close human contact. And it’s created inflated valuations that you just heard crashing down. Sure, we’re now at home, it’s just that there’s nothing to deliver.
As a Midlander, I might remind you that real economies are actually built, ultimately, on stuff that you grab with your hands, weather it’s a tin of peas or an aircraft. That toilet you flush, with or without toilet paper, is still made in a factory. Right now, every time we touch anything, we might get ill. And when people die in their thousands, and work at home in their millions, a lot less stuff gets held, is needed, or is manufactured or grown.
Reacher’s other famous phrase is “it’s binary” – either the bullet will kill you, or it won’t, either you’ll get punched in the face first, or you’ll do it to the other fella, we’ll go into a recession or we won’t, we’ll come out stronger from this crisis or we won’t.
I wonder whether we should discard our management tomes and read a few more Jack Reacher thrillers, written by a man from Coventry.
Also published on LinkedIn.