The Great Unravelling

The Great Unravelling

To be fair, I am not the first to use the term, “The Great Unravelling”. However, this is the best term to describe what I see happening both in New Zealand and around the world.

Most people would not have thought that what we are presently witnessing would even be possible in the early 21st Century.

But, what we are seeing is the shut down of almost all international travel and with it disruptions to not only the movement of people but also the movement of freight, especially airfreight. We are starting to see rapidly escalating numbers of unemployed, which some commentators are comparing to the Great Depression of the 1930s. Country after country is both experiencing and forecasting huge drops in GDP. Businesses are closing, both large and small. The international tourism industry is taking an enormous economic hit, from which it may never fully recover.

We are seeing massive disruptions to society, including the opportunity to socialise face to face, being severely restricted: no handshakes, no hugs, no hongi. Human beings as a species are naturally gregarious. Most of us thrive with being able to mix and socialise with others. While social media has partly bridged this gap, it is still not the real thing.

We are incarcerated in our own homes.

It is, however, the speed in which this unravelling has happened, that I have found the most surprising. Most would not have thought that the dynamic international system of trade, travel and communication could grind to a halt so quickly, and even start to unravel so fast.

But is this a case of the old saying, “the chickens have come home to roost”?

The chickens, in this case, being the international system of just in time inventory. The production of goods that with globalisation has shifted production to countries with lower wages and lower environmental standards. In a drive to provide ever-cheaper consumer goods, this shift has left domestic manufacturing in many western countries in tatters. We are dependent on supplies from overseas for so much of what we routinely take for granted.

The Great Unravelling is challenging all these systems and more. Farming is being held up in New Zealand as the shining light for the immediate future. But look closer. What is the single largest market for our agricultural exports? The answer is China, and in particular, China’s rapidly growing middle class. This middle class has expanded and thrived as China has become the manufacturing hub of the world. What happens to the spending power of that middle class when people in the west are not purchasing?

All this unravelling should not come as a surprise. Over the last couple of decades, many authors have written about the vulnerabilities of this system. While they may not have identified the trigger as a global pandemic, they have warned about the consequences.

No doubt a fair few permies (permaculture enthusiasts), preppers (end of the world as we know it fans – think months of supplies of canned goods), and others will also be patting themselves on the back and feel vindicated by what is happening.

Where to from here?

It is clear the current economic system is fragile. Not only is it highly vulnerable to shocks, but it is also non-resilient and non-sustainable. While it has lifted many people out of poverty, it has also left many people behind, as evidenced by growing income inequality in most developed countries. The cost to the environment has been especially severe. This economic model is based on the flawed premise of limitless growth in a finite system.

As we grabble with getting everything “going again”, let’s start designing and building a new economic system that puts resilience, people, and our relationship with the natural world, our fellow citizens on Planet Earth, at the centre.

Now that would be an inspiring challenge.

 

Brian Megaw

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