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jsburbidge Consider, if you will, five areas: airlines, restaurants, petroleum, commercial real estate, and teiephone companies. For each of them the majority of the news and opinion coverage officially and implicitly assumes relative conrinuity with some changes, but there are reasons for doubting it for all of those domains.
First: there has been much immediate coverage of the airlines' failure to refund money for cancelled flights, providing offers of flight vouchers instead. (Governments are so far backing the airlines rather than the consumers, because they want a functioning airline industry.) There is also some coverage of the reduced density which will be part of airline travel no rms for the next year or more. There is little recognition that the industry is in for a fundamental shakeup.
The reason that airlines are not returning money where they can avoid it (contractual terms) is that they do not have the money, and are currently bleeding red ink like blood; but those same terms require them to offer credit for the future rather than simply walking away from the contracts. (Even then, they're vulnerable to clawbacks from credit card companies if they, and not the passenger, initiated the cancellation.) But pushing all that obligation into the future is not good for them either, as it means that on returning to fuller operation their revenues will be impacted by loads of customers flying on the vouchers. And they won't have as many customers - between less density, individuals who decide that flying is now too risky, and businesses which are more comfortable now with meetings over WebEx relative to face to face, passenger numbers are going to be down. The price of flying will also go up, but it is unlikely to make up the difference.
They have been, at present and broadly, refusing bailouts to retain independence. Some, at least, will have no choice, and governments who in some sense need a passenger airline system, will probably provide assistance - but it will have to be ongoing, and (outside, perhaps, the US, which has an allergy to this sort of thing) probably will involve governments taking over some measure of direct control.
Secondly: there's a steady drip of news stories about individual restaurants closing, and the odd story of one which has made a success of a delivery/pickup business.
Cities are encouraging reopenings with patios and widely spread tables, but a typical restaurant runs on narrow margins and part of that has been packed Thursday and Friday evenings, or midweek lunches for the business district. (A few very high-end restaurants work with exclusivity and high prices instead; in principle, that will continue to work.) Some, even a significant cluster, of restaurants will probably make a successful transition to a model where pick up/delivery plus off-licence sales makes up for fewer dine-in customers; the premium for dining at a restaurant will go up. But that sector us going to look very different in a short while in both numbers and what are s offered.
Thirdly: demand for petroleum is down, and there were already intrinsic pressures driving towards a collapse of the petroleum industry. There are indications that the stresses of the pandemic may push it across that threshold. If that happens, a lot of other dominoes will fall as a massive amount of capital value evaporates very quickly, including financial institutions and governments which have become too entangled in their petroleum-extracting corporate citizens.
Fourth: you don't have to assume that everybody will continue to work from home to anticipate a collapse in commercial real estate demand in the downtown cores. Even a drop in the number of people working on-site on a daily basis will shrink the footprint of larger lessors, and the idea that there will be a flood of smaller ones to make up the gap seems to me to assume that the desirability of being physically downtown will be much higher than it really will.
My previous employer had a pilot project well before the pandemic aimed at pushing its technical employees into a model where they would have notebooks and lockers and no dedicated desk space on-site and would have to work off-site a couple of days a week; the rhetoric was about increasing flexibility but the real aim was to reduce the real estate footprint. And prudent employers who have had the experience of transitioning a workforce to off-site work may very well require workers to work from home a day or so every couple of week just to ensure continued Disaster Recovery capability.
If many employees don't want to take transit and live in the suburbs, that may result in more, smaller-footprint, satellite sites where suburban workers can be "on-site" with a local commute for more of them. This may take a while as the ability to move commuters around in any directionvand not just from suburbs to the centre and back, gets put in place. It's not much good putting an office in for the block of your employees who live in Oakville if most of the rest live in Richmond Hill.
All this may have some counterbalance in the need to lower the density of workspaces - fewer employees may be in the office, but there will be bigger air gaps between them. However, my guess is that this won't be enough to make up for a centrifugal movement of workers out of the centre.
A smaller number of downtown workers means a smaller market for goods and services, and many people are developing patterns of ordering things online that they used to shop for in person. So commercial retail real estate will also be affected.
So will the tax bases of cities, already stressed with the need to provide more services.
This will be a slow-motion, gradual change, like the proverbial frog in heating water.
Fifth, and slightly different, consider major phone companies, which happen to be the major internet providers. They're doing relatively well out of the pandemic, but the extreme reliance it has revealed that everyone has on internet access now is already calling for internet access to be a "right". The Ontario government has just announced funds for subsidizing building out rural internet access.
It is not unlikely that internet access will be regulated -- federally, telecommunications being a federal responsibility - in much the same way that POTS was when I was young: an enforced low flat rate for access at least at certain times (say, from 9 to 6), but with supports for it being universal (rural areas, poverty, etc.), with cross-subsidization from other sources. (Telcos stop being growth-oriented companies and go back to a regular-dividend-stream model that they used to have.)
On top of that, there are obvious public-sector issues in healthcare, long-term care, policing, transit, and social work which have been popping up like gophers.
Locally, we don't see a lot of this yet for political reasons. The Ontario PCs, although they get reasonable grades for initial action to shut things down - Doug Ford gets credit for empathic reactions when concrete examples of certain sorts of difficulties are presented to him - has largely squandered the breathing space they got by shutting things down. Ideologically, they have no appetite for sustained changes in government involvement in the economy, or for raising taxes to provide the revenue stream to support a more activist role, and deep down they're still at a Keystone Kops level of competency for actually getting things done. They have put their problems on hold but not actually solved them. The federal Liberals have a minority government, limited jurisdictional powers in many of the areas under mist stress (except airlines and telecommunications) and a recent track record of promising much and delivering little, slowly. But that doesn't mean that change is not going to happen.
Governments have already discovered that where they had a policy of "flattening the curve" for the pandemic, the population has generally not followed them. A minority don't seem to care and are possibly the core of the reason that cases of Covid-19 stubbornly refuse to drop below a certain level (plus, probably, not shutting down enough activity); the majority, though, missed the message about getting Covid-19 in a spread-out and manageable fashion and take the shutdown as "not getting Covid-19 at all", particularly themselves, and don't want to go out and restart the economy if it means risk to themselves. And with that level of pushback, governments are scrambling to respond and frequently making things up on the fly.
These are specific changes, even if, all together, they amount to an economic upheaval. The question of systemic change is more obscure. Certainly one of the secondary effects of the pandemic has been to show more of the implicit inequities generated by class, racial, and economic distinctions, and government responses, especially in the USA, have tended to show more of the iron fist than the velvet glove, and we're seeing responses to that at a relatively broad level. But whether the current set of disruptions are enough to push enough people off their pre-existent local maxima into a place where there is a gut realization that the alternatives to systemic change are all worse - that's another question.
I'm dead certain that, economically, the landscape will look very different two years or so from now. I am not sure, in general (aside from the US where the election is guaranteed to deliver change no matter what happens), whether we will see significantly different social and political landscapes.
no subject
Date: 2020-06-06 08:22 pm (UTC)(The thing with COVID-19 is that it's pretty obvious you don't necessarily recover, and the whys and wherefors are down to something close to genetic luck. Nobody wants to risk getting maimed.)
It comes down to (I think) three things.
Will the supremacists admit defeat on demographic and public opinion grounds without opening fire? Maybe, in Ontario (though I kind of doubt it); in the US? No way.
Will the Mammonites, faced with the obvious and certain end of open-loop extractive capitalism and the policies necessary to sustain it ("if you don't work you starve, and sometimes then", "no land tenure but corporate tenure", and "pollution is free to the polluter"), accept structural change that lessens their relative degree of wealth? Absolutely not. They've been pushing hard for human extinction in preference.
Government that does things. The single best predictor of COVID-19 policy success is whether or not the government responsible engages in direct production of goods and services. In polities where that's anathema, the response has been poor to actively terrible. In polities where the government manufactures medical supplies directly, the response has been effective.
Canada has a terrible case of squeems about direct production. Canada's COVID-19 response has been much worse than recognised, mostly because no one can get the excess death statistics for this year until next year.
I don't think we're -- Canada -- going to come out of this with a functioning economy. There's a leadership vacuum just about everywhere and nobody talking about sufficient policies, never mind optimal policies. Nobody is talking about the necessity of being something other than a petrostate. Nobody's talking about the need to close the loop. Everybody's stuck in an imagined past of one sort or another in preference to dealing with the certain future.
So I'm not expecting upheaval so much as I'm expecting slumping collapse; there are enough mammonites to prevent a useful public response and enough supremacists to prevent a useful mass movement to demand a public response.
And, well, even a perfect policy response in Canada isn't going to matter much if the US slides into anarchy.
no subject
Date: 2020-06-06 09:02 pm (UTC)Canada's best chance is that it follows the EU generally after somewhat coherent policies work there -- central Canada likes to identify with Europe over against the US these days -- and that the Liberals are willing to let Kenny's government swing while delivering relief directly to the inhabitants of Alberta. I'm not sure what the odds are of that, but they're non-zero.
no subject
Date: 2020-06-06 09:41 pm (UTC)(Moralistic Mammonism, lots of incumbency, and no emerging philosophical alternative to the status quo. So they're ahead on state function but not really anywhere else.)
(I will be delighted if the US makes it to November and holds an actual election, rather than observing the forms.)
Thing about Le Dauphine is that while he is arguably a better person than his dad, he has a crippling weakness for a national politician; he wants to be liked. Even if you convince him that the status quo needs replacing, he can't do it. (and he is, like any other child of power, pro-status-quo.) The alternatives are a dead-eyed death cultist and a personable but innumerate figurehead. They're not preferable disasters, put it that way.
I would feel a lot better about this if there was a single premier or a national politician who was displaying "time to move" clue. (the ones chanting "ethnostate! ethnostate!" are about murder, not social change.)
no subject
Date: 2020-06-06 10:48 pm (UTC)All three of them had far more competent leaders and ministers than anyone I can call to mind recently, barring possibly a few figures in the Obama administration. Pearson's cabinet was, by comparison, stellar, and Johnson was a corrupt bastard but a highly competent corrupt bastard who did more for civil rights than any other President of the century. It isn't just showing "time to move" indicators; it's showing indications that they are capable of it.
no subject
Date: 2020-06-07 12:46 am (UTC)I would be delighted to see signs of capacity, but, seventh and last, capacity can be hired. The will to do the thing cannot. The most we've got is a sort of inchoate "this can't go on", and while I agree with that, it's not the sort of thing that produces quick results.