How the Wuhan Virus Will Change the World Order

[TBoneTX 45,571]

Plain-English analysis of what might and ought to happen after the crisis stage.

Quote

How the Wuhan Virus Will Change the World Order

by Charles Lipson

 

The horrific spread of COVID-19 has filled hospitals and graveyards, shut down the global economy, and exposed deep fissures among nations.  The international problems, such China's rising threat and reliance on foreign sources for critical supplies, are not new.  But the contagion puts them in sharp relief and will surely affect relationships going forward.

Most changes won't come until the crisis passes.  Right now, policymakers are preoccupied with life-and-death decisions.  They don't want to challenge Beijing while they need its medical supplies and data. They also want to see if it will fulfill its promises in the Phase I trade deal or cheat, again.  But make no mistake, changes are coming. [...]

 

Continues here: https://www.realclearpolitics.com/articles/2020/04/08/how_the_wuhan_virus_will_change_the_world_order_142886.html  

 

 

 

[sl1pstream 551]

I think you're seriously underestimating the power of cheap labor and how unwilling people are to pay more when they can pay less.

Combine that with the fact that people won't have any money in the first place and you get to the point where not a whole lot will change.

 

There might be some supply chain changes where companies like Apple will get a reserve again, but I really don't see companies like Walmart switching to more expensive stuff just because it's American made. People don't care where things come from.

 

This article underestimates how expensive all of those changes are. All of those changes are great, but that means making huge changes in a world in which every country will either have a recession or will at least have an economy seriously affected by the virus' aftermath.

 

There definitely be changes in how we go through daily life and there will hopefully be some changes when it comes to how we treat minimum wage workers, considering their importance during this crisis. I just don't see the changes this article talks about happening, at least not on that scale.

Their use of "Wuhan-virus" kind of gives away their general stance on China, so I'm assuming that this is sort of their dream scenario, but they're way too overoptimistic.

Edited April 9, 2020 by sl1pstream

[Dashinka 24,628]

This is already happening, there is a slow but steady movement out of China for cheaper labor markets especially in SE Asia.

 

“International corporations will act on their own to reevaluate where they produce key products and component parts. They will reevaluate any supply chains that pass through China on their way to sales in the U.S. and Europe. They will also face political pressure, not just from Washington but from London, Brussels, Berlin, and elsewhere. If President Trump is going to tell 3M not to sell masks to Canada during an emergency, then Ottawa will have to decide whether to manufacture those locally, build a stockpile of essential supplies, or perhaps strike a bilateral deal not to restrict supplies in emergencies.“
 

 

[sl1pstream 551]

2 hours ago, Dashinka said:

If President Trump is going to tell 3M not to sell masks to Canada during an emergency, then Ottawa will have to decide whether to manufacture those locally, build a stockpile of essential supplies, or perhaps strike a bilateral deal not to restrict supplies in emergencies.“
 

 

Those masks are manufactured with pulp from a specific kind of tree that only grows in Canada. If Trump had actually succeeded in the ban there wouldn't have been masks rolling out of those factories in the first place.
The world is too connected for every country to suddenly decide that globalism is a bad idea and to start manufacturing things themselves. In a lot of cases that's also just not possible, either due to labor laws or due to the necessary materials just not being available.

I can totally see how this crisis seems like a dream for some people, but the world isn't going to rethink globalization and suddenly change because of it. Even if countries weren't already struggling with financial issues, leaving absolutely no money for a structural change of that magnitude, people also wouldn't suddenly start paying more for things just to get them manufactured locally. That's why they moved manufacturing abroad anyway. If anything, this is going to have an effect on how quickly everyone's going to move towards automatization, which means less overall jobs worldwide.

Edited April 9, 2020 by sl1pstream

[TBoneTX 45,571]

Very thoughtful responses here.  We need more threads like this.

[Burnt Reynolds 5,058]

17 hours ago, sl1pstream said:

Those masks are manufactured with pulp from a specific kind of tree that only grows in Canada. If Trump had actually succeeded in the ban there wouldn't have been masks rolling out of those factories in the first place.
The world is too connected for every country to suddenly decide that globalism is a bad idea and to start manufacturing things themselves. In a lot of cases that's also just not possible, either due to labor laws or due to the necessary materials just not being available.

I can totally see how this crisis seems like a dream for some people, but the world isn't going to rethink globalization and suddenly change because of it. Even if countries weren't already struggling with financial issues, leaving absolutely no money for a structural change of that magnitude, people also wouldn't suddenly start paying more for things just to get them manufactured locally. That's why they moved manufacturing abroad anyway. If anything, this is going to have an effect on how quickly everyone's going to move towards automatization, which means less overall jobs worldwide.

Automation makes globalization more irrelevant. Robots physically in China work the same as robots physically in the US. Also decreases risk of supply interruptions. 

 

I'm all for it.

[sl1pstream 551]

2 hours ago, Burnt Reynolds said:

Automation makes globalization more irrelevant. Robots physically in China work the same as robots physically in the US. Also decreases risk of supply interruptions. 

 

I'm all for it.

We're not just talking production. Why keep your retail stores open when online works as well, isn't affected by stuff like this and doesn't require renting physical space?

 

Once automation gets going you're going to lose American jobs too. Transportation is going to be one of the most important ones that are going to go.

 

Millions of people will permanently lose their jobs and unless you're willing to provide them with an alternative income, that's going to be an enormous economic problem.

 

I mean, sure, you'll have more products that are made there, still dependent on the availability of components and raw materials, but it's not going to help workers. If other countries can still do it cheaper because of the cost of energy or other reasons, they're not going to come back either.

Edited April 10, 2020 by sl1pstream

[Dashinka 24,628]

47 minutes ago, sl1pstream said:

We're not just talking production. Why keep your retail stores open when online works as well, isn't affected by stuff like this and doesn't require renting physical space?

 

Once automation gets going you're going to lose American jobs too. Transportation is going to be one of the most important ones that are going to go.

 

Millions of people will permanently lose their jobs and unless you're willing to provide them with an alternative income, that's going to be an enormous economic problem.

 

I mean, sure, you'll have more products that are made there, still dependent on the availability of components and raw materials, but it's not going to help workers. If other countries can still do it cheaper because of the cost of energy or other reasons, they're not going to come back either.

I always hear this doom and gloom with respect to increased automation, the simple fact is that increased automation leads to a shift in the way labor functions.  Sure there might be little blips, etc., but just look at the auto industry, automation has been increasing greatly over the years and yes, less folks are working int he factories, but unemployment is not 50%.  In fact prior to this virus stuff, the unemployment numbers across the board have been at a historical low, and it is not everyone working at McDonalds.

 

I also disagree that we should completely abandon brick and mortar for only online business.  There is still a need to have some stores.  A great example I just recently saw is we needed to get some TP, I was scouring online and could not find any except for the gougers on Amazon.  We went to Costco and low and behold, TP.  There is also the case of fresh produce and fresh meat/poultry/seafood, sure you can find some of that stuff online, but the method of shipping it safely is much worse environmentally than going to a store and picking it up (I am sure everyone is appropriately disposing of all the chemical filled cooling packs that come with shipping containers).

Edited April 10, 2020 by Dashinka

[sl1pstream 551]

I'm not saying that we should abandon brick and mortar, but stores will keep closing either way. Grocery stores will probably still be a thing, but they'll move more towards self-checkout or a system like Amazon Go.

[Orangesapples 1,954]

2 hours ago, sl1pstream said:

I'm not saying that we should abandon brick and mortar, but stores will keep closing either way. Grocery stores will probably still be a thing, but they'll move more towards self-checkout or a system like Amazon Go.

Self check outs are the worst. 

[sl1pstream 551]

2 minutes ago, Orangesapples said:

Self check outs are the worst. 

I'm not a huge fan either, it's just a lot cheaper for stores to pay less people.

Edited April 10, 2020 by sl1pstream

[Orangesapples 1,954]

3 minutes ago, sl1pstream said:

I'm not a huge fan either, it's just a lot cheaper for stores to pay less people.

They should pay the shoppers then for doing the cashiers' work. 

[sl1pstream 551]

Just now, Orangesapples said:

They should pay the shoppers then for doing the cashiers' work. 

They should probably also pay cashiers more if they're essential workers but I don't see that happening either. 😛

[Dashinka 24,628]

41 minutes ago, Orangesapples said:

Self check outs are the worst. 

What is worst about a self check out?  Certainly better from a physical distancing standpoint and much more efficient.

[Orangesapples 1,954]

46 minutes ago, Dashinka said:

What is worst about a self check out?  Certainly better from a physical distancing standpoint and much more efficient.

It is better from a physical distancing standpoint, true, but I find it very annoying. It also breaks quite often and you still need to have an employee help you. I prefer to have people scan things for me, doing it myself just feels like a hassle. I also like interacting with cashiers.