Populism risks worsening corona impact


Analysts say almost all of the world’s airlines will be bankrupt by May. FILE PHOTO | NMG

The fear virus has infected us all with panic. We lose more than 10,000 children every year to pneumonia and do nothing, and now we have three people (at the time of writing) diagnosed with a respiratory illness that kills one in 500 in their age group and we have closed our economy.

Of course, rationality is long gone at this point, and it makes me a maverick to even wonder when sanity will be restored and at what cost. But let’s just count.

Matatu touts turn up to be picked for the day at around 4am, work long hours and get paid in cash.

Virtually none of them have the National Hospital Insurance Fund (NHIF) cover and, now, many of them are not working at all. That will see them run out of money rapidly: few have any kind of cushion of spare funds. They will be forced to drink dirty water when they cannot afford clean water. They will go without food. That will kill some of them.

This balloon of new and exacerbated poverty will go much further, of course. All those private schools so many people have collected their children from this week, they don’t pay well. There has been a row of studies — we’re talking about Sh3,000 a month. So those teachers already live at the borderline on that dollar a day that supposedly defines some middle class. But knowing some of the owners of these private schools, I am going to hazard a guess that many will now stop paying those teachers.

Cleaning staff, cooking staff, all will stop. Our airline staff — what are they going to be doing? Our hotel staff, how many of our hotels must now have closed?

But what’s to say? It’s happening everywhere in the world. Nowhere seems exempt from this coronavirus hysteria. Yet the lessons are huge, as we turn our world economy into a porridge.

We are hurtling to complete financial implosion.

stress testing

For there is a term in global banking for ways of assuring the system and individual banks can cope with shocks: it’s called stress testing. But no stress test has ever been run that would come close to what our planet’s banks will now experience.

For which loan repayments will be met now? Who will still pay their rent in France where people, comprehensively, the entire population, has been banned from leaving their homes?

Globally, shops, malls, tourist sites, hotels, airlines, theatres, restaurants, cafes, bars, clubs, all Netflix filming, all cinemas and cinema launches, millions of schools and colleges — the list goes on of everything that is now ceased.

So where is it all taking us? Governments, some of them, are saying they will stop businesses going bankrupt — not including our own at this point in time — on the contrary, our Kenya Revenue Authority is still chasing for its funds as contracts crash everywhere.

For sure, maybe we will save some of our over-70s from premature death from pneumonia. Although, it’s been said often enough, this is not Ebola. This virus is barely worse than normal flu. But, finally, our high-drama media has had its flesh. Because we now face the prospect of peddling back decades and even a century a more in our world ecosystem and lifestyles.

poor faculties

Analysts say almost all of the world’s airlines will be bankrupt by May. Which banks will be keeping their doors open once the defaults are high enough? Even sovereign debt simply falls like a nine pin when a government can suddenly only collect a fraction of taxes.

When we look back on 2020, here’s my forecast: it won’t be the flu deaths we remember. It will be the year we destroyed our entire system of trade, business, and finance. For which reason, no wonder the stock markets are melting down.

The lesson is not how to cope with a pandemic. The lesson is our very poor faculties when it comes to weighing up the competing consequences of our government measures.

For whose doing the risk assessments now, in our race to destruction? Populism rules: the whole way back to the dark ages.