Covid-19 After the Storm
COVID-19 - After the Storm
I was talking with Ashish this week about the challenges he is facing in India, like how his extended family both self-isolate in Delhi and find ways to support each other. We talked about the ways that COVID-19 might change the way people organize their lives in India and the US. This led me to think about the breadth of ideas that might become the drivers of our recovery.
Before we dig into those ideas, take a minute to reflect on how you are processing the recent developments. How are you thinking about our elders and other people that are deemed to have high risk? What are your thoughts when people talk about ‘the cure being worse than the disease’? Are you ready to allow some segments of society to get sick and possibly die in order to keep the economy from contracting sharply in the short term? These are real questions that policy makers and politicians are talking about. It’s more important than ever to ask these questions, and to imagine what the next three years might look like – to imagine what kinds of changes you want to see in our country.
Eleven years ago, in 2009, the American Recovery and Reinvestment Act (ARRA) was signed into law and $800 billion poured into the US economy. Together with massive US monetary easing, this US fiscal stimulus (together with massive interventions by central banks and governments from all around the world) is credited with preventing the collapse of the US/global economy. The CARES Act provides a $2,000 billion fiscal stimulus (two and a half times the 2009 package). After three and a half years of inaction on infrastructure, might this “surge” be the moment to rebuild the US? The CARES Act is a short-term shot in the arm, there are likely to be follow on disbursements: e.g., focused on infrastructure.
Let’s think about infrastructure in two dimensions: physical and social. The US healthcare system’s capacity to deal with COVID-19 consists of heroic nurses, doctors and other caregivers, 175,000 ventilators, and millions of N95 Masks. Human capital is priceless, ventilators cost about $50,000, and N95 masks used to be a $.75 commodity. If you interview patients in Bergamo, Italy or in New York City – what might they pay for these priceless elements of a healthcare delivery system?
Besides the physical “stuff” that we need to prepare for the next pandemic – what are we learning about our social infrastructure? Consider that approximately 30 million US citizens don’t have health insurance. COVID-19 doesn’t discriminate based on whether you have insurance. If 9% of our population doesn’t have insurance, is our national health compromised? What resources are available to marginalized people living in overcrowded, urban communities? What resources are available to marginalized communities in rural communities?
In health care alone, there are a myriad of investment opportunities that require long-term, thoughtful and comprehensive investment. Investments that link the communities to the results: financial and non-financial. Does this sound familiar to the TILT investment process?
The American Recovery and Reinvestment Act included $90 billion (11% of the total) for “clean energy.” If you review the impact of this funding on the build out of renewable wind and solar energy over the last ten years, there is no doubt that government “surge” funding can catalyze other investors. What would it mean to our healthcare infrastructure if we applied a similar surge? What about doubling down on the “clean energy” model? What other sectors of our society could be transformed by a similar level of financial investment?
Before you get too comfortable thinking this way, and believing that our political leadership can navigate these decisions, please take a look in the mirror. What could you do to support these ideas? If you have wealth to invest, if you have power to influence how wealth is invested, if you know people that influence how wealth is invested – you have a role to play. COVID-19 has shone a sharp light on many parts of our society: both the physical and the social chasms. As we mobilize to rebuild the systems that supported some of us and held some of us down, what are you going to do? The $90 billion of government funding that was invested in wind and solar renewable energy supported a much larger quantum of private investment funds.
As a society, we value innovation and creativity. As a species, these qualities have pushed us forward. Now is the time to reimagine our world, to prepare for the calm after the storm has passed. What are your ideas and what are your actions? If you need some additional prompts, check out the New York Times series that is starting this week. Eleven years ago, we emerged from a financial crisis with innovative ideas for renewable energy that are transforming that sector. The CARES Act and follow-on fiscal stimuli offers each of us a chance to align our voices, our wealth, and our power to support investments in “the stuff” that is going to improve life for all of us. If you have some ideas, we’d love to hear from you – please reach us through www.tiltinvestments.com.
I hope to check in with Ashish again next week, and I expect that he and his family will have figured out new ways to both “stay in place” and to meet the household’s needs. It’s scary here in the US, and I’m pretty sure it’s scary in a lot of other places in our big beautiful world.