Pandemics and Economics: A trade between Blood and Paper

Pandemics and Economics: A trade between Blood and Paper

I woke up this morning and indulging my usual curiosity, I decided to read a November 2007 publication by one Thomas A. Garret on “Economic Effects of the 1918 Influenza Pandemic: Implications for a Modern-day Pandemic”. For the avoidance of doubt Thomas at the time, the Assistant Vice President and Economist, at the Federal Reserve Bank of St. Louis, must be praised for his near prophetic write-up some 13 years ago. I read his work wondering if the world did not pay attention to voices like his because the probabilities of such an event occurring was too low? Today I regurgitate important parts of his report drawing specific bearing with the Ghanaian context and also with the view that we may reduce the impact have been less hit (at least so far) and certainly assuming the UN advise for African Countries to prepare for a worst possible scenario in two weeks to three weeks is no April Fool’s prank.

1. The first thing that stuck with me from Thomas’s publication was; “Health care is irrelevant unless there are systems in place to ensure that an influenza pandemic will not knock out health-care provision and prevent the rapid disposal of the dead in the cities… If medical staff succumbs to the influenza and facilities are overwhelmed, the duration and severity of the pandemic will be increased.” The first question then for me this morning was, if the forecast of a worst case scenario for African countries, more that Italy or Spain, is anything to go by, can our health systems withstand the stress? I guess we will let the medics answer that but our collective observations as non-medical professional may need some faith. The discussion for the health system should be how are we preparing for a worst possible scenario? The questions in these times should not be wash your hand, use sanitizer and so forth, although extremely important, the conversation at this stage should be, assuming a worst possible viral exposure and how do you deal with it? And please bear in mind as covid-19 escalates other illness have not reduced, the already overstretched facilities with death in simple things like maternal mortality still exits and may also escalate. So let us refocus the conversation now to a what will we do if these infections get worst.


2. The second thing in the report that caught my attention was; “Local quarantines would likely hurt businesses in the short run. Employees would likely be laid off. Families with no contact to the influenza may too experience financial hardships. To prevent spread, quarantines would have to be complete (ie. No activity allowed outside of the home). Partial quarantines, such as closing schools and churches but not public transportation or restaurants (as done in Philadelphia, St. Louis and Washington D.C.) would do little to stop the spread of the influenza.” I know the trade off is between bloods and money but for a people where ‘Sika y3 mogya’ we will still hope a partial lock down has the blessing of God, in contradiction to what the evidence shows. The bigger question then will be how long should a lockdown be anticipated and with what increasing strictness will lockdown be with the passing days? Ghana did implement a movement restriction and a partial lockdown. The stampedes in our markets and travelling two days prior to the effective date of the Restriction notice made my heart skip a beat and cringe with the words, lead us not into temptations, for thine is the Kingdom.

3. “Some businesses could suffer revenue losses in excess of 50 percent. Others, such as those providing health services and products, may experience an increase in business (unless a full quarantine exits). If the pandemic causes a shortage of employees, there could be a temporary increase in wages for the remaining employees in some industries…” Business such as financial institutions who already have assets in some of the worst hit industries will see the effect in its asset quality. Industries who fund these assets with deposits are expected to have cash flow squeezes and the economic effect will be significant. Money will be lost but must we trade that for lives? The moral answer is obvious but the economics is not an easy choice for any business person at this time. We have seen some mortgage banks in Ghana already making prudent decision to suspend repayments (bad for the profitability but certainly great for the optics). And yet speaking about the trade of profit for optics, I have personally had a regrettably painful experience with GHL Bank and think if all of the dust settles we should interrogate the complete disregard for client’s right with institutions like theirs and all the other greedy traders selling things like ‘gari’ for ridiculous sums (My crime was I opted to reduce my principal, give them back their money earlier than expected, yes! And the options they gave me for penalty for paying earlier were completely outlandish, disregard for the contract because of ‘New Regulations without Notice’, prepayment fees wahala, I have never been a fun of boycott of an economic entity but if I ever become one it will be because of the terrible experience and unpardonable greed. No one else should experience at inhumane profiteering business enterprises especially during these times. But again can you blame an institution who seeks profit over a humane optics?) Many economic entities will be faced with this blood-money dilemma; I hope my mother was right when she said, “human being are sweet, we just don’t eat their flesh” or at least we should choose to let companies without values know they can’t be all about the money, at least not now. My view is that, after this pandemic the business organisations that are organized for value and not only profit should have our loyalty.

4. I cannot overemphasize the need for personal responsibility enough, especially at this time, because as the data indicates, “Government has shown its inability to handle disasters in the past” and private institution may frame disasters in the light of profitability. Hard as we want godfathers to solve all our problems for us so we can blame everybody but ourselves for outcomes, please note that, your blood is yours and yours alone to determine how you spill it.

My concluding thoughts will be, society in itself may recover rather quickly but a loss of a loved one will be an eternal scare. I pay tribute to Senior Samuel Waterberg, a man I met twice and had great conversations with and respect for. Preventing a pandemic of this nature from happening would have been the best risk management approach but at last we are here. Complete Quarantine is known to be the most effective but will the money let us choose that?

It is not all gloom, however, (at least again not yet). Let our attitude and inclination in these really uncertain times be one of survival first. It is blood that prints papers and builds the productive sector to sustain its economics. But as we choose life may we build stronger communities and effective support systems in anticipation of the values of unity, cooperation and one mindedness by which even the gods could not stop the tower of Babel except to cause disunity. And for institutions like GHL and the greedy market women who give us experiences we wish we never want to talk about, let us be bold to remind them that the world after this pandemic will be a much bolder, freer and humanity will be at the center.

Of course, we must all learn at all cost in these times with anticipation of what a post COVID-19 world will look like so we may advance society forward. Let me end with an African proverb, “when the chief’s palace is destroyed by the raging market day fire, it gives community the opportunity to build a much loftier palace by the next market day.” So stay safe, stay at home, learn all you can and let’s look forward to a great Ghana and a much prosperous Africa after this is over. My name is Yaw Sompa, May God bless our homeland Ghana and Make Africa great.

Written by Yaw Sompa

P.O. BOX CT8921

Emmanuel: [email protected]

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