Lessons From Black Swans

by James Wallace Harris, Wednesday, March 18, 2020

We always learn something from black swan events, such as the 9/11 attacks and the 2008 financial collapse. First, we’re always shocked by changes that many predicted and see the obvious warnings in hindsight. With the current pandemic, we’re now realizing just how many books and movies imagined an event like this one, and we asked ourselves “Why weren’t we prepared?” There were those who warned us about terrorist attacks and economic bubbles but we didn’t listen to them either.

Basically, people are hopeful. Or at least, they need to turn a blind eye to fear of the future. After the black swan lands, we become so fearful of another similar landing that we become paranoid for decades. We’ve spent trillions on worrying about terrorism since 9/11, and whenever Wall Street got the sniffles we’ve freaked out worrying about another giant economic downturn. Singapore was better prepared for COVID-19 because it had already experienced a SARS outbreak. We do learn, it just takes a big kick in the head first. On the other hand, some groups like Boomers and the Faithful are still living in denial about the current black swan. And preppers are having a big “I told you so” moment.

It now looks like this pandemic will hurt more Americans than terrorisms and wars, and damage the economy far more than any shenanigans of big business. We hope the coronavirus will clear up in weeks, but it could change the country for decades, just like other black swans. Events like this pandemic will also identify the grasshoppers and ants in society. Aesop’s fable told us not to always party and put away for tomorrow. This plague is going to sicken more people financially than medically. Far from everyone heeded the advice to set aside six months of living expenses, but really, how many ever imagined they would be told to stay home for months? I expect the lessons learned from surviving this pandemic will affect how people live for decades to come. And that too could affect the long term economic outlook. And I bet getting vaccinated for everything offered will become a lot more popular.

You’d think we’d start learning how to handle black swans. We’ve known for a very long time that if some people eat bats in China or monkeys in Africa diseases that previously only existed in animal reservoirs would jump the dam to dwell in us. We’ve had decades of experience containing these pathogen breakouts, knocking them back, and knowing if we failed the disease would become part of our regular lives. Every year cold and flu viruses flare up and travel around the world because so viruses are entrenched in us. If we don’t contain the coronavirus it could house itself permanently in Homo sapiens and either become an annual flareup or a chronic problem like TB. We don’t know enough yet, to say which.

For the year 2017, the CDC said these were the leading causes of deaths in the U.S.:

  • Heart disease: 647,457
  • Cancer: 599,108
  • Accidents (unintentional injuries): 169,936
  • Chronic lower respiratory diseases: 160,201
  • Stroke (cerebrovascular diseases): 146,383
  • Alzheimer’s disease: 121,404
  • Diabetes: 83,564
  • Influenza and Pneumonia: 55,672
  • Nephritis, nephrotic syndrome, and nephrosis: 50,633
  • Intentional self-harm (suicide): 47,173

If the coronavirus isn’t contained, and it looks like it won’t be, it could become another regular item on this list. The $64,000 question is where it will rank. Until we develop herd immunity and the experience of many years of living with mutated versions of the SARS/coronavirus, we won’t know. Eventually, it might become no more deadly than the other annual influenzas. But if it is truly ten times more deadly than the flu, it will come in at #3 behind heart disease and cancer. To handle that will require a complete transformation of our medical system. My guess is coronaviruses won’t be that deadly once humans develop natural and vaccinated immunities, but it will rank above Influenza and Pneumonia, or it will expand that category greatly.

What we have to do now is learn how to avoid COVID-19 until a vaccine can be developed. That means avoiding people for the next one to two years. I’m not sure we’re prepared to do that. But it also means learning to live in a new way — a much more germ conscious way. Should we allow so much airline travel if it confers such potential danger? So many economies depend on tourism. China has already announced bans on eating wild animals, but can they make hundreds of millions of people give up a multi-billion dollar industry that people have relished for centuries?

Can we invent personal bunny suits that protect us from diseases? Ones that are reusable, machine washable, and even fashionable? Can we invent vaccines that anticipate new diseases? Do we really need to congregate by the thousands? Will we just accept a certain level of death in society for the activities we love? We embrace cars knowing that 1.25 million people are killed by them every year — so maybe we’ll embrace gathering in sports arenas for ball games and rock concerts and just accept the related fatalities. Who knows what we will decide.

At first, I thought we were overreacting to the coronavirus. Everything is shutting down in my city which has only two infected people. I worried that thousands of people will be crushed financially. But the more I read about how European hospitals are being overrun by pandemic patients, and what it’s like to need a respirator to survive, that I now worry that we’re not panicking enough. I also assume if political leaders are freaked out enough to do all the things they are doing, then it’s probably going to be much worse than I feared. Political leaders aren’t known for quick action.

The die has been cast. Our society has committed to sheltering in place. Some people are thinking it will be for three weeks, but I don’t see how that’s possible. If the disease disappears with summer, I can see us getting a reprieve until next winter, but that means we need to hunker down for three months. Then we can run around for four months before taking shelter again. The goal is to wait it out until a vaccine is tested and distributed. Can we shelter in place for that long?

What if vaccines aren’t ready until Fall 2021? It means we have to learn a new way to live. How do we do our food shopping? How do people work and get paid? How do you go to the dentist or get your car repaired in the middle of a pandemic? If you need non-critical cataract or prostate surgery do you still go? It’s not going to be as bad as living through the Blitz in London or surviving Stalingrad, but it might be as challenging and inconvenient as living in America during WWII.

That’s the shocking thing about black swans — normalcy is suddenly disrupted — but we adapt. At least the people in history have. I’m already skilled at staying home for days at a time, so I don’t see learning to do it for weeks or months being a problem. But I do know most people might go crazy with cabin fever. And I worry about all my single friends. Sheltering at home for long periods by yourself might be deeply psychologically damaging. Many of my single friends also sneer at Facebook, but it might be a great social outlet during the plague months.

I’m lucky Susan moved back home last year after working a decade out of town. I’m also lucky that I have a wide-ranging set of internet friendships to keep me socially active. And I’m further lucky in that I have a long list of things I’ve been meaning to do. I generally ignore my to-do lists in favor of socializing, so maybe I’ll actually get some of the things done from those lists.

The most fascinating thing is we don’t know how this will change us. It’s another black swan about to land.

JWH