A Way Ahead – Post COVID-19 recovery and prosperity
by Tim J. Clark
The government response (national, state, county) to the pandemic has been overly influenced by fear, emotion, politics, and ignorance.
Transitioning from Response to Recovery – Getting back to work
The 24×7 media coverage that thrives on controversy does not help. I support the assessment identified in the article in Quality Digest magazine – “Tracking Covid-19 – How to let the data tell you what lies ahead” that “case isolation, home quarantine, and social distancing of those at risk of severe disease—make up an optimal mitigation policy that will guide getting the country back to work.” The issue that is just starting to surface is about community (herd) immunity.
- Community (Herd) Immunity. A situation in which a sufficient proportion of a population is immune to an infectious disease (through vaccination and/or prior illness) to make its spread from person to person unlikely. Even individuals not vaccinated (such as newborns and those with chronic illnesses) are offered some protection because the disease has little opportunity to spread within the community. Also known as herd immunity. Reference: CDC
I’m also following the discussions on the macro-economics. The current situation has been assessed as being similar to the period between 1930-45. The Depression (1930) contributed to conditions that created conflict between competing powers that led to WWII, followed by a “new democratic world order” led by the U.S where the dollar became the reserve currency for the world. In some future scenarios, the pandemic is projected to lead to a “depression,” heightened by tensions between the U.S. and the emerging power (China).
Hedge fund billionaire Ray Dalio participated in a Tedx discussion on the topic – “What coronavirus means for the global economy” where he states that “This is not a recession; this is a breakdown. You’re seeing the same thing that happened in the 1930s.” Comments on the discussion at Forbes:
- Forbes. Ray Dalio: ‘We’re Heading Into A Great Depression’ by Alexandra Sternlicht, April 8, 2020.
In contrast to Dailio’s conclusions, CNBC in their review ” Ray Dalio predicts a coronavirus depression: ‘This is bigger than what happened in 2008’ by Tom Huddleston Jr. remarks:
- ” …. However, other experts believe this financial crisis is unique because it is a result of a health issue, a global pandemic, rather than an otherwise unstable or unproductive economy. As such, they are more optimistic that the economy will rebound quickly once the coronavirus pandemic subsides.”
- “I would point to the difference between this and a normal recession: There is nothing fundamentally wrong with our economy,” Federal Reserve Chairman Jerome Powell told NBC’s “Today” in an interview last month. In a follow-up interview with CNBC on Thursday, Powell reiterated his belief that the U.S. economy can have a “robust” rebound once the pandemic ends, though he is reluctant to offer a precise timetable for how long that could take.
Regarding Brown County, the Community Organizations Active In Disaster (COAD) works within a four-phase cycle: Preparation-Mitigation, Preparedness, Response (the phase we are in now), and Recovery.
An optimal “Recovery” strategy is not likely without a successful transition to a “whole-of-county” strategy and plan that is supported by the Brown County community.
The county is funded by income and property tax and a depression/recession will reduce revenue. The county cannot print money and options of increasing revenue include a combination of cuts, borrowing, and raising property taxes. The most optimistic and unrealistic scenario is that things go back to the way they were – this may be wishful thinking.
Regarding increasing county debt, the “temptation” may be to borrow money to fund a variety of special projects with the promise of economic miracles.
The economic engine for the county is residents that reported adjusted gross income (AGI) of $401 million dollars in 2017. Tourism has been identified as the economic engine for the town of Nashville. In contrast, in 2017, the gross revenue generated from tourism was estimated by Rockport Analytics at $42.7 million with a total economic impact of $22.6 million.
Relying on past county methods and practices to determine the priorities and direction of the county will likely be the preferred and initial approach. However, this approach is not capable of producing optimal results where everyone benefits, or at least, are not any worse off in the long-term.
Systems determine 85-100% of results and the capability of a system can be assessed on a scale of 1 (low) to 5 (high). Brown County is governed through a one-party monopoly on political power that represents a closed system which would be assessed at a Level 2.
A Way Ahead?
Albert Einstein remarked that “We can not solve our problems with the same level of thinking that created them.” For over the past two years, volunteers in the community with the support of the Indiana Office of Community and Rural Affairs, Purdue and Ball State, have been working to develop a new leadership approach as part of the Hometown Collaborative Initiative (HCI). It introduces an open-system approach to economic growth and community development.
The initiative is referred to as the Brown County Leader Network. We are in the process of developing a website to help share information. In the interim, additional information is provided at the following. “Brown County Leader Network.”
- Adjusted Gross Income (AGI)- Taxpayer Returns by County
- 2017 Economic Impact of Tourism in Brown County developed by Rockport Analytics.