COVID-19: An Invitation to the Dance - We Don't Have One
Bryan Brownlie
Emerald Strategy Group: Strategic Advisory - M&A - Transaction & Project Financing - Due Diligence - Private Equity - Renewable Energy
Disclaimer: All views expressed in this article are my own and do not reflect the views of any entity what so ever which I have been, am now, or will be affiliated.
It’s March 17th, and myself, my fiancé and our children are sitting in a local restaurant/bar for a final meal before Ft. Bend County, Texas begins its shelter in place order the next day. Despite it being St. Patrick’s Day, customers are scarce and retaining 6 ft. social distancing is far from challenging. The mood is not even remotely festive and despite the green beer, the atmosphere is grim.
As I enjoy the last draught beer I will be able to consume for an indeterminate period of time, and we all enjoy the last bit of passive sociability we’ll experience for who knows how long - one thought creeps across my mind, “This is going to be bad”. The news playing on the TV shows images of mass graves in Italy, overwhelmed hospitals in Spain and other parts of Western Europe, and the complete and systematic quarantine in China. We are next. Everyone knows we are next. How bad will it get? How serious will it be? A Skype message pings across my phone: My brother and his family are all sick with suspected COVID-19 in the UK.
That day, just six short weeks past, feels like a lifetime ago for many (myself included). It feels like years, a distant memory. Life moves at such a frenetic pace, and we do so much with our time, that it distorts reality. Six weeks is a blink, but it’s become, for many, too long to bear. Since then, we have witnessed the systematic ‘sheltering in place’ (with varying degrees of enforcement and resultant success) of most countries in the Northern Hemisphere, a complete collapse of several segments of the economy and a rout on oil prices which have shattered the growth in the US Shales and sent the industry into the steepest decline in expenditure in history.
Hundreds of millions of people around the world are furloughed or unemployed, food supplies are stretched, and starvation is occurring in vast swathes of the developing world. Hospitals have become the front line in a war against an enemy we barely understand, and the lowest paid employees in the economy have become the ‘essential workers’ that have kept food on the tables of billions. This crisis will re-define the collective psyche of the entire planet for at least a generation.
The World is a very different place today. A mutation of unimaginable proportions, and now - with case numbers seemingly falling in many parts of the World, and with the economic Armageddon becoming far too extreme to bare - as one popular article puts it – we are now preparing to dance. The problem is, we don’t have an invitation; not in much of the US, not in many countries in Europe (though some certainly do), and almost nowhere in the Southern Hemisphere.
There are exceptions: Australia and New Zealand – who were so well prepared for a potential bird flu outbreak that they had every measure ready to go at the push of a button. They quelled the infection so quickly – that they have merely tens of new cases each day - easy to contact trace, easy to control. Provided their international boarders remain closed – they can eradicate the disease. They are near unique in the world in having this characteristic.
The predominant social discourse in our postmodernist media universe is that – we are now all looking out into a ‘post pandemic World’ – where this will be behind us, and we will carve a path to a new normal – COVID-19 just a smoldering ash somewhere in the back of our minds. The problem of course with any postmodernist discourse – is that in that world, as Baudrillard warned us 40 years ago – the map has become the territory. If it’s flying across the screen, any screen, it’s the world (the map), it’s real, and what is happening in the real world (the territory) itself has zero impact. We live in a simulacrum – a copy that has no original version anymore.
That postmodernist, ‘meme over matter’ discourse is fine when it comes to politics, philosophy or moral theory - but when it comes to medicine and science, as we have seen with the “anti-vax” movement – the map is irrelevant. The territory, the actual facts, the actual diseases - will result in actual human consequences, such as the re-emergence of measles in the US, which has cost countless lives. It doesn’t matter what is in print, or appearing on TV, or what politicians are blaring – all that matters in the face of a viral pandemic of this nature are two base numbers: What is the percentage increase week over week in the total volume of cumulative cases in a location in any given two-week period, and what is the % change in the total number of new cases in that same period?
The reason these numbers matter is that this determines, if you relax social distancing, what the likely trend in new cases will be in the next two-week period – where absent complete availability of testing (as they have in South Korea, who are dancing incredibly well, but almost nowhere else in the World) any new infections will likely be asymptomatic. As a result, most countries do not have the ability to know if they’re on a trend to a doubled case load in any territory, on less than a 14-day cadence.
It is for this reason, the '14-day watch period' is active in each State in the US as they relax, because the case numbers after that 14 days will be telling. This 14-day period can only be reduced by proactive (rather than reactive) testing, and we are about 200 million test kits away from that reality in the US, and billions of test kits globally. Absent complete testing, it simply cannot be known if we’re on an exponential growth curve or not other than a 14-day pulse check in which enormous damage can occur.
Below, the table shows the number of daily new cases in each country in the world still showing a positive week over week change in numbers of new cases – and the % change from highest to lowest (source: John Hopkins University):
The table below shows the total % week over week change in cumulative cases in each country in the world with over a 20% increase. The conditional formatting shows how close we are to the largest, or smallest number. As is clear here, many countries are rushing towards their peak – not away from it.
We will return to these numbers shortly, but I have highlighted the UK and the US in the Northern hemisphere - with the UK in lock-down still, but with many States in the US re-opening or are very close to making that decision. You will note that the US is unique on this list at contemplating relaxing its shelter in place while still showing this level of week over week increase (as a %) in cumulative new cases, while also having a flat to slightly declining number of week over week new cases. Most countries re-opening in Europe are showing -10% to -20% reduction in number of week over week cases for example.
Why did we social distance?
‘Flattening the Curve’ has been discussed at length in the media. The ultimate mitigation method (other than total quarantine, which China leveraged, with apparent success) for a pandemic of a disease for which we have; no proven effective treatment, no proven effective vaccine, and where vaccination (as with several other coronaviruses) may only grant weeks or months of immunity, not years.
The concept of flattening the curve makes sense, but it is not broadly understood by many, and the media on the subject is muddled. Essentially, flattening the curve avoids some cases of the illness, and some deaths, but not in the way that many understand. It is more easily graphed as an explanation:
What is important to note here is that the surface area (the number of cases, and as a result deaths) under each of these lines is exactly the same, except for the uppermost section of the curve. Those cases and deaths are caused by hospitals, doctors, medical facilities being overwhelmed by the huge volumes of sick people – resulting in new infections in those hospitals, and cases and deaths being caused. Also in that section are cases being caused by people who cannot get tested, or treated, and die and spread the disease as a result. It is a small % of the total.
The curve flattening we have undergone by social distancing, is not going to ‘stop’ the virus – it just pushes out how long it takes for almost the same number of total people to get the disease so that the medical system can better cope with it and we avoid that top section of the curve. This does not make the enormous sacrifices being made by hundreds of millions of people in vain of course – far from it – it has saved at least a few million lives globally which is tremendous – but it also does not make those same sacrifices a ‘cure’.
For this reason alone, talk of being in a ‘post pandemic world’ is absolute nonsense. We have done nothing to significantly reduce the number of cases of COVID-19 that will ultimately occur in the human population, we have just spread them out over a prolonged period of time (which is a life saver of some, but it is not a solution). We are still in the grips of a pandemic globally, and that pandemic is in its early stages in many countries in the world.
As we begin the process of ‘dancing’ and re-opening – life is going to be very different until a vaccine is created, and the path to re-opening (as Singapore showed, by re-opening, and then rapidly closing down again) is fraught with risk, and dependent almost entirely on a countries ability to test and contact trace (Taiwan has demonstrated how this needs to be done, and also how completely incapable most nations in the world are of doing so – including the USA).
The road we are walking will require a dramatic change in lifestyle for everyone until a vaccine is developed, or until (which is more likely in the opinion of many – as we are unlikely to have a vaccine in time) enough people have caught the virus, and recovered to develop herd immunity. We also have to face the reality, that the Southern hemisphere, (Sub-Saharan Africa) and many nations in South America are just on the very start of their journey. They are also in many cases the countries that are least equipped to deal with the pandemic. Global travel is going to feel the impact of this reality for months, and potentially years, not days.
To illustrate the risk, the below graph is based on the 2-week growth potential of the virus, if certain countries (based on their current case decline rate, and cumulative case % increases) continue as they relax their social distancing. The key hit point here is, will the country have an exponential growth curve potentially and double its cases before patients show symptoms and seek testing and treatment (about 14 days give or take). Obviously with near constant testing, this would be a very different picture – but the listed countries do not have that capability:
As can be seen here, Italy, Germany, and Australia all have an extremely low % increase in total number of cases in any given two-week period due to having been performing social distancing for a much longer period. They also have rapid decline in their week over week number of new cases. They, if their social distancing and dancing measures work as effectively as the complete sheltering in place that they have been doing, have well over 6 months before their case numbers could realistically double. The danger for nations in these categories is that of course, much like Singapore – their ‘dancing’ measures, and social distancing aren’t as effective as they want them to be and the number of new cases per week begins to spike, putting them back onto an exponential growth curve too soon.
The US, by contrast, as can be seen in the tables previously posted, although having a fairly steady % change in the number of new cases, still has a rapidly growing total cumulative case load. It’s also important to note that this analysis is imperfect in that it implies the US is a homogeneous country and will re-open all at once, but it does indicate that the US is under high risk of entering an exponential curve based on where we are today. The reality is not as alarming as the raw numbers - but one need look no further than the state of Georgia in the US to see that this curve can very much be a reality in some of the States currently re-opening.
The good news is that, the case doubling point would be 1.5 months approximately out, and so people should be identified, tested, and contact traced before that happens, so the higher point of the curve is unlikely to ever take place. It is however critical to note that this curve is also dependent on the ‘dancing’ measures (masks, surface disinfection, social distancing protocols, and safety measures) working exactly as well as the complete social distancing and sheltering in place that has gone on up to this point.
This is unlikely in the extreme – otherwise we would never have done the sheltering in place in the first instance – we would have just immediately started the ‘dancing’ process of social distancing, gloves, testing and masks, which Sweden is role modelling in terms of exponential increases in the numbers of deaths they are experiencing.
The key question for the USA and other nations in its category – is do we have the capability of proactively testing (on top of the tests being conducted on those that are already sick) millions of people who are asymptomatic each and every day and week to ensure that we can isolate them and contact trace them? The answer is, today no.
Italy and Germany are in much better shape in this regard, because they have a low enough number of new cases each week that you can likely get away with just contact tracing the sick and if they perform their social distancing correctly will see the virus remain controlled. This does however represent an extremely long period (months and potentially over a year) of living in a shadow state of social distancing and local lockdowns where needed.
The five pillars of controlling COVID-19 must be addressed:
1) Testing for everyone, every day, every workplace.
2) Social distancing
3) Disinfection of all high contact surfaces in every location, every contact
4) Wearing masks
5) Access to medical treatment (respirators, hospitals, etc.)
I do not put the medical portion at the bottom of the list in terms of priority (because it is the highest) but rather because it is the backstop. The last piece of the process in the timing of a new infection, and for a new infection vector in general. By the time someone is sick, the first four pillars have already failed, resulting in the infection in the first place.
The Post Pandemic World:
Before we can even think of talking about a post-pandemic World, we must be clearly talking about the World. Not the county or city, or even country that we live in. The entire World.
As we can see from the tables of data, huge swathes of Africa, and South America are on catastrophic trends of massively increasing numbers of new cases per day, and each week representing a doubling or trebling of their total case load. They are at the very beginning of their rise. The below map provides a heat map of those areas of the planet which are experiencing a rapid increase in case load, and where the Pandemic will be raging next, and for an indeterminate time period. Travel to and from these countries will result in new infections in any nation that opens boarders to them:
The gray countries are countries that have a below 20% increase in their daily case load (or there is no data available), for the colored countries: the redder the country, the higher its case rate is going up. (The US is unfortunately still in that category with cumulative cases increasing 27% week over week).
As can be seen here, Russia, India, all of Africa (whose case data does not take into account the near 0 testing capability, with the number of actual cases likely being significantly higher – the gray countries in this continent represent 0 testing data), South America are all on the very commencement of a meteoric rise in cases.
Many of these nations are developing, have poor medical facilities, and multiple factors for co-morbidity. A human tragedy occurring in these areas of the World is a near certainty, without global coordinated action, which is why multinational NGOs, and the WHO are so critical during this time. They, and only they have the means to mount the coordinated response needed.
The good news is that China, Australia, and much of Western Europe – if they can be as effective with their less aggressive social distancing as they were in lockdown, are ‘out of the woods’ – but the measures that they take are critical during this time period.
The Long Road Lies Ahead:
There is no dance, and even if there were – we are not invited. We don’t have the dress code in most of the World – and that dress code would look like South Korea or Taiwan. Or an epidemic as controlled as in Australia or New Zealand. We also need complete contact tracing, complete testing capability with proactive testing and near total surface disinfection, etc. We are instead on a very long road out of this, with the end in sight being a vaccine which may or may not be completely effective – but I am pinning my hopes on this occurring in the next 18 months.
In order to ensure we don’t trend to an exponential case increase which would overwhelm our medical systems we must walk carefully. We must socially distance, wear masks, disinfect surfaces, and be receptive to testing and being very proactive. We must commit to these measures. We must also face a reality of near zero international travel for the coming months, probably longer. For most of the southern hemisphere – the curve is just beginning. Brazil, Chile, Venezuela, most of Africa are in the very beginnings of an explosive growth in the number of cases. (They likely already have them but lack the testing capability to track them). If we fail in these measures - millions more will die globally.
Each individual, and of course every business needs to face the reality that the world isn’t ‘going back to normal’ any time in any reasonable planning horizon, and that if we are serious about containment, and eventual herd immunity (either by vaccine or simply enough people having caught this) – without overwhelming our medical system we must help support that.
We are seeing this, with distilleries making hand sanitizer, breweries making masks, bleach producing companies making large deals with medical centers, and with oilfield equipment providers re-purposing to provide parts necessary for medical work. It’s a road that we can walk – but we must all walk together.
We can do it:
As businesses do open, we need to not only provide our customers with safety, but also the guarantee of that safety, and the perception of that guarantee. We must disinfect every surface, and we must follow social distancing guidelines to the letter and leverage the fact that we have all proven that remote working can work, and that the office doesn’t need to be full (not even close) to show improvement.
For my part, I am proud to work for a great business, that has re-purposed a line of products into the World of Surface disinfection, so that our many new customers can guarantee their customers that they will always have bleach – because they can now, with the press of a button make it right there in their hotel, school, office, or elsewhere. I would never have imagined this before – but it is something I am proud to watch happen. I am also proud to watch many of our suppliers and vendors make huge paradigm shifts of their own in response to the ongoing pandemic, and despite the somewhat grim picture painted above – I am optimistic as we move through the next months – because we have shown time and again – humans are resilient.