COVID-19 And Economic Meltdown: Was Global Tourism Only Thing Keeping Us Afloat? – OpEd
Three months since the arrival of the novel coronavirus COVID-19 prompted an unprecedented lockdown on human interaction and on huge swathes of our economy, the primary objective — preventing our hospitals and morgues from being overwhelmed — has been achieved. The cost — economically, and, in some cases, psychologically — has been enormous, but the road ahead, as those in charge attempt to revive a functioning economy, looks like it will be even more arduous.
No congratulations should be extended to Boris Johnson and his government for the achievements of the lockdown. Johnson dithered for far too long at the beginning of the crisis, and the deaths of tens of thousands of people are, as a result, his responsibility, although not his responsibility alone, as the last few months have also shown us that, sadly, this empty windbag of a Prime Minister is largely manipulated by his senior adviser, the sneering eugenicist Dominic Cummings.
Both men were initially prepared to allow the virus to spread unchecked throughout the entire population, with people required to “take it on the chin”, as they let it “move through the population”, as Johnson explained in a now notorious TV appearance. It was only when medical experts pointed out the potential death toll of the “herd immunity” scenario that the lockdown began, following similar conclusions that were, in most other countries, reached rather earlier in the virus’s spread.
Per capita, the UK has the worst death rate from COVID-19 in the world, based on excess deaths; in other words, the number of deaths exceeding the statistical average for the time of year. On June 9, the latest information from the Office for National Statistics showed a total of 63,629 excess deaths since the virus first hit the UK.
The good news right now is that the excess death rate is falling, although that doesn’t mean that the virus has gone away, even though that now appears to be a widely-held perception in parts of the population. As was noted yestoday, the number of identified cases globally has just passed the 10 million mark, while the number of confirmed deaths has now passed half a million. In addition, as the Observer explained, new clusters of COVID-19 outbreaks around the world are currently sparking fears of a second wave.
The difficulties of getting out of lockdown
Meanwhile, as countries begin to work out how to lift their lockdowns, a few key conclusions about its impact are readily discernible: firstly, partly prompted by hypocrisy (Dominic Cummings’ notorious trips to Durham at the height of the lockdown) or general incompetence (step forward, Johnson, and Trump in the US), and partly because of the unprecedented effort of being required to be isolated and anti-social for two to three months, people are responding to the easing of lockdown in sometimes alarming ways.
Two weeks ago, two “quarantine raves” attracted 6,000 people in the Manchester area, and other parts of the country have followed suit, even though the precedent was far from encouraging. At one of the raves, attended by 4,000 people in a country park in Oldham, a 20-year-old man died of a drug overdose, while “a woman was raped and three men were stabbed at a separate illegal rave in Trafford.”
Elsewhere, problems have arisen with out of control revellers on beaches, with perhaps the most notorious example being in Dorset, on Thursday, when “half a million people had flocked to the beaches”, according to the Bournemouth East MP, Tobias Ellwood, and, at Bournemouth in particular, there was “widespread illegal parking, gridlock on roads, excessive waste, antisocial behaviour including excessive drinking and fights and prohibited overnight camping.”
While the excessive drinking is a well-known British problem, other countries in Europe are also grappling with “impromptu parties and illicit raves”, according to the Guardian, which focused on problems in Portugal, France, Germany and Spain. On Thursday, “the World Health Organization warned that some 30 European countries had reported a surge in new cases in the past two weeks.”
If hedonism and uncontrolled drinking are one response to three months of lockdown — aided by the fact that so many people, for one reason or another, are not as tied to the weekday 9 to 5 as they were before the virus hit — it is also evident that huge numbers of people remain overwhelmingly cautious about the virus. Certainly, in the UK it would be reasonable to say that the government’s messaging is so scrambled that individualised perceptions of risk are actually the main driver of people’s behaviour — when, that is, they have the luxury of not being required to go to work in circumstances that may or may not carry different levels of risk.
No return to the office
A survey of parents conducted last week by the children’s nursery company Bright Horizons, for example, found that, of office workers, “[j]ust 13% want to go back to pre-pandemic ways of working, with most people saying they would prefer to spend a maximum of three days in the office.” According to the Guardian, the survey suggested that “many working parents realise that large parts of their jobs can be conducted remotely. And they believe that their employers will agree. Nearly two-thirds think their employers will be open to remote or flexible working in the future as the widespread adoption of Zoom and other online tools has kept many businesses functioning even as physical workplaces have been shuttered.” Nearly half of the respondents said that they were intending to ask for more remote working.
This could make a huge difference to the world of work, hopefully bringing to an end the insanely packed rush hour commute that no longer looks feasible at all. Happily, walking and bike use have increased massively since the lockdown began, but now, with people still avoiding public transport, car use is unfortunately on the rise, which, for environmental reasons, is a disaster. What we need to find is a balance that permanently reduces car use and encourages bike use (many more bike lanes and pedestrianised areas, and far fewer roads and carriageways), but that also entices people back onto public transport, for which the obvious solutions involve permanent working from home, for at least some of the work, for those who can, and perhaps also some form of staggered work hours.
Interestingly, as was reported last week, the sudden revolution in working from home, which employers had failed to engage with meaningfully before the virus hit, despite the technological advances enabling it, now looks set to be permanent. Last Tuesday, the Guardian noted that “demand for office space in City skyscrapers will be diminished even after the coronavirus pandemic is over, with experts predicting a major shift in the commercial property market.”
As the Guardian explained, “Financial institutions were among the companies that completely changed their way of working and sent their colleagues home from city centre offices prior to the government lockdown” in March, and in April, Jes Staley, the chief executive of Barclays, “predicted that there would not be a return to rush-hour journeys to large corporate headquarters, even once Covid-19 no longer poses a risk”, because “[t]he vast majority of the bank’s 80,000 staff were able to work remotely during the pandemic, allowing the lender to function as normal.” As Staley described it, “I think the notion of putting 7,000 people in a building may be a thing of the past, and we will find ways to operate with more distancing over a much longer period of time.”
I anticipated the demise of the greedy and environmentally insane housing and office development industry back in May, in an article entitled, Coronavirus and the Meltdown of the Construction Industry: Bloated, Socially Oppressive and Environmentally Ruinous, and I was pleased to see, in the Observer yesterday, an assessment that a future of severely reduced office use “poses a serious problem for multimillion pound skyscraper projects under way in the capital.”
The Observer spoke to some small financial companies that are moving out permanently, like Bishopsgate Financial Consulting, which is closing its head office in the Square Mile, with all 65 workers now working from home. As the Observer described it, “The move will save the company hundreds of thousands of pounds a year, slicing a quarter off its annual costs. Employees will also benefit financially – with some saving thousands of pounds each in annual commuting bills.” The company “has bought desks, laptops, dual screens and printers for its staff to use at home”, keeping only a a “virtual office” in the City, to preserve a City address “along with access to meeting rooms and lounges when it needs them.”
On a much bigger scale, Lloyd’s, “which closed its underwriting room in the Square Mile in late March, for the first time in its 334-year history”, is planning to reopen in August, but, at least for the time being, “expects that only 20% to 25% of 850 corporation staff and 3,000 to 4,000 brokers and underwriters will return” to its Lime Street headquarters.
As a result of these changes, it is anticipated that planned giant office developments that have not yet begun will not happen, including “1 Undershaft, known as the Trellis, which would be the second-tallest building in western Europe after the Shard at 290 metres, and where construction had been expected to start by the end of this year”, as well as “the Diamond, rising to 247 metres; and the Bishopsgate Goodsyard towers.”
In the meantime, ongoing projects, like the fund manager M&G’s 40 Leadenhall Street development, which has been given the nickname ‘Gotham City’ because of its similarity to the fictional skyline in Batman, are unlikely to be stopped, even though they look like the definition of pointlessness. At Leadenhall Street, work on the foundations had just begun when the virus hit, and it was one of the few sites where construction work didn’t stop at all during the most severe phase of the lockdown.
The prospect of the office environment — and its huge profits for landlords, landowners and investors — not bouncing back creates opportunities to think about how the future might be different, and how that space can be re-configured, especially if we factor in the equally doomed towers of overpriced apartment blocks, which looked like a zombie industry even before the virus hit, with investors put off by the broken basket case of Brexit Britain, and with Londoners almost completely unable to afford to buy into the developments, even if they wanted to.
Something better change
Moreover, thinking about a different future not only reflects the hopes of working parents; it also reflects the concerns of society as a whole, as a YouGov poll showed that 59% of people want change, and only 6% wanted to resurrect pre-virus “business as usual.” The polling, as reported by the Guardian today, found that “31% of people want to see big changes in the way the economy is run coming out of the crisis, with a further 28% wanting to see moderate changes”, and with “only 6% of people wanting to see no changes.”
The polling coincided with the launch of the New Economics Foundation’s ‘Build Back Better’ campaign, calling for a “fairer and greener” economic recovery that “provides more funding for the NHS and social care, tackles inequality, creates good jobs, particularly for young people, and reduces the risk of future pandemics and climate emergencies”, which is backed by “350 influential figures” including Bob Kerslake, the former head of the civil service, religious leaders including the former archbishop of Canterbury Rowan Williams, the heads of the Trades Union Congress, the Confederation of British Industry, the British Chambers of Commerce, Oxfam, Shelter, Save the Children, the Trussell Trust, Greenpeace and Friends of the Earth.
The environmental imperative to drastically and permanently change our economic activity, which I wrote about in April, was also emphasised in a report by Climate Assembly UK, “a group of 108 members of the public chosen to be representative of the UK population and to help shape future climate policy by discussing options to reach net zero carbon emissions, in line with the government’s 2050 target.”
The assembly found, as the Guardian described it, that “[p]eople would be prepared to continue many of the lifestyle changes enforced by the coronavirus lockdown to help tackle the climate emergency, and the government would have broad support for a green economic recovery from the crisis”, with working from home “a popular option, along with changes to how people travel”, giving the government “the opportunity to rethink investment in infrastructure and support low-carbon industries.” As the Guardian added, “Nearly eight in ten of the members said the measures taken by the government to help the economic recovery from Covid-19 should be designed to help reach net zero, and an even bigger proportion – 93% – said that, as the lockdown eased, the government and employers should encourage lifestyle changes to cut emissions.”
The end of tourism?
The third aspect of the post-lockdown world, which is most significant in terms of the economy, involves, broadly speaking, shopping and tourism, which I looked at in an article in March, Imagining a Post-Coronavirus World: Ending Ravenous Capitalism and Our Consumer-Driven Promiscuity, and which has been preoccupying me as I have been cycling around London’s West End, taking photos for my ongoing photo-journalism project ‘The State of London’, where efforts at opening up the economy after three months of lockdown are meeting with only limited success, and where it has become apparent that the economy of pre-virus London relied to an extraordinary extent on foreign tourists, who no longer exist, and who are clearly not going to return any time soon in sufficient numbers to revive what was a crazed business model — a city of hectic economic activity, groaning under the sheer weight of tourists, with sky-high rents, tiny operating margins and hordes of exploited workers.
At its heart, of course, the problem is safety. To all but the most reckless would-be travellers, planes now look like virus incubators, but even for those who are prepared to overlook the risk, the destination is no longer as enticing as it was, with London’s theatres, music venues and clubs all shut, a situation that is devastating for Britain’s creative people, and that will not be alleviated by the rush, on the government’s part, to reopen pubs, restaurants and cinemas on July 4.
In a major article for the Guardian, The end of tourism?, Christopher de Bellaigue looked in detail at the global tourist industry, beginning with the cruise industry, a largely unregulated $150bn business that is “shedding jobs, issuing debt and discounting furiously simply to survive”, but that really shouldn’t survive because of its hugely destructive impact on everything it touches.
As de Bellaigue explained, “Tourism is an unusual industry in that the assets it monetises – a view, a reef, a cathedral – do not belong to it. The world’s dominant cruise companies – Carnival, Royal Caribbean and Norwegian – pay little towards the upkeep of the public goods they live off. By incorporating themselves in overseas tax havens with benign environmental and labour laws – respectively Panama, Liberia and Bermuda – cruising’s big three, which account for three-quarters of the industry, get to enjoy low taxes and avoid much irksome regulation, while polluting the air and sea, eroding coastlines and pouring tens of millions of people into picturesque ports of call that often cannot cope with them.”
As he added, “What goes for cruises goes for most of the travel industry … [M]ost hotel groups, tour operators and national tourism authorities – whatever their stated commitment to sustainable tourism – continue to prioritise the economies of scale that inevitably lead to more tourists paying less money and heaping more pressure on those same assets. Before the pandemic, industry experts were forecasting that international arrivals would rise by between 3% and 4% in 2020. Chinese travellers, the largest and fastest-growing cohort in world tourism, were expected to make 160m trips abroad, a 27% increase on the 2015 figure.”
Now, however, as de Bellaigue added, “The virus has given us a picture, at once frightening and beautiful, of a world without tourism. We see now what happens to our public goods when tourists aren’t clustering to exploit them. Shorelines enjoy a respite from the erosion caused by cruise ships the size of canyons.”
As he also explained, “Coronavirus has also revealed the danger of overreliance on tourism, demonstrating in brutal fashion what happens when the industry supporting an entire community, at the expense of any other more sustainable activity, collapses. On 7 May, the UN World Tourism Organisation estimated that earnings from international tourism might be down 80% this year against last year’s figure of $1.7tn, and that 120m jobs could be lost. Since tourism relies on the same human mobility that spreads disease, and will be subject to the most stringent and lasting restrictions, it is likely to suffer more than almost any other economic activity.”
Sadly, as de Bellaigue stated, “As tourism’s impact on the world has deepened, so the global economy has come to depend on it.”
As he also explained, “one in 10 jobs in the world depend on” tourism, and its loss will be devastating almost everywhere. However, it is important to remember that, “For all the money the industry usually brings in, one of the prices of allowing a place to be taken over by tourism is the way it distorts local development. Farmers sell their land to the hotel chain, only for the price of crops they once grew to inflate beyond their reach. Water is diverted to the golf course while the locals go short. The road is paved as far as the theme park, not the school.” As de Bellaigue put it, “In its subordination of an economy to a powerful, capricious, external motor, tourism dependency has something in common with the aid dependency that I observed as a reporter in Afghanistan after the 2001 invasion. In both cases, the worst threat is the possibility of sudden withdrawal.”
Moving on, de Bellaigue analysed “overtourism – the saturation of a destination by visitors in numbers it cannot sustain”, looking at Venice, where its 30 million visitors a year “exceeds the city’s ‘carrying capacity’, the number it can accommodate without permanently damaging its infrastructure and way of life, by at least 10 million”, according to Jan van der Borg, a university-based tourism specialist. He is particularly concerned that the majority of the tourists fail to contribute in any meaningful way to Venice’s economy, with de Ballaigue stating, “Some 70% are day-trippers, who after being ‘spat from their tour buses, cruise ships and airplanes’, spend a few hours congesting the historic heart of Venice ‘but without contributing to its maintenance.’ After parting with perhaps €15, enough to buy them a souvenir manufactured thousands of miles away, they are hurried by their guide on to their next destination.”
As de Ballaigue also explained, “In the past 10 years, the curse of ‘Venetianisation’ – the hollowing out of a place, as it fills with tourist-termites – has beset city after city, as budget airlines and Airbnb have brought a weekend somewhere cobbled within reach of millions. That hasn’t just meant long-established destinations such as Venice or Paris, but sleepy coastal towns such as Porto, on Portugal’s Atlantic coast, that were completely unprepared for the numbers of tourists unleashed on them.”
The resistance began in Barcelona in 2015, when the city council “introduced a moratorium on new hotels”, and, in 2016, gave Airbnb “a €600,000 fine for listing unlicensed properties – small beer for a company whose revenues from a single quarter have been known to exceed $1bn, but a sign of growing hostility towards an industry that could make a city unrecognisable to its residents in a short space of time.” As de Ballaigue noted, although the attractions of tourist money are undeniable, “mass tourism displaces other businesses, while the exodus of many creative and productive residents, as well as the stress placed on local infrastructure by visitors in such numbers, carry a cost of their own.”
As he also explained, “Behind the recent campaigns against over-tourism lies a growing appreciation that public goods that were assumed to be endlessly exploitable are, in fact, both finite and have a value that the price of visiting them should reflect. ‘Polluter pays’ is an economic principle that is gradually being introduced to farming, manufacturing and energy. The idea is that if your business produces harmful side effects, then you should be the one who picks up the tab for the cleanup operation. Something similar, incorporating not only environmental harm but also wider cultural degradation or damage to way of life, might become the guiding principle of a properly sustainable tourism industry.”
That may be a forlorn hope, as destinations around the world, outside of the richer western economies, may well be desperate for any and all tourist revenue, but the problem remains, as mentioned above, that we have no way of knowing right now how many people will be prepared, in the near future, to get on a plane to go anywhere.
Instead, for the foreseeable future, tourist destinations are going to have to become more self-reliant — an uncomfortable truth that is going to impact London to a greater extent than, perhaps, most people realise. While I remain extremely concerned about the current loss of culture, via live music and theatre, I cannot even theoretically accept a return to London’s previous tourist levels (up from 11 million visitors a year in 2002 to 21.5 million in 2018), which, while not as dire as the experiences of Venice and Barcelona, were still unsustainable environmentally, however, much they created what looked like a viable economy (even if, in reality, it involved quite shocking levels of greed and exploitation).
I have no illusions that the adjustment to a less tourist-ravaged world will be easy or painless, and I have no wish to be seen to be dismissing the damage it will cause to so many people’s lives, but it is, I think, why we need what we very clearly don’t have in the UK — bold, visionary political leadership. We need creative ideas about how to create new jobs from the wreckage of the old, how to dismantle property-based greed, via a deflated housing market, and reduced business and domestic rents and leases, as well as how to revive live culture by thinking outside the box.
