When the immediate future looks grim, it sometimes helps to look at a more distant perspective. Let us assume that we can get through the next six months without the government going bankrupt or society collapsing. If we can’t, then all bets are off. Let us also suppose that we find (via a vaccine or some breakthrough in treatment) a way to live that no longer requires periodic lockdowns, social distancing, masks and all the rest of the covid lifestyle. What might this “new normal” look like?
It could of course just be a return to normality as previously defined, but I don’t think that is very likely. I believe that the pandemic has accelerated certain trends towards change that were already taking place much more slowly, and that we can’t put the genie back in the bottle again. But we could perhaps go forward to something better than we had before.
I’m not an economist. I don’t know what is or is not possible. But I believe that the best solution to a problem is sometimes another problem. In other words, the way forward may involve allowing foreseeable problems to solve each other.
One obvious change is the trend towards working from home. This is something that could have happened earlier but didn’t because no one actually believed in it. Employers were wary of losing control of their staff and employees couldn’t really imagine wanting to work like that. The only people who actually worked from home were women with caring responsibilities, and they did it because they had to.
Covid forced office workers to work from home and many of them found, somewhat to their surprise, that they enjoyed it. This was helped, of course, by new videoconferencing applications which prevented home workers from feeling alone and “out of it”. And personel managers, who had always asked, “But how will we know they are actually working?” found out that the answer was simple. Give the workers tasks and deadlines and check that they are producing the required throughput. It isn’t actually necessary for them to work a specific number of hours if they can do their assigned work in less. A bonus of course is that workers get an instant pay rise through not having to pay for a commuter’s season ticket.
Working entirely from home is probably not the future except for high tech firms like Twitter (which has already said that they don’t want their staff to come back). Most office workers will still need to meet colleagues regularly to exchange ideas, to discuss progress with superiors, and to mentor subordinates. For example, a new office worker would need to attend every day for a couple of weeks and so would the person(s) mentoring them. But most of this can be accommodated by people coming in by arrangement on one or two days a week and working the rest of the time from home. The result is that many companies will no longer need a big, expensive central headquarters. A single corridor in someone else’s building will do. Already commercial property landlords are reporting that their tenants are unwilling to renew their contracts because they can see that actually they no longer need these buildings.
This raises two obvious problems:
Let’s add two further problems to the mix:
I have deliberately arranged these questions so that the problems which I think can solve each other are matched.
The obvious use of unwanted urban work space is to convert it into affordable housing for key workers. Most of these cannot work from home, so it makes sense to give them homes near where they need to work. Until now that was impossible because residential landlords have had to compete for land with big commercial companies with deep pockets. That meant that the land they bought could only be used for luxury apartments that would bring in high rents. Mostly they were bought up by rich foreigners as investments and left empty. But if all those finance and similar companies no longer need the space, city centre land prices are going to crash, and that gives us an opportunity to bring residential life at affordable prices back into urban centres on a big scale. Our cities need no longer go dead at 7.00 PM. And all those sandwich bars and sushi bars and salad bars and cafes and takaways that used to serve the lunchtime commuter traffic and are currently staring at bankruptcy could serve the new resident clientele instead, making most of their profits in the evening rather than at lunchtime.
Of course, not all the firms that service commuters are in the hospitality business. One of the weirder experiences of the pandemic is watching some entrepreneur explain in a news magazine what they did before covid and can’t do any more, and thinking, “But why would we want anyone to do that? What ultimate use is it to society?” Yes, these firms are filling a gap in the market which they were clever enough to find, but the gap in the market is often like the gap in a broken bone. It’s there, so it has to be filled, but the customers would probably prefer to be able to arrange their lives so as not to have that need.
William Morris once said that you should have nothing in your house that you do not know to be useful or believe to be beautiful. I believe that the same is true of society. People should be able to work either at jobs that are clearly of benefit to us all or at tasks that create beauty or pleasure. In a really well-functioning society, no one should have to engage in activity which has no purpose except to fill a gap. Re-employing more usefully all the people whose present work we are not going to need in the future will be a huge task, but I don’t see why it should be considered an insurmountable one.
Now, what about the future of public transport? There are two problems here, one major and one relatively minor. The minor problem is what replaces the commuter season ticket when most people no longer commute regularly? The obvious answer is to replace the time-bound season ticket with a bundle of journeys paid for in advance at discounted prices and realisable at any time, similar to the Parisian carnet system. The more journeys are purchased at one go, the greater the discount (just as, at present, an annual season ticket is cheaper than four quarterly ones). With smart card/smart phone technology, this should be easy enough to arrange.
The more serious problem is how to finance the whole operation with a much smaller number of commuter journeys. At the same time, we have the growing problem of distributing all the things we are now buying online. We really do not need a new explosion of vans and motorbikes on our suburban streets! One possible answer would be to use rail freight. The underground train of the future could have just two or three passenger carriages in front and several freight cars behind. Freight charges would replace the fares that were no longer being paid by commuters, and commuter stations would become click-and-collect points. At each station, people would get off and a bag of freight would also be unloaded to be taken to the collection point in the ticket hall. People would soon get used to collecting their groceries on the way home instead of having to sit at home and wait for a delivery. Online suppliers would pay a railway company to transport their goods to a wholesale business in the appropriate city centre and the wholesaler to direct the goods to the appropriate suburban station. Economies of scale would probably make the whole thing cheaper for them than arranging road delivery for individual purchases.
The move online also has repercussions for the High Street. Part of the problem here is that we do not have a level playing field. Shops have to pay business rates and rent, while online suppliers pay neither. There is no social benefit in this kind of unfairness, so one obvious (and popular) thing for the government to do is to tax the online suppliers fairly by the amount of trade that they do in the country and not by their profits (which can always be dishonestly distorted). But we also need to organise our high streets differently. At present shops exist in a kind of symbiosis with each other. People go to one shop (perhaps a big store) and are then more likely to buy things from other shops nearby. The same works in reverse unfortunately. When shops close, the high street takes on a dilapidated look, so people are less willing to shop there and more shops have to close. You end up with only charity shops, pound shops, loan sharks and bookmakers.
The answer surely is to give people new and additional reasons for visiting their local high street. Public access points for the local council, libraries, small art galleries and the like could fill gaps on the high street. This would give people more reason to visit and to use the shops. And people could live there. Every high street has a floor, sometimes two floors, of residential space above each shop. In most European towns, these can be accessed by a door at the side of the shop. There is no good reason why we cannot do the same. This would provide further living space for key workers and keep streets buzzing into the evening.
Finally there is the glaring light the pandemic has shed on the identity of our society’s key workers. They turn out to be precisely the people to whom we have been paying the lowest wages we could get away with. Very often this means wages that British people won’t work for, so we suck in immigrants to fill the gap. Meanwhile a lot of people from bankers to BBC reporters have been earning millions by claiming to require this degree of remuneration to allow them to do their very important work. “If you pay peanuts, you get monkeys” is their slogan. But as they have turned out to be a lot less important when push comes to shove than care home workers or shelf-stackers, perhaps we could afford to put up with a few monkeys in their ranks.
But we cannot get fair remuneration for key workers by simply mandating higher wage levels. For example, most care homes are balanced on a knife edge. If they have to pay higher wages to their staff, a lot of them will just close. So if society as a whole thinks these people deserve more (and why else were we clapping for them every Thursday?) then society as a whole will have to fork out the money to pay them more and not leave it to their employers. One possibility would be a hypothecated redistribution tax, to be paid by high earners and distributed as a form of negative income tax to workers in officially recognised key jobs. Hypothecated means that the tax could be used only for this purpose and not to plug gaps in government spending elsewhere. It could not be used for welfare payments either; paying for those is everyone’s job. It’s what we pay national insurance for. But paying fair wages to key workers should be specifically a job for overpaid non-key workers.
None of this would be possible if the economy was still rolling on along its old track, simply because no one would be motivated to carry out this degree of change. But we now have a once-in-a-lifetime opportunity to do things differently. The usual argument, that change would require too much sacrifice, is meaningless when going back to something like the old normal will be just as difficult and involve just as much pain. If we are going to have to go through with this, let us at least have a new normal that is better than the old to look forward to as our reward.
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