9◼ REMARKS Bloomberg Businessweek April 20, 2020
Today’spoliticalleaders,fromAngelaMerkeltoDonald
Trump,areinrareagreementthatthefighttodefeatthenovel
coronavirusis a challengeuniquesince1945.“Weareatwar,”
is FrenchPresidentEmmanuelMacron’srefrain.IntheU.S.,
Trumphasproclaimedhimselfa “wartimepresident.”
Yet,asWinstonChurchilldiscovered,it’spossibletowinthe
warandlosethepeace.AttheendofWorldWarII,Britainsur-
prisedtheworldbyvotingoutChurchill—who’dledit through
theconflict—infavoroftheoppositionLabourPartyandits
promiseofa welfarestateanda nationalhealthservice.A
similarshiftfromtraditionalbudgetarypriorities—suchasthe
military—todealingwithbasichealthandwelfareissuesmay
beinstoreforthegovernmentsoftheworld.
Evenafterthediseasehaspeaked,governmentswillbecon-
frontedwithravagedeconomies,a traumatizedpublic,and
whatpromisestobeanalteredpoliticallandscape.It’sa soci-
etalchangethatwilltestexistingmodelsofgovernmentfor
yearstocome.“Westerneconomieswillbesetbackbyyears,
andgovernmentspendingconstrainedasa result,”saysTim
Huxley,executivedirectorforAsiaattheInternationalInstitute
forStrategicStudies.Thatraisestheprospectofdemandsfor
“afundamentalreexaminationofgovernmentalprioritiesand
a rethinkingofwhat‘security’means.”
TheCovid-19crisishasmarkedthereturnofactivistgov-
ernmentina waynotseeninpeacetime.Butit’salsoexposed
markedlydifferentdegreesofsuccessincontainingthevirus,
withperformancemeasuredinnumbersofhospitalbeds,not
aircraftcarriersorgrossdomesticproduct.
Recriminationsarealreadyunderway.IntheU.K.,eventhe
Conservativegovernment’smediaalliesjoinedthecriticismof
itsU-turnsduringtheoutbreak,whilethefragilecoalitionin
Madridis underpressurefora responsethatsawSpainover-
takeItalyasEurope’sepicenter.JapanwaiteduntilApril7 to
declarea stateofemergency,theninitiallyallowedsomebars
andnightclubstostayopen.AstheU.S.sufferedmorethan
a quarterofglobalcases,Trumpfeudedwithgovernorsand
blamedthe“veryChina-centric”WorldHealthOrganization
forbeingslowtoreacttotheoutbreakinWuhan.
TheU.S.spendsmoremoneyonhealthcarethanany
countryintheOrganizationforEconomicCooperationand
Development,inbothdollartermsandasa shareofGDP.But
it rankssecond-to-lastamongtheOECD’s 36 nationsincover-
ageforitscitizens;onlyMexico’sis worse.
TheBritishpublicapplaudedworkersfortheNational
HealthServiceinthe streets;analreadyinfectedPrime
MinisterBorisJohnsonjoinedintheclappingfromDowning
Street.Butwhatis a sourceofnationalpridesufferscapacity
problems,anditsstaffis poorlypaid.Thegovernmenthasbeen
accusedofa chaoticresponseamidreportsthatfrontlineNHS
workersweredeniedvirustestsandlackedprotectiveequip-
ment.AnappealtoBritishindustrytoproduceventilatorsfor
theNHSdrewmorethan5,000offersofhelp,butdeliveries
remainweeksaway.
Germanyhasfaredbetter,relativelyspeaking,witha death
ratealmosthalfthatoftheU.S.andmorethanthreetimes
lowerthanintheU.K.Thishasbeenascribedtowidespread
testingforCovid-19.Britain’sgovernmentconcededthatit is
fallingwellshortofitstestingtargets.
AccordingtoHuxleyatIISS,onepossibleoutcomeofthe
crisisis thatcountrieswillfacepressuretochannelspending
awayfromdefenseandtowardhealthandwelfare.Whether
coincidenceornot,Germanyspendslessonitsmilitarythan
eitherBritainortheU.S.Trump’saimtobadgertransatlan-
ticalliesintoraisingtheirdefenseoutlays,preferablybypur-
chasingAmericanweapons,lookstobeanearlycasualty.As
of2019,justnineofNATO’s 29 membersmettheminimum
recommendationfor2%ofGDP,withSpainandItalyamong
thelowest-spendingmembers.Sincetheyarealsoamongthe
worstaffectedbythevirus,findingmoremoneyformilitary
hardwarewillbeuntenable.Whoknows?It mayevenprove
hardfora U.S.administrationtomaintainitscurrentlevelof
spending—at3.4%ofeconomicoutput,anestimated$730bil-
lionlastyearandthehighestinNATObyfar—whenit strug-
gledtoprocureenoughfacemasksformedicalprofessionals.
Channelingmorefundsintohealthcarewillposeprob-
lemsincountriessuchasIranandVenezuela,wheresecurity
is anchoredina strongmilitarybackedupbypolicekeeping
a lidonrestlesspopulations.InIran,whichsufferedthehigh-
estdeathtollintheMiddleEastaftertherulingclericsreacted
slowly,thegovernmenthassaidthepandemiccouldadd5 mil-
liontotheranksoftheunemployed.Witha crateredeconomy
alreadyhitbyU.S.sanctions,that’sa recipeforsocialdisorder.
Germanyhasbeenpushingforoverseasdevelopmentaid
tobeincludedwithtraditionaldefensespendingasa mea-
sureofnationalsecurity.Thatargumentmightgaintraction
asthevirusspreadstoAfrica,whichhasyettosuffertherav-
agesseenelsewhere.OxfamInternationalwarnsthattheeco-
nomichitfromcoronaviruscouldsendhalfa billionpeople
intopovertyworldwide.GermanDevelopmentMinisterGerd
MüllerisurgingfellowEuropeanUnionmemberstomobi-
lize€1billion($1.1billion)fora Covid-19programtoaidlow-
income countries, arguing that Europe has a great interest in
securing stability in North Africa and the Middle East, where
the virus could cause “famine, outbreaks of violence, and even
civil wars,” forcing refugees to flee toward Europe.
It seems remarkable now, but health made it onto the Group
of 20 agenda only in 2017, at Germany’s behest. Similarly, when
Merkel’s government begins its six-month term in rotation at
the EU’s helm later this year, it is expected to focus the bloc’s
agenda on dealing with the coronavirus. European leaders,
who are in the process of negotiating the EU’s €1 trillion-plus● The pandemic may lead countries
to change their priorities—perhaps
taking cues from Angela Merkel
● By Alan Crawford