28 BARRON’S December 7, 2020
economic hit that the U.S. has suffered. It’s the only thing
that the Biden administration in the short run has to get
a grip on. But after that, if the coronavirus is a conse-
quence of the crisis of the Anthropocene [unofficially, the
current geological age, in which human activity has most
affected the climate and geology], then we need to con-
sider that climate change and dealing with that should be
a top priority. What that entails depends on the political
circumstances after January. It could be regulation, inter-
national diplomacy, and investment. I’m tempted to say
that the main problems facing the U.S. are actually prob-
lems of the political system rather than policy challenges.
Most governments outside the U.S. think that the U.S. is
no longer a credible actor.
Before the pandemic hit, you were working on a
book about the changing relationship between hu-
manity and the environment, and the consequences
for the economy and society. As far as we know, the
virus emerged from people eating wild animals.
How does that fit into your thinking?
The thing that 2020 forces us to come to terms with is that
this wasn’t a black swan. This kind of pandemic was
widely and insistently and repeatedly predicted. In fact,
what people had predicted was worse than the corona-
virus. Since the early 1970s, scientists and social scientists
have come to the view that humanity’s relationship with
the natural world has become unbalanced. One facet of that
is climate change. Another is the concern about “emerging
infectious diseases,” which is what you get when more peo-
ple go into areas that hadn’t previously had humans and
start interacting with animals and catching new viruses.
The classic cases are Ebola and AIDS, but you can also
look at the new strains of flu coming from birds and pigs.
At the same time, the transmission of diseases has been
greatly accelerated by technology. It was in the late 1960s
that people started worrying about “Old Plagues in the Jet
Age.” The fear wasn’t about new diseases, but that an out-
break of an old disease somewhere in the world would end
up spreading across the globe. Those places were generally
very poor, so limited access to transportation used to pro-
tect against that, but nowadays you can have people getting
infected in Wuhan and taking the disease to Europe and
North America in under 24 hours. People knew about all
these dangers, and there has been increasingly elaborate
modeling about the risk of a catastrophe. What we’ve seen
in 2020 was that the risk management failed.
We could rewrite the history of the past 20 years as a
series of near misses. In2004-05,there was a danger of
a strain of bird flu that would have been as infectious as
Covid but with 30% mortality rates. The U.S. govern-
ment at the time responded with a lot of research
spending. But then it stopped. The crazy thing is that
the amounts of money you would need to spend are so
low. Funding all of the known vaccine precursors in the
world to Stage 3 would only cost $130 billion, which is
peanuts compared with the amount of value lost to the
pandemic. There is a huge disproportion between the
scale of the problem and what we spend.
That’s actually great news, because it means we can
easily fund a massive war chest of biotech, pharmaceuti-
cals, and such. It’s a bright future for humanity because we
will need lots of people working in advanced research. A
lot of people criticize how much the U.S. spends on health
care because it’s wasteful, but in general, it seems like a
unified rule-based trading system.
Has the uncertainty created by the pandemic been
challenging for corporate dealmaking?
The one challenge is [not] rubbing shoulders and being
sure there’s a mutual affinity when it comes to teams and
companies you haven’t met before. So, not surprisingly,
some of the deals we’ve done were with companies we’ve
known already. We agreed to acquire Aimmune Thera-
peutics in August. We have been invested in the company
since 2016 and had a board seat. With Freshly [acquired
in October], we had a minority stake since 2017 and
knew the company well. I wouldn’t say we have limited
our deal making exclusively to [companies we know], but
deals where you know the target and the management
team have been easier to pull off at this time, compared
with the ones where you don’t know the people.
What food-product innovations can we expect to see?
We’re very happy with our plant-based meat-alternatives
business, and with the continued progress around our
plant-based burger. This is like software; every six
months, these products get better in terms of mouth feel,
taste, and nutrition. It’s a fantastic area to be in, with an
ever-more-sophisticated mix of ingredients.
Thank you.
—Rupert Steiner
ADAM TOOZE
Professor of History, Columbia University
New York
Barron’s: What are the big investment opportunities
coming out of this pandemic?
Adam Tooze:The only thing we know, coming out of
this, is the tech story: Without the marvels of the [tech]
platforms, it’s unclear how we could have coped with
this. The question is whether the power conveyed by the
sheer obviousness of that fact triggers a backlash in
terms of antitrust and regulation. We have seen this in
Europe and China already.
What should be the main priorities of the incoming
Biden administration?
There are so many. The most evident one is to control the
epidemic and then secure an exit from the enormous
seen is here to stay. Future growth rates won’t be as fast as
during the pandemic, but it is unlikely that we’re going to
backslide. People like the convenience of buying food and
beverages online. They will continue to embrace e-commerce.
What are the biggest risks to the corporate world
and markets now?
The level of debt is a source of concern. There was no
alternative; governments did the right thing by providing
a safety net, but at some point these debts have to be
brought down. Remember, for many advanced countries
the 2020s and 2030s will also be decades of significant
demographic stress, as more baby boomers retire and
require significantly higher health-care spending. So, this
is not an easy time to pay down debt.
Which geopolitical risks are most on your mind?
In trade, the old rule-based World Trade Organization
system is meeting significant challenges. There are
more bilateral agreements and trading blocs competing
with one another, and that calls for more localized and
shorter supply chains. While this isn’t something we
wish for because we like a rule-based trading system, it
plays into our traditional posture because Nestlé
[NESN.Switzerland] is on the ground in 187 markets
around the world and has more than 400 manufactur-
ing sites. So, we have been seen as the ultimate local
inside player and neighbor.
How will managing a public company change?
Some of the quicker pace we have seen is probably here to
stay. Some people are going to be working a bit more re-
motely in the future, and people will also revisit their travel
schedules, working out which trips are absolutely neces-
sary and which [meetings] can be done on video. On the
margin, travel will probably be a little less. At the same
time, you’ll see accelerated, digitally driven decision mak-
ing. The overall clock-speed of life around us will have in-
creased, and companies will have to rise to that challenge.
Are we entering a more fractious period in global
relations, or will there be more cooperation among
countries and regions?
This period has shown some strain when it comes to
global cooperation. In Europe, to take a Covid example,
you see a low degree of harmonization when it comes to
travel restrictions. The fact that so many people were
taking decisions into their own hands resulted in a patch-
work of rules that often didn’t make sense. Around the
world, you’re seeing movements that aren’t supporting a Schneider: Sebastien Agnetti (13 Photo)/Redux; Tooze: Gary Doak/eyevine/Redux