Archive for the ‘Uncategorized’ Category

The headline comes from a recent webinar intervention by Annabel Seebohm[i]. We are negatively experiencing in our everyday lives how the very much praised and extended “just in time” inventory management method has turned our lives upside down. Car factories are on hold, electronic gadgets are missing from the shelves, ports are blocked and unable to process incoming   goods. And, last but not least, the health system is stressed to the limits, because it was designed for “normal times”. “Normal times” does not take into account out-of-the-norm factors like a pandemic, like “just in time” does not take into account disruptions caused by lockouts due to a pandemic.

When Covid-19 struck, the health system designed for “normal times” was absolutely unprepared to cope with an unexpected inflow of patients: there was a need to build new hospitals, a need to recruit more health professionals, a need to explore new treatments, a need to design new care processes, a need for extra masks, medical aprons and other medical goods. And all of that had to be done in the shortest possible period of time, since people were dying by the millions (17.3 million so far according to The Economist)[ii].

Suddenly, we realized that “just in time” was not the panacea that everybody thought it was. Suppliers should move back to the point of need. That trend is obvious in the chip market, with the USA and the EU putting forward state subsidies to build chip factories in their territories, avoiding the actual dependence on the far east manufacturers.

The health sector is suffering from a similar malaise, even if the causes are different. There was an initial dependence on China for some medical products, but the two big restrictions came from inside the system: 1) lack of infrastructures such as ICU’s and hospital wards; and 2) lack of health professionals.

The first restriction has an easy solution since it can be solved with political will and money. The second restriction has a more difficult solution, it requires a great degree of advance planning. It is necessary that the design of the health system incorporates human resources for “abnormal times”. That leads to a degree of over dimensioning of human resources during normal times, contrary to “just in time” management system, incorporating the “just in case” management proposal. I am aware that this means increased budgets during “normal times”, but the rewards will be collected during “abnormal times”. It is our choice, the same kind of choice we make when buying insurance, in the hope that “abnormal times” will never come.

[i] linkedin.com/in/annabel-seebohm-ll-m-380b0392

[ii] https://www.economist.com/graphic-detail/coronavirus-excess-deaths-estimates?fsrc=core-app-economist

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Have a look at those two demographic pyramids:

From 1950 to 2019 there has been a clear change in the European demographic structure. Low birth rates combined with higher life expectancy have transformed a pyramid into a barrel. Why we keep calling it “pyramid” is beyond my comprehension.

Enough has been said about the challenges and pressure put on the fiscal structure due to the demographic evolution.

The other side of the coin is the many possibilities opened by the natural ageing of the baby-boomer generation that made up the base of the pyramid of the 1950s. That generation, today in their 50s and older, is probably the generation with the best education and   economic resources  to “come of age” in the last 100 years. It is made up of the sons and daughters of the welfare state, with compulsory schooling and guaranteed pensions.

In the past month, two papers worth reading have come to my attention. One is focused on the United States, “The Longevity Economic Outlook”. The second focuses on Spain, “Los senior en España”.

The common denominator of both papers is how important for the economy and society it is to integrate and profit from the vitality of the 50 plus generations. As an example, that section of the population contributes 40% to the GDP of the United States and represents 44% of the work force.

As for Spain, where 39% of the population is 51 years old and older (see INE), the most striking feature, in contrast with tradition, is their answer in the survey about plans for their heirs. Over 60% responds that their children’s inheritance is their education. Add to that an average income of 1,500€ per month for almost 80% of them and you will get a generation with a propensity to consume well above the level of previous generations.

In short, once the pandemic is over, society has to make room for a generation of old people that does not feel old and that is ready to consume and be an active part of society for much longer than their forefathers.

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After WWII, the ideas of Otto Von Bismarck and William Beveridge came to the fore. In almost every country, citizens demanded that the State should take an active role in helping people in distress: labourers without work, sick people, retirees, etc.

That thinking dominated the world till the Reagan-Thatcher liberal revolution. Helped by an ageing population in almost every country, the current thinking of the last decades of the previous century and first two decades of the twenty first  have centred around the  possible unsustainability of the social umbrella designed after WWII.

Then came SARS-CoV-2 and the COVID-19 pandemic. It changed everything. If the post-WWII design was meant to care for people in distress, citizens are demanding that the new social-welfare policies now include the whole population. From worrying that the social-welfare system was about to collapse, to demanding a bigger role for it, only a pandemic has sufficed. As an example, according to a recent editorial by The Economist (March 6th, 2021), today two-thirds of Europeans are asking for a universal basic income. How we are going to finance those new demands is not clear, but the old rule of lower taxes and no interference by the State in our personal socio-health has been broken into pieces.

We are demanding a social system in which help moves quickly and seamlessly to the entire population, and not only during crises, but always. Governments will need to find ways in which to finance that demand, and not only through borrowing, as is the case today, but permanently. The chunk of social services in the overall government budget will increase and, accordingly, the chunk of taxation in respect to GDP will increase. There will be a movement away from the Anglo-Saxon model towards a more comprehensive model, something more similar to what the Scandinavian countries have in place.

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El año pasado empecé mi felicitación de Año Nuevo con “2020 tiene un sonido mágico, suena bien”. Y continué con un post que hablaba de sociedades resilientes. Probablemente todos hubiéramos deseado un “sonido” más agradable, pero a pesar de todo la sociedad ha demostrado ser resiliente. Trabajemos hacia un futuro mejor, hacia un nuevo Felices Veinte, lo mismo que nuestros abuelos fueron capaces de sacar lo mejor después de una devastadora guerra hace cien años.

Las sociedades han demostrado ser resilientes. La historia habla de “Guerras Mundiales”, pero el número de países afectados por ellas no tiene comparación con el de afectados por el Covid-19 que sí que ha afectado a todos los países del mundo. Sin embargo, el número de muertos causado por el Covid-19 es muy inferior, felizmente, al causado por cualquiera de las dos guerras mundiales.

Oímos hablar de la “Nueva Normalidad”. No sé quién ha inventado tan estúpida expresión y su concepto. Creo que debemos aprender de las sociedades de posguerra: reinventarse. Los “Felices Veinte” de después de la Primera Guerra Mundial o los “Trente Glorieuses”, como lo llaman en Francia, después de la Segunda Guerra Mundial no tienen nada que ver con “Nueva Normalidad”. Supusieron una completa revolución en la sociedad, tanto desde el punto de vista sociológico como económico.

Es este tipo de revolución el que estoy esperando ahora. Un movimiento violento hacia un mundo mejor; más humanizado y al mismo tiempo mejor sostenido por la tecnología. Con la tecnología trabajando para la persona, al igual que en los “Trente Glorieuses” una revolución invisible (J. Fourastié, la Révolution invisible) transformó Europa, combinando un aumento de la productividad con mejores sueldos y, sobre todo, un nivel de beneficios sociales sin precedente en la historia de la humanidad.

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Last year I started my New Year’s greetings with “2020 has a nice ring to it, a magic kind of sound.” And I continued with a post talking about resilient societies. Probably all of us would have liked a “nicer ring”, but society has proved to be resilient. Let us work towards a brighter future and work towards a New Happy Twenties, the same way that our grandparents were able to make the best after a devastating war 100 hundred years ago.

Societies have proved to be resilient. History talks about “World Wars”, but the number of countries affected hardly compares to those affected by Covid-19. Covid-19 truly affects the whole world. Happily, its effect on society has nothing to do with the number of casualties caused by either of the two world wars.

We now hear about the “new normality”. I don’t know who invented such a stupid word or imagined the concept behind it. I think we should learn from what society did after the two world wars: reinvent themselves. Be it the Happy Twenties -after WWI- or the Trente Glorieuses as the French called it -after WWII- it had nothing to do with “new normality”. There was a complete overhaul of how society behaved, sociologically and economically.

It is this kind of overhaul that I am looking forward to this time. A push for a better world; more humane and at the same time more technologically based. With technology working for the person, the same way that during the “Trente Glorieuses” an invisible revolution (J. Fourastié, la Révolution invisible) transformed Europe, combining high productivity, higher wages and, above all, a level of social benefits unprecedented in the history of humankind.

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Human beings are more or less worried about the use other people could make of their data. From Mr. Trump to the little guy on the corner, everybody is aware that their data, their activity, is being recorded and exploited by somebody somewhere: people with good intentions and people with not so good intentions.

To be honest, the fact that Amazon records my purchases so that it can send me what their algorithm decides I like is not a concern for me. Little does the algorithm know that I buy mostly for my wife, so I get inundated with the things my wife probably wants.

But what about health related issues? The EU has issued, and most countries have adopted, a very sensitive legislation about how to treat health data. The problem arises when, thanks to IoT, a myriad of data is recorded that is not strictly health data. Data that is not sensitive in  isolation; for instance how much I walk, how much time I spend in front of the  TV, if I go or  to the bathroom or not, or if I wet my bed. All of those examples are indicators of my health status. All those indicators are gathered and recorded by unobtrusive sensors imbedded in my wrist-band, in my sofa, in the door to the bathroom, or in my mattress. All of them form part of the IoT. Are those sensors hacker-proof? Stand-alone information from any of those sensors is meaningless, but the combined information of all of them makes sense.

Now I can start worrying about what Amazon and others are gathering from my activity. If somebody puts that information together and adds the information from the many possible sensors I may end up having at home, that organization is going to know more about me than I care for them to know.

Summing up, we should be aware that there is no such thing as an innocent sensor. Before adopting the newest gadget, we should be aware that we may be broadcasting our information to the world. The choice to do so is ours (as a matter of fact the smartphone, adopted gladly by almost everybody, is the biggest – so far – recorder/transmitter of our information) but we should be aware of it and make an informed decision so as not to be sorry later.

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