Back to the furore: protests set to reignite

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Hello and welcome to the Intelligence on Economist Radio. I'm your host Jason Palmer. Every weekday we provide a fresh perspective on the events shaping your world. Throughout human history, epidemics have left their mark on habits, on language, etc. Even on urban architecture. Disease has shaped many of the world's cities. We look at how likely it is that COVID 19 will do the same. And at first it seemed like a joke, a misfortunate global beer brand with a name echoing that of a global pathogen. But the marketeers behind Corona have a real problem on their hands and a simple rebranding isn't really an option. First up though, Switch on the news today and chances are it'll be about one thing.

US Coronavirus deaths almost doubling.

But six or seven months ago, something else was dominating global headlines and this show. A wave of protests had erupted across the globe, not least in the Middle east and Arab world.

Not since, I suppose, the Arab Spring of 2011 have one seen so many apparently coordinated or simultaneous protests in one place. We're so afraid what's going now in Baghdad is a carnival.

As the coronavirus has spread, many of these protest movements have necessarily been put on hold. Lately, though in Lebanon, not even a lockdown has been able to contain the public anger that has swelled as the country's economic crisis has gone from bad to worse. Those who took to the streets last October are protesting against their government once again.

For more than a month, the lockdown bought the Lebanese government clear streets. There was a lot of concern here that the virus would overwhelm the underfunded healthcare system in Lebanon. And so people really did obey the government stay at home order for the latter part of March for much of April.

Greg Karlstrom is our Middle east correspondent reporting from Beirut.

We've gotten to a point over the past two weeks where the virus looks contained and where the economic situation has gotten so bad that people have begun to ignore the lockdown orders to go out and protest. So particularly In Tripoli in northern Lebanon, which is one of the poorest cities in the country, thousands of people came out to protest. Some of these protests turned into riots with people throwing firebombs into banks. The Lebanese army, using live ammunition to put down a protest in Tripoli, killed one protester, a young 26 year old man, and wounded a number of others.

And the protests we're seeing now are a continuation of the ones we saw last year.

They are. The protests that started in October were really a rejection of the entire political class in Lebanon and this sectarian confessional system that's been in place since the end of the Civil War 1990. But the trigger for the protests really was an economic crisis. The banking sector looks illiquid, if not entirely insolvent. The currency is collapsing. People are seeing their life savings effectively cut in half over the past six months. And all of this was happening even before the lockdown, which has obviously dealt another severe blow to the economy. So there's a situation now where food prices have gone up by an estimated 40% since September. The government thinks inflation this year will run about 50%. You hear reports from business federations that maybe a third of registered companies in Lebanon have gone under over the past six months. So the economic situation really has gotten very bleak and it's pushing people back into the streets.

And what is it that put Lebanon in this crisis in the first place?

Lebanon has never had a very productive economy. It's been based on finance, real estate, tourism, a very large service sector. So it's not a very wealthy country. It doesn't have very many well paying jobs. But it's been able to keep the economy humming with this big influx of foreign capital, much of which comes from the Lebanese diaspora, which of course is larger than the Lebanese population inside of Lebanon. And what's happened over the past few years is all of this has stopped working at once. The real estate sector, there's a bubble that looks overbuilt and overpriced. The financial sector is slowing down deposits. After a year of steady growth, deposits in banks have begun to decline. The central bank sort of resorted to running a pyramid scheme to defend the currency, where it was borrowing dollars from commercial banks at very above market interest rates and no longer has enough dollars to do that. And so all of a sudden, everything has collapsed. The Lebanese pound, which has been pegged to the dollar at 1500 since the 1990s, now trading at about 4000 on the dollar. On the black market, the government in March defaulted on its debts. Lebanese public debt is more than 150% of GDP. And it's simply become unsustainable.

And the pandemic, and the reaction to the pandemic has only exacerbated all of that.

It has. And we don't know quite how bad the economic situation is yet because of course everything has been closed. But you hear sort of anecdotal stories of businesses that are not going to reopen once the lockdown is lifted, particularly things like restaurants, bars, cafes, which are a big source of jobs in this country. But between the lockdown cutting off their business and the collapsing currency, they no longer have a sustainable business. There are stories of hardship that circulate on social media every day. There was a video of a pregnant woman and what we assume was her husband eating out of a dumpster. There was a story of migrant workers who have really been hit hard by this crisis because they haven't been paid in months, in some cases trying to cross the border into Israel, which of course is closed and heavily militarized. So it's become a very difficult situation. Lebanon has gone to the IMF to ask for a bailout. Of course there will be many other countries asking the IMF for help. Right. But securing one is going to require a very serious effort at economic reform, which is something that successive Lebanese governments for decades have not wanted to do.

But late last year, we weren't just talking about protests in Lebanon. There were demonstrations breaking out all over the world, particularly in the Middle east and the Arab world. Do you think it's the same story as in Lebanon, that this kind of unrest will return to other countries in the region just as soon as the worst of the pandemic has passed?

I think it is Lebanon is perhaps going first because the economic situation has gotten so bad here. But you go back six months and Iraq, Iraqis were in the streets protesting against a corrupt and ineffective government. Algerians were protesting all year in 2019, first to overthrow their longtime dictator, then to protest against the army backed government that succeeded him. All of that, of course, was suspended because of the lockdowns. Everyone has been at home. But the grievances that drove them into the streets in the first place, which again are largely economic, those grievances remain there. Iraq and Algeria are both should be quite wealthy countries. They have large oil and gas resources, and yet that money has been squandered and stolen over the decades. And that is what is driving people into the streets in protest. And again, in both of those countries, the situation looks to be getting worse because oil prices are as low as they are. You look at Iraq, and there are estimates that the government will have a $40 billion shortfall this year from what it budgeted versus where oil prices are now. It's not at all clear who is going to in to lend that kind of money to Iraq. And so there, too, the economy is going to get worse. And I think give it a few weeks or a couple of months, and it's quite likely that people will be back out in the streets there as well.

Greg, thank you very much for joining us.

Thank you.

For a lot more analysis like this, subscribe to the economist. To get 12 issues for $12 or 12 pounds, just go to economist.com radiooffer. New York City's history is partly a story of disease. An 1899 exhibition on tenement housing showed a map that overlaid crowded quarters with reported cases of tuberculosis, diphtheria and typhoid. One critic who saw the map called New York the city of living death and called for a change in the city's architecture. In fact, many modern cities have been shaped by past contagions. That's led some observers to predict or even hope that the coronavirus, too, will transform our urban centers, just as plague, cholera and tuberculosis have in the past. Our Social Policy editor, Joel Budd has been studying the built environment for clues about how likely that is.

New York is usually an extraordinarily busy, noisy city. The pavements are full of people. The roads are full of cars and motorbikes and lorries and bicycles. And you just get a sense in that city of a great sort of racket of noise and a great crush of people. But New York these days is a very, very much quieter city. You can hear the birds there. The only traffic noise, really, is the sound of sirens, the occasional sirens of ambulances. New Yorkers have taken to walking in the middle of the road, and as a result, they can sort of look around them. They can look at the buildings in their city. One thing they're seeing, even without realizing it, is an architecture and an entire sort of urban environment that has been shaped by disease. One thing to remember about cities in the rich world, both in America and in Europe, is that until about 100 years ago, they were much more unhealthy than villages. So if you move to a city, your life expectancy dropped. We now know that epidemic diseases are caused by microbes, bacteria or viruses. But until the late 19th century, people believed that diseases spread through air that was, in a way, rotting. The word they used was miasma. So sort of air would itself become toxic, and the air would infect you. And because people believed that disease came through bad air miasma, they made strenuous efforts to kind of cleanse the air. So one way they did that, for example, was they would light bonfires, because bonfires were believed to sort of clear the air. The other thing they would do is, Starting in the 15th century, some of the large, wealthy italian cities Started to set up large institutions that they called lazzaretti, where they would take victims of bubonic pl in particular. And the idea of these institutions was to remove people such that their kind of emanations wouldn't infect other people. But in the early 19th century, when a new disease arrived in europe, cholera, the authorities tried to do a similar sort of thing. So they tried barricading people inside their homes. They tried to put them in these hospitals. The result was a very, very severe wave of rioting across europe. And the authorities, as a result, started to think in a different way. From then on, they would have to make cities themselves healthier and safer. So in the middle of the 19th century, there are lots of extraordinary, grand civic improvements which are designed to prevent disease. So it's the great era of sewer systems, Water fountains, and public parks. So central park in new york was built not just as a kind of nice area where city people could go and, you know, enjoy a bit of pseudo countryside, but as a kind of machine, really, for sort of purifying new york. Then, by the late 19th century, an old disease had become really the focus of sort of urban thinking, and that disease was tuberculosis. Urban reformers came to believe that you had to try and reduce tuberculosis by reducing overcrowding and sort of stagnant air within buildings. And so that's why in new york city and in other american cities, you see the creation of air shafts in buildings, which very often are still there. But for many people, that was not enough. They argued that overcrowding itself Was the cause of these disease outbreaks. So you see arguments being made that people should simply be removed from cities. So the first recognizable suburban development sprang up, and also that cities should invest much more in sort of rail infrastructure to get people out into these suburbs. And so that is partly why you see New York accelerating its subway building program and then fairly quickly, also limiting building density and building heights. In europe, the same thing was happening as in america. So you see suburbs springing up, but you also see something quite different, which is an architecture fundamentally shaped by tuberculosis. European architects in the early 20th century became very Very strongly influenced by the architecture of tuberculosis sanatoriums, which they had seen in places like Davos in Switzerland, which was, of course, a resort town where people would to try and cure tuberculosis. And many of the things that we really associate with modernist architecture. So the white painted walls and the floor to ceiling windows and the flat roofs, these are features of sanatoriums. And the modernists were not explicitly, but implicitly, they were trying to create an architecture that was, as it were, sterile, that would be free of disease. There was somebody around at the time who said, man is born in a hospital and he dies in a hospital, and it makes sense that he should live in something resembling a hospital. So when we look at European and American cities today, we see the legacies of all of these diseases. So we can see tuberculosis in the architecture and we can see cholera in the street plans and the sewer systems. And if you look very hard, you can even see plague. Many people now believe that coronavirus will fundamentally reshape our city. So there are those who argue that people are going to not want to live in dense places anymore, that they're never going to want to take public transport again, or there are people who argue that streets should be permanently given over to bicycles and pedestrians. But I think that coronavirus probably won't have a long term effect on the urban built environment. And the reason for that is simply that we think it's going to be defeated within a year or two. And as a result, I don't think we are really inclined to make fundamental changes to the way our cities look and function in response to it. And so I do expect actually that in three or four years time, as improbable as it now seems, that cities like New York will go back to being the noisy, crowded, chaotic places that they were six months ago.

That was Joel Budd, the Economist's social policy editor. After all this is over, I quite fancy a beer. There's nothing quite like a cold one to let you unwind, unless the beer you're drinking reminds you of a global pandemic.

Corona beer has conquered the world through this marketing campaign of escapism, beaches, and fun in the sun.

Richard Enser is the Economist's Mexico City bureau chief.

Unfortunately, there's something else called corona that's conquering the world. Now, the coronavirus was called this because in the 1960s, when the human variation of this started showing up underneath microscopes in England, people thought that the corona of the sun, this outer aura, was kind of reminiscent of what the shape of this Virus actually was. Fast forward 40 years and you are talking about a real hellish coincidence for this beer company that has spent billions of dollars painstakingly crafting its brand.

And not just a little brand. Corona is truly global.

Corona's had a pretty good 30 or 40 years going out and conquering the world. They've taken this brand globally, and I think it's fair to say now this is the most valuable brand that has ever come out of Latin America. And for many years, American consumers were instructed to pay less for something for the fact that it was being made in Mexico. But Corona was the first product to go into America and say, no, you need to pay more for this premium Mexican product because it's better because it's from Mexico.

What have the bad effects of that new association been so far?

The way that branding for a company like this works is you try to trigger subconscious associations in the minds of your customers, giving them a mental kick when they buy the product, making people imagine that they're on a beach when they open up a Corona, and that everything is. But the problem with this is it's very difficult to think of the word Corona right now without thinking about a completely different set of associations, many of which are very negative. And so at best, this kind of disrupts the message and the mental feeling that Corona is trying to generate, and at worst, it kind of drowns it out.

But you really think there's a real risk that those associations are strong enough to genuinely dent Corona's sales?

Well, some people think it's possible. I mean, there are some examples of brands, admittedly not towering brands, that have had to change their names in the past. There's the famous case in the 1980s of a weight loss candy called AIDS. AIDS with a Y M delicious chocolate.

Flavor and I love being a size 10.

Again, lose weight deliciously with the aid of AIDS.

When a new disease on the block with a similar name came to the fore in the 1980s, sales dropped by half. Similarly, with the rise of the ISIS terrorist group, lots of institutions and companies around the world which had the name isis, be it a chocolatier from Belgium or an institution at Oxford University, ISIS suddenly became a very unfashionable to be called.

And so is that possibly the answer for Corona just to simply get away from these associations by getting away from the name itself?

It's trickier than that. Lots of marketing psychologists say that when you are this iconic brand name, it's an extremely big risk to go about changing your name and even the packaging because you have a sense of authenticity and history now with consumers, and you're losing that. They don't want to acknowledge the association, because when you acknowledge the association, you accept it into existence and you strengthen it. The other option is to try and change the name, but not too much. Anyone who's ever been to Spain and has drunk a Corona will know that it's called a Coronita, a little Corona in Spain because of a trademark dispute with a wine company over there. So if you call it Coronita, maybe that's a happy compromise. You still get most of the name and the identity intact. But you can try and get rid of this very unfortunate clash of names that is giving executives at Corona a headache almost as bad as their product does in if you drink it for a whole night.

Richard, thanks very much for your time.

Cheers, Jason.

To follow all of the Economist's coverage of the COVID 19 pandemic and how it's swiftly reshaping the world, visit economist.com coronavirus that's all from us on the intelligence. If you like us, give us a rating on Apple Podcasts and see you back here tomorrow.