How Panic-Buying Revealed the Problem With the Modern World
The pandemic has shown how just-in-time systems are also fragile.
As pictures of empty shelves dominated our social-media feeds here in Britain, armchair critics denounced their fellow citizens as selfish and greedy. Stop hoarding! End the panic-buying!
Hang on, though. Were hordes of selfish Britons really squirreling away 90 tins of tuna each? As the fog of panic dissipates, the answer is clear: No. Instead, the data show that small changes in the habits of a minority of shoppers prompted lurid headlines about empty shelves—which then made others, quite rationally, change their behavior. That has led to short-term supply issues. (Neither of the two stores closest to me in south London has any eggs in stock, for example.)
Any student of economics will tell you that modern supply chains rely on just-in-time ordering. In the case of British supermarkets, production schedules are tailored precisely to demand, so that unused stock does not sit in warehouses or go to waste. In the current crisis, the country has not run out of essential goods such as toilet paper; the difficulty is getting them onto the shelves quickly enough.
Urban couples and families, unlike their parents and grandparents, have their own version of just-in-time supply chains. They pick up milk on their way home from work. They buy six eggs from a local store, rather than driving to an out-of-town supermarket to load their larder for the week. That approach makes sense: British new-build houses have been getting smaller for decades, so some families simply do not have the space for a full-size freezer. Fewer of us drive now than did in previous decades, and keeping a car in a city can be expensive, particularly when it’s rarely needed. Young Britons also eat out more regularly than previous generations, so like supermarkets themselves, they don’t want to hold on to produce they might never use.
Under normal circumstances, this just-in-time system is convenient. Yet it is also, as we have discovered in the past fortnight, fragile.
This month, the government advised those with coronavirus symptoms to spend seven days at home “self-isolating.” Like many others, I read this advice, looked in my fridge, and thought, Yikes. My subsequent trip to the supermarket wasn’t evidence of hoarding; it was proof that I had been running an overly efficient supply chain into my own home. Changed circumstances meant I had to change my behavior.
Unfortunately for us all, so did many others. “Temporary shortages are being caused by people adding just a few extra items and shopping more often,” said Fraser McKevitt, the head of retail and consumer insight at Kantar, which monitors consumer spending. The company’s study of 100,000 British shoppers found that only 6 percent of those buying liquid soap, and only 3 percent of those buying pasta, “have taken home extraordinary quantities.”
Yet that relatively small, unexpected surge in demand was enough to generate social-media snapshots of bare shelves at inner-city supermarkets. When amplified by the traditional media, those frightening pictures convinced more of us that there was a problem with food supply. And, like in a bank run, perception quickly became reality. Big queues started to form. Online slots for supermarket deliveries filled up. The situation spiraled.
What happened at supermarkets is worth dwelling on, because it reveals a problem with one of the modern world’s most hallowed concepts: efficiency. As businesses and governments chase ever-tighter margins—ever-greater efficiency—they have created systems that are finely tuned, but also delicate. Many of us are individually guilty of indulging this tendency, encouraged by the trendsetters of Silicon Valley. “The tech sector’s overarching philosophy remains bent towards treating the human brain and body like a machine that can be tweaked and perfected until it is running at peak efficiency,” the journalist Lux Alptraum wrote for Quartz in 2017. This is, however, a fundamentally inhuman philosophy. People aren’t machines. We are inherently inefficient, with our elderly parents and sick children, our mental-health problems, our chronic diseases, and our need to sleep and eat. And, as the past few months have demonstrated, our susceptibility to novel viruses.
We have been trained to see efficiency as a desirable goal. We often don’t see, or don’t acknowledge, the risk of catastrophic meltdown. Think of efficiency as a high-performance engine. Under perfect conditions, it delivers maximum power and minimum waste. However, that very efficiency makes it less robust. Highly efficient systems have no slack, no redundancy, and therefore no resilience and no spare capacity. That’s a problem because perfect conditions rarely exist for long in the real world, and “rare” events happen more often than you’d think. (Climate change, for example, has turned “once in a century” challenges such as extreme heat waves and floods into more regular occurrences.)
The coronavirus crisis has also exposed how efficiency can be a false economy. Even before the pandemic, Britain’s National Health Service was losing doctors at a worrying rate, to either the private sector, opportunities abroad, or simple exhaustion. Last year, the NHS’s understaffing problems were so acute that the service launched a recruitment campaign overseas. A recent study, published in the British Medical Journal, found that a third of doctors surveyed had burnout and secondary traumatic stress. Emergency medicine and general practice—the local doctors who are typically a patient’s first point of contact, where each appointment is supposed to last less than 10 minutes—had the highest rates.
On the surface, a health service working at close to maximum capacity looks efficient. But it’s not if it is driving doctors out of the profession. Every lost doctor is a waste of years of training and (in Britain, where medical school is subsidized by the state) taxpayer investment—and creates more work for those who remain.
Heading into this past winter flu season, nearly all NHS beds were occupied. “If you think about things from a financial perspective, you can see why that looks like an efficient way to manage resources,” Dr. Julia Patterson of Everydoctor, a membership organization for health-care staff, told me. But clinical guidelines state that average bed occupancy levels should remain below 85 percent for a reason. “We need capacity in the system to deal with annual changes in disease,” Patterson added. “Otherwise, it’s a false economy. When surges occur in January, February, there simply isn’t enough capacity.” Government hospitals either have to purchase space from private ones, or transfer patients to other parts of the country, “and that’s not cheap.” And all this was the case even before the arrival of a pandemic.
Like the NHS shortfalls, other coronavirus challenges can be traced back to the “austerity” agenda of the Conservative-led government elected in 2010. Its architect, the former chancellor George Osborne, believed that the public sector was bloated and inefficient. He regularly invoked “efficiency savings” to make his numbers add up. His penultimate budget, in 2015, reported that the government had an “aspiration to find £10 billion in further efficiency savings by 2017–18.” (The E-word itself appears 18 times in the document.)
In practice, though, fat was not the only thing cut from public spending. Local councils, which are responsible for trash collection, park maintenance, and an array of other issues, had their budgets reduced by 60 percent in the past decade. The money given to local business watchdogs has fallen by that much too. These services are now expected to monitor compliance with the government’s closure, announced this week, of nonessential shops, and ensure that scammers are not cashing in by selling fake face masks or preying on elderly people stuck in their homes. Police numbers were also reduced during the austerity era—a policy that the prime minister, Boris Johnson, pledged to reverse as part of his election campaign. The cuts that made the force more “efficient” now leave it ill-equipped to enforce Britain’s lockdown. Officer numbers are at their lowest since the early 1980s.
One more glaring example of the problem with efficiency is this: What should you do if you have coronavirus symptoms and live with an elderly or vulnerable person? The NHS advice is straightforward: Stay two meters apart, try not to use shared spaces such as living rooms at the same time, and “do not share a bed, if possible.” This advice makes sense for Britain’s middle class, as does the injunction to exercise in the garden if possible. However, seven years ago the government decreed that no one living in public housing and claiming welfare benefits should have a spare bedroom. The penalty for doing so was to lose up to 25 percent of their housing benefit.
The so-called bedroom tax was needlessly punitive, given the size of the savings made. Some families protested that their area had no smaller properties into which they could move. Foster carers complained that their housing benefit was reduced in months when they had no children living with them, leading some to abandon the practice. In December last year, the European Court of Human Rights ruled against the British government, which had tried to penalize a domestic-violence survivor for the panic room intended to shelter her and her 11-year-old son from her ex-partner.
All of these changes, carried out in the name of efficiency, have made our society more fragile: tired doctors, overstretched police officers, families forced to live in cramped homes. People living highly tuned lives have faced more disruption as the system overheats.
It is too early to say how many of the changes caused by pandemic lockdowns will last. But we already know that survivors of disasters, wars, and famines have a tendency to hoard food. Regaining confidence in a system once you’ve seen its essential fragility is difficult. So here is a post-coronavirus suggestion: We should make our peace with a little inefficiency in good times, because it makes the bad times easier to bear.