Any other business

Keep your eye on GlaxoSmithKline. The UK-based multinational drug-maker represents the future, both as a mass-producer of the vaccines that we pray will finally defeat Covid-19 and as a beacon of the way shareholder capitalism will re-position itself in the post-pandemic era. GSK last week announced a collaboration with its French rival Sanofi to create a Covid-19 vaccine that it aims to manufacture at the rate of ‘hundreds of millions of doses annually’ by the end of next year. That’s 20 months before we might begin to feel safe again but still ‘a significantly faster timeline than for normal vaccine development’.

The phrase ‘sharing economy’ was coined a decade or so ago to describe collaborative new business models made possible by the internet, from Airbnb and Uber to crowdfunding, peer-to-peer lending and skill bartering sites. It was about ways of monetising assets, circulating capital and earning casual livings that boosted economic activity after the ‘great recession’ and it will be a hive of creativity in the next recovery — even though its partner is the ‘gig economy’ whose insecurity has left so many people in hardship now.

The suspension of the residential property market is disheartening for those who were hoping to buy a first flat or new-build house this spring. But spare a thought also for estate agents, who are usually well back in the queue for public sympathy but are nevertheless a familiar part of our high-street fabric, their windows and websites feeding the national aspiration to home ownership that also fills so many hours of Kirstie-and-Phil television. With government urging completions to be deferred, mortgage lenders tightening their terms, viewings and removals impossible and shares in the bellwether London agency Foxtons down by half, the whole sector is now in what Niraj Shah of Bloomberg Economics calls ‘an induced coma’.

The CBI’s guidelines on ‘best practice for business’ during the pandemic tell the 1,500 larger companies that make up the lobby group’s core membership to prioritise employee welfare while also asking ‘how can we help’ government and society to manage the crisis. So far so good. But the notes don’t say ‘Consider a temporary cut in senior executive salaries’. And that is what I think they should all be doing, sooner rather than later, both as a gesture of immediate solidarity and as a move to avert a longer-term backlash against wealth, privilege and the pillars of capitalism. The trend has already begun in the all-but-grounded airline sector.

The world needs airlines — and, barring Armageddon, will still have some when this crisis is over. It will also still have aircraft, pilots and airports. The aviation industry, accustomed to volatility as it is, should be well capable of restructuring and regrowing in response to renewed demand, even if bankruptcies are left behind. I know that sounds glib, but airlines on both sides of the Atlantic have been loud in calling for state aid as traffic has collapsed — and in the cruel process of deciding how governments can equitably relieve the virus’s financial impact on every business and family, all such claims demand scrutiny.

‘It’s a ghost town,’ said the officer manning the body scanner at Manchester airport — Manchester, New Hampshire, that is, a city of some 112,000 citizens. I don’t know how many of them would normally be passing through its departure hall on a Sunday morning, but today there are no more than 50, plus me and a bottle of hand sanitiser to remind us why it’s so quiet. A spokesman for the global airline industry says carriers collectively foresee worst-case revenue shortfalls of $113 billion as a result of virus fears and travel restrictions, similar to what hit them after the 2008 financial crash.

If anything, stock markets have been slow to respond to the spreading coronavirus outbreak. Stories of Chinese supply interruptions, from JCB digger components to plastic toys, have been circulating since mid-February, while hedge funds have been hard at work short-selling cruise-operator shares: Royal Caribbean and Carnival are both down 30 per cent. Now airlines have taken a pasting too, with easyJet and Ryanair among the big fallers in Monday’s sell-off of European stocks, following news of a cluster of virus cases in northern Italy. Meanwhile, a turning point may or may not have been reached in the rate of -reported cases in Wuhan, where the outbreak began.

So farewell Bernie Ebbers, former chief executive of WorldCom, the long--distance phone operator that became America’s biggest-ever bankruptcy case in 2002. Ebbers has died aged 78, having been released on health grounds in December from a 25-year jail sentence for his part in an accounting fraud that concealed the perilous state of WorldCom’s finances, misleading investors after a series of high-risk acquisitions by the bejewelled ‘telecom cowboy’ Ebbers during the dotcom boom. By repute, US justice aims to make examples of high-profile corporate miscreants, starting with the humiliating ‘perp walk’ into court and concluding with harsh sentences and scant hope of parole.

I first wrote about the risks and rumours around Huawei — and made bad jokes about its name — in September 2012. That was seven years after BT started ordering cheap equipment from the Chinese telecoms giant without, apparently, delving into stories about its military-connected origins. But 2012 was the year when Huawei was reported to be working with GCHQ via a ‘Cyber-Security Evaluation Centre’ in Banbury to prove its kit was not open to hackers and did not contain ‘backdoor’ listening devices. Since then, no direct evidence of espionage has been reported, only potential vulnerabilities; but the Trump regime has become strident in denouncing Huawei as a conduit for Chinese spying and data theft, and demanding that allies toe the US line.

Seven years ago, when HS2 was still officially costed at £33 billion, I wrote that I was looking forward to using my pensioner’s rail pass on it ‘early in the reign of hugely popular, three-times-married King Harry, in whose favour his elder brother will abdicate after his 50th birthday’. Now HS2’s upper cost estimate has reached £106 billionand the northern spur of the track may not reach Leeds until 2040, when my pass and I will surely have expired. There’s still a possibility all this will happen — high-speed rail and Harry’s coronation, that is — but both look less likely by the day. And after a decade of defending HS2 against all-comers, I fear I must review my position.

Asked to name British institutions they’d rather not see shaken to the foundations, many consumers would list the John Lewis Partnership and its Waitrose supermarket subsidiary just behind the House of Windsor. Indeed some might rank the employee-owned retail group ahead, on the grounds that Her Majesty’s family doesn’t sell Egyptian cotton sheets and organic celery juice. A fall into losses, a management bloodbath and a threat to John Lewis’s distinctive business model really is, in its way, a national crisis. As you flick from one online retailer to the next, pondering how to spend the saving you just made on a load of Lidl groceries, you may ask why John Lewis still matters.