We weren't prepared for the economic collapse that followed the pandemic — but there's a plan that could prep us for the next one

• Paul Constant is a writer at Civic Ventures, a cofounder of the Seattle Review of Books, and a frequent cohost of the "Pitchfork Economics" podcast with Nick Hanauer and David Goldstein.
• On the latest episode of Pitchfork Economics, economist Lindsay Owens discusses a report she co-authored calling for a standing emergency economic resilience and stabilization (SEERS) program.
• The plan wouldn't be for any specific disaster, but would instead be activated as soon as certain economic indicators are triggered.
• It would address several of the problems in the initial stimulus response, including establishing direct payments to businesses and everyday Americans.

When it came time for me to learn how to drive, my dad had one piece of advice that he repeated over and over: "Expect the unexpected," he solemnly told me.

As an overly literal teenager, I hated that advice. Just as a sentence, it didn't make sense — how could you expect something when it was, by definition, outside the realm of expectation?

Now that I'm older and a little less precious about the flexibility of language, I understand what my dad was trying to tell me. No, you can't prepare yourself for every single eventuality that the world might throw at you. But you can at least be alert and prepared to take action when that unexpected event happens. He was warning me against letting my guard down or being distracted so when that tree branch falls into the road, or that deer pops out of the woods, or that car veers into my lane I'll be able to respond appropriately.

Governments are impossibly complex systems, and it's similarly impossible to predict every disaster that will befall a nation at any given time. You can assume certain types of disasters might happen within a given season — forest fires tend to happen in the summer, hurricanes in the fall — but there's no way to predict every negative event in advance. You can only plan for the fact that not everything will go according to plan.

It would be unfair to blame any government for not being fully prepared for the coronavirus pandemic at the beginning of this year. There was no way to predict the arrival of a highly infectious virus called COVID-19 in January of 2020. But we're now seeing two very different results play out in real time. There's a huge gap between those governments that had a reliable pandemic plan in place, and those that either didn't have a plan in place or simply ignored pre-existing plans.

But most nations were caught flat-footed by the economic downturn that accompanied the pandemic. For the most part, policy solutions for the fastest, steepest economic collapse in modern times were crafted quickly and with very little precedent in mind. Nobody, it seems, expected the unexpected.

On this week's episode of Pitchfork Economics, economist Lindsay Owens discusses a report she co-authored for The Great Democracy Initiative that calls for "the creation of a standing emergency economic resilience and stabilization [or SEERS] program" that legislators can "pull off the shelf" and enact as soon as an economic emergency occurs.

Like the Obama pandemic plan that the Trump administration ignored, the SEERS plan isn't tailored for any specific type of disaster — it could have worked for both the COVID recession and the housing bubble collapse of 2008. It's devised to protect ordinary Americans from the consequences of huge failures in the economic system before they get too far out of control.

The SEERS plan is a masterful piece of legislation that employs automatic stabilizers to respond to crises. That means the policies in the plan wouldn't require a highly partisan Congress to take action — they'd simply go into effect as soon as certain economic indicators (high unemployment, plummeting markets, etc) are triggered. Think of it as less of a political football and more of a home security system that calls in help when it's needed.

SEERS provides a restructuring process for "too-big-to-fail" corporations that only saves big banks and businesses if the American people get a stake in the company going forward. It covers payroll for small businesses to prevent unemployment from rocketing too high. And it establishes a set of checkpoints that enact certain policies based on how well or how poorly the economy is responding.

If our leaders had adopted a SEERS-like program after the Great Recession, Congress wouldn't be deadlocked over continued stimulus programs as they are right now. The proposal also fixes several of the biggest problems we've found with Congress's initial stimulus response.

For example, the PPP loan program established in the first big stimulus package was widely criticized for leaving the distribution of government funds to private banks. Those banks largely favored big companies over small businesses, and they left many minority-owned businesses out in the cold while white-owned businesses and corporations won what essentially amount to no-strings-attached grants. SEERS, by contrast, establishes a direct government payment program for businesses and ordinary Americans that circumvents discriminatory brokers like big banks.

By standardizing our economic crisis response, Lindsay explains on the podcast, we are simply bringing the same foresight to our economic relief programs that we bring to disaster relief programs like FEMA. We'd avoid the bitter partisan combat that unfurls every time Congress is required to take action, and we'd be saving precious time — which means we'd be saving jobs, homes, and the life savings of millions of average Americans. The two most damaging effects of any economic disaster are uncertainty and instability. By reducing those two factors, SEERS transforms the all-encompassing blind panic of an economic downturn into just another problem to be solved.

It's impossible to say when or how the next economic downturn will happen — but one thing that virtually every economist in the world can agree on is that it will happen. It is within our power to prepare broadly for that moment, so that we're never caught completely flat-footed again.