The COVID-19 pandemic will change everything - for better or worse
In the past week, it has become horribly clear that we are living through something cataclysmic. The human cost of the covid-19 pandemic will be immense. Despite stark and horrific inequalities in people’s ability to protect themselves and their loved ones, it will upend the lives even of those whose privilege usually shields them from the worst impacts of crises. And the extraordinary steps that governments are already taking in response will redraw the political map. The situation is so radically uncertain and fast-moving that we cannot predict the shape of the economies and societies that will emerge from this crisis, but they certainly will not be the same ones that have just blindly stumbled into it.
Amidst widespread fear and anxiety, there are those on the left who hope that from the ashes of this crisis the foundations of a better society will rise. There have been several different versions of this argument circulating. The first is that the crisis is brutally exposing the shortcomings of our broken economic model. Sick people are being forced to continue going to work in defiance of public health advice, because the alternative is destitution. Workers in the hospitality sector were laid off literally overnight after the government advised people not to go to bars and restaurants. The devastating effects of austerity on our NHS are being laid bare. The prospect of schools closing has thrown into sharp relief the swathes of our economy that would cease to function without childcare – and with it, the unpaid, undervalued and essential work done by carers in the home. In short, it’s now painfully clear that the structure of our economy fails abysmally to support human health and wellbeing. It’s also clear that our society is only as strong as its weakest link. Contrary to the austerity-era rhetoric pitting strivers against skivers, if we don’t guarantee a secure livelihood for everyone – including those unable to work – we all suffer. When the dust settles and we compare the path of the epidemic in, say, the UK and Scandinavia, it will become apparent that these failings have claimed many lives.
The crisis is also being seen as bringing out the best of humanity, normalising a new spirit of collective care. Mutual aid networks are springing up across the country. Communities are organising to provide each other with support during isolation – from providing food to running errands to helping with childcare and dog-walking, or simply keeping in touch on the phone or online. The government’s hesitancy to introduce social distancing measures seemed to be partly based on evidence about the health and morbidity effects of loneliness – but they appear not to have reckoned with the way society would respond. It’s entirely possible that some will end up feeling less lonely than before the crisis hit, as their neighbours and communities rally round to support them. The UK has seen nothing like this in recent memory, but countries like Greece and Spain have: in the aftermath of the financial crisis, an extensive ‘solidarity economy’ sprang up to step into the gap left by broken markets and a retreating state. I’m reminded of a quote from a Greek organiser with Solidarity4All: “We are at the end, but from this end we try to help each other.”
This matters not only because of the new values of solidarity it could nurture and the connections it could create, but because it is expanding and highlighting non-market means of provisioning. People are starting social media groups to swap things they need in response to shortages. Companies like Brewdog and Leith Gin are repurposing their operations to make hand sanitiser and distributing it for free. If the crisis begins to seriously disrupt markets for essential goods and services, these solidarity networks could become an essential lifeline. Markets are being curtailed by less heartwarming human responses, too, as supermarkets introduce rationing in response to shelves being emptied by stockpilers. The idea that the market is the only, or even the best, way to meet our basic needs seems unlikely to survive this crisis unscathed.
Not only are non-market means of social provision coming from the bottom-up, the crisis is also normalising state intervention in the economy on an almost unprecedented scale. Already the US government is proposing an $800bn stimulus package. The UK government has announced £330bn in loan guarantees and has guaranteed 80% of the wages of employees “furloughed” due to the crisis, saying it will do “whatever it takes” to limit the fallout. The economy is being put on a war footing, with manufacturers urged to switch to making ventilators. Spain has nationalised all private hospitals. Before the crisis ends, we are likely to see hundreds of billions of pounds pumped into the economy so that households and businesses can stay afloat. Just a few weeks ago, state interventions such as the Green New Deal and universal healthcare were deemed unaffordable, “pie in the sky” ideas. If we can do these things in response to a pandemic, the argument goes, we can do them in response to the climate emergency.
But it is here that such ideas start to unravel somewhat, and reassuring visions of a post-crisis socialist utopia begin to give way to reality. It’s true that this crisis will change what is politically possible: the idea that Labour’s 2019 spending plans were unrealistic or reckless, or that government shouldn’t try to mould markets to meet social goals, will seem hard to sustain after this. It’s true that in 1945, the experience of WW2 meant that state planning was widespread, and that this helped lay the foundations for a post-war settlement based on extensive public ownership and control. It’s possible that the financial crisis was our Wall Street Crash, that this is our world war, and that we will emerge into the sunlit uplands of a new and better political settlement.
And yet. Despite all of this, there is something disconcerting in the idea that emergency state intervention will, in and of itself, pave the way to a socialist future. For one thing, there’s a definite sense of déjà vu here. Many of the same arguments were being made during the 2008 financial crisis. Unbridled capitalism’s flaws had brought the system crashing down. The government had stepped in, blowing out of the water the pretence of firms taking their own risks in competitive, dynamic markets. Many thought that this, too, would lead to a new system in which markets would be more constrained and government would play a bigger role. But things didn’t work out that way. Instead, we saw the crisis leveraged to advance an agenda of the radical retreat of the state – partly on the basis that we had ‘maxed out our credit card’ responding to the crisis and had no money left for other priorities. (Already, Conservatives are trying to sustain this narrative, arguing that “the whole point of fiscal conservatism in normal times is to be able to act decisively if there is a genuine economic emergency”.)
The bank bail-outs were state intervention, sure: but they were an intervention that underwrote the losses of finance capital, for which ordinary people paid the price for a decade or more. It’s mildly astonishing to me that, twelve years later, we are hearing the same arguments being made again, as if the state stepping in to manage a crisis is necessarily going to push politics to the left. The question then is not simply whether states are intervening to manage the crisis, but how. Who wins and who loses from these interventions? Who is being asked to take the pain, and who is being protected? What shape of economy will we be left with when all this is over? It’s too early to answer these questions with any certainty, but early signs are not encouraging. The measures announced so far have scrupulously protected the interests of capital whilst failing to do nearly enough to protect workers.
Boris Johnson initially set the tone by ‘advising’ people not to go out rather than ordering venues to close, meaning they could not claim on their insurance – though he was eventually forced to move to a complete shutdown after many businesses predictably stayed open. The rescue package announced the following day mostly amounted to enabling people to take on more debts that will need to be paid back: £330bn guaranteed loans for businesses, and mortgage ‘holidays’ for home-owners (during which their loans will continue to accrue interest). Many people’s lost income will not be recouped once the crisis is over, yet landlords will be allowed to recoup any missed or suspended rent payments in full. The government moved belatedly to protect jobs and incomes by offering wage support, but its package remains full of holes. At time of writing, it was coming under increasing pressure to extend help to the self-employed, currently excluded from the measures and still forced to choose between health and hardship. There has been nothing for the millions of parents who suddenly find themselves without childcare and struggling to continue working. Even where salaried employees are concerned, the measures failed to adequately protect workers, with business receipt of wage support not being made conditional on avoiding lay-offs. The costs of the crisis, then, are still being borne largely by workers and small businesses – albeit subsidised by the state, and thus by future citizens – it’s just that some of those costs are being deferred. As yet, no sacrifices have been demanded of banks, landlords or profitable corporations.
In the British context, where people and businesses are already dangerously over-indebted, this reliance on expanding private debt during a downturn is risky. It also means that we could emerge from this crisis with an economy even more skewed in favour of capital against labour. Commentators and government figures are beginning to suggest that planned increases in the minimum wage may need to be deferred, and unspecified ‘regulations’ eased, to support businesses to recover. The result could be that many people are left with their household finances in tatters and increased debt burdens to cover, while workers’ rights could just as easily be watered down as strengthened. From an economic point of view, it is obvious that the UK’s broken labour markets have made us less resilient to this crisis. But from a political point of view, it is as yet far from clear that this will translate into positive change.
In any case, I worry that the idea of state intervention as an unqualified good reflects a dangerously outdated view of what constitutes progressive change, one stuck in the era of austerity, when the left/right debate was about whether the government should spend money or not. Recent years have seen an emerging economic agenda on the left that has recognised that this is not really where the action is (albeit higher levels of state spending are essential). It has also recognised that states can be tools of oppression as well as liberation, and that we must democratise and decentralise power – both economic and political – if we want to build a just and well-functioning socialist economy. WW2 paved the way for the post-war settlement because both were based on bureaucratic state control – but this is precisely the characteristic of the ‘spirit of ‘45’ that Corbynism has criticised. Why then the sudden enthusiasm for it?
In any case, austerity politics is no longer the main enemy. Rishi Sunak’s budget may now be an economic irrelevance, but it served a useful purpose in illuminating the new politics of ‘Johnsonism’. The left debate on this had tended to assume either that Johnson was ‘moving left’ and Labour had ‘won the argument’, or that it was all rhetoric and he was simply going to continue with austerity. The budget showed that neither of these was really true. Of course, Johnson was going to spend money to keep his new voters on-side, but that didn’t imply some Damascene conversion to progressive values. Austerity would continue for the most marginalised, particularly those on benefits, there was no intention of taking on concentrations of extractive economic power – the banks, the landlords, the utility firms – and this new economic interventionism was still coupled to a racist-nationalist agenda including draconian restrictions on immigration.
Before we can seek to rise to the present moment, the left needs to realise, and very quickly, that it is no longer competing with small-state neoliberalism. Across the world, it is competing with a new breed of right-wing nationalism – sometimes coupled with neoliberalism, to be sure, but sometimes quite happy to countenance state intervention if it helps cement their electoral coalitions. If this crisis may be creating some of the conditions for socialism, it is also accelerating many of the conditions for fascism. It shouldn’t need spelling out, but fascism does tend to involve quite an economically interventionist state. And if it is normalising state intervention, the crisis is also normalising draconian border controls and restrictions on daily life. It is normalising emergency legislation banning everything from mass gatherings to teachers going on strike. It is normalising the belief that government knows best and everyone else should just fall in line. While a global pandemic clearly demands a global response, with Donald Trump in the White House it is instead lending itself to xenophobia and small-minded nationalism. Instead of just focusing on the scale of Johnson and Sunak’s interventionism, we should be looking at Trump talking about the “Chinese virus”, pressing the pandemic into service to shore up support for his border wall, or trying to negotiate exclusive American access to vaccines. We should be looking at the refugees and migrants abandoned by the authorities or trapped in camps in France, Italy and Greece. We should be looking at the rise in racism towards Chinese people and attempts to scapegoat migrants for the pandemic.
More fundamentally, we should be looking at the emotions the crisis is activating. As various people pointed out just a fortnight ago (even if that now feels like a lifetime), when Toby Young was blathering on about ‘defeating fascism by debating it in the public sphere’, fascism is not rational – it is emotional. It plays on emotions like fear, hate and anger, as well as less obviously negative emotions like national pride. Socialism does not thrive on these emotions: it thrives on hope and, dare I say it, love. After Sunak’s budget, Grace Blakeley observed that progressives tend to over-estimate the radicalising impacts of a crisis and under-estimate the radicalising impacts of having one’s demands met. Recent events give that insight new relevance.
It would be a dangerous mistake to assume that this represents a straightforward ‘opportunity’ for positive structural change. It could just as easily activate a limbic response that inclines people to protect those closest to them and shut out everyone else. Even seemingly positive displays of community solidarity could play into this if they remain confined within national borders or couched in parochial rhetoric about the ‘blitz spirit’. After all, a sense of belonging to one’s community is also a feature of fascism.
There is obviously political work to be done during this crisis. We must not shun the idea of pushing the situation into a better direction – indeed, it’s essential that we try. But if we want to make this more likely, it’s crucial that we don’t get carried away with the idea of crises as merely moments of opportunity. Fundamentally, we must remember that we are not in charge of the course of events. The far-right are. And it’s crucial that we focus on what distinguishes our politics from theirs, rather than spend too long celebrating our newfound common ground: that we fight the next political argument and not the last one. In this context, we must constantly keep coming back to the question of who is winning and who is losing; who is being protected and who is being blamed. In short, how will this reshape power relations, and whose side are we on? How can we counter the actual enemy we face – an unholy alliance of racist authoritarian nationalism and disaster capitalism – rather than the imagined enemy of last-decade austerity neoliberalism? Fetishising state intervention, at a time when right-wing authoritarian governments are presiding over emergency measures – however necessary they may be for public health – may look with hindsight like a catastrophic historical mistake.
Christine Berry is an author, researcher and freelance journalist based in Manchester. She is co-author with Joe Guinan of People Get Ready: Preparing for a Corbyn Government. Christine is a Trustee of Rethinking Economics, a Fellow of the Next System Project, a Senior Fellow of the Finance Innovation Lab and Contributing Editor of Renewal journal. Previously she was Director of Policy and Government at the New Economics Foundation.