Covid v Neoliberalism

IT has become increasingly obvious that when Covid hit in early 2020 the UK was disastrously unprepared. It was the most pervasive pandemic since the Spanish Flu after the World War I. But it was the political decisions over the last 30 years, which, ironically, were hell bent on eliminating political decision-making, that exacerbated the impact.

The Covid virus

The aim since the 1980s has been to reduce political decision-making on the assumption that the so-called ‘free economy’ and the much-vaunted rational choice theory, which at the heart of neoliberalism, knows best. However, Covid exposed this theory as being hopelessly inadequate.

As Adam Tooze writes in Shutdown – How Covid Shook the World Economy, Covid required a ‘willingness to contend with political choices, choices about resource distribution and priorities at every level’. And he adds: “That ran up against the prevailing desire of the last forty years to avoid precisely that, to depoliticize, to use markets…to avoid such decisions. This is the basic thrust behind what is known as neoliberalism, or the market revolution – to depoliticize distribution issues, including the very unequal consequences of societal risks, whether those be to structural change in the global division of labour, environmental damage, or disease.” It should be said here that New Labour did do a lot to reverse the damage done to public bodies like the NHS and to reduce poverty, especially among the young, with policies like the minimum wage, Sure Start, and child poverty reduction programmes. But, arguably, is still supported the basic premises of neoliberalism and thought it could ride the tiger to reduce its worst effects – until the tiger bit back of course.

Getting back to the days in the run-up to Covid, however, for the briefest of moments it looked as though things were about to change, that inequality and the globalized lifestyles of the richest of the rich cliques was about to be challenged.

This new challenge was epitomized by that part of the Left Wing on both sides of the Atlantic fired up by Jermey Corbyn and Bernie Sanders. But, as Tooze writes: “The promise of a radicalized and re-energised left, organized around the idea of the Green New Deal, seemed to dissipate amid the pandemic.” And one might add, in the UK Brexit. One should also point out here that the Corbyn venture failed before the pandemic happened. There was, however, a bitter irony in all of this: “Even as the advocates of the Green New Deal went down to political defeat, 2020 resoundingly confirmed the realism of their approach.” The response to Covid was massive fiscal life support even bigger than in 2008 after the financial meltdown, thus confirming the ‘essential insights of economic doctrines advocated by radical Keynesians and made newly fashionable by Modern Monetary Theory (MMT). State finances are not limited like those of a household. As Keynes himself wrote: “Anything we can actually do we can afford.” And the actual history of so-called small state neoliberalism has been a ‘series of state interventions in the interests of capital accumulation’.

Covid also demonstrated just how dependant the economy is on the stability of nature. Tooze writes: “A tiny virus mutation in a microbe could threaten the entire world economy.” And it tore down the partitions neoliberalism had erected dividing the ‘economy from nature, economics from social policy and from politics per se’. According to him the pandemic exposed the ‘illusion that there is a thing called the economy that is separate from society’. And when government intervened the markets recovered remarkably well – but the recovery was unequal. “Worldwide, the wealth of the billionaires rose by $1.9 trillion in 2020, with $560 billion of that benefiting America’s wealthiest people. Among the surreal and jarring juxtapositions of 2020, the disconnect between high finance and the day-to-day struggles of billions of people around the world stood out.”, writes Tooze.

Tooze does not provide a solution to the problem except to say that we must shift our worldview in order to be ready to meet the challenges that face us now and may face us in the future. He writes: “If 2020 taught us anything it is how ready we must be to revise our worldview. The Green New Deal was brilliantly on point, but it imagined climate as the most urgent threat to the Anthropocene. It too was overrun by the pandemic’. He recommends a kind of open mindedness ‘commensurate with the times we live in’.

We need to change our worldview

It has to be said that this is a pretty thin response to the problem we face today. Sure, openness is an important quality in an increasingly splintered and polarized world. But to say that the Green New Deal was overrun by the pandemic, is not to say that it was wrong. We need something like the Green New Deal that was offered by the radical left in the run up to Covid. The mealy-mouthed lip-service that the candidates gave to the climate change during the Conservative Party’s unedifying leadership contest and the economic disaster that has ensued since, just won’t do. And it is worrying that the invasion of by Russia of Ukraine is being used to justify the status quo in the West.

Defending the status quo!

If we are going to save Homo Sapiens and other animals, then we need to turn apathetic citizens, who look on the Westminster cliques as mere spectators, into active participants. And one way to do that is to introduce citizens’ assemblies at every level of society – from parish councils to a new People’s Assembly to replace the House of Lords.

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