WeeklyWorker

19.03.2020
Johnson’s original plan would have cost at least 260,000 lives and completely overwhelmed an already overstretched NHS

Bankruptcy of neoliberalism

With countries everywhere on a ‘war footing’, writes Eddie Ford, the pandemic shows the necessity of global social control.

It is impossible to overstate the nature of the crisis engulfing humanity due to the Covid-19 pandemic. Wartime-style language from leaders is now common parlance. Draconian emergency measures are being taken, with many more to come. Things are unfolding so rapidly that almost anything can happen. The only thing you can guarantee is that the crisis (medical, economic and political) will not be over soon and the world will never be the same place again - however much our rulers may wish otherwise.

In a swirling tide of events that is almost impossible to follow, travellers everywhere are scrambling to get home as country after country closes borders, meanwhile airlines drastically cut or cancel flights.

All this comes in response to the soaring death rate, especially in Italy and Spain. Europe is now the epicentre of the pandemic. As of March 18, there were 55,000 confirmed cases and 2,300 deaths in Europe - out of these, 25,000 cases and 1,800 deaths were in Italy alone. Globally, infections are now above 200,000 with about 8,000 deaths. The World Health Organisation has called for “aggressive action”, particularly in south-east Asia, where the disease is beginning to get a hold. If Covid-19 seriously begins to effect Africa and other desperately poor parts of the so-called third world, which seems near inevitable without sustained and serious emergency action, then the infection rate - and deaths - could be utterly horrendous, as many of these countries barely have a health service of any kind.

France is certainly taking aggressive action, with president Emmanuel Macron declaring the country on a “war footing”. Thus on March 17 an emergency decree ordering the population to stay at home came into force, with citizens only allowed out for “essential” trips, such as food shopping or a medical appointment, as well as exercise, (so long as you stay metres apart from other people). If you transgress the edict and fail to produce a valid document on demand detailing the reasons for being outside, you will be fined or even imprisoned if you are a repeat offender - although prisons are happy breeding grounds for Covid-19. Clearly, these are the sort of measures that the British government should be taking, as the crisis escalates.

Meanwhile, Donald Trump - after previously calling coronavirus a “hoax” or no worse than the flu - has declared a national emergency and imposed travel bans on European countries. His administration has also announced a financial stimulus package worth at least $850 billion and is actively considering delivering ‘helicopter money’: ie, putting cash directly into the bank account of every American, or a cheque if you are part of the one in nine households too poor to even have a bank account.

The research consultancy, Capital Economics, has predicted that the UK’s GDP could fall 15% in the next quarter - a staggering drop when you consider that during the 2008 crisis there was only a 6% fall. S&P Global, one of the rating agencies’ “four men of the apocalypse”, has warned of a surge of bankruptcies.

Panic

As everyone knows, at the beginning of the week Boris Johnson - flanked by Sir Patrick Vallance, the government’s chief scientific adviser, and Chris Whitty, the chief medical officer – urged everyone to avoid “non-essential” contact and travel, as the disease was now “approaching the fast growth part of the upward curve”, with London in the virus vanguard. This meant, a slightly haunted looking prime minister explained, staying away from pubs, bars, clubs, cafes, restaurants, cinemas, theatres, music gigs, galleries and so on. Anything, in fact, that constitutes a ‘mass gathering’. Johnson also announced a series of stringent steps, including 14 days of self-isolation for a whole household if anyone displays symptoms of the disease - preferably retiring to separate rooms for the duration and using separate bathrooms or showers. Anyone who can work from home, should, he said - which is impossible for most people, it goes without saying.

In other words, in a measure that would have been unimaginable only two weeks ago, Boris Johnson was announcing the closing down of all “non-essential” parts of the British economy - with all these venues and businesses expected to close down voluntarily, though that could quickly change. This state of non-economic activity, as things stand now, has no end date or exit point. Indeed, the pandemic could well last for six months or more, possibly even up to 18 months on the most pessimistic scenario. Stating the obvious, Johnson’s advice is going to mean hundreds of thousands of job losses, unless the government takes immediate action. Disruption to the economy could become destruction - a prospect alarming the new governor of the Bank of England, Andrew Bailey - with the bank’s monetary policy committee expected to cut interest rates from 0.25% to a record low of 0.1% and resume quantitative easing next week.

The government’s drastically new policy in relation to the pandemic does represent a break from its initial ‘herd immunity’ approach (or mitigation strategy). Essentially, that is based not just on the idea that once you reach a certain general immunity in a population, then you can actually stop its further spread. The calculation by immunologists is that if 60% or more of the population have already had the virus, it will peter out.

That is all very well. but Covid-19 is a new disease, with no past evidence or behavioural patterns to study and build reasonable predictions upon. The government went into panic mode when disturbing new evidence from Italy indicated that if the government had stuck to the original plans, then it could have cost 260,000 lives and completely overwhelmed the inadequately resourced national health service - or, as Boris Johnson said, be prepared to “lose loved ones”. That was deemed to be politically unacceptable, quite rightly, and hence the government speedily adopted the alternative suppression strategy, in which - using the words of Patrick Vallance - a death toll of 20,000 would be judged a “good result”.

Of course, virtually every country in the world has gone in the opposite direction from herd immunity. As we have seen from China, Taiwan, Singapore, etc, the thing that works is strict isolation and mass testing - but in Britain you only get tested if you have been hospitalised, unless you are the prime minister. Shamefully, Italy has far more hospital beds and respirators than the UK, the NHS having being chronically starved of funds. So far in Britain there have been almost 3,000 infections and over 100 deaths, but the country is roughly three weeks behind Italy - the deluge will start soon.

Following Johnson’s shock announcement about social distancing measures, totally disrupting the British way of life, chancellor Rishi Sunak said he would do “whatever it takes” to see the UK through the crisis - a repeated mantra at government press conferences, which are now daily. His supposedly “big and bold” plan to salvage the economy from a catastrophic hit would provide £330 billion of loan guarantees - with more available “if needed” - to help businesses pay their bills during the crisis and top up the £12 billion budget stimulus with a further £20 billion of spending. Many businesses would also have a year-long holiday from paying business rates, with smaller companies eligible for a cash grant of up to £25,000. Sunak also announced cash grants of £10,000 for the UK’s 700,000 smallest companies, and a three-month moratorium on mortgage payments for home owners in difficulty as a result of the coronavirus.

Frankly, this package is too little, too late - you do not need to be a genius to see the gaping holes. What about people who cannot pay their rent and face eviction? Then there are those workers in the so-called gig economy, freelancers (like many artists, musicians and writers), people on zero-hours contracts and the self-employed - what are they supposed to do? Quietly starve to death at home? And what about workers who are already self-isolating and on statutory sick pay, getting the princely sum of just £94.25 a week? Not to mention those who have been laid off or are just about to get the sack. It can take up to five weeks to receive universal credit.

And the supermarkets are now effectively practicing a form of rationing, Sainsbury’s has already imposed a three-item limit on many goods. Surely there needs to be immediate assistance for those workers that are finding it difficult to feed themselves and their families. The state cannot just stand by and do nothing.

Every citizen - working or non-working, well or sick, young or old - must be guaranteed a basic or minimum income throughout this entire crisis that they can actually live on; for all people self-isolating or infected all mortgage and rent payments must be indefinitely suspended too.

Governments across the world of whatever political or ideological colouration, including Johnston’s and Trump’s, could be forced to go for widespread nationalisations, takeovers, subsides, economic planning and other ‘socialistic’ measures. There has to be massive state intervention on an unprecedented scale - in the economy and all other aspects of society.

Above all else, Covid-19 demonstrates the final bankruptcy of neoliberalism - no-one is going to buy into that fantasy any more. The idea that the market can solve this disaster is insane. Given that the pandemic is global, this shows the necessity of global social control by the working class - not the destructive anarchy of capitalism. Rather, it is humanity versus capitalism - a fight for survival.

eddie.ford@weeklyworker.co.uk