The following is a guest post by José Itzigsohn.
The COVID-19 pandemic is threatening the lives of people worldwide. It has certainly increased the level of risk we are all exposed to. Ulrich Beck and others have described our times in terms of a risk society, and the pandemics seem to confirm this view. Of course, exposure to risk has always been unequal. The marginalized sectors of the world economy have always been exposed to high levels of risk (from illnesses, to violence, to exclusion), while the economic elites and the middle classes have been able to protect themselves and to some extent shelter themselves from risk. And exposure to the coronavirus, access to health care, and the risk of losing one’s life are highly correlated to class and to race in our racialized class system. But the pandemic has increased the risk for all, mounting the risks of people who already live precarious lives, but also putting at higher risk the lives and livelihoods of people who usually enjoy some mechanisms of protection from the “conventional” risks we were used to living with. It is hard to think of a previous crisis that has affected all parts of the world at the same time and in such a radical way (at least within the memory of most living people).
In order to manage and reduce the risk posed by the pandemic most countries have taken some combination of social-distancing, lock-down measures. These measures have been successful in flattening the curve and reducing risk in all places in which they have been implemented. At the same time, they have halted the world economy in previously unknown ways. In the United States the speed of the growth in unemployment claims has no historical precedent, and its level parallels that of the great depression. Workers have lost jobs, small enterprises and self-employed people are seeing their businesses vanish. Mass unemployment leads to a decline in consumption, leaving manufacturing export economies with no demand and retail with no activity. All the sectors related to travel and leisure, are paralyzed. We used to live in a world in which traveling across border was easy (at least for the middle and upper strata of the world economy) and now we live in a world in which we can hardly think of travelling beyond our city boundaries and we can’t imagine traveling abroad. The halt of the world economy has created massive pain, and if it lasts, it can pose insurmountable challenges to the current ways of running the global economy.
The pandemic amplified the consequences of neoliberalism and existing inequalities. We see that in hospitals that don’t have the necessary resources for people who are sick or for the people treating them. We see that in essential workers risking their lives for meager salaries, and companies threatening them for demanding better pay or working conditions. We see that in the pandemic affecting mostly the poor and minorities, those who can’t afford to shelter in their homes. We see that in countries like Germany, which in generally has responded well to the pandemic, importing migrant workers to work in agriculture, workers who will risk their health and be sent home once their task is done. We see that in the call of many people to reopen the economy even if that is at the cost of the lives of vulnerable people.
At the same time we have also seen forms of solidarity and mutual care. We have seen incipient forms of worker organization in sectors considered essential. And we have seen massive forms of state intervention to prop up national economies and alleviate the economic costs of the crisis. Without the intervention of states to provide some form of income for people and keeping companies alive the current painful global slump would have been a total collapse (which it still could become). The forms of state intervention have varied depending on the resources of states and on their different political economies but, even under a neoliberal captured state like the United States, the government has provided a measure of help for common people, even though it has been much more generous with corporations and the financial sector.
As countries are starting to lift their quarantines and thinking about reopening their economies we can ask, what will our future will look like? How will the world look as it start to reopen depends on human agency, which is always messy, and on unpredictable contingencies, or in the terms of W.E.B Du Bios, on chance. That is, it is a question of contingency, agency, and messiness. The present is uncertain and the future unpredictable and it would probably be best to remain silent, better be thought as a fool than make a prediction and confirm it. Yet, as social scientists perhaps we can discern some trends, perhaps we can draw some possible scenarios that can develop from the current situation.
In The Great Transformation, Karl Polanyi argued that industrial societies were built through a double movement. First, the detachment of the economy from society and the increasing commodification of aspects of life, followed by a reaction of civil society towards a re-embedding of the economy in social structures of reciprocity and redistribution. This second movement could take many forms. The state was involved in both movements. Polanyi’s book was published in 1944 and he thought that the second movement was consolidated. But since then, or more precisely since the 1970s, we have seen a return of commodification of increasing areas of life and this is the stage were the current coronavirus pandemics finds us. As we think about our coming future it seems that the world faces a choice: either a deepening of existing inequalities, exclusions and violence to levels unseen in the post-World War II world, or instead some form of re-embedding of economic life in social norms of cooperation, inclusion, and respect for the environment. The alternative is between a return of the Polanyian double movement or the deepening of neoliberalism, a choice that will spread pain and death for increasing numbers of humans around the world.
The paramount challenge that the world confront is to contain the virus and to find a remedy or a vaccine to avoid massive number of deaths and the crippling of public health systems. This does not mean that the economic pain is not real. Indeed it is! And it can lead to deaths too. But it is difficult to imagine that if the economy is open people will return to the malls, the movie theatres, the restaurants while there is no answer to the virus. People will not return to “normal” while their lives are at risk. People who lost jobs will not be able to consume as they did before. People are not returning to travel or to hotels until the pandemic is solved. Indeed this is what is happening in the countries that have reopened or avoided a lockdown (such as Korea, China, or Taiwan). Mass consumption, leisure, and traveling are not going to come back while they put the lives of people at risk (or at much higher risk than that we were used to live with). There is really not restarting the economy and getting out of the economic slump until the pandemic is contained. This does not seem to be a case of a V shaped recession. In the best of cases we are likely to stay in a recession until the health crisis is over. In a worse scenario, the recession can become a full blown global depression.
As countries start to reopen their economies, the next big debate will be over debt. All countries have incurred debts in dealing with the pandemic. We already hear calls for austerity, and we will hear further calls going forward. We will be told that we were forced to spend large amount of money and that it will be now necessary to restore the national balance sheets through a reduction of state expenditures. And those reductions will not focus on the military but on social expenditures. These are dangerous calls. They are dangerous because state spending will have saved economies and societies from total collapse , but by keeping the economy, as Paul Krugman describes it, in an induced coma. Massive state spending will still be necessary to reactivate the economy after the pandemic. Otherwise we will remain with huge levels of unemployment and poverty for a long time. Of course we will hear warnings about inflation, but we won’t have inflation under conditions of global recession. And besides, in a situation of great indebtedness, a measure of controlled inflation will help reduce the weight of the debt.
In the United States, with a right wing administration, a captured state, and a history and present of high levels of social exclusion, the possibility that we will emerge from the pandemic with a regime of intensified racialized social inequalities and violence is not minor. Such a regime will be based on white supremacy and would include such things as the voucherization of Medicare, privatization of social security, elimination of environmental protections, an even more exclusionary health system, worsening of labor conditions, further destruction of public education, further growth of the carceral state, increasing violence against minorities, etc. Of course such a regime can only be maintained by state repression (the carceral state) and different forms of privatized social violence. Witness the armed demonstrations against the lockdown in many states. Indeed, private and privatized social violence—from the Klan to the Pinkertons, from contemporary everyday forms of violence against minoritized people to the current privatization of military operations abroad—played a central role in racial and class exclusions in American history. Perhaps it makes sense after all that one of the responses to the pandemic was a rise in the selling of weapons.
Such an outcome, however, is by no means inevitable. The Democrats could win the November elections and social pressure may press a Democratic administration into a new form of New Deal or Great Society type politics. Trump’s America seems to be closer to a hyper-exclusionary scenario than to a New New Deal. But, again, were people predicting something like the New Deal in 1929 or 1930? I don’t know. I do know, however, that organized labor was much stronger then than now and that labor mobilization was central to the emergence of the New Deal. Of course, one of the difficulties in making predictions is that we tend to project the current conditions on to the future. But we know that moments of large scale crisis may generate changes that are hard to see at the moment that they are emerging.
But this dilemma between austerity or a New New Deal is presupposed on the assumption that we have more or less contained the pandemic. Some countries, like China, Taiwan, South Korea, have been able to reopen, or avoided lock downs altogether. They have done so through combinations of massive testing, very intrusive contact tracing, and the successful isolation of positive cases. They have paid a heavy price in giving away any form of privacy vis-à-vis the state. But they have been able to keep living without closing everything. But, in the US, states are reopening without a long and consistent decline in contagion, without systems of mass testing, without systems of contact tracing, and without having used the lock down time to strengthen its health infrastructure.
Who knows, perhaps a medicine would be available that would address the high mortality of COVID 19 (in Remdesivir we trust?) Perhaps the warm weather would slow the spread of the virus (although the high incidence in places such as Brazil or Ecuador doesn’t suggest that). Hopefully at some point there will be a vaccine. But what would happen if, as some people predict, there is a second wave of the pandemic that forces another massive halt in the world economy and forces states again to intervene to put their economies back again on an induced coma? This would put states in unprecedented situations within the global capitalist economy. It would made the world capitalist economy fully dependent on massive and continued state intervention and state money just to keep it barely afloat. Of course states intervene in the economy all the time, but a second halt in the world economy would made states owners of large segments of the economy and responsible for the livelihood of most of the population. It would pose the challenge of creating variations of hybrid state capitalist economies worldwide.
What would happen then? Could a democratic, socially regulated and green economy emerge? Or would that mean that governments respond to the demands of their economic elites and decide that societies need to accept large sacrifices in human lives to keep the economy going? We have certainly heard such calls in the U.S. We have recently heard President Trump say that, vaccine or no vaccine, we are back, meaning that the economy will restart regardless of the virus. Behind this kind of statement is a call for the population to accept a new normal in which we live with much higher levels of risk than before the pandemic. It is a socioeconomic model that chooses to put an increasing number of people at risk of losing their lives for the sake of maintaining profits and avoids creating an economy where the state takes increasing responsibilities for the well-being and the livelihood of people.
Perhaps a second wave of the coronavirus could generate a movement towards solidarity, towards decommodification and a defense of human life over profit. But it could also generate support for more exclusion and large scale repression. I remember Immanuel Wallerstein saying that the fall of the capitalist world-economy may usher in a better system but also a much worse and cruel one. One that is even more exclusionary and oppressive than the current one. Perhaps it is hard for us academics to imagine because we tend to believe in rationality and because we sort of believe in the strength of the liberal order and in progress. But, historically, countless numbers of people have seen their lives change for the worse under modernity and enlightenment: think war, colonialism, settler colonialism, imperialism, enslavement, genocide, etc. As Du Bois and many others documented, racialized modernity has been a very violent epoch for marginalized people. Paraphrasing Walter Benjamin, every document of civilization is at the same time a document of barbarism.
In an engaging book about the fall of the Soviet Union wonderfully titled Everything was Forever, Until it Was No More, Alexei Yurchak describes how the collapse of the regime ended a world that people took for granted. There are of course vast differences in the political and economic systems of the US and the former USSR, but perhaps we are living through a similar moment in which much of what we take for granted collapses. It is difficult for us to imagine the crumbling of the current order because we have internalized so much its tenets. We take our world for granted. But again, everything is forever until it is no more. Social orders do change and those changes are usually good for some and catastrophic for others. The eventual balance at the end is not certain at the beginning of process, contingency matters.
What will be, exclusion or solidarity, will depend on the balance of forces in each place. Unfortunately, there is no global movement for solidarity. Indeed, the need for global coordination and solidarity for overcoming this pandemic and its economic consequences has never been more urgent. And yet, its absence has never been more poignant. What then would world politics after the pandemic look like? Would it be some kind of negotiated consensus? A world with many centers and without a hegemon? But what would those alternative centers be? China? The EU or Germany? Would Russia try to assert its power?
What seems clear is that the pandemic has accelerated the decline of U.S. hegemony. Its soft power has been eroded by Trump. It is still the main military power, but the interventions in Afghanistan and Iraq show that it is one thing to be able to destroy a country or a regime, and a very different one to construct a friendly political order. The ultimate base of American hegemony, however, is the centrality of the dollar in the global economy, and as long as the dollar is the global currency and as long as people fly to the dollar in moments of uncertainty the US will retain a measure of centrality in the global order. So far, the economic crisis has strengthened the centrality of the dollar as the global currency and the Fed as the world central bank. But if hastening the opening of the economy results in a massive second wave of the pandemic that severely hits the U.S. economy, could we think about a situation in which the dollar loses its centrality?
What will be can’t be predicted. It depends, as Du Bois emphasized on contingency, on agency, on chance. From the perspective of the present we can only try to discern likely scenarios, and perhaps act so the one we favor prevails. In my case, that would be solidarity prevailing over exclusion, but that will not be possible without social movements and the organization of civil society.
José Itzigsohn is Professor of Sociology at Brown University.