We’re Still Picking up the Pieces of the Last Crisis

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04/25/2020

At this point there can be only one priority: to overcome the public health crisis caused by the COVID-19 pandemic. As economist James Meadway has described, in the short term we need the opposite of a war economy — not the public mobilization of resources against a common enemy, but a demobilization in order to avoid spreading the virus. This means multiple crises in the entire circuit of capital. Global production and logistics networks are breaking down, with workers staying at home and goods (except food and basic items) not finding buyers. Without doubt, the depth of the crisis depends on how long it takes to overcome the pandemic. But we need to remember that as the circuit of capital stops, payments and debts will not. There is no way to “pause” the economy in order to press “play” again later. Yet even as capital faces several simultaneous crises, and states come to the rescue with taboo-breaking measures, this does not automatically produce better conditions for the political left. But the fissures of austerity don’t just concern states’ (in)capacities in providing effective crisis responses. The financial crisis of 2008 had, as its social cushion, the so-called welfare society typical of the Southern European periphery. It was households — through intergenerational solidarity and a generalized increase in indebtedness — that were able to mitigate the most harmful effects of unemployment, underemployment, and poverty. This even had side effects in reinforcing more conservative interpersonal behavior, since one’s level of independence and capacity to make one’s own life decisions depend on the material conditions to do so. Once again, more vulnerable workers, such as women or LGBT people, will be affected differently by the crisis (the rise in domestic violence is already being felt). Social distancing policies, vulnerabilities in state systems for provision, and the consequences of the mounting economic crisis will add to the burden on working-class households.

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