Has the pandemic confirmed the failure of Neo-liberalism?

Coronavirus has killed 2.5 million people since early 2020. This was preventable and not inevitable. The current pandemic marks the late beginning of a destructive movement brought around by capitalism and neoliberalism. States, notably in the West, despite boasting a monopoly on freedom and the pursuit of happiness, have shown that this only extends to petty consumption – the freedom to take on enormous debts and buy a Big Mac. Whilst naked profit-seeking and protection of market outcomes over other social pursuits (equality, housing, healthcare) is certainly, in part, to blame for the pandemic and its effects, this is probably not the end of neoliberalism. In the coming months and years, rather that witnessing the burial of neoliberalism, I predict that we will see a rebirth, a mutation, all the while marching onwards to environmental ruin. I fear the worst is yet to come.  

Neoliberalism was never meant to save or protect us, the 99%. Broadly speaking, neoliberalism is the tripartite manifestation of an ideology, a mode of governance, and a policy agenda, which holds at its core the liberal ideals of self-regulating markets. This tends to manifest in a policy platform which can be crudely summarised as deregulation, liberalisation – within the public and private spheres – and privatisation, all in aim of more “freedom”, “everywhere”. It was backed by a willing and obedient state and was gradually adopted to protect market outcomes and private property. In this respect  it is entirely ill-equipped for a global pandemic. Neoliberalism does not allow for unprofitable production, something that public social welfare and emergency planning requires. We need hospital beds and properly stocked and (not out of date) PPE for when crisis strikes – and yet, this is not in the immediate commercial interest.  

In neoliberalism’s last response to global crisis – after the 2008 Global Financial Crisis – the government met with the financial lobby: winks were shared, wrists slapped, and austerity was eventually enforced. The government, our representatives, allowed for those responsible to save face – a total of 47 bankers receiving jail sentences globally, 76% of those 47 originating from just two countries, Spain and Iceland. Although austerity was meant to bring about recovery, a combination of this strict economic policy and the current economic shutdown has resulted in the income of the bottom 90% decreasing by ~3%, while increasing that of the top 1% by 4.4%.  

Crucially however, it has left us unable to effectively respond to the issues we are now facing. Austerity in Italy, for example, one of the worst hit countries by the 2008 Global Financial Crash, resulted in a 50% reduction in hospital beds between 1997 and 2015, as well as 46,000 less hospital employees from 2009 to 2017. Is it a coincidence that Italy has also had one of the worst coronavirus death tolls in Europe?  

Austerity enforced by neoliberal order has also worsened socioeconomic inequalities. In America, 20% of people cannot pay all of their monthly bills and 41% cannot cover a $1000 medical emergency, yet the world’s billionaires became $1.9 trillion wealthier during the pandemic.  The pandemic, in cruel fashion, has reminded us of an almost forgotten truism – that the people responsible for keeping society moving forward were not just the rich elites but public sector workers, a group that has been hit hard by austerity. Combining these factors and an ongoing chronic health crisis, we arrive at what Dr. Richard Horton, editor of The Lancet, calls a “syndemic” – multiple pandemics, health, social, and economic, all feeding off of one another at the same time. Neoliberalism has led us deeper into a tragically predictable situation, in which community and responsibility are trumped by selfish individualism. Crucial public institutions are underfunded, and the most important jobs are underpaid and understaffed. Why, then, faced with this knowledge, will neoliberalism likely survive?  

If we recognise neoliberalism as protected by our institutions, then systemic change must begin in government. However, if we look at the current interventions made by states, there is little reason to think that any departure from the status quo will occur any time soon. The Bank of England, for example, has resumed quantitative easing, pumping £300bn of financial capital into the markets, and ultimately, elite shareholders’ wallets. Whilst these efforts may calm the world economy in the medium term, they fail to confront the internal contradiction within capitalism, and strengthen the myth that neoliberalism is an answer to societal and economic woes. 

Today’s global crisis, however, is significantly different from the financial one we experienced in 2008. In 2008, our financial systems collapsed. Today, the foundations on which society is built, the 99%, the workers and consumers, stopped spending. While some may point at state furlough, Amazon’s move to unlimited unpaid time-off and sick pay, telecoms companies waiving additional fees, and hotels cancelling cancellation fees as evidence of “capitalist goodwill”, there is doubtless also some commercial self-interest involved. Unlike 2008, all our fates are now intertwined – a stark reminder that commercial interest requires endless commercial consumption, they need us to spend, they need us to eat out to help out. It is not goodwill, it’s business as usual.    

Rather than the pandemic confirming the failure of neoliberalism, it has shown once again that as long as governments lack the imagination and courage to implement meaningful change, neoliberalism will live on. Neoliberalism may have failed the world, but it hasn’t failed the elites. It is here to stay. 

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