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The Post-COVID State

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CAMBRIDGE – The world is experiencing one of the most transformative moments of the last 75 years. The social, economic, and political consequences of the COVID-19 crisis have already been truly momentous, and they have most likely only just begun to be felt. In the United States, more than 40 million workers have filed unemployment claims since mid-March, and more and more families are being pushed to the brink of poverty. Around the world, millions more are facing even more precarious conditions, with 40-60 million people expected to fall below the extreme poverty line of less than .90 per day. Rage Against the Pandemic Stephanie Keith/Getty Images

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CAMBRIDGE – The world is experiencing one of the most transformative moments of the last 75 years. The social, economic, and political consequences of the COVID-19 crisis have already been truly momentous, and they have most likely only just begun to be felt. In the United States, more than 40 million workers have filed unemployment claims since mid-March, and more and more families are being pushed to the brink of poverty. Around the world, millions more are facing even more precarious conditions, with 40-60 million people expected to fall below the extreme poverty line of less than $1.90 per day.

Most governments have proved dangerously unprepared for the crisis, which has exposed deep-seated weaknesses in public-health and social-security systems in rich and poor countries alike. Social and political tensions that have long been simmering just beneath the surface of the global economic order have begun to boil over, as evidenced most vividly by the protests in the US over the recent killing of an unarmed black man, George Floyd, by four police officers in Minneapolis.

As has been widely noted, the unacceptably high number of COVID-19 deaths, especially in the US and the United Kingdom, are closely tied to the grotesque levels of inequality in both countries. Just before the pandemic struck, 12-15% of the US population was receiving food assistance, over 42% of adults qualified as obese, almost 9% of the population was still lacking health insurance, and 20% were covered by Medicaid (government-provided health insurance for the poor).

Now, owing to the pandemic, we have witnessed an expansion of the government’s role in the economy at a pace and on a scale without modern precedent. Ironically, despite peak polarization and lack of trust in government institutions, many commentators would prefer the state to have even more power to regulate behavior, collect private information, and compel people to undergo testing and quarantine.

First as Tragedy

The conditions in which we find ourselves amount to what James A. Robinson and I would call a “critical juncture.” In our 2012 book, Why Nations Fail, we describe similar historical scenarios in which deep-seated instability lends itself to the possibility for sweeping institutional change, but without any clarity as to the likely direction of that change. Depending on their institutions, power structures, political leaders, and other factors, societies at such junctures embark on radically different trajectories. History and current conditions suggest four possibilities, each with vastly different economic, political, and social implications.

The first is “tragic business as usual,” in which, to paraphrase Karl Marx, the history of the dysfunctional present simply recurs. In this scenario, we make no serious effort to reform our failing institutions, or address the economic and social inequities that have become endemic. We neither strengthen the role of expertise and science in decision-making, nor take steps to boost the resilience of our economic, political, and social systems. We simply accept today’s deepening polarization and collapsing public trust. This path is highly likely if our leaders do not understand the severity of the problem, or if we cannot organize ourselves to demand from them the necessary reforms.

Needless to say, the consequences of tragic business as usual would be terrible. COVID-19 will hardly be the last public emergency to confront us during this century, or even during this decade, and we would have inherited from the current crisis a much larger and more powerful government that lacks the ability or will to use its resources to tackle pervasive social ills. That would fuel further discontent and alienation, because the perceived gap between the government’s power and its capacity to address people’s needs would widen.

The “tragedy” part of this path would come when we realize that business as usual cannot last. One way or another, democratic politics will start coming apart at the seams, and something even worse than populist nationalism would likely emerge to fill the void.

Renewal with Chinese Characteristics?

The second possible path is “China-lite,” which has become increasingly likely for the “Hobbesian” moment we are now living through. Writing in the middle of the English Civil War (1642-1651), Thomas Hobbes believed that any human population requires an almighty state to keep individuals safe from one another. Society, he argued, would thrive if it submitted its will to the Leviathan. In times of deep uncertainty, when there is a need for high-level coordination and leadership, many people’s first instinct is to turn once again to Hobbesian solutions.

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