Covid-19 and the multiplicity of crises

 

The Covid-19 outbreak brought with it a confluence of crises – health, economic, financial and political. This makes the multiple crises something of a unique phenomenon, creating new challenges and uncovering fault lines that have been made worse.

The Covid-19 outbreak was a global crisis that almost threatened to break down the global capitalist system. Rarely is there a combination of crises that take place simultaneously on the scale that happened. We are more used to economic or financial crises that destabilise the system but unusually, this was a health crisis that derailed other aspects of nations throughout the world.

It is for these reasons that Lim Mah Hui and Michael Heng’s book, “Covid-19 and the Structural Crises of our Time” deserves attention.

These days it is rare to treat problems as structural and as involving the global capitalist system as a whole. It is the exceptional commentator who even dares look at national issues in a holistic manner, arising through the inter-relationship of inter-related sub-systems such as the economy, polity, public health and finance.

Lim and Heng take the challenge a step further and examine the Covid-induced crises from the lens of Hayek and Polyani.

One was an Austrian economist who championed the free play of market forces and the other a sociologist who looked at the contradictions at work in the market system.

Lim and Heng see the Covid crisis as a crisis of the global capitalist system of unrestrained markets, or, rather, of markets gone awry, though they do not quite express it that way.

But the multiple and simultaneous crises cannot be expressed more tamely.

What is supposed to be a public health crisis has its origins in an environmental crisis, fuelled by a public health crisis, itself a consequence of the neglect of a public health crisis, itself a consequence of the neglect of public health care and the lack of provision of adequate access to health for all.

These two crises are inflamed by the crisis of financialisation, the abuse of financial institutions, the excessive reliance on speculation and the addiction to debt.

Perhaps the most destructive aspect of financialisation is the permeation of commercial and financial values into all aspects of human society, without sparing even education, health care and housing. The neglect of social security is the neglect of man as a social animal.

Lim and Heng propose a more humanistic economic system. Principle to this is a reassessment of the role of the market and its place in society. They also argue that finance has to be given a more carefully calibrated position, balancing it with the real economy.

Understandably, Lim and Heng suggest that large profit-oriented financial institutions be curbed.

This is reminiscent of the distrust that Wall Street faced during the global financial crisis, since it left Main Street in a subservient position. Wall Street was excused of all its crimes since it was “too large to fail”.

Their proposal to bring society (and therefore, man as a social being) back into the centre of things sees realisation in the suggestion to nurture social and community banks.

This necessarily means a strengthening of the community as a basis for society, spelling a re-empowerment of social relations and civil society. In effect, Lim and Heng are arguing for a movement against the excessive importance given to profits, risk and financial institutions.

There are other paths that could have been taken. For instance, the economy could have been conceptualised along Sraffa-Passinetti lines, paying due consideration to the division between capital and labour, and the corresponding payment of wages as opposed to profits.

Or to take another path of divergence, more class-based solutions could have been proposed in terms of the priority that should be placed for the disadvantaged and workers at the domestic level.

Lim and Heng could, for instance, have taken a Marxist position. But there is just so much that one book can do. The authors do a wonderful job of trying to make sense of a complex problem from a perspective of their choice.

There is no doubt that Lim and Heng are unhappy with the global capitalist system. Their work should encourage us to think more seriously about the path ahead.

We do not need another crisis to find that we have been napping all the while. - FMT

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.