“Tax the rich” has become the progressive battle cry — and not merely on the fringe. The scourge of economic inequality is celebrity politics, voiced by Nobel prizewinners and international policy chiefs alike.
Yet this slogan did not deliver the electoral victories the left hoped for. The reason is that economic instability, not inequality, is what ails the 99 per cent. Inequality is one symptom of instability, to be sure. But to focus on inequality alone is a diagnostic error. And the cure is not simply redistribution of purchasing power, but more radical: to build a more stable, secure and sustainable society. The Covid-19 pandemic drives this point home.
Outrage against inequality was a political loser because many people admire the rich; a few expect to get rich themselves, and most of the rest just ignore them. In existing socialist societies, excessive equality was just as much of a problem: people hated the drab sameness of their lives. These sentiments endure, so the politics of inequality-maundering doesn’t work.
Inequality is a statistical fact. It can be measured and thus easily draws attention. But when does the statistical fact of economic inequality become a form of social injustice? One answer: when affluence entails social privilege; when extreme wealth translates into power that is self-serving and predatory. Here the realistic remedy is not redistribution but countervailing power: trade unions and other mass organising; strong, principled political parties; prosecutions for financial fraud; and vigilance against state capture.
A second big problem comes when wealth becomes the only apparent source of safety. This is our predicament now. The combination of automation, globalisation and cuts in public services and social insurance, has generated massive economic instability for ordinary citizens — for men and women, young and old, skilled and unskilled, for the middle classes and the poor alike. It is much deeper for minorities, immigrants and other disadvantaged groups.
The pandemic was exacerbated by precarity, our politically crafted social insecurity. The insecurity and frailty of the 99 per cent is rooted in the poverty of our shared services, the weakness of public education, the burden of debt on graduates and, above all, in poor public health, and underfunded or even inaccessible healthcare. This would not change even if our societies became perfectly equal. We are in this conundrum because contemporary capitalism had created not just a precarious class (the “precariat”) but a precarious multitude.
The Covid-19 crisis plays out very differently according to how robust a country’s public sector is. Denmarkand Germany are doing remarkably well thanks to solid healthcare infrastructure with high numbers of hospital beds and critical care units, and testing. In contrast, the public healthcare systems in the UK and Italy have become dramatically underfunded under the austerity policies of the past two decades, while the US has become a textbook example of profit-centred medicine.
Politically, insecurity nurtures conservative, even reactionary, instincts. Against the left’s hopes for radicalisation of the working classes after the financial crisis of 2008, we saw a persistent shift of voters to the right. The pandemic will deepen these instincts. But a return to the status quo ante of massive precarity would leave us ever more vulnerable to public health emergencies.
The pursuit of profit mitigated by a few taxes and transfers will not do. We need massive, urgent investment in public healthcare and strategic science, followed by enhanced social insurance, infrastructure, education and other public services — the only thing that might work and the only cause that can generate the political movement required to make it happen.
The writer is the author of ‘Capitalism on Edge’ and associate professor of politics at the University of Kent’s Brussels School of International Studies
Source: Economy - ft.com
