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The state we’re in: will the pandemic revolutionise the role of government?

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Ronald Reagan’s 1986 wisecrack – “The nine most terrifying words in the English language are: I’m from the government and I’m here to help” – would not get a lot of laughs today. In much of the world, people are desperate for the government to show up and rise to the challenge of the coronavirus pandemic.

Reagan’s attitude to government solidified into orthodoxy for more than three decades, spreading abroad – particularly in the UK with the help of Margaret Thatcher – and captured the centre ground of politics in both countries.

The antipathy to the state was selective: Reagan, like Donald Trump today, racked up huge deficits, spent heavily on defence and built up a system of corporate welfare through subsidies and tax breaks. But on both sides of the Atlantic, the prevailing wisdom was the state should wherever possible get out of the business of trying to control inequality and provide services to the less fortunate.

There are already some signs that the Covid-19 shock may challenge those attitudes. Disease and mass unemployment have always been far better recruiting sergeants for the cause of big government than any party manifesto – and this crisis is unlikely to be an exception.

Some social scientists and historians argue that this pandemic could become a turning point in social history – on a par with the New Deal in the US or the post-war Labour government in the UK.

“We’ve been on this kind of trajectory for last 30-odd years where the individual was taking priority over the collective. And now we’re actually back into the kind of spirit that our parents and grandparents lived through in which communities have to pull together,” Fiona Hill, a British-born historian who served on Trump’s national security council.

Hill pointed to the UK, where 750,000 people signed up as volunteers for the National Health Service (NHS) and a wave of climate activism on both sides of the Atlantic.

“I do think there is a huge appetite among younger people, trying to get more government action. I really do think we could start to see the tide turning here.”

One of several volunteers at Thomas Rae tailors in Glasgow works making free scrubs for NHS nurses and doctors.

One of several volunteers at Thomas Rae tailors in Glasgow works making free scrubs for NHS nurses and doctors. Photograph: Jeff J Mitchell/Getty Images

Some of the biggest swings in public opinion have been in countries where the state’s role in social welfare has been in most rapid retreat.

The US and the UK stand out because the pandemic struck as their governments were seeking to roll back longstanding social welfare systems and are now scrambling to reassemble temporary versions of them on the run.

What is not clear yet is whether these stopgap measures will evaporate as soon as Covid-19 is sufficiently contained for people to go back to work – or whether some of them will stick.

The coronavirus pandemic could also boost statism of another kind – more Big Brother than Great Society – by providing cover for governments to restrict civil liberties and entrench themselves in power, as Viktor Orbán has done in Hungary. There are few signs yet that China’s leaders will be held accountable for their failure to contain the outbreak at its source, and their response to criticism has been further suppression of dissent and science.

The outbreak has created a surge in digital monitoring of populations that many civil libertarians fear will harden afterwards into a permanently raised level of surveillance.

The accretion of state power could accompany wider provision of public services, or take precedence over them. The less a government does for its people, the more it has to control them.

In the US, the Trump administration is likely to face resistance if it seeks to withdraw forms of social support that have long been standard in most western democracies.

“The whole pandemic, I think, has laid bare all of the inadequacies of the US social safety net,” John Schmitt, the vice-president of the Economic Policy Institute in Washington, said. “A very basic thing every other advanced economy in the world guarantees workers is at least a minimum amount of paid sick days. The US does not have at the national level any laws like that.

“It’s hard for me to imagine that there won’t be significant support when the dust settles for state, local and federal legislation to address that incredibly longstanding policy failure,” he said.

There are two other areas where Schmitt predicted there would be strong demand for lasting change. One is unemployment insurance, currently a meagre patchwork of different state systems subject to minimum national standards.

The other is the healthcare system. As a far broader cross-section of Americans face medical bankruptcy because they have partial or no health insurance, it will be harder for Trump to pursue his effort to obliterate the Obama administration’s Affordable Care Act, which extended the scope of health insurance coverage, and could provide support for a more ambitious expansion of government-funded healthcare.

For parallel reasons, it will be even harder politically for Boris Johnson to bargain away the fundamentals of the NHS at trade talks with Washington, after it saved his life.

It is too early to predict how the coronavirus shock will affect the outcome of this year’s US elections. All other things being equal, greater popularity for a government-funded social safety net should translate into more votes for Democrats, who have traditionally championed such policies. But Trump will seek to take that ground, insisting, for example, that his name is on the $600 cheques the federal government is sending out each week to supplement unemployment benefit.

Donald Trump signs the coronavirus stimulus relief package in the Oval Office. He has insisted on his name appearing on all stimulus checks being sent out to taxpayers.

Donald Trump signs the coronavirus stimulus relief package. He has insisted on his name appearing on all stimulus checks being sent to taxpayers. Photograph: Evan Vucci/AP

And the elections could be as much about cultural and political loyalties as social policy.

Arlie Hochschild, a sociologist who has written extensively about the American right, said she had been watching responses to the crisis in Kentucky.

“Trump supporters are generally older people in poor health, and if they’re blue-collar, they’re actually less likely to have work that they can do from home,” Hochschild said. “What’s happened in this short period of time has challenged so much of what they believe in.”

Despite that, she said, the crisis seemed to have had little effect on political identification and affiliation. “There is no immediate turnaround in attitude. I think they’re going to vote for Trump, pretty much at the same rate as they did in ’16.”

If Trump is re-elected, few believe there will be much lasting change to the role of the state. His instincts have been to seek to hand leadership during the crisis to the CEOs of big corporations, lining them up in the Rose Garden when he declared a national emergency on 13 March.

Opinions differ on whether a Democratic administration under Joe Biden would be a force for transformational change.

‘You’re seeing a closer alliance between the left and the centre of the Democratic party” Theda Skocpol, a sociology professor at Harvard University, said. If Democrats also capture the Senate, she added: “I think it sets the stage for for a real change in direction – the first important one since Reagan.”

Dean Baker, co-founder of the Centre for Economic and Policy Research in Washington – and one of the first economists to identify the US housing bubble that created the conditions for the global financial meltdown in 2008 – argues that that crisis demonstrated how impervious the economic system was to shocks, no matter who is in government.

“The thought that we had this horrible experience and now everyone’s going to learn from it: it wasn’t true really in ’08-’09, and I don’t have a lot of confidence it’ll be true this time,” Baker said.

Much may depend on the depth and duration of the coronavirus shock. A V-shaped, rapid bounceback is looking less likely with every passing week, and a gradual U-shaped recovery or even an extended depression become real possibilities. In such circumstances, formerly unthinkable solutions become more palatable.

“People use the analogy of the financial crisis but I think it’s the wrong one. War is a much better one because it is both a supply and a demand shock,” said Branko Milanovic, an economist at the City University of New York, adding that a prolonged economic downturn would lead to “a reassessment of the role of the state”.

Milanovic cautioned, however, that it was also quite possible that a groundswell of support for a universal healthcare system and a much more robust social safety net might not be reflected in the US political system. He said: “What we would actually face in the US is an ever-increasing discrepancy between the demand for change, and the total absence of change.”

Content provided by The Guardian. Original piece can be found here https://www.theguardian.com/us-news/2020/apr/26/government-state-role-pandemic-coronavirus

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