Is the covid crisis produce greater economic inequality?
I think it is, certainly in Britain but also in other countries too.
Whenever a crisis hits, it's the forces best positioned to take advantage which does so. In Britain, it's the political right and financial institutions which will further re-make the economy in its own image.
This is a really excellent article by economist Grace Blakely:
https://tribunemag.co.uk/2021/01/covid-19-is-widening-britains-economic-inequality
The tldr is that our economy is structured in a way that prioritises the rich over the poor and financial institutions over individuals. The has reached new heights during the pandemic as our government (much like the US Feb) has pretty much imposed unlimited quantitative easing to keep the stock market ticking over and share prices stable.
Whilst our government has spent huge amounts of money to protect jobs, it's an employer-centric for of state intervention. The furlough scheme involves the government paying workers through their companies and the companies still have the power to lay off staff.
Obviously, this will be cut at some point and our chancellor (finance minister) Rishi Sunak has been pushing to do this for a long time. When that happens, even more businesses will go under and more people will lose their jobs. The affluent have assets to fall back on but the poor do not. The British state sees protecting individuals as desirable but protecting share-holders as essential. When tough choices have to be made, it's obvious who will be favoured and who will take the hit, just as with the aftermath of the 2007/8 crisis.
The massive quantitative easing (effectively government borrowing money to buy financial assets) means a further decoupling of the finance sector from the real economy. The free market was always a myth but now we've moved beyond the pretence. Neo-liberalism has warped into monopoly state capitalism. Socialised risk and privatised profit.
I predicted a lot of this about a year ago when the crisis first hit:
https://similarworlds.com/18-Politics/3243173-What-will-the-long-term-political-consequences-be
Sorry for the long and nerdy post but these are huge issues which impact people's lives massively but don't get enough media attention. Thanks for reading.
Whenever a crisis hits, it's the forces best positioned to take advantage which does so. In Britain, it's the political right and financial institutions which will further re-make the economy in its own image.
This is a really excellent article by economist Grace Blakely:
https://tribunemag.co.uk/2021/01/covid-19-is-widening-britains-economic-inequality
The tldr is that our economy is structured in a way that prioritises the rich over the poor and financial institutions over individuals. The has reached new heights during the pandemic as our government (much like the US Feb) has pretty much imposed unlimited quantitative easing to keep the stock market ticking over and share prices stable.
Whilst our government has spent huge amounts of money to protect jobs, it's an employer-centric for of state intervention. The furlough scheme involves the government paying workers through their companies and the companies still have the power to lay off staff.
Obviously, this will be cut at some point and our chancellor (finance minister) Rishi Sunak has been pushing to do this for a long time. When that happens, even more businesses will go under and more people will lose their jobs. The affluent have assets to fall back on but the poor do not. The British state sees protecting individuals as desirable but protecting share-holders as essential. When tough choices have to be made, it's obvious who will be favoured and who will take the hit, just as with the aftermath of the 2007/8 crisis.
The massive quantitative easing (effectively government borrowing money to buy financial assets) means a further decoupling of the finance sector from the real economy. The free market was always a myth but now we've moved beyond the pretence. Neo-liberalism has warped into monopoly state capitalism. Socialised risk and privatised profit.
I predicted a lot of this about a year ago when the crisis first hit:
https://similarworlds.com/18-Politics/3243173-What-will-the-long-term-political-consequences-be
Sorry for the long and nerdy post but these are huge issues which impact people's lives massively but don't get enough media attention. Thanks for reading.
41-45, M
