By James Campion, edited by Josh Broadhurst
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Covid brings home the need for a more compassionate kind of capitalism.
An NHS nurse. Credit: Luke Jones
As we begin to see the economic ruin left behind by COVID-19, we have to acknowledge that tough times lay ahead. We’ve already seen an economic downturn that is unprecedented in the modern era, so far dwarfing that of the 2008 Global Financial Crash.
There will be no easy answer to this financial crisis, no quick fix, but we know that it would be unwise to follow the path taken ten years ago. If we want to prevent people turning to Marxism and the political extremes, we need to find a new form of compassionate capitalism.
After the last crisis, the economic recovery was based mostly on the backs of those who needed help the most. From 2008, we saw widening income inequality, in 2010 we saw the Government redefining poverty, and a rise in deaths of those who had their benefits placed under sanctions over the past decade.
To a certain extent, the Government recognises this, they have been more willing recently to talk about potential tax rises rather than cutting the budget even further. However, at its heart remains the instincts of austerity, as clearly shown by David Davis' intention to vote against budgetary measures that contain tax rises.
So can the UK forge a different path to revitalise the economy? The answer is, it has to. Cuts to public services and cutting the size of the government will not get us out of this mess, with a crisis of this magnitude there’s no way that we can cut our way back to growth.
Instead, we should turn to the US progressive movement for inspiration in how to rebalance the economy, whilst also putting it back on the road to recovery. Representative Ilhan Omar has recently put forward the Emergency Rent and Mortgage Cancellation Bill, with the support of Alexandria Ocasio-Cortez and other members of ‘The Squad’, a group of young progressive Democrats first elected in 2018 who have made waves by taking left wing stances in the US Congress.
The bill would bring to an end rent payments and mortgage payments, until such a time when people aren’t economically displaced, popularised by the slogan ‘Cancel Rent’.
Cancelling rent alone, however, isn’t enough to aid economic recovery.
We need to be even more bold in the area of welfare as well. Despite Covid-19, there remains the creeping tide of automation, which is leading to higher and higher levels of unemployment for low skilled workers.
This highlights the need for a new economic strategy when it comes to social security, one that is humane, creates jobs, and incentivises work. This can only be achieved by moving away from the current system of welfare and implementing a Universal Basic Income.
After the Second World War, the country faced economic ruin. The economy was almost bankrupt, our economic future lay in ruins, and victory, whilst great, now meant our attention had to turn to the financial matters of the country.
Much like today, the Conservatives wanted to tinker around the edges, they wanted to offer no lasting social change, to steady the ship rather than rock the boat, but people had very little left. The economy, their homes, and their families were left destroyed. There are many parallels with modern day Britain, we face the choice of not rocking the boat or to take a risk and be bold once more. Steady as she goes will do very little for those already facing unjust barriers both pre and post-Covid, much like it would in the post-war period.
In 1945, the people elected Clement Attlee the first Labour Prime Minister since Ramsay McDonald. Attlee, and the subsequent Labour Government, had a similar choice: be conventional and safe, or go forward and be bold. It chose to be bold.
They listened to the recommendations set out in the Beveridge Report, a report written by Liberal MP William Beveridge, into the social and welfare conditions of the country, leading to the creation of the welfare state and the National Health Service during Attlee's period as Prime Minister.
They could have tinkered, changed a few tax laws here and there, invest a bit more in public services, but instead they radically changed the path of the country.
Today, we face a similar choice. Be conventional, or be bold.
We are told that a universal basic income is too ambitious, that it will cost too much, or the timing just simply isn't right. However, this is the perfect time for a universal basic income.
We need the giant infrastructure projects and new start up loans to encourage innovation and small business.
We need to expand the Green Investment Bank and help grow new challenger banks in the financial sector.
The economic recovery from Covid-19 doesn’t have to be done in a way that hurts the most vulnerable in our society, it can be, and indeed must be, an opportunity for us to remedy the injustices in our economy and society.
So, let’s get on with the job of changing so many people’s lives for the better.
There will be no easy answer to this financial crisis, no quick fix, but we know that it would be unwise to follow the path taken ten years ago. If we want to prevent people turning to Marxism and the political extremes, we need to find a new form of compassionate capitalism.
After the last crisis, the economic recovery was based mostly on the backs of those who needed help the most. From 2008, we saw widening income inequality, in 2010 we saw the Government redefining poverty, and a rise in deaths of those who had their benefits placed under sanctions over the past decade.
To a certain extent, the Government recognises this, they have been more willing recently to talk about potential tax rises rather than cutting the budget even further. However, at its heart remains the instincts of austerity, as clearly shown by David Davis' intention to vote against budgetary measures that contain tax rises.
So can the UK forge a different path to revitalise the economy? The answer is, it has to. Cuts to public services and cutting the size of the government will not get us out of this mess, with a crisis of this magnitude there’s no way that we can cut our way back to growth.
Instead, we should turn to the US progressive movement for inspiration in how to rebalance the economy, whilst also putting it back on the road to recovery. Representative Ilhan Omar has recently put forward the Emergency Rent and Mortgage Cancellation Bill, with the support of Alexandria Ocasio-Cortez and other members of ‘The Squad’, a group of young progressive Democrats first elected in 2018 who have made waves by taking left wing stances in the US Congress.
The bill would bring to an end rent payments and mortgage payments, until such a time when people aren’t economically displaced, popularised by the slogan ‘Cancel Rent’.
Cancelling rent alone, however, isn’t enough to aid economic recovery.
We need to be even more bold in the area of welfare as well. Despite Covid-19, there remains the creeping tide of automation, which is leading to higher and higher levels of unemployment for low skilled workers.
This highlights the need for a new economic strategy when it comes to social security, one that is humane, creates jobs, and incentivises work. This can only be achieved by moving away from the current system of welfare and implementing a Universal Basic Income.
After the Second World War, the country faced economic ruin. The economy was almost bankrupt, our economic future lay in ruins, and victory, whilst great, now meant our attention had to turn to the financial matters of the country.
Much like today, the Conservatives wanted to tinker around the edges, they wanted to offer no lasting social change, to steady the ship rather than rock the boat, but people had very little left. The economy, their homes, and their families were left destroyed. There are many parallels with modern day Britain, we face the choice of not rocking the boat or to take a risk and be bold once more. Steady as she goes will do very little for those already facing unjust barriers both pre and post-Covid, much like it would in the post-war period.
In 1945, the people elected Clement Attlee the first Labour Prime Minister since Ramsay McDonald. Attlee, and the subsequent Labour Government, had a similar choice: be conventional and safe, or go forward and be bold. It chose to be bold.
They listened to the recommendations set out in the Beveridge Report, a report written by Liberal MP William Beveridge, into the social and welfare conditions of the country, leading to the creation of the welfare state and the National Health Service during Attlee's period as Prime Minister.
They could have tinkered, changed a few tax laws here and there, invest a bit more in public services, but instead they radically changed the path of the country.
Today, we face a similar choice. Be conventional, or be bold.
We are told that a universal basic income is too ambitious, that it will cost too much, or the timing just simply isn't right. However, this is the perfect time for a universal basic income.
We need the giant infrastructure projects and new start up loans to encourage innovation and small business.
We need to expand the Green Investment Bank and help grow new challenger banks in the financial sector.
The economic recovery from Covid-19 doesn’t have to be done in a way that hurts the most vulnerable in our society, it can be, and indeed must be, an opportunity for us to remedy the injustices in our economy and society.
So, let’s get on with the job of changing so many people’s lives for the better.
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