How social programs and safety regulations were scrapped for corporate profits, an eco-crisis and now the coronavirus

Feature by Gregory Beatty

For 40 years now, boosters of neoliberal capitalism have preached the gospel of downsizing government services (a.k.a “trim the fat”), slashing taxes for the wealthy (a.k.a. trickle-down economics), deregulation (a.k.a. cutting red tape), privatization, globalization, just-in-time production and more.

Neoliberalism, financial records show, has been a boon for the wealthy. As for the remaining “99 per cent”, some are managing okay but many are struggling mightily. Who knows, maybe you’re one of them.

This growing social divide has been on stark display during the COVID-19 pandemic, says Simon Enoch, Saskatchewan head of Canadian Centre for Policy Alternatives.

“One of the devious things about the virus is that it’s exposed the underbelly of our society where so many people live precarious and vulnerable lives. So many social supports have been kicked out from under us.

“You see that with Employment Insurance,” says Enoch. “At its height in the 1970s, it covered almost the entire work force. Now, it barely covers half. It’s been so gutted that the federal Liberals had to come up with a new benefit program because they realized EI, due to hours eligibility, wouldn’t cover a large portion of people who work in a part-time job or seasonal work and the gig economy.”

Disaster Capitalism

Though it emerged in the 1970s, neoliberalism took hold in the Reagan/Thatcher era of the 1980s. And with two global disasters to its credit in the last 12 years, it’s definitely showing its age.

The first disaster was the 2008–2009 financial crash, where governments worldwide had to cobble together a multi-trillion-dollar bailout package to prevent the economy from collapsing.

Now, we have this pandemic. If it was an isolated incident, you could maybe chalk it up to nature being nature. But this is the fifth pandemic in 17 years after SARS (2003), H1N1 (2009), MERS (2013) and Ebola (2015-16).

All were zoonotic, meaning they transferred from animals to humans. The main driver there is our ongoing encroachment into wilderness areas as our population expands and we ramp up resource extraction and industry, in service of the profit-crazed neoliberal agenda.

Factory farming, especially of pigs and chickens, is also a problem as it can spread swine and avian flus like H1N1.

Neoliberalism’s failure doesn’t end there, says Enoch.

“Neoliberalism has gutted our capacity, not just in healthcare, but in education and social services, to respond to crises like this. It’s been fundamentally undermined by an adherence to a lean state.”

To avoid overwhelming our hospitals with COVID-19 patients, Canada, like many countries, has been in lockdown since mid-March. Physical distancing has let us to “flatten the curve”, but that’s come at a tremendous cost.

When hotspots have flared up, hospitals have been pushed to the limit. Personal Protective Equipment has been in desperately short supply. And pretty much all non-emergency surgeries and other procedures have been suspended to focus on COVID-19 — putting the health and well-being of many thousands of Canadians in jeopardy.

“I think Canada has less acute care beds than any other OECD country,” says Enoch. “Before the outbreak we already had an overcrowding and understaffing crisis in our hospitals. That extends to our provincial laboratories [which test specimens].

“Everything neoliberalism has touched is needed to respond to this crisis in a robust way, and we can’t do that because it’s all threadbare and slapped together.”

Along with sapping our frontline capacity to respond to a crisis, neoliberalism has eroded our institutional capacity, says Enoch.

“We’ve gutted the civil service through privatization and outsourcing. But the ability of governments to respond to emergencies depends on having people with expertise and experience gained through previous emergencies. You might have plans, but if you outsource everything you don’t have people with any experience at implementing them.”

The poster child for that is U.S. president Donald Trump’s 2018 decision to defund a pandemic response team that the Obama administration established at Centres For Disease Control in 2015. It’s one in a string of White House blunders that has seen the U.S. become the runaway leader in COVID-19 infections and deaths.

Home Front

While people have been quick to cheer healthcare and other frontline workers, we owe them more than our gratitude, says Enoch. “If we’re going to ask them to make the heroic sacrifices they’re making, then part of the bargain has to be they’re provided with everything they need — whether it’s protective equipment, or whatever supplies and scheduling they need.

“We have to give them the tools to do their jobs and keep them as safe as humanly possible.”

And irony of ironies, some of these “essential” workers, in pre-pandemic times, were ridiculed when they pleaded for a living wage.

That highlights another failing of neoliberalism, says Enoch.

“It’s been a mask-off moment that has shown just who is essential in a crisis and the value of the work they do, whether it’s a grocery store clerk or teachers or childcare workers.

“Hopefully, once we get out of this we’ll have a brand-new appreciation for the people who maintained our society while the rest of us were holed-up so that the next time somebody asks for a living wage we’ll be less inclined to criticize them,” says Enoch.

Another “underbelly” that the pandemic has exposed is our shoddy care for seniors in long-term care facilities. With shelters scaled back and many charity services not operating, the poor and homeless have faced difficult times.

That’s not good for them and it’s not good for society. In a pandemic fight that’s been compared to whack-a-mole, where we knock down one outbreak only to have another pop up, and physical distancing is our main defense against the virus, poverty and homelessness are major risk factors.

“For so long, the attitude’s been ‘out of sight, out of mind’ where we use libraries, soup kitchens and shelters as places to store the homeless,” says Enoch. “Now, those are considered vectors of infection. Not only has that problem suddenly been rendered visible to us, it’s also shown to be extremely dangerous to the overall health of our community.”

Battle Stations

Through shady politics and well-funded propaganda, neoliberalism was able to duck blame for the 2008–2009 crash. That will be tougher to do this time, says Enoch. “With the crash, they blamed ‘bad actors’ who took out mortgages they couldn’t afford and tried to profit by flipping houses. That was completely wrong, but still to this day people believe that.”

The carnage this time, though, is so widespread that there’s no easy fall guy.

“There’s no single group they can point to and say, ‘This is their fault and they have to pay for it’,” says Enoch. “So that kind of morality play, I don’t think they’ll be able to make the case.

“That’s not to say they won’t find a villain,” says Enoch. “Right now, right-wing nationalists are going hard on blaming China and creating a new kind of ‘yellow peril’, which is dangerous in itself.”

Once the pandemic passes, Enoch expects a concerted effort to re-establish the neoliberal order under the guise of a (much-idealized) return to “normal”.

“What I think you’ll see is a lot of hand-wringing about how we’re going to have to pay off this enormous debt,” he says. “They’ll say, ‘Okay, this was an unprecedented crisis. We had to open the checkbook. But now let’s all be responsible and tighten our belts.’

“But we saw what austerity brought us, which was the incapacity to respond to this crisis,” says Enoch. “I think the right is going to be in a really tough position arguing for fiscal restraint after we’ve gone through this and it’s been patently obvious the system wasn’t up to task.

“People are going to want to make investments in the system,” he says.


Pandemic-Powered Change For Beginners

If the neoliberal order does get upended by COVID-19, it wouldn’t be the first time a pandemic sparked major social change, says Steven Jones of the University of Saskatchewan’s Planetary Health unit.

“The Black Death, the Bubonic Plague in Europe in the 14th century, changed the political system,” says Jones. “It was no longer sustainable to have serfs, and the whole feudal system collapsed. So it’s possible this current outbreak will move change forward, but the systems we have are entrenched.”

There’s also a wild card in the form of populist politicians pushing nationalist agendas against so-called “globalization”. Racism and xenophobia help power the movement, but there’s also legitimate anger and frustration from those neoliberalism left behind.

But we shouldn’t be too quick to throw the globalization baby out with the neoliberal bathwater, says Jones.

“Globalization has been driven by capitalism, which relies on constant expansion and exploitation. It hasn’t been about the people, it’s been about having things made cheaper by children and others forced to work for far less in the developing world and then selling to us in the West.

“What that’s meant is the traditional economy has suffered immensely, and that’s given globalization a bad name,” says Jones. “But it’s actually global capitalism which relies on the exploitation of humans and natural resources to serve the ends of big business, CEOs and shareholders. It’s got nothing to do with people being part of a global community.”

To correct this injustice, trade and investment rules need to be made fairer, with rigorous labour standards and environmental regulations to ensure our common interest is protected. We also need to recognize our global trade system has been built on cheap fossil fuels without considering the impact of climate change. And a global tax structure has to be created to ensure every person and corporation pays their fair share, with no tax dodging.

Really, we have no choice, says Jones. Because as the current pandemic is showing, we ignore the reality that we live in a global world at our peril.

“With the rise of populist nationalism globalism is seen as a bad thing, when we really need to see ourselves as part of a new beginning that spans the globe. And when other people are well and healthy, then we are well and healthy, too.”

As to what a post-neoliberal capitalist society might look like, Jones isn’t sure.

“It’s like an event horizon with a black hole — we don’t know,” he says. “But it can’t be what we have now, with continued expansion and exploitation of the natural world.”

Gregory Beatty