Financial markets crash, strict lockdowns, economic losses. How did we get there?

Take into account three words: Virus, Politics, Liberalism. Or maybe take them the other way around: Liberalism, Politics, Virus.

After the unprecedented disaster caused by the 2008 financial crisis, governments brought back the good old interventionism. Welfare State reappeared! Central banks started to print more money to save the economy, States started to invest more in the public realm to re-boost the economy and to prevent lethal consequences. 

Liberalism might have been one of the brightest political theory, but it doesn’t profit to everybody, not at all. Liberalism is made out of deregulations, the supreme law of the market and the letting of perfect competition. When you let everything fluctuate without intervening, nor implementing rules, it’s chaos: the richer you are, the safer you are. In other words, liberalism refers to the law of the strongest. Liberalism enhances non-interventionism from the State, no healthcare system, no rules to protect the most vulnerable ones. Liberalism aims to a very individualistic society, where each individual takes care of himself, which naturally brings social injustice. The U.S is a good example when it comes to how liberalism is implemented: no universal healthcare system, the supremacy of freedom over ethics, and the individualistic approach of the financial market, which influence wages among others. It’s like having a powerless State over the economy. See, even the FED (Federal Reserve), the U.S central bank, is partly privately owned. 

Politics. When politics and liberalism cohabit together, politics is used to implement liberalism, and then liberalism helps politics. Nowadays, when something goes wrong economically, what’s being said is that it happened because of a lack of liberalism, there’s too much regulation, and it’s not good for the economy. It’s like the USSR in the ’70s, if it doesn’t work, it’s because there’s not enough communism. 

Now comes the Virus. 31st December 2019, China reported a pneumonia from an unknown cause. 3 months later, almost every country entered in lockdown, trying to contain virus outbreaks. 

Let’s now link Liberalism and the Coronavirus pandemic. In Europe, most of the countries closed its borders: no more free trade. When a country is not capable of producing what’s needed within it, it becomes very hard when borders are closed. And it’s what happened: the less-developed countries haven’t been suffering the most in terms of deaths toll, but economically, they did. But let’s focus on western countries. France, for example, was forced to implement a very strict lockdown due to a lack of tests and masks. They’re only producing 40% of their masks stock, which makes the country very vulnerable. With the global trade on pause, the country couldn’t assure its population protection. The country is dependent on Globalisation. Due to progressive suppressions of regulations in the early 2000s, french companies fled to other countries where it’s cheaper to produce, to make more profit. And when there’s a pandemic, they’re trapped for business as much as the population is trapped for not having enough masks, nor being tested. Liberalism brings vulnerability when there’s a crisis, by pushing Globalisation to its limits, every country depends on each other. 

Let’s lie another problem, which links the pandemic, politics, and of course, liberalism. In the U.S workers don’t have wage insurance, nor social incomes from the State. If people lose their jobs, they can’t have any assured income. Due to the pandemic and its economic consequences, unemployment radically rose, reaching its peak of 14.7% in April. From mid-March to the beginning of May, there was an average of 5 million job losses claims per week. And of course, unemployed citizens couldn’t have another source of income except for market stakes, a very scarce situation for the average American. So if people want to accentuate job insecurity, they can keep on bringing liberalism to the table, but it doesn’t seem to be the solution foreseeing the coming economic crisis that we’ll undergo. 

Now that we’ve looked at liberalism’s default, you’ll understand that its perverse effects will be even worse with the current situation. A Pandemic and Liberalism don’t make a good couple. Countries are all dependent on each other, none can be 100% self-sufficient, and political systems still promote market supremacy and the absence of regulations. Without regulation, there is no protection. So it’s time to think about how liberalism increased our vulnerability, and how the welfare state could save us from chaos.