Today’s Coronavirus Anger Can Revive Tomorrow’s Welfare State
Under the right conditions, social frustration can herald the dawn of new political solidarity.
The word of our moment—the hopeful, talismanic word—is “solidarity.” As the coronavirus drives each of us into our private cubbyholes, we cherish every sign of mutuality. Most of us have probably had an experience with this new embrace of sacrifice and fellow-feeling within our family or our workplace or among our friends.
The great question for policy is whether that spirit will extend outward from these intimate circles to embrace a city, a country, even the world. Will this crisis make us so acutely aware of our mutual dependence that we adopt—if not now, then in the aftermath—the kind of economic or social policies that in normal times lose out to the calculus of self-interest? Will governments invest in health care, housing, education, and training for citizens who have been left behind by the forces of globalization?
Last year, one of us, Paul von Chamier, a policy analyst at the Center on International Cooperation, published a history of the adoption of progressive tax schemes that functions as a kind of solidarity index. The question he asked was: Under what political circumstances do nations agree to address inequality and provide for enhanced public goods by increasing taxation on the rich?
Take a look at the past few centuries in Europe and you will see that inequality ebbs and flows over time. As societies produce more, there is a historic trend toward ever more disparity. Occasionally, dramatic events such as the fall of Rome or the Black Death serve as potent erasers of that trend. However, societies, too, have the ability to address inequality through conscious policy, and every so often, they actually decide to do so. High inequality levels can themselves help generate the political will for change, but this does not explain why many highly unequal societies stay the course while others, seemingly less in need of an overhaul, embrace real reform.
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While one might imagine that either democracies, with their dependence on the popular sentiment, or certainly socialist governments, with their commitment to social justice, would be able to marshal the political will to make these tough choices, the data shows otherwise. In this respect, the power of wealthy interests typically triumphs over the public good. In fact, the paradigm shift to solidarity almost always proceeds from a negative shock that serves as a lightning rod for social anger. It is then the work of politics to channel that anger into change. Politics becomes, in effect, an exercise in storytelling that maps the crisis onto the policy outcome.
Looking back, two main narratives have been successful in focusing social frustration. The first one centers on compensatory fairness. During World War I, the top income tax rate in both the U.K. and Canada shot up from nearly zero to 60 and 70 percent respectively. The money was needed for the war effort, but the change also meant more redistribution and expansion of public services, such as education and health care, that stayed in place well after the war. This shift kicked in as the governments were forced to conscript young men, mostly from poor or working-class communities, into the army. The combination of the massive cost of the war mobilization and the supreme sacrifice of the soldiers forged an unarguable case for taxation and social spending. Income redistribution was framed not as charity but rather as the way to meet the popular demand that the rich make sacrifices in some way comparable to those being made by others.
The second narrative focuses on addressing fear of systemic instability. When existing inequalities threaten a state’s very survival, governments see their way clear to policies otherwise deemed too hard to enact. This was the experience both of the United States in the Great Depression and Western Europe during the Cold War, when Communism was seen to menace the social order both from within and without. More recently, though, the phenomenon has applied to developing nations. In its historic report from 1993 on East Asia, the World Bank concluded that when countries there faced fundamental threats from insurgencies and separatists, their governments critically depended on the popular support of the poor. The price for retaining that support was clear—more economic solidarity. In a follow-up publication, the World Bank listed some types of policies introduced by East Asian states to appease the working class: land reforms in Korea and Taiwan, rice subsidies in Malaysia, public housing programs in Hong Kong and Singapore.
What light does this shed on our own pandemic-afflicted world? The American economy is now forecast to drop between 8 percent and 24 percent over the coming year; the collapse may prove yet more drastic elsewhere. One can easily imagine a crisis of legitimacy similar to what the World Bank described afflicting middle-income and developing countries. While economic failure may not threaten the stability of Western states, as happened in the 1930s, it is bound to produce a combustible mix of social anger, anguish, and urgency. That public mood could deepen our already profound social schisms—or it could generate the kind of political narrative that leads to policy change. What would that narrative sound like?
While everyone, rich and poor alike, faces the possibility of sickness and death, the coronavirus has exposed the glaring inequities of all Western societies. Poor people are far more likely to be essential workers, delivering our food, providing utilities, and keeping the transportation systems working despite the pandemic. These “low-skilled” workers are now indispensable in fighting off the coronavirus. Many of them, especially in the United States, cannot afford proper health care and lack guaranteed paid sick leave. Their jobs are vulnerable even in the best of times. They are also among the most affected by the downsides of the emerging gig economy.
This situation is analogous, if scarcely equal, to the mass mobilization of the two world wars. Indeed, both Emmanuel Macron and Angela Merkel, the leaders of France and Germany respectively, have deployed the language of war time to summon their people to acts of sacrifice in the name of public good. What’s more, the pandemic has placed all of us in a position of dependence on those who remain on the job, equivalent to the front-line deployment of troops in the struggle against the virus. The circumstances are ripe for the first narrative to take hold. Soon enough, essential workers and those who support them might raise a valid demand for the societal solidarity to take on a material rather than symbolic form. It’s premature to suggest that the solidarity we already see among family, friends, and colleagues will extend to this larger sense of shared fate and thus to the argument for compensatory fairness. But we are still in the early days of our crisis.
Perhaps, alternatively, we should expect less from the affirmative sense of gratitude toward those at the bottom who have sacrificed most for the common good and more from the fear of the brewing anger and desperation of the 99 percent. There have been, in this regard, a few straws in the wind. Actress Gal Gadot and about 20 other famous Hollywood artists provoked wrath when they tried to commiserate with people affected by COVID-19 by posting a video of them singing “Imagine” by John Lennon. “We are all in this together!” Gadot claimed—only to be overwhelmed by a wave of angry comments about how the rich are not contributing enough money to solve the crisis.
There appears to be a growing public resentment against the wealthy getting access to COVID-19 tests and treatments before the people who need it more. Coincidentally, a few days ago, somewhat odd news emerged that a majority of Silicon Valley billionaires have already secured a luxury apocalypse bunker for themselves.
It is precisely the deep-seated inequality of Western societies that makes the imagery of solidarity look so hollow—even though, for once, we are all in this together. Thanks to the very unequal suffering we have begun to experience, the coronavirus is likelier to deepen than to alleviate our social divisions. But it does not have to be so. Political leaders will make choices that will shape and channel the public mood. We will see, once the worst of this crisis is over, how democracies react to their transformed circumstances. In President Donald Trump, of course, the United States has a leader who seems deaf to the language of solidarity as well as blithe in the face of human suffering. We will see whether his Democratic challenger, presumably Joe Biden, is prepared to speak the language of compensatory fairness as he addresses the nation’s future.
James Traub is a nonresident fellow at New York University’s Center on International Cooperation and a columnist at Foreign Policy, and author of the book What Was Liberalism? The Past, Present and Promise of A Noble Idea.
Paul von Chamier is a researcher and data specialist at the NYU Center on International Cooperation.