Opinion: Capitalism and the COVID-19 pandemic

Publish Date: 
Thursday, June 3, 2021

An overhaul of the economic system is long overdue: the signs were all there in 2020 but a year into the pandemic, the rich have grown richer and governments continue to sacrifice lives for the illusion of economic growth.

The term “late capitalism” picked up traction in the 2010s, suggesting that we may be reaching a moment of such gross excess that will pitch us into recovery from the unsustainable practices that entrenched inequality, conflict, and their systems of oppression. Yet, since the Economic Policy Working Group’s Systemic Critique workshop in Chiapas, Mexico, in 2019, it is evident that the neoliberal economic order is determined to stay, and if necessary put on some sympathetic performances to hide its ugliest faces. The living conditions of many people who were already precarious worsened with the pandemic, while those who had more money continued to accumulate fortunes.

It has been over a year since COVID-19 was declared a pandemic; at the start, some politicians suggested that it would be a ‘great equalizer’. This of course was quickly refuted: how does one socially distance in a slum, compared to a mansion? How do front line workers minimize risk of infection when their job cannot be done from home, and their employers do not provide them with the necessary personal protective equipment (PPE)? The free market system did not rise to the occasion of producing the necessary PPE; in the US and India, within these countries there was competition, driving up prices (and the same occurred with vaccine supplies in the US); UK government leaders gave PPE contracts to their friends, in a fine example of corruption. Where, then is the innovation for supply to meet the rising demand?

In a year, not only have over 3 million people died from the virus itself, people have lost jobs, businesses (usually small, medium and micro) have shut down, and in some countries that were able to limit the effects of the virus, economic desperation drove up suicide rates. This should have been a moment for global solidarity and actions for relief. We have yet to see the world commit to a global ceasefire, with conflicts continuing in many parts of the world, while there has been some debt moratoria for the poorest of countries we are still not seeing full cancellation; and a show has been made of celebrating the sacrifice of health workers, instead of equipping them, paying them, and supporting them properly. Addressing this crisis fully depended on the labor of women, who make up 70% of the health workforce[1], while the closure of schools meant additional burden on working mothers, who had to drop out of the formal workforce in large numbers. The pandemic also escalated situations of stress and trauma, and went hand in hand with what UN Women has termed a ‘shadow pandemic’ of domestic violence. So we see that the system is fine to accept women’s labor and contributions, but unable to give them safety, support or fair compensation for all they do.

Even democratic values have been undermined by this global crisis. Repression and violence continue to be the common answer from some governments when dealing with popular demands, at the same time that authoritarian regimes and ideas are flourishing across the world. Citizen participation is limited and communities cannot decide on their own destinies because some corporations have more influence than them.

Vaccine rollout and sharing has clearly shown us the divide between the Global North and Global South. Parts of Europe and North America started vaccinating in December 2020 and in six months are reaching coverage levels that may enable a return to some kind of normal. Yet, vaccine nationalism dominates their policies, and a fundamental misunderstanding sits with many of these governments: they operate with the idea that they are fulfilling their responsibility to their citizens by stocking up on vaccines for their own nationals. Canada has even gone so far as to secure booster shots for its own citizens. But every moment that vaccine production is not scaled up and shared across the world is increasing risk for us all as the virus continues to mutate. Getting a vaccine does not act as an impenetrable force field: unless a majority of the world population is vaccinated, the virus will keep mutating and compromising coverage. Despite this danger, many nations continue to block the TRIPS waiver initiative that could enable developing nations to produce the vaccine and other medical products. Many pharmaceutical companies are on standby to produce; like PPE, it is not possible for a few companies to monopolise the production if the goal is to meet the global demand. The current pandemic builds on decades of IMF structural adjustment policies that cut spending on public health and privatized large portions of health care, as well as the role of Pfizer and other companies in writing WTO Trade-Related Intellectual Property laws more than two decades ago, then denying life-saving antiretroviral drugs to persons diagnosed with HIV/AIDS.

Additionally, pharmaceutical companies are in such a power position, largely consented by governments, that an analysis done in 13 Latin American countries showed that these countries changed their laws related to public purchases and procurement in order to buy the Covid-19 vaccine from these companies. The legislative changes allowed governments not to disclose neither the contracts, nor the negotiation agreements with the laboratories. In addition, at least four of these countries granted tax exemptions in vaccine purchase for the laboratories.

We see from these developments that capitalism does not go away because of tremendous shocks nor does it change its face in moments of crises; vaccine apartheid and the global response to the pandemic demonstrate that our system would rather see perpetual crises and more deaths than consider reform. This is why it is essential to direct our energy towards system change and imagining our way out of capitalism. Because globalized capitalism has shown us that it operates in the same way around the world, we call for articulation of common actions and the exchange of experiences from a place of dialogue and solidarity.

[1] Miyamoto, I. (2020). (Rep.). Daniel K. Inouye Asia-Pacific Center for Security Studies. doi:10.2307/resrep24863

This article was developed through a series of discussions with the Economic Policy Working Group members. Special thanks to our members Sanam Amin, Osama Diab, Kairos-The Centre for Religions, Rights and Social Justice and Fundación para el Desarrollo de Políticas Sustentables (FUNDEPS) for putting this article together.