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<h1 class="css-19v093x">The last global crisis didn't
change the world. But this one could</h1>
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<div class="css-7kp13n">By</div>
<div class="css-7ol5x1"><span class="css-1q5ec3n">William
Davies</span></div>
<div class="css-8rl9b7">theguardian.com</div>
<div class="css-zskk6u">6 min</div>
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<p><span><span>T</span></span>he term
“crisis” derives from the Greek “krisis”,
meaning decision or judgment. From this,
we also get terms such as critic (someone
who judges) and critical condition (a
medical state that could go either way). A
crisis can conclude well or badly, but the
point is that its outcome is fundamentally
uncertain. To experience a crisis is to
inhabit a world that is temporarily up for
grabs.</p>
<p>The severity of our current crisis is
indicated by the extreme uncertainty as to
how or when it will end. The modellers at
Imperial College – whose calculations have
<a data-link-name="in body link"
href="https://www.theguardian.com/world/2020/mar/16/new-data-new-policy-why-uks-coronavirus-strategy-has-changed">belatedly
shifted the government’s comparatively
relaxed approach</a> to coronavirus –
suggest that our only guaranteed exit
route from enforced “social distancing” is
a vaccine, which may not be widely
available <a data-link-name="in body
link"
href="https://www.theguardian.com/world/2020/mar/20/when-will-a-coronavirus-vaccine-be-ready">until
the summer of next year</a>. It is hard
to imagine a set of policies that could
successfully navigate such a lengthy
hiatus, and it would be harder still to
implement them.</p>
<p>It is now inevitable that we will
experience <a data-link-name="in body
link"
href="https://www.theguardian.com/business/2020/mar/15/prepare-for-the-coronavirus-global-recession">deep
global recession</a>, a breakdown of
labour markets and the evaporation of
consumer spending. The terror that drove
government action in the autumn of 2008
was that money would stop coming out of
the cash machines, unless the banking
system was propped up. It turns out that
if people stop coming out of their homes,
then the circulation of money grinds to a
halt as well. Small businesses are
shedding employees at a frightening speed,
while Amazon has <a data-link-name="in
body link"
href="https://www.theguardian.com/technology/2020/mar/18/amazon-whole-foods-workers-stores-warehouses-coronavirus">advertised
for an additional 100,000 workers</a> in
the US. (One of the few, and far from
welcome, continuities from the world we’re
leaving behind is the relentless growth of
the platform giants.)</p>
<p>The decade that shapes our contemporary
imagination of crises is the 1970s, which
exemplified the way a historic rupture can
set an economy and a society on a new
path. This period marked the collapse of
the postwar system of fixed exchange
rates, capital controls and wage policies,
which were perceived to have led to
uncontrollable inflation. It also created
the conditions in which the new right of
Margaret Thatcher and Ronald Reagan could
ride to the rescue, offering a novel
medicine of tax cuts, interest rate hikes
and attacks on organised labour.</p>
<p>The 1970s inspired a vision of crisis as
a wide-ranging shift in ideology, which
has retained its hold over much of the
left ever since. The crisis involved a
contradiction that was largely internal to
the Keynesian model of capitalism (wages
were being pushed up faster than
productivity growth, and destroying
profits), and an overhaul in the dominant
style of business: out with rigid heavy
manufacturing, in with flexible production
that could respond more nimbly to consumer
tastes.</p>
<p>There was also an important spatial
dimension to the 1970s crisis. Capital
abandoned its iconic industrial
strongholds in northern England and the
American midwest, and (with help from the
state) headed towards the financial and
business districts of slick global cities,
such as London and New York.</p>
<p>For over 40 years after Thatcher first
took office, many people on the left have
waited impatiently for a successor to the
1970s, in the hope that a similar
ideological transition might occur in
reverse. But despite considerable upheaval
and social pain, the global financial
crisis of 2008<strong> </strong>failed to
provoke a fundamental shift in policy
orthodoxy. In fact, after the initial
burst of public spending that rescued the
banks, the free-market Thatcherite
worldview became even more dominant in
Britain and the eurozone. The political
upheavals of 2016 took aim at the status
quo, but with little sense of a coherent
alternative to it. But both these crises
now appear as mere forerunners to the big
one that emerged in Wuhan at the close of
last year.</p>
<p>We can already identify a few ways that
2020 and its aftermath will differ from
the crisis of the 1970s. First, while its
transmission has followed the flightpaths
of global capitalism – business travel,
tourism, trade – its root cause is
external to the economy. The degree of
devastation it will spread is due to very
basic features of global capitalism that
almost no economist questions – high
levels of international connectivity and
the reliance of most people on the labour
market. These are not features of a
particular economic policy paradigm, in
the way that fixed exchange rates and
collective bargaining were fundamental to
Keynesianism. They are features of
capitalism as such.</p>
<p>Second, the spatial aspect of this crisis
is unlike a typical crisis of capitalism.
Save for whichever bunkers and islands the
super-rich are hiding in, this pandemic
does not discriminate on the basis of
economic geography. It may end up
devaluing urban centres, as it becomes
clear how much “knowledge-based work” can
be done online after all. But while the
virus has arrived at different times in
different places, a striking feature of
the last few weeks has been the
universality of human behaviours, concerns
and fears.</p>
<p>In fact, the spread of smartphones and
the internet has generated a new global
public of a sort we have never witnessed
before. Events such as September 11
provided a glimpse of this, with Nokias
around the world vibrating with
instructions to get to a television
immediately. But coronavirus is not a
spectacle happening somewhere else: it’s
going on outside your window, right now,
and in that sense it meshes perfectly with
the age of ubiquitous social media, where
every experience is captured and shared.</p>
<p>The intensity of this common experience
is one grim reason that the present crisis
feels closer to a war than a recession. In
the end, government policymakers will
ultimately be judged in terms of how many
thousands of people die. Before that
reckoning is reached, there will be
horrifying glimpses beneath the surface of
modern civilisation, as health services
are overwhelmed and saveable lives go
unsaved. The immediacy of this visceral,
mortal threat makes this moment feel less
like 2008 or the 1970s and more like the
other iconic crisis in our collective
imagination – 1945. Matters of life and
death occasion more drastic shifts in
policy than economic indicators ever can,
as witnessed in Rishi Sunak’s astonishing
announcement that the government would
cover <a data-link-name="in body link"
href="https://www.theguardian.com/uk-news/2020/mar/20/government-pay-wages-jobs-coronavirus-rishi-sunak">up
to 80%</a> of the salaries of workers if
companies kept them on their payroll. Such
unthinkable measures are suddenly possible
– and that sense of possibility may not be
easily foreclosed again.</p>
<p>Rather than view this as a crisis of
capitalism, it might better be understood
as the sort of world-making event that
allows for new economic and intellectual
beginnings.</p>
<p>In 1755, most of Lisbon was destroyed by
an earthquake and tsunami, killing as many
as 75,000 people. Its economy was
devastated, but it was rebuilt along
different lines that nurtured its own
producers. Thanks to reduced reliance on
British exports, Lisbon’s economy was
ultimately revitalised.</p>
<p>But the earthquake also exerted a
profound philosophical influence,
especially on Voltaire and Immanuel Kant.
The latter devoured information on the
topic that was circulating around the
nascent international news media,
producing early seismological theories
about what had occurred. Foreshadowing the
French revolution, this was an event that
was perceived to have implications for all
humanity; destruction on such a scale
shook theological assumptions, heightening
the authority of scientific thinking. If
God had any plan for the human species,
Kant concluded in his later work, it was
for us to acquire individual and
collective autonomy, via a “universal
civic society” based around the exercise
of secular reason.</p>
<p>It will take years or decades for the
significance of 2020 to be fully
understood. But we can be sure that, as an
authentically global crisis, it is also a
global turning point. There is a great
deal of emotional, physical and financial
pain in the immediate future. But a crisis
of this scale will never be truly resolved
until many of the fundamentals of our
social and economic life have been remade.</p>
<p><span>•</span> William Davies is a
sociologist and political economist. His
latest book is Nervous States: How Feeling
Took Over the<a data-link-name="in body
link"
href="https://www.penguin.co.uk/books/1114367/nervous-states/">
</a>World</p>
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