State response to economic collapse from C19 (basic income)

[ska invita]

It is far from impossible that there were will be degrees of social distancing if not outright lockdown through to Spring 2021.
The economic impact is enormous and affects every part of the system.
Begs the question what can/should/will the state do to prop up a national economy.

I expect there will be a range of things that will happen. I read that Corbyn will be pushing for these 5 demands

1. Extend full sick pay and lost earnings protection from day one for all workers – including insecure workers, low paid workers, and self-employed, during self-isolation and illness
2. Raise statutory sick pay in line with amounts in other European countries
3. Introduce rent and mortgage payment deferment options and ban evictions of tenants affected by outbreak
4. Remove the requirement to present for Universal Credit, suspend sanctions and reduce the wait time for first payment down from five weeks
5. Support local authorities working with food banks in the purchase and distribution of food stocks

Theres talk of more quantitative easing, aka giving money to banks so they loan it out, but who is going to want to take such a loan out, heading into a global depression?

The only thing that i can imagine 'working' to stop the bottom falling out of everyone's lives is introducing universal basic income. Most other mechanisms not only don't have the reach but would be complicated to roll out. One advantage of UBI is the relative simplicity to enact it. And the response does need to happen fast. Most people dont have savings to live off, and nor do employers/businesses

Any thoughts?
Curious if there is any precedent worth looking at.. Perhaps in post-war situations?

 

[Treacle Toes]

NOT GOING TO HAPPEN. ...NOT SHOUTING, CAPS-LOCK was stuck on.

 

[ska invita]

i caught a little bit of radio news, missed the womans name, some kind of economist, said the government will likely to have to nationalise the entire economy, but she only had 30 seconds so couldn't get into the detail

 

[mauvais]

Corbyn's banned from Parliament so I guess he'll be pushing on the door.

 

[ska invita]

i caught a little bit of radio news, missed the womans name, some kind of economist, said the government will likely to have to nationalise the entire economy, but she only had 30 seconds so couldn't get into the detail

looked it up - Merryn Somerset Web editor of the well known Stalinist magazine Money Week, expecting that the government will have to nationalise the economy and also mentions UBI / other helicopter money. Can hear it here 1hr16mins in on PM

For want of a better word i think this is a revolutionary moment.

 

[LDC]

looked it up - Merryn Somerset Web editor of the well known Stalinist magazine Money Week, expecting that the government will have to nationalise the economy and also mentions UBI / other helicopter money. Can hear it here 1hr16mins in on PM

For want of a better word i think this is a revolutionary moment.

I agree, I think this is likely to be a defining period of time in our lives.

 

[redsquirrel]

looked it up - Merryn Somerset Web editor of the well known Stalinist magazine Money Week, expecting that the government will have to nationalise the economy and also mentions UBI / other helicopter money. Can hear it here 1hr16mins in on PM

She didn't really talk about "nationalising the economy" that was just a crap soundbite from Evan Davies, she was talking about a "fiscal expansion".. Government intervention in the economy is not something new, indeed it has been a key part of neo-liberaiism, the increasing synthesis between the state and capital and their mutual reliance.

It is crucial to realise that these people are not invoking UBI as a measure to attack capital but one to support it. As this article outlines

However, what each of these proponents actually mean and want with a Universal Basic Income is wildly divergent. Centrally, the Marxists want an end to the “compulsion to work”, liberals and libertarians rather want to provide “incentives to work”.

 

[ska invita]

I agree, I think this is likely to be a defining period of time in our lives.

Whats incredible is that it will impact every economy, every nation-state, and hit individuals across the class spectrum (up to a super-rich reality immune point). Globalisation multiplies the impact yet further.

Supposedly there'll be some financial support statement from government today. Sure to be a drop in the ocean.

 

[ska invita]

So uk gov announcement today amounts to government loans and some genuine helicopter money of grants somewhere between 10-25k for small businesses. Not a lot of detail regarding that. Well it's something, but it's definitely not enough. Lots of people for whom that is irrelevant and who are facing income falling to zero

 

[kenny g]

Fantastic opportunity for fraud if you had the mind for it.

 

[ska invita]

Ed Milliband calling for basic income amongst other interventions here Tear up the economic rule book. This pandemic calls for radical intervention | Ed Miliband
the piece mentions this happening in Denmark:
"Denmark has gone further with its government guaranteeing 75% of wages for private sector workers who would otherwise be made redundant. "

 

[redsquirrel]

Ed Milliband calling for basic income amongst other interventions here Tear up the economic rule book. This pandemic calls for radical intervention | Ed Miliband
the piece mentions this happening in Denmark:
"Denmark has gone further with its government guaranteeing 75% of wages for private sector workers who would otherwise be made redundant. "

So the UBI you want is the same as Miliband is proposing? This is a perfect illustration of what the piece I linked above was criticising.

 

[BigTom]

US has announced direct payments to all US citizens as part of a stimulus package - doesn't say how much: US government to give citizens emergency financial aid

In the UK, they will have to do something but I expect they'll extend SSP to closed businesses to "cover" payroll costs, defer/remove business rates & council tax (cos it'll fuck local councils harder than central govt, and more local councils are labour than tory), and do a cut in VAT (crowing about how this couldn't happen if we were in the EU).

We will really need a govt. spending spree this summer/autumn - whether that's in the form of keynesian style infrastructure spending or a single/series of direct payments to UK citizens (or both) we'll see. I hope they don't just do supply side stuff but with the tories in power, it wouldn't surprise me. If/when the tories fuck up the economy might see a vote of no confidence and new elections next year (especially once Covid-19 comes back again next winter if there's still no vaccine and we've not developed a good level of immunity) and then there's a big opportunity for more radical policies like basic income.

 

[redsquirrel]

If/when the tories fuck up the economy might see a vote of no confidence and new elections next year

That would require a hell of a lot of Tory MPs voting against the government of their own party. A change in leadership I can see as plausible, Tory MPs turfing their own party out of office, not going to happen.

 

[BigTom]

That would require a hell of a lot of Tory MPs voting against the government of their own party. A change in leadership I can see as plausible, Tory MPs turfing their own party out of office, not going to happen.

yeah, good point.

 

[StoneRoad]

Might depend on how many of the older duffers die / resign, allowing by-elections ... although I don't think the virus uses class distinctions.

 

[ska invita]

US has announced direct payments to all US citizens as part of a stimulus package - doesn't say how much: US government to give citizens emergency financial aid

In the UK, they will have to do something but I expect they'll extend SSP to closed businesses to "cover" payroll costs, defer/remove business rates & council tax (cos it'll fuck local councils harder than central govt, and more local councils are labour than tory), and do a cut in VAT (crowing about how this couldn't happen if we were in the EU).

We will really need a govt. spending spree this summer/autumn - whether that's in the form of keynesian style infrastructure spending or a single/series of direct payments to UK citizens (or both) we'll see. I hope they don't just do supply side stuff but with the tories in power, it wouldn't surprise me. If/when the tories fuck up the economy might see a vote of no confidence and new elections next year (especially once Covid-19 comes back again next winter if there's still no vaccine and we've not developed a good level of immunity) and then there's a big opportunity for more radical policies like basic income.

1000 dollars is a figure I've seen mentioned

 

[ska invita]

Btw you say spending spree this summer, I know people who have basically become unemployed, zero work, zero hours, this week, in the events industry that is. Intervention needs to happen immediately

 

[SpookyFrank]

Btw you say spending spree this summer, I know people who have basically become unemployed, zero work, zero hours, this week, in the events industry that is. Intervention needs to happen immediately

Yup monday was my last day at work for who fucking knows how long. I've got maybe a month before I start being hungry. Two months if there's a rent freeze.

 

[BigTom]

Btw you say spending spree this summer, I know people who have basically become unemployed, zero work, zero hours, this week, in the events industry that is. Intervention needs to happen immediately

Yeah, you're right, when I was writing that I was really thinking about infrastructure type projects - new housing, railways, fibre broadband to rural areas type thing - stuff which won't be able to happen until after any lockdown ends.
But I think they will say Universal Credit is enough to get people through this.

The $1,000 is what Mitt Romney suggested, but the white house press release said it would be "more than was being talked about in the press" (paraphrased) so it'll likely be more than that. Around 300m people in the states I think so if they were to equal the $2bn they've spunked into the stock markets in the past week, it'd be closer to $7,000 dollars each if my mental maths is correct.
Of course they won't do that.

 

[SpookyFrank]

As far as it goes I'm against any kind of basic income that would just become yet another landlord subsidy.

 

[Shechemite]

Anyone without a passport (of the country there are in, right now) is fucked

 

[Shechemite]

We will end up with the national health service (and social care/security system) that the Right have been salivating about.

It will ‘only go to those who need it most’ (ie emergency) it will be used exclusively to manage national security and economy, and god help anyone who isn’t seen as deserving.

When covid hits again in the winter? Not even worth thinking about

this isn’t a post-war rebuilding going on. This is the war we were all expecting.

 

[Smokeandsteam]

I think this thread is conflating two things. These are:

1. Is there a need for a basic income programme, rent, mortgage, utility and council tax holidays and QE to keep money circulating? Yes
2. Is this socialism/reluctant socialism/an ‘event horizon’ for capitalism? No and for exactly the reasons outlined by redsquirrel - this is about saving capitalism.

More interesting is the fatal assumption of Johnson, the Treasury and much of the commentariat, which is the view that the underlying economy is strong and will ‘bounce back’. This is simply wrong. We are not a producer economy. We are an economy based on finance, credit, consumption and a large public sector to manage the fall out of deindustrialization and the resultant surplus population.

So, in summary, the inevitable response to Covid-19 isn’t socialism and won’t usher it in. It’s a buying time measure for the free market. It is both necessary and will allow producer economies to come back at some point.

The problems for capital are sat underneath this in the real economy.

 

[Shechemite]

I think this thread is conflating two things. These are:

1. Is there a need for a basic income programme, rent, mortgage, utility and council tax holidays and QE to keep money circulating? Yes
2. Is this socialism/reluctant socialism/an ‘event horizon’ for capitalism? No and for exactly the reasons outlined by redsquirrel - this is about saving capitalism.

More interesting is the fatal assumption of Johnson, the Treasury and much of the commentariat, which is the view that the underlying economy is strong and will ‘bounce back’. This is simply wrong. We are not a producer economy. We are an economy based on finance, credit, consumption and a large public sector to manage the fall out of deindustrialization and the resultant surplus population. The inevitable response to Covid-19 isn’t socialism and won’t usher it in. The problems for capital are sat underneath

the Tories aren’t going anywhere for (at least) 4+ more years. Why anyone is hopeful for the states response is beyond me.

the state will do everything to protect itself and its class.

 

[Shechemite]

The state will be more nationalist, more interventionist, more corporatist. No ‘gains’ from this are guaranteed.

 

[Smokeandsteam]

the Tories aren’t going anywhere for (at least) 4+ more years. Why anyone is hopeful for the states response is beyond me.

the state will do everything to protect itself and its class.

There are large numbers of left commentators totally misreading why what is happening is happening. I shouldn’t be surprised I know, but they supposed to be Marxist/socialist etc

 

[Shechemite]

Re-structuring an entire economy based on not only a novel (forgive me) epidemic, but also a new, rapidly changing, and deeply unstable geo-political reality.

The state (well all states everywhere) will be focused entirely on national interest.

 

[Shechemite]

There are large numbers of left commentators totally misreading why what is happening is happening. I shouldn’t be surprised I know, but they supposed to be Marxist/socialist etc

ash sarkar smirking whilst reading the news, holding the papers with her freshly painted bling nails, complaining (whilst smirking) that the state isn’t doing enough to control people’s movement.

literally a communist indeed.

 

[Smokeandsteam]

Government intervention in the economy is not something new, indeed it has been a key part of neo-liberaiism, the increasing synthesis between the state and capital and their mutual reliance.

This is the most important relationship that is now in flux as a result of the covid pandemic.

The necessity for the state to manage the social fallout of neo-liberalism, corporate welfare, the ability to recycle the working class and money to keep the show on the road.

This is the debate we need to have