The Corona Crisis and the Need for a Change of Policy

Read the essay by Heinz Bierbaum, president of the Party of the European Left.

One country after another is closing up. The most significant case in Europe is that of Italy. But after a rather long period of hesitation the other countries are now following the Italian example. Even here in Germany truly drastic measures are now being implemented. Public life is dead. People are obliged to remain at home. The restaurants and cafés are closed. Even the major automobile corporations, the heart of German industry, have drastically reduced production or have closed. All these measures are aimed at halting the viral contagion and slowing the epidemic. But no one knows how long these measures have to remain in effect. Government policy is baffled.

Many people have been hit, in particular the poor. Those who work under precarious conditions, for example subcontracted workers, are the first to lose their jobs. But others too are endangered. Particularly badly hit are those who work in the restaurant sector and in private services, freelance workers, and free professionals. The German government has decided on financial subsidies for these victims of the crisis, for both companies and workers. Accordingly, it has eased and enlarged the conditions unemployment insurance for ‘Kurzarbeit’ or short-time work.

This is an enormous crisis, which has truly very serious consequences for the economy and for daily life. But the crisis also lays bare the inadequacies of our development model. Due to neoliberal policy and its privatisations, our health system does not meet the needs of the crisis that has caused this virus. Certainly, Germany is perhaps in a somewhat better position that the other European countries, but in Germany, too, the healthcare system’s capacities are inadequate. There have been efforts to create more capacities for those ill with Covid-19 but this is coming up against its limits.

All in all, we have to say that the measures taken by the German government are inadequate, both on the healthcare level and in terms of the economy. It is obvious that the ruling principle of balanced budgets has to be suspended and that the state has to run up deficits to tackle this crisis, and so Germany’s Minister of the Economy has declared that there will be no lack of money. However, up to now the financial allocations have been insufficient. And the Minister of Finance is even today demanding a state budget without new debts – which is truly grotesque.

Every European country is going it alone. Yes, there are intentions on the part of the European Union to grapple with this crisis but there is no adequate European coordination. It is obvious that we need a cross-border European policy to take on this crisis. To begin with, the Stability Pact has to be suspended. We need economic aid to countries most affected. And the European Central Bank (ECB) has to assume its responsibility of carrying out a monetary policy to deal with the consequences of the crisis and to prevent any sort of financial speculation.

In this crisis we have also seen attempts at worsening labour conditions, for example by suspending collective agreements, lowering wages, or making work hours more flexible. It is, however, precisely in this crisis that workers’ rights need to be reinforced because they need strong protections.

For the left, this crisis, which has exposed the limits of our economic and social model, must be the point of departure for launching a different policy. Policy at both the national and European levels has to be radically changed. At the European level it is high time that austerity policy be abandoned in favour of a proactive policy in the interests of people, through public investments in sectors that are important for society’s sustainable development. We need an offensive aimed at improving public services. At present, the deficits of the health sector are evident. We need effective structures, with more staff at better pay and human working conditions. What is obvious now for the sector that is at the centre of public focus also goes for the other sectors.

There is no doubt that drastic measures to stem the pandemic are necessary. On the other hand, the state of emergency must not be used to establish permanent reductions of civil rights and authoritarian forms of government. And we have to resist any attempt at using the crisis to propagate xenophobic and racist policy. We need to take advantage of the opportunity the crisis affords to think about the existing economic and social model. We need to change direction towards a proactive policy oriented to the common good, beginning with adequate protection for the people most hurt by this pandemic.