There’s a better way out of this . . . Update

Much has happened since I wrote the first post with this title (1). Because the earlier post appears to have interested quite a number of you, I am now posting an update.

For those that have yet to read it, the first post argued that Universal Basic Income (UBI) could help resolve some of the issues governments face in trying to keep their economies afloat at the same time as keeping their citizens safe from this novel coronavirus. By ensuring all people are secure financially, rather than just some, as at present, UBI would help bolster demand, enabling those not at work to purchase what they need to live, while staying safely at home. UBI might not answer every problem, but it would give governments and societies the time to work out better ways to manage the current challenges.

Since I wrote it, the idea of UBI seems to have taken on a life of its own. An opinion poll conducted by an Oxford University research team and published on the 6th May found that 71% of Europeans are now in favour of introducing a Universal Basic Income. This is astonishing. Even in Britain, a bastion of free enterprise and neoliberalism, the figure saying they are in favour is 68% (2).

That the idea of UBI is even gaining traction within the UK parliament is made clear in a great article by John Harris in The Guardian. John reports, “Ten days ago, the left-inclined pressure group Compass organised a letter, signed by more than 100 MPs and peers from seven parties, calling for a ‘recovery basic income’ that would be ‘sufficient to provide economic security’. An accompanying paper sets out the case for these short-term measures being followed by a permanent basic income – set at a starting rate of £60 a week per working-age adult and £40 per child (or £10,400 per year for a family of four), with additional unemployment, housing and disability benefits maintained. Over time, this ‘income floor’ could rise to £100 per adult.” While this is not a princely sum, it would be a great start.

What is interesting to me is that this letter shows that a large number of MPs now support the idea of UBI. I cannot imagine this being the case before the coronavirus. This change in perspective has come about quietly, almost under the radar. There has been little or no media publicity given to it, no major campaigns, no demonstrations in the street. Normally it takes a massive groundswell to cause such a shift in popular opinion. The enthusiasm of our MPs and the results of the Oxford poll suggests that such a groundswell is already well underway.

John Harris goes on to say in his article, “UBI’s advocates insist the tax system could be remodelled to ease the cost. Besides, this might not be quite the hard sell some would suggest: after the bailing-out of the banks and the government’s munificent response to the current crisis, radical spending plans are surely not the political taboo they once were.” Too true.

From my point of view, even more encouraging for the proponents of UBI is the outcome of a major pilot study conducted in Finland. The study, conducted between 2017 and 2018, has attracted widespread interest around the world. Some 2,000 unemployed people were randomly selected from across Finland. They were each provided with a regular monthly income of €560 (£490), somewhat more generous than the UK proposal. The Guardian article of May 7th reports the results of this experiment of providing citizens with a basic income (3).

Researchers at Helsinki University conclude, “The basic income recipients were more satisfied with their lives and experienced less mental strain than the control group.” Unsurprisingly, “They also had a more positive perception of their economic welfare.”

Professor Helena Blomberg-Kroll, the lead researcher of this study says, “The scheme also gave some participants the possibility to try and live their dreams.” This transformative effect was seen most clearly among those whose ambitions are inherently financially insecure: “Freelancers and artists and entrepreneurs had more positive views on the effects of the basic income, which some felt had created opportunities for them to start businesses.” In other words, UBI could tap into creative energies that currently lie dormant in our society. Just the sort of creativity we will need to deal with the challenges that lie ahead of us in the climate crisis.

The trial’s impact might be even more profound than appears at first sight. The researchers report that UBI also encouraged some participants to become more involved in the society in which they live, undertaking voluntary work, for example. “Some found the guaranteed income increased the possibility for them to do things like providing informal care for their family or their neighbours.” According to researcher, Christian Kroll, “The security of the basic income allowed them to do more meaningful things, as they felt it legitimised this kind of care work. Many of the people who performed such unpaid activities during the two-year period referred to it as work.” It is often work, of course. And usually it goes unpaid, as many carers are all too well aware. Could UBI also be a way of giving recognition to caring, the glue that holds our society together? Could it be one way to promote a better society?

This is certainly the view of Scott Santens. Scott, a long-term advocate of UBI, has been given a platform by the World Economic Forum. (That in itself is a good sign, as the WEF always want to get a good sense of what they think they are likely to be up against next.) Scott, in making his case to the assembly of billionaires who assemble in Davos, argues, “Humans need security to thrive, and basic income is a secure economic base – the new foundation on which to transform the precarious present, and build a more solid future. That’s not to say it’s a silver bullet. It’s that our problems are not impossible to solve. Poverty is not a supernatural foe, nor is extreme inequality or the threat of mass income loss due to automation. They are all just choices.” (4)

They are indeed. But no government is presented with infinite choices. The impact of the pandemic means that every government will need to make tough choices in these extremely precarious times. They already know there is no easy way to recover the economy and there is no cheap way to protect people. This is a key reason why UBI is suddenly centre stage: no longer a wild idea on the fringes of economics, it is quickly becoming mainstream.

It might not be Britain that takes the lead in UBI – it could be Spain . . . or some other country elsewhere in the world. But, what is eminently clear is that this is the moment when this idea makes eminent sense.

UBI is an idea whose time has come.

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Celebrating Sadiq Khan’s car-free fest

Diana Francis, a peace activist I hold in great respect, writes, “Many of us are hoping that good things can come from our experience of this pandemic, creating a kinder, gentler, more equitable society. Will this latest threat have brought us to the moment when decisive societal and political rethinking and action lead to the radical restructuring of our personal and collective lives?”

She goes on to say, “I have been encouraged by the many thoughtful articles published since the pandemic’s outbreak, suggesting kinder, more inclusive ways of living: new approaches to economics, new uses of technology, the rejection of consumerism and simpler, gentler lifestyles. The quiet streets and bird song have awoken old memories and a sense that all is not yet lost and that some sort of renewal could be possible.” (1)

Londoners were today given an indication that such renewal really is possible when the Mayor of London, Sadiq Khan, announced a major initiative to make much of central London car-free.

The Mayor’s Office stated, “Some streets will be converted to walking and cycling only, with others restricted to all traffic apart from buses, as part of the Mayor’s latest bold Streetspace measures. Streets between London Bridge and Shoreditch, Euston and Waterloo and Old Street and Holborn may be limited to buses, pedestrians and cyclists to help boost safe and sustainable travel as our city starts to gradually emerge from national Covid-19 restrictions. Access for emergency services and disabled people will be maintained, but deliveries on some streets may need to be made outside of congestion charging hours. Waterloo Bridge and London Bridge may be restricted to people walking, cycling and buses only, with pavements widened to enable people to safely travel between busy railway stations and their workplaces. TfL is looking into providing Zero Emission Capable taxis with access to both these bridges, and other areas where traffic is restricted.” (2)

What was Sadiq Khan’s motivation? It appears that he and his office saw what the rest of us saw: the stark contrast between the pollution in London prior to lockdown and the clean air after lockdown. “Following the Government announcement of coronavirus related travel restrictions, traffic levels on TfL roads fell by as much as 60 per cent and harmful nitrogen dioxide was down by around 50 per cent on some of London’s busiest roads.”

Now that traffic and pollution are starting to rise again does he believe that this is the moment when a different world is within our grasp? Has he reached out to grab it while he can?

His decision could finally reverse the long-term dominance of the car. Since the 1950s, the previously unstoppable rise in automobile ownership has made many of our cities almost unliveable, destroying streetscapes, scarring our built environment, creating uncrossable divides between communities, and drowning us all in pollution and noise. Suddenly, this is now seen to be the mistake that it surely was.

Even better news is that Sadiq Khan is not the only leader to be responding in this way to opportunity thrown up by coronavirus. Worldwide, from Milan to Montreal, from Bogota to Mexico, administrations are seizing the moment to improve the air quality and environment of their cities by encouraging pedestrians and cyclists and discouraging cars. (3)

Could it be that birdsong, clear skies and clean air will continue to be a feature of urban life even after Covid? Only if we stop using our cars and and get on the bus.

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21 reasons why it’s better that the rich don’t help the poor

The Cover-19 pandemic has made it clear how our newly discovered “essential workers” (aka working poor) are not so essential that they are not put at constant and often avoidable risk. It’s almost as if we don’t want to give them proper PPE if the camera is not turned on.

The fact that “we are all in this together” hasn’t meant that government help has been spread to all equally. Nearly every pandemic financial relief package has been disproportionately oriented to helping out large businesses and, by implication, shareholders and the rich.

In the light of this, I thought it might help out worried fellow would-be philanthropists by reminding them of a few familiar reasons why we should hold onto our money and not share it more widely:

  • We are so much better at handling money than others (that is why we have so much of it and you don’t)
  • We know how to make money work for us (whereas you have to work for money)
  • We got our money through sheer genius (it was nothing to do with Dad, connections, tax breaks, or the fact that some of those capital gains were slightly dodgy)
  • It is our just reward for the hard work and the value of our creativity (ok, and Dad’s work, and some employees, and the creativity of a few others who weren’t smart enough to cash in . . .)
  • Taxing us would deprive people of jobs (even when those poor so-and-so’s have to work for pay well below the living wage, they still need jobs)
  • Higher taxes would handicap business, depriving it of vital investment (even though most of my money is hidden away in the Cayman Islands, some of it gets invested in business for sure – heck, I will check with my accountant . . .)
  • Be patient, money will trickle down to the deserving poor, eventually, maybe (though not if Mother has anything to do with it; she’s always blocking those little leaks as if her life depends on it)
  • Taxing us more would reduce consumption where it’s most needed (it would wreck the luxury yacht business for sure, top-end real estate would suffer real bad, and how would those private jet guys survive?)
  • Shit, its our money that keeps the economy going! (it’s only fair that we get the odd state subsidy here and there and the occasional handout when the economy goes belly-up)
  • Making money is in our genes (that’s what my great granddaddy told my Dad just after he had made his second million at twenty-two)
  • It’s our right to be rich (the constitution says so – and if it doesn’t, it sure as heck should)
  • The fact that I only look good in Givenchy and Armani says all you need to know about me – I’m born to wealth and it shows (sure my sophistication is more than one-buck deep, ask any woman)
  • The poor don’t know how to make good use of money (that’s why they deserve to be poor, ask anyone)
  • And they are feckless and spend every penny they have on gambling and drinking (which, QED, is why they never have a dime)
  • Wealth is like class, you need to be born into it to get it (which is why it always follows suit, like in cards)
  • One of the world’s great truths is that the poor wouldn’t know what to do with money if they had any (it stands to reason, they don’t have the right experience, nor the right connections)
  • My ma told me don’t ever give money to the poor, it just encourages laziness (they will never get anywhere if they don’t work hard)
  • Nope, giving money to the poor just encourages them all round (and we don’t want them encouraged, there’s already enough of them)
  • This whole idea of redistribution of wealth through taxation is just pure Communism (What! It can’t have been invented in the USA! – are you sure? No way!)
  • No I haven’t heard of the parable of the Good Samaritan (damn Communism again!)
  • If this dude said the rich are as likely to get into heaven as a camel going through an eye of a needle, I sure hope he did a good line in needles . . .

Hive innovation – self-sufficiency with a new twist?

In Britain, the once common idea of self-sufficiency vanished from public view several decades ago. The notion that ‘where things are made doesn’t matter’ has been wedded to ‘it doesn’t matter who owns the manufacturing’. All that matters is price, or so we were told. Primark, Tesco and Amazon rule. Where things come from is irrelevant. Supply fulfils demand. Always.

And then came the 2020’s Covid-19 pandemic. In these unprecedented circumstances, the inherent virtues of self-sufficiency have become all too clear once more. We have all learnt the hard way that supply chains are only as good as their weakest link. Currently, with many of those links broken, the government, the NHS and every family and individual are scrabbling around to match demand with supply. The demand for personal protective equipment (PPE), from ventilators through to face masks, as well as food and household products, such as yeast and baking flour, has outstripped supply.

What fascinates me is that the solutions we are coming up with are at one and the same time both global and local. The difference to what we’ve done over the past several decades is the emphasis on the local. Whereas Britain has always been keen to join in with international research programmes (in vaccines and antivirals), which I am glad it’s still doing, local initiatives have always (until now) received short shrift. The reason for this is financial. The City has hunted out the highest returns, wherever they might be in the world; venture capital has always encouraged the sale of startups to the highest bidder on flotation, wherever that owner is based. Suddenly this model appears under question. Locality matters once more.

As we’ve become aware that British invention does not equal British access, nor does German invention equal German access. Local research projects suddenly seem more important – and who owns what is now known to be critical. There are even reports of bidding for control of PPE supply taking place on the runways of China’s airports (1). Invention is not enough in itself. Who will have access to the Covid-19 vaccine if and when it’s produced is the big question. How much profit its sale makes once it is produced, is less important. At least, for now.

Getting hold of ventilators in that critical moment before Boris Johnson ended up hospitalised with the disease, required scouring the globe for every and any source of supply, writing begging emails to suppliers, making phone calls to heads of state, and pleading. It worked. We got sufficient supply… by the skin of our teeth.

This wasn’t going to be good enough in the longer term, and the government knew it. They put in place a call for UK manufacturers to supply ventilators – backtracking on the notion that all our needs could be met by outsourced manufacture. Suddenly we needed manufacturing capability on UK soil. This required innovation of the famous British “make do and mend” variety. Within days they received 13 separate proposals (2) and a new business model was born, one of collaboration between companies, where no one company owns the final product. All do. As a result, instead of individual corporate self-sufficiency and off-shoring, we now have hive innovation, a form collective self-sufficiency that we are all benefiting from.

Fast tracked ventilators

Two of the 13 ventures stand out in this regard: Project Pitlane, and The Ventilator Challenge UK (VCUK) consortium. Both are highly unusual in the degree of cooperation entailed; both have proved highly successful.

Project Pitlane is a consortium of seven Formula One teams, including Aston Martin, Mercedes-AMG, Renault and Red Bull. Normally rivals, they have come together to working jointly to help the NHS. Their project has produced the Continuous Positive Airway Pressure (CPAP) device. The CPAP device provides a much gentler approach than a ventilator to help Covid-19 patients with lung infections to breathe more easily.

Project Pitlane has developed the device in cooperation with University College London (UCL) and clinicians at UCL Hospital. By reverse engineering an already existing device, they have been able to ensure rapid approval by the Medicines and Healthcare products Regulatory Agency (MHRA). This has enabled the manufactured product to be placed in hospitals within two weeks of the prototype being developed (3). An order for up to 10,000 devices has now been placed by the NHS, with 1,000 a day being built at the Mercedes AMG High Performance Powertrains technology centre in Brixworth.

The Ventilator Challenge UK consortium has resulted in the unlikely collaboration of companies from a range of diverse industries. As with Project Pitlane, several of the companies in the VCUK consortium are usually major competitors, including Airbus, Rolls-Royce, GKN and BAE Systems, as well as Ford and McLaren. Others in the consortium include Meggitt, Renishaw, Thales, Siemens and Ultra Electronics. Including suppliers, nearly 60 companies are involved in this cooperative venture.

While re-purposing production capacity is something that has long been talked of, this is a practical demonstration of how quickly it can be achieved once people put their minds to doing so. As well as providing factory floor production space and logistical know-how, the companies have worked together to redeploy some of their most skilled engineers on the ventilator effort.

VCUK now has two machines under production. Their first product is the Smiths’ machine, which started production on March 29th. This machine, the result of Project Penguin, involved scaling up production of a model already made in small numbers by the medical equipment firm Smiths Medical at its factory in Luton. The consortium has since received approval from the MHRA for a second design, the Penlon Prima ESO2 ventilator. This is product of Project Oyster, and involved making tweaks to a second existing design produced by the small Oxfordshire firm Penlon.

The VCUK production lines are in Broughton, Dagenham and Woking. Production of the Penlon ventilator will be in Oxfordshire. The government has ordered a total of 15,000 of the two machines and the consortium targets to raise production to 1,500 units a week (4).

The consortium has been facilitated by Catapult, the innovation centre set up by the government quango, Innovate, UK (5). Catapult’s expertise is in taking academic research in manufacturing and applying this to developing and scaling up production of new technologies and processes.

A model for the future of our planet?

This hive innovation approach, sometimes called a product development partnership, has been used successfully in several other areas, including the development of new malaria medicines, bringing academic research, industry and donors to work together under the same umbrella (6). The huge advantage of hive innovation is that the synergy it produces marries fresh perspectives with production capabilities. This same hive approach has now proved effective in tackling some of the problems thrown up by this pandemic, enabling businesses, academia and government to work together in innovative and creative ways.

The results demonstrate that when we are really serious about something that is going to affect our lives, we can find ways to achieve results quickly – remarkably so. Given that the usual development times (time to market) for medical devices is three to seven years (7), it is nothing short of a miracle that ways have been found to design, license, source, and manufacture new models of medical equipment in a matter of just a few weeks.

Covid-19 has shown us that achieving significant innovation is as much about shaping new relationships and collective responses to the challenges we face as it is about sharpening our focus and garnering resources.

Just imagine what we could achieve if we took the same approach and applied it to the challenges of the climate crisis. Yes, the climate challenges are even greater than Covid-19 – but that, surely, is the point – we need to treat the fate of our planet with an even greater sense of urgency than we give to the threat of SARS-CoV-2.

Our experience of this disease continues to be a very painful one. Hopefully, one of its benefits can be to give us new clarity, not only about what is really important in life, but also about the important role hive innovation and collective self-sufficiency can play in tackling the challenges facing the future of our planet.

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  • (6) One of the earliest product development partnerships is MMV:
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Advantage Federal?

There has been a lot of speculation in the press about why Germany (and to some extent Switzerland) have seen proportionately fewer deaths than other countries during the first wave of the Covid-19 virus (1). While there are undoubtedly many reasons for why this is the case, and we will not understand the full picture until this pandemic is over, many have concluded that it is the sheer extent of the testing in these countries that has been effective in constraining the scale of the outbreak there (2).

One aspect that has gone largely unnoticed, however, is the positive impact of the federal system on shaping both countries’ capabilities.

It is inherent in the nature of federal systems that healthcare facilities are decentralised. Whereas the UK has created major regional centres of specialisation – such as the Liverpool Heart & Chest Hospital, serving everywhere from the Isle of Man and Anglesey in Wales to Liverpool and the northwest of England – in Germany and Switzerland every state (or canton) is expected to be largely self-sufficient. This means that, in contrast to Britain, which started out with just a single, centralised testing unit, Germany was able to immediately replicate testing in numerous centres throughout the country.

In the view of Christian Drosten, the director of the institute of virology at Berlin’s Charité hospital, whose team of researchers developed the first COVID-19 test used in the public domain, this goes to the heart of the matter. He told NPR, the German public radio broadcaster, that Germany’s low fatality rate was the result of his country’s ability to test early and often. 

“We have a culture here in Germany that is actually not supporting a centralized diagnostic system,” said Drosten, “so Germany does not have a public health laboratory that would restrict other labs from doing the tests. So we had an open market from the beginning.”(3)

Germany’s 16 federal states make their own decisions on coronavirus testing because each of them is responsible for their own healthcare system. The same is true in Switzerland, another country with a federal system, which has achieved one of the highest testing rates in the world (4).

But it is not just testing, of course. Another aspect that also came in for scrutiny in the UK at the beginning of this crisis is the number of intensive care beds per a million people. Germany had 292 compared to the UK’s 66 (5). Why the difference? The same answer holds true: in Germany, all 16 states needed to replicate ICU facilities, whereas in the Britain they were heavily centralised. Even if Germany wanted to, the states wouldn’t have allowed it to reduce the number of intensive care beds down to the level seen in Britain.

There is another harsh truth that has little to do with decentralisation: the NHS has been underfunded for a considerable time. Years of austerity have ensured that the UK has inadequate facilities in place to deal with the annual winter flu outbreaks, let alone a virulent pandemic such as Covid-19. In an interview with The Financial Times, Severin Schwan, CEO of Roche, a Swiss based pharmaceutical giant, said that the UK government lagged behind other countries in dealing with the coronavirus crisis because it had not invested enough in healthcare and testing. Speaking from lockdown in Switzerland, Mr Schwan said to the FT, “I am not saying [the decision not to invest] is right or wrong, . . . But don’t wonder [when] a crisis like this comes and you don’t have the infrastructure that you are in a more difficult situation.” In other words, don’t be surprised, Mr Johnson, when the austerity chickens all come home to roost.

So, is there something that other countries can learn from the experience of Germany and Switzerland? Probably. And, to give credit to the UK government, it seems that these lessons have already been learnt to some extent. Since the start of the outbreak the British government has acted quickly to correct the inherent problem of over-centralisation and underinvestment, rapidly equipping seven Nightingale Hospitals, one in each region of England. Others have been added in the other countries of the Union.

Similarly, they have addressed the problems due to over-centralisation of testing. Starting with just a single centre, the UK has now increased the number of testing centres to three, supplementing this by university facilities and numerous drive-through centres. Dozens of mobile units are soon to add to this flexibility. Is this the beginning of a new federalised approach? Could decentralisation and increased investment be the legacy of Covid-19? Let us hope so.

If federal systems are so great, what on earth has happened in the USA? There is an obvious answer; there is another factor at play: a Presidential system headed by President Trump. This has had a major influence on the outcomes there. A moment’s thought, however, shows the federal advantage even in America. New York and California have been able to act as they see fit to deal with the crisis. Though Trump has attempted to interfere on occasion, he has not been able to stop the governors of these states acting in the best interests of their citizens. In short, the death toll might have been a whole lot worse without federal independence of action. This is an independence that has been widely recognised and praised in the US (6).

A note of caution: I don’t want to give the impression that federalism is universally seen as better than a centralised system in every single aspect. The Germans and the Swiss both complain on a regular basis about how slow their decision-making is. Because little can be imposed top-down by the central government, often consensus is arrived at through a long, slow and painful process. “It takes too long to make decisions,” is a complaint heard regularly. On occasion, the citizens of both countries even overcome deep prejudices and look over the fence at more centralised systems, such as that of neighbouring France, with something akin to envy.

At present, however, much of the envy faces in the other direction. And this is despite France having what is widely recognised to be one of the best healthcare systems in the world. To the surprise of many of their citizens, the federal systems of Switzerland and Germany have shown just how fleet of foot they can be during an emergency. Advantage Federal.

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The Dutch manifesto

With a number of countries already contemplating easing the lockdown (see my post of April 22), The Netherlands is first off the block in considering degrowth when thinking about what our society should look like once the Covid-19 has eased.

Degrowth is a political and environment movement that advocates moving away from our obsession with GDP, downscaling production and consumption to focus on our real needs as a society. This changed focus would reorient our activity as human beings, giving greater importance to relationships and community, our families, art, and general wellbeing. Business and commerce would become just one part of life, not its sole goal. The objective of degrowth is to produce a future that is both environmentally sustainable and generally much more satisfying for people than today’s rat race. Restored World is aligned with this movement.

The proposals of 170 Dutch academics are wide-ranging and address fundamental issues of our collective future, building on some of the green shoots we have seen the early signs of in the UK and elsewhere in Europe – the need for greater self-sufficiency, a basic income for all, sustainable agriculture, less travel, and the cancellation of debt.

Fortunately for me, as I speak not a word of Dutch, Jason Hickel, an inspirational academic in his own right, has provided a summary of their inspiring objectives in translation (1). I quote at length:

“This is remarkable: 170 Dutch academics put together a 5-point manifesto for economic change after the C19 crisis, building on #degrowth principles. It has gone viral in Dutch media. In this thread I’ll summarize the points in English.” (2)

1) Shift from an economy focused on aggregate GDP growth to differentiate among sectors that can grow and need investment (critical public sectors, and clean energy, education, health) and sectors that need to radically degrow (oil, gas, mining, advertising, etc).

2) Build an economic framework focused on redistribution, which establishes a universal basic income (see my post of April 22), a universal social policy system, a strong progressive taxation of income, profits and wealth, reduced working hours and job sharing, and recognizes care work.

3) Transform farming towards regenerative agriculture based on biodiversity conservation, sustainable and mostly local and vegetarian food production, as well as fair agricultural employment conditions and wages.

4) Reduce consumption and travel, with a drastic shift from luxury and wasteful consumption and travel to basic, necessary, sustainable and satisfying consumption and travel.

5) Debt cancellation, especially for workers and small business owners and for countries in the global south (both from richer countries and international financial institutions).

The Dutch aren’t alone in thinking we need a very different way of life if we are to address the Climate Emergency. This necessarily entails a completely different way of thinking about our purpose. I have found the thinking of Tim Jackson useful in this area. His book, Prosperity Without Growth is described by Yanis Varoufakis as “essential reading” (3). He argues that the Problem with Growth, in driving and determining all our actions, is the gorilla in the room (see my post of April 20). We ignore it at our peril.

  • (1) Dr. Jason Hickel is an economic anthropologist, author, and a Fellow of the Royal Society of Arts.  He is a Senior Lecturer at Goldsmiths, University of London.  He serves on the Labour Party task force on international development, the Statistical Advisory Panel for the Human Development Report 2020, the advisory board of the Green New Deal for Europe, and on the Lancet Commission on Reparations and Redistributive Justice. His most recent book, The Divide: A Brief Guide to Global Inequality and its Solutions, was published by Penguin Random House in 2017.
  • (2) For those of you who read Dutch (I know there are some who subscribe to this blog):
  • (3) Tim Jackson, Prosperity without Growth: Foundations for the Economy of Tomorrow, second edition, Routledge, 2017.

There’s a better way out of this . . .

Now is the time for governments to take up an idea that has been around for some time – let’s give everyone a Universal Basic Income. Not a small paltry income, but one large enough to cover all their bills and all their needs. Every individual would receive this sum. It would be universal, unconditional and automatic.

But why? Because everyone benefits. It eliminates poverty in a single stroke and this improves health and wellbeing. Studies have shown that increased equality benefits everyone in society (1). And because it is so simple to administer, being a single payment, the elimination of bureaucracy reduces administration costs substantially, which goes part way to paying for it.

Why now? It has to be admitted that no one really knows what the consequences would be of such a scheme. It is undoubtedly expensive, which is the main argument against it. But then so is paying unemployment benefits and the salaries of all those on furlough because of Covid-19.

We need to test it and see

The universal payment would be made for exactly the same reasons as the current payments but would include everyone. Currently, the governments benefits are missing out at least five million single-person limited companies, while the current level of unemployment benefit (“Jobseeker’s Allowance”) of a paltry £72 a week (for a single person over 25) is totally insufficient for anyone to live off.

Some argue that a Universal Basic Income could increase inequality by giving money to those who already have it. It need not. There is a simple answer. Take it back through taxation, or at whatever fraction you so choose, from those who already have a high income or high wealth. This is easy. HMRC does it all the time.

Others worry that it would disincentivize work. It might, but so does very low pay. We won’t know the tradeoff until we try it. Yet others say this wouldn’t suffice for some with special needs, for example, the severely disabled who need carers. Okay – make this an exception and put the resources into meeting such exceptional needs – by paying carers to do the caring. Clever people could surely work out solutions. The key, though, is to keep things simple.

There are plenty of theories about the advantages of Universal Basic Income – but not enough experience. A few places have trialled it, in countries such as Finland and Canada. This is why the present moment is a once in a lifetime opportunity for the biggest possible trial. Let’s see whether the theorists are right or not.

There’s no safe way to ease the lockdown

This is the right time for many reasons. One that makes it most essential is the question of how we are going to keep the economy functioning during the pandemic. Currently, governments appear to be betting on getting everyone back to work sooner rather than later. This bet rides on the back of developing a vaccine in 12 to 18 months. There are huge costs to this strategy.

To make this happen, governments are going to let the infection rate rise again, albeit temporarily, before once more locking down when the mortality rate rises. This approach appears to be based on “flattening the curve” repeatedly, on a longer term basis – that is, keeping the number of deaths at any one time within “manageable limits”. This will need to be done time and time again – possibly over many years.The hope is that over time this will lead eventually to some level of herd immunity (this is how diseases eventually “burn themselves out” anyway, and is not just the woolly thinking of the British government). Governments intend to reach the point by ensuring our hospitals can cope with the numbers of those infected and seriously ill. Note that this doesn’t a) eliminate the disease any time soon, nor b) stop people dying in large numbers. It merely spreads the number of deaths due to Covid-19 over a much longer period.

This is not a bet I’d like to make. Governments are making this bet because they see no other way to keep their economies running while managing the consequences of the disease. They rightly do not wish to contemplate complete economic meltdown. However . . .

Improving everyone’s wellbeing could be one way to buy time

I agree with President Macron that we all need to think again. Planning for further deaths is unacceptable.

The alternative is for countries to buy time by staying in lockdown until a solution is found – a solution we haven’t thought of yet. However, people will not stay locked down when their livelihood is at risk. To the government’s credit, it has already understood this – and has introduced the concept of furlough, which guarantee’s 80% of employee’s salaries when they are not at work.

No one has yet thought of this as the long-term solution. To my mind, it might have to be. Universal Basic Income would make this possible, improving wellbeing and giving us time to find a way out of this problem.

As an aside, while it’s more likely that we can develop effective antivirals to help treat patients, these are cures not prevention. Cures will help disease management, but not eliminate the impact of the virus. They will at least make the jobs of our healthcare workers more rewarding, less distressing and more sustainable than at present. It must be truly awful to feel so helpless watching people die when they are trained to save lives.

The truth is that a solution could be a long time coming. Vaccines usually take many years to develop. Even if it proves possible to reduce the development time from the usual 10 years or more, which there is every sign that it might, it will nonetheless be an enormous stretch to condense the testing protocol in the human population sufficiently to meet the current aspirations now being reported in the media, of having a vaccine ready within 12 to 18 months. And even if this aspiration does prove attainable, it is still 12-18 months in the future. Not now.

Until then, easing the lockdown and going back to work, shopping, going to an event, inevitably means further spread of Covid-19 among the 97-98% of us not yet infected.

Let’s not be part of a much more dangerous experiment

Letting people go back to the work and then picking up the pieces after a second wave, and third wave, and a fourth ad infinitum is not a solution. . . It’s not only a callous and immoral leading to many more deaths but is unnecessarily expensive and ineffectual. We cannot allow this to happen – it’s completely unacceptable.

Nor can we let all commerce die – that would be completely unsustainable. This is why Universal Basic Income could prove so important. Yes, it’s untried, but if it will at least give us a way to ensure that the economy keeps ticking over until we find a solution, one which doesn’t lead it to more deaths. People would have security and money to spend, and this would create demand for goods and services.

True, it doesn’t solve every problem. Many businesses dependent on high footfall will not survive. For these services, the future looks bleak, unless some manage to convert to home delivery or find some ways to provide for physical distancing. The hard truth is that the economy is likely to change beyond all recognition, whatever we do. This is the stark reality of where we find ourselves. Hence, the propensity of governments to make wild bets.

Universal Basic Income will enable us to stay locked down for the many, many months it’s going to take to come to terms with the consequences of this virus. It will keep businesses going which otherwise would collapse. From where I stand, it now not only looks a more kindly approach but appears a much more effective one to managing this continued and ongoing catastrophe.

(1) Richard Wilkinson and Kate Pickett, The Spirit Level: Why Greater Equality Makes Societies Stronger, Bloomsbury, 2011.


Signs of new beginnings

This spring is a very different one to the last. Not only can you hear the birds sing, but since they no longer have to stretch their voices above the sound of the planes and the road traffic, they can also hear each other better than before. The birds seem happier. I expect a chick baby boom.

And the skies are blue. The poor air quality and smogs that beset almost every major city have disappeared as a result of the reduction in traffic and business activity. Satellite images of NO2 pollution, comparing the situation before and after lockdown, show that the veil of nitrogen dioxide has largely vanished across Europe (1). Even more dramatic are the changes that have been seen in Asia (2). In China, C02 levels dropped by more than 20% during the six weeks from mid-February. In Delhi the contrast is like the difference between night and day. For the first time in decades, there is day after day of bright blue sky in India’s capital. The same is no doubt true elsewhere.

But it is not just nature that shows renewal. Money trees are sprouting across the world. After years of austerity following the financial crisis of 2007-08, suddenly governments have found the money to embark on almost unlimited spending.

New priorities require drastic action. I have watched with wonder as the British government, in particular, has show great creativity in finding ways to support its citizens and its businesses in these unprecedented times. Many things once deemed unthinkable, or beyond the pale, are now found to be possible. Desperation, pragmatism, realism, all mean that there is most definitely new thinking afoot. This deserves appreciation.

This new thinking intrudes into the world of commerce. Private hospitals have been co-opted into the NHS, railway franchise agreements have been suspended, the Bank of England has extended its credit facility to the Government, providing it with an unlimited overdraft facility. In short, the distance between the Treasury and the Bank has been reduced to zero. In effect, the Bank of England is under Treasury control . . . once again. And none of this has been called Marxism or Corbynism. Amazing!

Things are also changing in unexpected ways. Driven by the desperate nature of the present situation, manufacturing and construction have suddenly unleashed new creativity. Nightingale hospitals are springing up like mushrooms, in record time – rather than the ten years it normally takes just to get to the planning stage. Businesses all around the country have suddenly a new-found entrepreneurial flair and – horror of horrors! – are working in cooperation with each other, with scientists and technologists, and with the government to produce everything from PPE to ventilators. This is new.

The present crisis is showing us that, once the shackles of neoliberal dogmatism are thrown off, there are other, maybe better ways of doing things. Innovation isn’t something that has to take years “to come down the pipeline” but can be conjured almost on demand. This is not to say that it is easy, or cheap, merely that it is possible.

The present situation illustrates that once we take a crisis seriously, it not only focuses the mind but also the resources, organisation and finance to drive innovation. We can do it if we wish to.

And this underlines the point that we have not yet devoted the same focus and attention to the climate crisis and species extinction. We could, if we wished to.

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At a fork in the road

We are a critical juncture for humanity. The climate crisis and species extinction are the number one existential challenge. To date, we have singularly failed to deal with what this means for us as a species, collectively, nationally, globally.

Now this very real threat has been almost sidelined by the overwhelming impact of the SARS-CoV-2 virus, which has swept away everything we thought solid, indisputable and true. Its impact has undermined many of our institutions, ways of life, and our assumptions about how things are done that we, like much of the world, have held dear for the past forty years or more.

Business as usual

It is most unlikely that we can simply “go back to the way things were before the outbreak” even if we wish to do so. Governments have extended their powers in unprecedented ways, democracy has been put on hold, debt is increasing at a previously unimaginable rate, a myriad businesses have already vanished for good, and the global system of trade and exchange is undermined. There will be no return tomorrow morning to “business as usual” – too much has already been broken.

And this is only just the beginning . . .

The sad truth is that many, many more people will die before this pandemic is over. It may be several years before we find a cure or a means of fully containing the virus. Years! This stretches the imagination.

While the media is talking of a vaccine being produced in a year to eighteen months using new technologies (1), we know it can take as much as ten years or more to develop a vaccine that can fully immunise us against viral infections (2). In other words, we will somehow have to keep going for a long, long time while simultaneously trying to contain the spread of Covid-19. And people will continue to die all around the world. This a horrifying prospect.

Already, trust is now at its most fragile. The dimensions of this tragedy mean the goodwill is sorely tested between individuals, communities, institutions and countries. Yet, if we are to survive in this strange world, let alone thrive, we will all need to find new and better ways to cooperate with each other and to share our resources and innovations. This is the challenge . . .

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