Market states and pandemic politics: Some lessons from coronavirus

When news spread in January of 2020 that the SARS coronavirus which killed 774 people worldwide in 2002-2004 had mutated, and spread once again from China to the rest of the world, it was not clear things would get so bad. Two years on, and six million people are dead, and many more injured by the biological, economic, political, and social effects of the coronavirus crisis. In such dark times, it is important to find light in one of the simplest of places: libraries.

Here is one such library, the University Library of Cambridge, which I frequent as part of my master’s degree in intellectual history.

Much of my time is spent reading books which don’t seem, at first glance, to have much to do with current events. What could great works of political theory, like Hobbes’s Leviathan or Plato’s Republic, have to say about contemporary developments? Perhaps not much on their own — but if viewed through the lens of contemporary events, which themselves can be read through the prisms of political thought, we might learn a great deal. So, here are some lessons I’ve gleaned from reading current events side-by-side with political thought (albeit mostly in English language versions) since the ancient Greeks.

In March 2020, markets were reeling from the news that the latest mutation of coronavirus (SARS-COV-2, after the SARS-COV-1 epidemic of 2002-04) had spread throughout Europe and North America, leading western governments to take a lead in announcing ‘lockdowns’ of the economy and society to slow down the spread of the virus. This allowed health services more time to treat those infected by the virus, preventing breakdown of the health infrastructure of affected countries (which, ultimately, became almost all of them). But lockdowns themselves brought costs that were not widely considered in the popular consciousness. It was up to states and their central banks to save the market economy by providing more liquidity than has been provided since the financial crisis of 2008. A combination of fiscal stimulus by governments and quantitative easing by central banks kept markets afloat, stemming the worst effects of economic recession.

But the fact this situation arose due to political choice, rather than to the economic mania of the financial crisis, is evidence of an enduring fact: the modern state has more power than the modern market, or capitalism, which must bow down before the ‘Leviathan’ of the sovereign authority. Thomas Hobbes’s Leviathan describes just such a state — and the frontispiece of the book portrays a king presiding over an empty city, with streets filled only with troops and a single plague doctor; a polity in the grips of a pandemic. The modern world remains in this Hobbesian paradigm. The idea that economics takes precedence is an idea that only followed the general priority of politics. States only save markets after they save themselves, by attempting to save their citizens and secure their trust. The recent return of inflation is evidence of the return of market logics to dominate politics, but states retain the ability to contain such pressures, especially if they are powerful states with leverage over the entire global financial and commercial system. One such sovereign state is the United States of America, whose financial reach stems from its enduring purchasing power, allowing it to perform the dual roles of consumer and lender of last resort, while production has been offshored to east Asia, where a power struggle continues between American and Chinese spheres of influence.

Indeed, there is a certain parallel between the coronavirus crisis and the China crisis, apart from the geographical coincidence of the two (with both major mutants of the SARS coronavirus originating in China). Both crises have economic causes: coronavirus spread along world trade routes, while China’s growing might owes to its hold over world trade as the largest exporter on the planet. And the economic effects are also similar: just as coronavirus temporarily brought down world trade, the US-China trade war similarly threatens global economic interdependence. The lesson here is quite simple: economic interdependence is self-undermining. Over time, trade creates the weapons, biological and political, of its own destruction.

Politics remains torn between the various ‘inputs’ to the political process — such as health, and the economy. The initial choice to prioritise health over the economy by way of complete lockdowns of society led to the revenge of the economy and the return of the economic logic of contemporary politics. Indeed, politics is trapped in a fundamentally economic trap, since the biological conundrum is unlikely to ever be solved (mortal beings as we are, prey to the fates of nature). Although the state is the ‘sleeping sovereign’ of the modern world, the market retains an artificial hold over the state, while health concerns constitute the ‘natural’ limit of modern politics. In Hobbes’s Leviathan, the state is held up as an ‘artificial person’, compared with the ‘natural persons’ who constitute its citizens and leaders. We remain, it seems, trapped in a Hobbesian story, where what is ‘natural’ and what is ‘artificial’ are opposed to one another. Perhaps the resolution to this division is to balance the two concerns with each other. But it is hard to see how this could have been done: to balance health with economic concerns simultaneously would have been to risk both. Could world leaders have done any better? If they could, it is hard to see exactly how we would do better, were we in their position.

Markets and states have different interests, and the health concerns that dominated politics initially trumped the economic concerns arising from the market economy, but both sets of interests and concerns played a role in determining how the crisis unfolded. If we cannot learn exactly how to secure balance in practice, perhaps we can at least learn from this crisis the importance of balance in theory, if we are to make sense of the world and change it for the better.

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