Coronavirus and a state fit for purpose

5 August 2020

In the first of a four-part series, Ben Hunter and Chris Carlon discuss what a left-wing state could look like in the aftermath of Covid-19

As the coronavirus spread across Europe and North America this year, developed countries were forced to rapidly devise policy plans to try and deal with both the virus itself and the cost of the public health response. In the United Kingdom, this repertoire of action encompassed behavioural restrictions on individuals; making emergency funds available for businesses and the self employed; social programs for particularly vulnerable groups; and so on. These measures constitute the largest peacetime fiscal expansion in British history, with the Office for Budgetary Responsibility suggesting the cost could would rise to over £300 billion this financial year.

This context has caused a burst of critical reflection on the role of the state. It’s an issue that was already on the agenda in the UK, in part due to Brexit and the ensuing debate around what the British state should be, but also Jeremy Corbyn’s Labour Party (2015-2020) and its activism in favour of a larger, more interventionist state. Even going back to Ed Milliband’s leadership (2010-2015), the British left’s renewed (or uncorked) socialist agenda brought the boundaries of the state back into contestation in a manner unseen since the 1980s. Although public spending – a common bellwether of state expansion – rose substantially under New Labour (1997-2010) from 40% of GDP to 44.5% between 1996/7 and 2008/9, these increases, whilst the second-largest in Europe, were never part of a broader attempt to redefine the state. New Labour’s most significant steps in that direction took place internationally, with humanitarian intervention in Kosovo and ostensibly in Iraq seeking to enforce sovereignty as responsibility, and a form of statehood contingent on adherence to human rights and global norms. Clement Atlee (prime minister from 1945-1951) and Margaret Thatcher (prime minister from 1979 – 1990), by crafting the post-war settlement in the UK and winning the primacy of the free-market respectively, formed a new mandate for state-society reorganisation, a new social contract which rewrote the rule book for what the government legitimately could do.

In 2020, the systemic crises of the coronavirus, combined with the context of Brexit and a renewed statist element within British political discourse, have spurred broader questions surrounding the underlying purpose of British governance. Both our current moment and those after 1945 and 1979 tell us that the structural context is all-important in this regard – Europe’s collapse into conflict in the former, the post-war welfare state’s crisis of stagflation and unemployment in the latter. New Labour’s acceptance of dominant domestic currents came amidst widespread confidence in liberal governance, whilst the collapse of the USSR spurred new thinking internationally.

With that in mind, it’s difficult to see how the UK’s domestic travails can’t be considered part of a broader crisis of the globalised, neoliberal state which faces the long-term domestic impacts of the financial crash and an international outlook shorn of purpose. Brexit and Prime Minister Boris Johnson’s new ‘Project Defend‘, as well as comments from French president Emmanuel Macron highlighting the need for French economic sovereignty and independence in both his April and June addresses to the nation, are indicative of the growing sense that change is needed. The coronavirus is such a powerful catalytic pressure because it crystallizes these systemic fragilities into a short-term emergency, one run against a clock counting down in the lives of citizens.

Given this context, what perspectives currently exist on the COVID state? Left-wing economist Paul Mason arguesthat after this crisis there will be ‘only two kinds of people in British politics: reluctant socialists and enthusiastic ones’. George Eaton, writing for the New Statesman, suggests that the coronavirus means ‘the indispensability of the state will become even clearer’. The Financial Times offers a similar perspective, with Janan Ganesh suggesting that state action to combat the virus will bring about ‘a tilt in the balance between the public and private realm‘ similar to which occurred after 9/11 and the 2008 financial crash. Even in The Telegraph, Spectator editor Fraser Nelson argues that ‘the global response to the coronavirus shows that the nation state is back’. Outside of the popular media, the European Council for Foreign Relations believes that ‘the coronavirus will force the return of big government’, a statement that received support, albeit conditionally, from Professor Matthew Godwin for the British Chatham House think tank.

In this reading, expanding state action to deal with the coronavirus will leave a long-term legacy, ushering in another era of ‘big government’ through the toolbox of interventionism. Although the broader picture we’ve established thus far presents a viable context for such a renegotiation to take place, we take issue with it, and level two substantive criticisms against it.

Firstly, this debate has been dictated by lines drawn more from the past than the present. A cyclical perception of the state’s evolution – based on the lows of the Great Depression, the post-war expansion, the crisis of the 1970s,  and the Thatcherite settlement – has created two overly simplistic poles around which the state is conceived: big, or small. This conceptualisation takes place without an appreciation for the state’s complexity, for the diversity of interactions and functions that allow a state to be simultaneously both big and small. This frame suggests a state which moves between these poles in a linear fashion across time, ignoring evidence which points towards a much more nuanced picture. Scottish socialist thinker Neil Davidson, writing about Margaret Thatcher’s defeat of the unions, noted ‘that the general interests of her class sometimes required the adoption of strategies that were contrary to particular economic doctrines’, as Thatcher was prepared to use the state ‘as a weapon’. In this sense, a state can become big in one area in order to be small in another. The issue inherent to the big versus small debate is a lack of disaggregation, an absence of a consideration of the state’s purpose.

With this in mind, we suggest that the state has always been present and it’s always been bigwith the nature of its interventions only changing, not disappearing. Concerning the state, what counts is not so much if it gets involved but why it gets involved, and the ‘big government’ commentary highlighted above lacks detailed analysis on the state’s potential purpose. For example, Kate Bayliss outlines the institutional and legal configuration of domestic regulators and international investment consortiums which, as a result of political action, have completely changed the ownership architecture behind the UK’s provision of water services. From 1979 to 2020, big state intervention has been required to allow increasing levels of privatisation and financialisation to take place.

Although the phraseology of a statist ‘return’ is problematic, that there has been a significant expansion of state activity to combat the virus is inarguable. Our second criticism, then, is that this expansion doesn’t necessarily herald a return to the form of government commonly held as ‘big’. The pre-virus governing ideology of neoliberalism remains firmly entrenched into ideational and physical structures of power because, unlike in the Second World War and similar to the Great Recession, our current crisis response has propped up, rather than refashioned, our political economy. We posit that a true paradigm shift in state-society relations involves not just changes to policy, but a new governmental perspective on appropriate state-society relations Although Boris Johnson’s ‘Project Defend’ maybring about some form of change regarding international capital flows and the UK’s place within global supply-chains – we still believe that instead of replacing neoliberalism, our current moment resembles a defensive neoliberal posture, a pragmatic crisis response that doesn’t display any tenets of an institutionalised shift in governing practices. In fact, we argue an even deeper retrenchment is likely to take place in some areas in the years to come.

This observation draws upon the purpose of the state and not merely the extent of its presence, and requires a detailed analysis. In order to do so, we examine two elements of the pandemic response, namely: the implications of the UK government’s Job Retention Scheme (JRS), otherwise known as the furlough scheme; and the centralised manner in which the virus has been fought. In so doing, we demonstrate how the virus response both derives from and continues to support a pre-existing model of the state. To conclude our discussion, we will sketch out alternative models which could remedy the issues highlighted in our criticisms.

To read the next part in this series, click here.