COVID-19 and Neoliberalism: Critical Analysis

COVID-19 and Neoliberalism: Critical Analysis

Introduction

Neoliberalism is arguably at its worst during the COVID-19 pandemic. Merino (2020) and Hathaway (2020) both agree that the structures and institutions that propped up neoliberalism have led to the exacerbated suffering of most people in the form of poor sanitation, poor housing, food insecurity, and low access to quality healthcare. In free-market capitalism, priority is given to other sectors excluding the health and education sectors as well as not building adequate resilience in the global supply chain. In this paper, the impact of COVID-19 on global society will be analyzed through a critical analysis of three relevant journal articles. The analysis will be based on the conflict theory which states that society is a product of domination and power over the powerless in the society. It is relatable to the current struggles faced amidst the COVID-19 pandemic. Households in the lower and middle class have experienced difficult economic conditions, more so than the upper class. The importance of focusing on this topic is to uncover whether the pandemic has improved or worsened neoliberalism. The rationale for approaching this topic as critical analysis is to use relevant expert opinions in determining the actual impact of the pandemic.

Critical Analysis

A different scholarly review of the pandemic has resulted in varied opinions on how the lockdown has affected society. Peters (2020) stated that while scholars can disagree on the impact that the pandemic has had on societies, a majority agree that it has led to negative economic outcomes for virtually all societies. What most cannot agree on is the shift attained on such social frameworks as free markets versus closed economies. The subsequent section presents a critical analysis of three journal articles focusing on the subject of neoliberalism and COVID-19.

Article #1

The UK and the USA have had dissimilar effects from the pandemic, but they both showed how unprepared they were for such an occurrence. Mellish, Luzmore, and Shahbaz (2020) blamed the unpreparedness on the acute nature of neoliberalism in both the UK and the United States compared to other countries such as Germany and South Korea. The authors postulated that the COVID-19 pandemic was not entirely unpredictable; it was only unexpected on the basis that of its timing. There had been other similar pandemics in the past which countries like the UK should have been well-prepared for. The main obstruction to attaining the same level of preparedness as South Korea and Germany is perceived to have been capitalism which is higher in the UK and the US.

Dwelling on the health sector’s preparedness, it is arguable that in the UK and the US, challenges experienced could have been avoided had priority been given to them. Barrera-Algarín et al. (2020) concur with this premise noting that health sectors amidst the pandemic must be assessed based on structures and not the personnel. In this perspective, some nations had adequate structures to handle the crisis than others. Worryingly, nations with enough resources to have proper structures in places such as the UK and the US were included as unprepared nations. As an example, Mellish, Luzmore, and Shahbaz’s (2020) study reported that the UK government spent £330 billion to support businesses in 2020 while the cost of funding the UK National Health Service (NHS) in the 2018/19 year was only £129 billion. The authors termed neoliberalism a flawed theory due to such discrepancies. The government’s support for business is based on the idea that it gives most households enough income to afford healthcare. The pandemic has shown that economic empowerment of households should have come second to economically empowering medical institutions. With no cure, more households were clamouring for medical equipment such as beds or oxygen tanks all over the world. This problem affected households in the upper and lower social classes—money did not alleviate the problem as neoliberalists would have expected.

Mellish, Luzmore, and Shahbaz (2020) indicated that the main difference between the UK and the US compared to both South Korea and Germany is in the government response. The idea of profit before people is cited as the UK and USA scrambled unprecedented resources to save banks to cushion their respective economies instead of focusing on saving people. The main message communicated in these approaches is that a financial crisis would be worse than a pandemic. This idea was supported by Hathaway (2020) adding that support for neoliberalism leads to robust economies but the people are the true cost of such a model. By not prioritizing social goods such as hospitals and education, such economies are a pandemic away from a colossal failure.  In the US, the medical sector has grappled with nurse strikes for the longest time with workers. Further, companies such as Tesla and Amazon have been reported to demanding that their workers return to work even during the pandemic endangering their lives. Conclusively, these are the symptoms of neoliberalism that have made the pandemic worse in such countries (UK and USA) compared to South Korea and Germany where neoliberalism is minimally supported.

Article #2

From the perspective of migrants and their struggle with the pandemic, the central thought in the article by Dutta (2020) is that low-wage migrant workers have been on the receiving end during the pandemic due to neoliberalism. This article focused on Singapore; a nation described as having extreme neoliberal structures. The author surveyed several migrant workers who stated that they were experiencing poor sanitation, poor housing, and food insecurity in the country that has been hailed globally due to how it reacted to the pandemic. Neoliberalism can be extreme especially in first-world countries where only a minority of people are in the extreme poverty section. Such households find it difficult to rise above their situations. This situation is best explained using the Conflict Theory.

The foundation of the Conflict Theory is that societies have the working class and the ruling class. The ruling class is determined to suppress the working class and prevent them from rising above that level (Rohner,2020). It is feared that the working class was to rise above their economic suppressions, they would overturn the whole class system replacing or eliminating the ruling class. In Singapore, Dutta (2020) demonstrated how Conflict theory has worked against the minority or the poor in Singapore. As an example, the author noted that low-wage migrant workers dominate the data when it comes to worker infections, poor housing, and food insecurity. They are also placed in the outskirts of the “smart cities” in Singapore as those are the only areas, they can afford to house. This arrangement is a direct repercussion of neoliberalism that has existed for a long time in Singapore and other countries in a similar economic state.

Government responses have also favored the majority in Singapore as all the other policies have been in the past. When setting up lockdown measures, for instance, Chua et al. (2020) report that lower-income households in Singapore were negatively affected regarding their ability to still generate income during such measures. While those measures were implemented, households with savings and high-paying white-collar jobs were not as negatively impacted as households with semi-skilled breadwinners or lower salaries families. Das and Zhang (2021) found that for individuals who contracted the virus, being isolated was a huge problem due to the lack of housing resources and space while living outside of the “smart cities.” Such eventualities should have been considered. Failing to plan for such issues shows the lack of understanding of the plight of migrant workers and low-wage households in Singapore. Lee, Chiew, and Khong (2020) adds that the government should have instituted measures to safeguard the economic wellbeing of such families which would have been the true definition of equity in the country’s context. Like Canada, Singapore could have offered to cushion such families from rental payments to enable them to focus their low salaries on food, housing, and health improvements.

Article #3

Peters (2020) takes a different view of the pandemic. While acknowledging that it is difficult to accurately understand or foretell the impact of COVID-19 on the global economy now, it is arguable that it has led to a disorder of things such as the decline of neoliberalism. The author concluded that most institutions, in the education, health, and government sectors, have drafted plans to change the way things will be done in the future. From a government perspective, it is indicated that “sustaining a culture of democracy” is the priority going forward. In education, it is argued that “reinstituting education as a public good” rather than the profit-making industry it was before, is the right path ahead. The author has concluded that with these resolutions going forward, the pandemic has in effect led to the reduction in neoliberal views.

This article makes a rather big assumption. Nunes (2020) would argue differently. Analyzing the resilience that governments managed to attain since the Financial Crisis of 2008, the author expressed doubts that the resolutions made now will result in a reduction in neoliberal views. Barrera-Algarín et al. (2020) concur that neoliberalism is too entrenched in the current society with both government level and social level support. The idea that profits should be maximized is ingrained in most people; these are the same people who will end up forming governments and committees after the pandemic. Consequently, it is a big assumption that resolutions of today will be implemented.

Jones (2020) also expressed doubt that there will be significant changes in the global society after the pandemic. While more resilient measures may be implemented, the main problem has been the prioritizing of private sectors at the expense of the public ones. This may not change soon because the global economy is now tuned to work in that manner. For instance, China has become a manufacturing hub for most global companies because of the low cost of production it offers. Shifting from this trend will be difficult because the nature of competitiveness in the global economy plus the dynamics of comparative advantage remain despite the pandemic. While better and more resilient frameworks will be designed such as decentralizing production hubs, it is too ambitious to argue that the pandemic will lead to a reduction in neoliberalism.

Peters’ (2020) view is not, however, unsubstantiated. The author relied on insights from authors such as Condon (2020) and Mai (2020) that the crisis has caused inversions of neoliberalism. The change that is being proposed is based on how people are changing. The assumption is based on the idea that if people on the ground change their view about neoliberalism, the world will likely change since people make up governments and private organizations. Particularly, Libal and Kashwan (2020) note that COVID-19 has led to forms of solidarity where people are helping the most vulnerable in society. This has also been seen between nations where vulnerable nations have been receiving grants, masks, and vaccines to help combat the virus. Despite these actions substantiating the idea that neoliberalism is coming to an end, it is still a major assumption. As the corporate world has shown, big companies are eagerly waiting for the resumption of the economy to get their workers back in the workplaces to resume profit-making activities. These are the same companies that offered help to the vulnerable during the pandemic in a myriad of ways. Similarly, it can be argued that once the pandemic is over, people will go back to being focused on maximizing profits and not caring for the vulnerable as they are now.

Conclusion

To conclude, the relationship between neoliberalism and the COVID-19 pandemic has been unraveled. While some people share the idea that neoliberalism is ending due to the pandemic, a majority of scholars show that the pandemic has only perpetuated and amplified the neoliberal tendencies of the private sector. While there have been cases of well-doing on an individual, national and global level, it is not enough to conclude that neoliberalism is dying; that the world is ushering in a new era where neoliberalism will be minimal.

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