Nobody Left Behind.

Solidarity Forever: All over the world, the arrival of the Covid-19 virus has exposed the fragility of the walls we erect around ourselves and our loved ones. It has shattered our illusions of autonomy and revealed to us how utterly dependent we all are on other human-beings. Finally, we see the state for what it truly is: the institutional expression of our interdependence; the place where everybody comes together – and nobody gets left behind.

ALL THOSE who criticised Finance Minister Grant Robertson for refusing to break his Budget Responsibility Rules owe him an apology. Steadfastly, for more than three years, Robertson has reiterated his conviction that maintaining surpluses; keeping Government debt levels low; and tightly managing public expenditure; was the only responsible course for an economy as vulnerable as New Zealand’s. His argument: the we needed to keep plenty of economic headroom in anticipation of that proverbial “rainy day”; has been vindicated. Just take a look out the window – it’s bucketing down!

Not that the Finance Minister is sticking to his Budget Responsibility Rules now. The emergency economic package announced on Tuesday afternoon makes it very clear that the Coalition Government will spend whatever it takes to keep the New Zealand economy afloat.

The $12.1 billion of emergency spending announced by the Finance Minister represents 4 percent of New Zealand’s GDP. This is a massive commitment. Proportionately, it is more than twice the size of the Australian Government’s response. Robertson told journalists that his package was inspired by the expansionary policies of the First Labour Government. Certainly, his decision to increase benefits by $25 per week and double the Winter Energy Subsidy for all welfare recipients and the elderly conforms absolutely to the generous spirit of Mickey Savage’s Labour Party.

Though politicians are notorious for not learning the lessons of history, on what, and more importantly, what not to do in response to a sudden economic shock, Robertson and his colleagues have proved themselves more than willing to take instruction.

In the wake of the 1929 Wall Street Crash, the advice tended to President Herbert Hoover by his Secretary of the Treasury, Andrew W. Mellon, was as brutal as it was blunt: “Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate.” In other words, allow the ruthless surgeons of finance to exact the pounds of flesh now owed them by millions of  stricken Americans. Mellon and his fellow laissez-faire capitalists were convinced that encouraging the survival of the fittest, by sending the weak to the wall, was the President’s only rational course of action. The ideology of Social Darwinism, to which all the world’s ruling elites subscribed, demanded nothing less.

Mellon’s advice, as we now know, was wrong in every respect. It transformed a savage sharemarket correction, which was recoverable, into a devastating global depression that lasted more than a decade.

In fairness, the cause of the current economic shock cannot be attributed to Mellon’s neoliberal successors. The unfolding Covid-19 Pandemic is one of those exogenous events (like the asteroid strike that wiped out the dinosaurs) that defy all but the most inspired soothsayers. The species jump that precipitated this crisis cannot be laid at the door of any particular ruling elite.

Where human agency does come into view, however, is in the way responsible authorities’ respond to Mother Nature’s random interventions. For more than three decades, the promoters of the “free market” have been telling us that the state is an impediment to human welfare and prosperity; that “sovereign individuals” are far better placed to promote their personal welfare than politicians and bureaucrats. Well, they are not so vocal now. Just as there are no atheists in foxholes, there are precious few rugged individualists in pandemics. Indeed, it is nothing short of miraculous how rapidly the spread of a deadly infectious disease has reinvigorated sovereign individuals’ faith in collectivism!

All over the world, the arrival of the Covid-19 virus has exposed the fragility of the walls we erect around ourselves and our loved ones. It has shattered our illusions of autonomy and revealed to us how utterly dependent we all are on other human-beings to keep us fed, and watered, and well. For a great many of us that revelation has been both devastating and liberating. Finally, we can see the state for what it truly is: the institutional expression of our interdependence; the place where everybody comes together – and nobody gets left behind.

As the Federal Government intervened decisively in the financial crisis of 2008-09 to rescue the commanding heights of American capitalism, the cover of Newsweek summed up the new zeitgeist. Watching Grant Robertson unfurl our collective umbrella against the Covid-19 Pandemic’s rainy day, I couldn’t help recalling the words emblazoned on Newsweek’s front page:

“We are all socialists now.”

This essay was originally published in The Otago Daily Times and The Greymouth Star of Friday, 20 March 2020.