Capitalism after the pandemic: Getting the recovery right

‘Governments also need to consider how to use the returns on their investments to promote a more equitable distribution of income. This is not about socialism; it is about understanding the source of capitalistic profits. The current crisis has led to renewed discussions about a universal basic income, whereby all citizens receive an equal regular payment from the government, regardless of whether they work. The idea behind this policy is a good one, but the narrative would be problematic. Since a universal basic income is seen as a handout, it perpetuates the false notion that the private sector is the sole creator, not a co-creator, of wealth in the economy and that the public sector is merely a toll collector, siphoning off profits and distributing them as charity.

‘A better alternative is a citizen’s dividend. Under this policy, the government takes a percentage of the wealth created with government investments, puts that money in a fund, and then shares the proceeds with the people. The idea is to directly reward citizens with a share of the wealth they have created...

‘A citizen’s dividend allows the proceeds of co-created wealth to be shared with the larger community—whether that wealth comes from natural resources that are part of the common good or from a process, such as public investments in medicines or digital technologies, that has involved a collective effort. Such a policy should not serve as a substitute for getting the tax system to work right. Nor should the state use the lack of such funds as an excuse to not finance key public goods. But a public fund can change the narrative by explicitly recognizing the public contribution to wealth creation—key in the political power play between forces.’

Read here (Foreign Affairs, Oct 2, 2020) 

The coming post-Covid anarchy: Kevin Rudd

‘As with other historical inflection points, three factors will shape the future of the global order: changes in the relative military and economic strength of the great powers, how those changes are perceived around the world, and what strategies the great powers deploy. Based on all three factors, China and the United States have reason to worry about their global influence in the post-pandemic world.

Read here (Foreign Affairs, May 6, 2020)

Past pandemics exposed China’s weaknesses: The current one highlights its strengths

‘...[The] audience for Xi’s performance is as much global as domestic. Just as in the past, whether in the time of SARS or of plague, outside observers are assessing China’s governance by its capacity to manage its health. COVID-19 has become an important test for the virtues of authoritarian governance versus those of citizen empowerment. Aware of this high-stakes diplomacy, China is reframing the narrative to emphasize the success of its mass-containment measures and downplay concerns about its initial failures. China has shared its expertise with the European Union, pledged $20 million to the WHO in its fight against the virus, dispatched medical teams and supplies to Iran, Iraq, Italy, and Serbia, and promised to help African countries meet the crisis. All at once, Xi has begun to look more like a global leader committed to health for all...

‘The new coronavirus has revealed a fractured geopolitical landscape and reactivated old arguments about openness and efficiency. The virus has laid bare China’s strongman leadership, but it has also highlighted incompetencies within Western democracies. As governments of democratic states impose sweeping quarantine measures, China is hoping that its draconian style of epidemic management will prevail as the new global norm.’

NOTE: There is a mention Wu Lien-Teh in this story. ‘In 1910, as Qing rule crumbled, the British-educated, Penang-born physician Wu Lien-teh was sent by the Chinese government to curtail the spread of pneumonic plague across Northeast China. He enacted stringent containment strategies based on modern scientific teachings: postmortems, bacteriological investigations, and mass cremations, to name a few. Wu’s program was markedly different from the response to the bubonic plague just two decades prior, when endeavors to halt the contagion were left to local charitable organizations or to the foreign officials who staffed the Imperial Maritime Customs Service with minimal oversight from the viceroy at Canton.’

Read here (Foreign Affairs, March 7, 2020)