Crises Only Sometimes Lead to Change. Here’s Why.
THE CORONAVIRUS PANDEMIC has upended Western economies, many of which are now facing their gravest crises since the Great Depression. In response, governments are taking unprecedented measures.
In the United States, the crisis has produced an expansion of big government programs unparalleled in peacetime: massive stimulus measures, a historic expansion of unemployment benefits, a temporary basic income for many citizens, billions of dollars in funding for public health measures, low or zero-interest loans to businesses, and more. In addition, the U.S. Federal Reserve is engaged in an experiment with modern monetary theory—previously considered “voodoo economics” by mainstream economists—promising to pump unlimited amounts of money into the economy.
In Europe, governments have implemented even more dramatic measures, as economists such as Martin Sandbu urge them to “throw caution to the wind and spend massively.” Germany has given up its obsession with balanced budgets. In France, President Emmanuel Macron suspended many taxes, rent, and household bills and promised no company would be allowed to collapse. Scandinavian countries and the United Kingdom have essentially nationalized payrolls, promising to cover the wages of workers who would otherwise be laid off.
The assumption that the crisis and the radical measures undertaken in response to it will shape the world for years to come and forever alter the world order, as Yuval Noah Harari and Henry Kissinger respectively put it, has become commonplace. As the other essays in this issue make clear, many hope—or believe—that the crisis and the responses to it will enable governments to deal with many long-standing problems, from climate change to inequality.
Many progressives in particular seem to believe that the world is at the dawn of a new era, perhaps even more now that protests against racial injustice have been added to the upheaval caused by the pandemic. The “era of small government is over,” declared the columnist Jamelle Bouie. After the coronavirus, “ambitious progressive ideas that once seemed implausible … start to become more imaginable,” argued his colleague Michelle Goldberg. We must rethink “the basic assumptions underlying the American value system,” asserted former Democratic presidential candidate Bernie Sanders. A belief in the inevitability, or at least necessity, of transformative change has characterized the European left as well., proclaimed a headline in Germany’s leading left-wing newspaper, referring to the final destruction and subsequent renewal of the world famously portrayed in Richard Wagner’s opera about an apocalyptic battle. But transformation is never preordained.
