Both in the U.S. and in the world, the COVID-19 outbreak could have long-term political effects.
The political dynamics of Washington in recent years have been like an ’80s aerobics routine: full of thrashing and contortions, but with little actual movement. An endless succession of pseudo-“bombshells,” frenzied two-week scandals, and Twitter rampages created a jaded intensity — the perfect spectacle for the smartphone era.
But the past ten days or so have undone that exhaustion-through-microtitillation. Now, things are moving fast, so fast that perhaps no one understands what’s really been done, let alone where we’re going. On cable news, some talking heads try doggedly to slip back into the accustomed pattern, as though whether we call COVID-19 the “Chinese virus” is really the most pressing issue facing the country. And that’s understandable; the feuds we know might be more comforting than challenges unsolved.
It’s hard to say what this change will ultimately mean, in part because we don’t know exactly how high coronavirus’s ultimate costs in both lives and GDP will be, how long it will last, or what eventual steps the United States will take to face it. However, some possible consequences stand out.
U.S. politics will likely not be the same. So much money will be spent, and the federal government is taking such sweeping action across a host of sectors, from banking to medical licensing to industrial production. Federal power often grows during times of crisis, and this case is no exception. The United States is experiencing perhaps the most extensive exercise of (relatively) coordinated state power since the Second World War. Even the aftermath of 9/11 seems restrained in comparison. Across the country, states and municipalities are closing down businesses, shuttering schools, and imposing curfews for extended periods.
A raft of subsidies, low-interest loans, and other supports seems in the offing for American businesses, and that crucial injection of capital may come with certain strings. For instance, some in Congress have called for making aid to some businesses contingent on relocating supply chains to the United States. If the other policy aims are bundled into various relief efforts, that could have long-lasting implications for American economic policies and political dynamics. The absence of policy strings could also be a cause for disruption. After all, the frustrations resulting from the fallout of the 2008 financial crisis — including the lack of reforms to end Too Big to Fail — have helped fuel the unrest of pre-COVID politics.
The coronavirus crisis may be jostling existing political coalitions. It has perhaps dispelled the totem of austerity that has hung over Republican politics (or at least political rhetoric) for so long. While Republican presidents from Reagan onward have long expressed an indifference to balanced budgets in governing, the GOP response to this crisis has by and large avoided even a pro forma expression about the importance of fiscal responsibility. Instead, the Trump White House, Senators Mitt Romney and Josh Hawley, and others have called for just cutting a check to American families.
High neoliberalism already had a preexisting health condition, and this global pandemic may be fatal for it. World trade as a percentage of global GDP peaked in 2008, after which the financial crisis made it plummet. It has climbed closer to that historic high, but the coronavirus outbreak seems likely to send that number downward again. Harder borders are springing up around the world, with even free-movement havens such as the Schengen Area being divided. For the moment, at least, coronavirus has severely curtailed the free movement of goods and people that is at the heart of many neoliberal dreams.
In recent years, defenders of the neoliberal order have taken to venting their anger at the political factions that have sprung up in response to neoliberal dislocations — “populists,” “nationalists,” Brexiteers, and, of course, Donald Trump. Yet these political actors have gained a foothold precisely because of the tensions that neoliberalism heightened: the economic frustrations of a financializing economy, the disruptions of mass migration, the polarization between the professional classes and blue-collar workers, and so forth.
In the United States and elsewhere, the COVID-19 outbreak has highlighted some of the choices entailed in the current iteration of globalization. The risk of real shortages for medical supplies has done more to convince policymakers of the importance of domestic industrial production than a thousand white papers have. Moreover, this outbreak has renewed the tensions between the United States and the People’s Republic of China. Donald Trump’s election signified a shift toward an increased hawkishness toward China, but this trend has accelerated, prompted in part by the Chinese leadership — who have spread the false claim that the United States — and not Wuhan — was the origin of COVID-19. Many analysts already saw American dependence on the PRC for many key goods as a threat to the continued ability of the United States to engage in great-power politics, but this view has gained increased currency over the past month.
There is a chance that the coronavirus outbreak could end up being a relatively minor disturbance to the geopolitical status quo, an urgent blip after which the world returns, eventually, to business as usual. However, the effects of this global pandemic could also help solidify some correction to the current model of globalization. This correction need not be a Cold War 2.0, or a replay of the great disintegration that happened during the First World War, in which great-power competition unleashed a torrent of mayhem and misery. Countries might hold out a place for trade and migration while also placing a new emphasis on their internal social and economic infrastructures. The United States, for instance, could simultaneously engage in a more energetic form of industrial policy while also trading with nations across the globe (as countries such as South Korea and China already do). A more robust effort to renew the American industrial base and working class might actually help prevent a radical global retrenchment; a United States with a stronger internal infrastructure could better meet its international commitments.
Until we find out, we will sit in our quarantined homes, watching and waiting to see what the future holds.