Sunday, May 24, 2020

Social and Political Fallout from Pandemic Likely to Be Far Greater than Economic, Pastukhov Says

Paul Goble

            Staunton, May 23 – There are two extreme views of the social-political and economic consequences of the coronavirus pandemic, Vladimir Pastukhov observes, that the pandemic will change everything or that it will change very little. The truth is somewhere in between, but it is highly likely the fallout will hit the social and political system harder than the economic one.

            That may seem counterintuitive, the London-based Russian analyst says, given the extent to which the pandemic and responses to it have shut down the economies, led to mass unemployment and made it likely that many firms won’t be able to recover (

            But it makes sense if one considers that the pandemic is a trigger that will accelerate or slow trends already in place. Once that is recognized, it is clear that the biggest firms with monopoly power will do the best because they have the greatest access to sources of credit while the smallest ones who are agile at using the Internet will also have good possibilities.

            The companies that will do the worst, Pastukhov says, are those in the middle. They are “the dinosaurs” in this crisis, and there is little question that they will begin to “massively die off.”  But these developments will only be an acceleration of trends that have been in place one way or another for “about 150 years.”

            According to the London-based Russian analyst, “the social and political response to the crisis will likely be disproportionate and much more severe than the economic ones.”  That is because “economics doesn’t exist in a vacuum” and the political responses to the economic consequences of the pandemic will thus be doubled.

            Beyond question, “the virus is especially dangerous for the middle class, which in the short term is likely to be the main victim of the crisis.” While some of its members will see their opportunities increase if they seize the Internet, most will see their status and incomes fall relative to state bureaucracies and other groups in the population.

            Even beyond the middle class, “the crisis will make an enormous number of people strongly dependent on budgetary spending. Unemployment is only part of this problem,” and “the administration of budget funds could become the nerve center of the new post-coronavirus politics.”

            These funds will require the development of “a more powerful bureaucratic apparatus” and so “the world awaits the growth of statism in all its manifestations,” including the proclivity of those in charge to maintain restrictions and mobilization arrangements long after the conditions that gave rise to them pass.

            According to Pastukhov, “the space of freedom in its old traditional-liberal understanding – everything that isn’t prohibited is permitted – will certainly be reduced. The world will become much more regulated.”  And the turn to the left will accelerate, albeit often under what appear to be anything but leftist slogans.

            That is because “the heroes of the post-coronavirus world will be not investment bankers and lawyers but doctors and pizza deliverymen in the broadest sense of the world.”  They will demand that society show respect to them and that it move to equalize incomes, taxing the rich to support those less well-off.

            Pastukhov says that “erzats nationalism, better known under the disorienting name ‘right-wing populism’ will either disappear or on the contrary be reborn in a malignant form.” That is because once the pandemic is over, the leaders who oversaw national responses are going to be subject to serious criticism for their failings.

            In some places, current leaders will be driven from power, the analyst continues; but in others, they may survive by launching “an aggressive counter-attack on the positions of civil society. In that case, they may be reformatted into fascism-lite in a specifically post-modernist version.” 

            All this will lead to an increase in “risks for democracy. People will have to struggle everywhere for democracy and not just, for example, in Russia.”  Democracy unfortunately “even in the West not to speak about other places will cease to be viewed as something that can be taken for granted.”

            That could create some strange new alliances both within countries and between them, undercutting existing arrangements and creating new ones.  Humanity isn’t ready for these shocks and thus is likely to resist even as underlying forces carry them along in that direction, Pastukhov says.

            And there is one thing more that must be kept in mind: what he has outlined is a general trend. Some countries will move further and faster in that direction than others. As a result, the real impact of the pandemic on all aspects of life will only be clear long after the event. It is certainly not clear as the coronavirus danger has not yet passed. 

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