Inequality has steadily escalated since the days of Reagan and Thatcher. It’s now deeply ingrained in every aspect of our society. My focus, economic inequality, is a major factor in every other kind of inequality–social, racial, religious, gender, etc. And, no matter what the major problem of the world, the less equal always get the short end of the stick. The environment is a good example. As we continue to pollute our water, who is forced to live by the polluted lakes, streams, and rivers? The poor, of course. The rest of us can live on high ground and drink bottled water.
So, here we are again. This time it is the Coronavirus pandemic. Sure, it is affecting all of us. Even a billionaire or two might succumb to the disease, no matter his access to the very best health care. But in the total population, the losers are going to be the underprivileged, the poor, the economically unequal.
First, their living conditions are far from optimal to maintain social distancing. They can only afford less effective health care, if any at all. Many are still uninsured, a tragedy for a country of our wealth. On top of all that, they have little or no economic protection, living paycheck to paycheck, as many of them do. So, when the airlines, cruise lines, and hotels lay off thousands, when those are followed by the small businesses, restaurants, and even the laundries, cleaning services and all of that, what can they do? They can only survive a few weeks or a few months, usually even that by exhausting their retirement or emergency savings.
What then? This week, the government will approve measures which reportedly protect those people (on average) for a few months. “Few” being like maybe 3. And, “averages” means some will last a little longer, but some far less. For example, if your inner city rent is $5,000, not uncommon in our major cities, we’re talking maybe only a month or two. And if these folks had any savings, say a 401K or whatever, that’s been diminished as of today by about 30%.
Now to the debate of the day: Continue to “Shelter in Place,” or open up the system and go back to work? The Left is aghast at the idea that we might lift the Shelter regulations. The Right is paranoid about the harm to the economy, and perhaps to the stock market.
I can’t resist chiding my friends who pushed back on my concerns for inequality when I argued that our unequal have little benefit from a stock market. They argued that everyone has some sort of retirement fund, however small it may be, and it is invested in stock–therefore we ALL prosper from the stock market. Well, that’s pretty academic now. I have less, but the “unequal” have little, very little, if any, after all this is dealt with.
What’s the answer? Shelter or go back to work? The sad and brutal reality is that both alternatives involve loss of life. Yes, if we sent too many back to work too soon, there will inevitably be additional loss of life, before we get to Tony Fauci’s guesstimate of 18 months to a vaccine. That’s a regrettable reality.
However, many of these, our middle class, our blue collar workers, and our poor, will die of lack of food, housing, health care and other necessities, if they can’t go back to work. To imagine any other scenario, one would have to make a highly improbable assumption–that government is able and effective in sufficiently compensating every one of our bottom 50%, some 62 million Americans, reported to be holding only 1% of national wealth and with only $11,000 in net worth.
Even if the average income of the bottom 50% is only $30,000, and if this half of our citizenry can somehow live off that, for government to provide for that for 62 million Americans would take a staggering 1,860,000,000,000. Check my math. That’s about $2 Trillion, and that’s just for staying alive, doesn’t cover the needs of airlines, hotels, cruise lines, small businesses, health care, etc. And that’s just for 12 months.
I’m not an economist, but it’s doubtful even the US economy could survive stimulus of that magnitude. And if it can’t, or can’t do it efficiently (a near certainty), that leaves little alternative.
At some point in the continuance of this pandemic, if it doesn’t relent, our “unequal” will have to go back to work.
We have to face the twin dangers of the pandemic. There is no easy solution.
One can only hope that this tragedy is enough to wake up our legislators to the desperate need to begin to restructure our entire economic system to enable real shared prosperity. If not, revolution could be a lot closer than we ever imagined.