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Normal Was Killing Us

April 23rd, 2020

The first crisis point of the COVID-19 disaster was figuring out how to respond, after being caught flat-footed, to the immediate health threat. Now that the death curve in many places has begun to flatten and the scope of economic disaster is hitting home, we are approaching crisis point two, which is all about how we move toward “reopening” the economy.

In the next weeks, as the economic pain and fear increases, the clamor to “get back to normal” is going to ramp up. Some politicians, sensing political opportunity, are already stoking that foment. The outcry for normalcy will certainly gain momentum.

The point that must be recognized and discussed, that begs our attention, is the fact that “normal” was killing us.

Most of our politicians and the for-profit media portray the economic disaster we are currently facing as strictly Covid-caused. It’s not. For many, many Americans the “normal” economy was already broken long before the first patients fell ill.   C-19 is merely revealing fundamental flaws in societal and economic norms that have been eroding upward mobility, impoverishing entire communities and devastating the environment.

Before the onset of the pandemic more than fifty percent of all Americans were living paycheck to paycheck with little or no savings.  In other words more than half of us were already living below or near the poverty line – half! Most at that marginal level were working long hours and multiple jobs just to pay monthly expenses, stay slightly above water and do their part to keep the economy growing. You could certainly make the argument the economy wasn’t really working for them; rather they were working their hearts out to feed the status quo economy.

At the same time, Income inequality in the U.S. was off the charts. Over the past fifty years, the highest earning twenty percent of households have steadily brought in a greater portion of overall income in the country. In 2018, the top twenty percent captured more than half of all income in the country. Income inequality in the U.S. is higher than any other G-7 country including the UK, Japan, Italy, Canada, Germany and France. Now more than ever before achieving the American Dream depends upon your zip code. Due to imbedded biases toward the wealthy and privileged, “upward mobility” in this country is constrained, as never before, by income, race, and where we currently live. We have accepted as normal a Robin Hood society, in which wealth is systematically distributed upward from the poor to the rich.

Meanwhile, this same economic system that was failing millions of Americans, relied upon chewing up natural resources and ecosystems at a relentless, rapacious pace. The large-scale sacrifice of environmental health for economic growth was also accepted as normal. It should serve as a stunning existential wake-up call that the only real winner in the COVID-19 crisis at this point is the planet. Air pollution is down; climate change emissions have dropped precipitously; water pollution is down. Even wildlife trafficking and consumption is down. All of this is happening because we’ve been forced to push pause on an economic system that is fundamentally unsustainable in that it grows by destroying natural systems and our planetary life support structures.

Here’s yet another aspect of normal that should give us serious pause. COVID-19 shows that our status quo economic system is devastatingly fragile. For the massive numbers of people at or near the poverty line loss of a job means immediate crisis. The public support programs being pushed out now, while essential, are adding to a level of national debt already unprecedented and which we have no real idea how to deal with. In fact, the bulk of economic growth over the past couple of decades has largely been debt driven, and that was viewed as normal. Add to this, the U.S. pharmaceutical industry stopped manufacturing antibiotics because they don’t turn as much profit as other, less universally necessary drugs; we now get 97 of our antibiotics from China. Meanwhile Big Pharma, artificially hikes rates of certain life-saving drugs and, like big Oil, gobbles up millions in federal subsidies each year. Our seemingly robust U.S. economy was a house made of cards and COVID-19 blew in a mighty wind. It was a stress test for our current economic system and the system failed; this economy of, by and for the ultra-wealthy was eviscerated by a virus.

In a powerful cautionary tale, remember that after the great recession of 2008, for the most part, we did just go back to normal; we got the economic engine churning again and through hard labor, escalating environmental destruction, propping up Wall Street and the finance industry, blowing open oil and gas drilling, and mushrooming the chasm between the ultra-wealthy and all the rest of us. And, well, that led us to where we are today.

Just because a thing is normal doesn’t mean it’s good.

We have before us a decision of epic magnitude. We can let the discomfort and fear overwhelm us and put all of our energy into getting things back to the way they were, or, we can take a stand for creating a new normal. This is the biggest challenge and opportunity of our era.

Right now, as we are still, mostly, in this abnormal space of relative stillness, with life-as-we-have-known-it on pause, is the perfect time to ask what would we like “normal” to look like?

  • What kind of work would we like to do?
  • How much would we like to work?
  • Do we really need to drive to work everyday?
  • What kind of businesses would we like to see in our community?
  • How and how much would we like to travel?
  • Are we really OK with so much wealth in the hands of so few?
  • Are we really OK with the ecological destruction that has been normalized?
  • What actually makes us happy?

It is so critically important to remember the economy is not an act of God or a force of Nature. It is a human-made construct. We invented it and groom and redirect it all the time. That means we can reinvent it, now.

Let’s not waste this crisis. Let’s not let all the lives and livelihoods lost just be collateral damage of a broken system but rather the impetus to create anew a world that works better for all of us.

We need a new normal and there has never been a better chance to create one.

 

Posted by Cylvia Hayes at 11:07 am

Stimulus for a Saner Economy

March 24th, 2020
Consider that the Chinese symbol for “crisis” is comprised of two words, one meaning danger and one meaning opportunity.

I have worked for twenty-five years as a sustainable economy strategist, trying to raise awareness about the need to shift to a saner economic system. With the COVID-19 crisis it is time to get very serious about not just bailing out the current economy but harnessing this upheaval to fundamentally redesign an economic system that is currently destroying the planet and failing millions, even billions of people.

Here are some components of redesign we should be considering right now. Warning these ideas are not for those with hidebound thinking who can’t see past status quo.

First, individuals and families need immediate assistance. Send the first round of checks immediately but don’t stop there. This is a time to get serious about considering a Guaranteed Basic Income (GBI) program. Basic Income is a regular monthly payment from the government to every citizen to meet basic survival needs. The goal is to stabilize people financially and, over time, downsize the many, many stop-gap poverty relief programs currently in place for people in lower income brackets.

Guaranteed Basic Income is not a brand new idea nor is it completely untested. In 1967, Martin Luther King Jr. urged that a guaranteed income would abolish poverty and reduce skyrocketing income inequality (which is higher now that when King was alive by the way).

In 2018, Facebook co-founder Chris Hughes argued that U.S. workers, students, and caregivers making $50,000 or less a year should receive a guaranteed income of $500 a month. Mark Zuckerberg and Bill Gates agree, arguing that automation has fundamentally changed the structure of the U.S. economy. Sir Richard Branson and Elon Musk are also on record saying automation, Artificial Intelligence and robotics have so changed the workforce situation that a Guaranteed Basic Income is the only solution.

The State of Florida has implemented a GBI since 1982. Canada, Finland and Kenya are running GBI pilot programs. Several U.S. cities are developing GBI type programs.

When I was serving as First Lady of Oregon, heading the Oregon Prosperity Initiative, we ran some numbers on the possibility of some form of statewide Basic Income and found that it was cost competitive with the many poverty relief programs already in place in the state. If ever there was a time for such innovation that time is now.

Here is an article with more detailed information on the GBI.

The second key piece of upcoming stimulus packages needs to be an extreme focus on Main Street not Wall Street. The Trump Administration is pushing for the bail out of airlines, cruise ship lines, casinos and even big oil. Come on people! Do we really need fossil fuel powered mega cruise ships and casinos in our world right now?!

The airline industry is a particularly interesting case. Unlike cruise ship companies, airlines do provide some essential services to society and commerce. However, bear in mind, according to The Guardian, over the past five years, the major airlines spent $45 billion in payouts and bonuses to CEOs and shareholders! Reports show that the four big ones – Delta, Southwest, American Airlines Group, and United Airlines Holdings — together bought back $39 billion worth of their own stock over the past five years, much of it since passage of massive corporate tax cuts in 2017 pushed through by Trump and Republicans. Any assistance given the airline industry must be in the form of loans, with aggressive claw back measures and must forbid payouts of executive bonuses, pay raises or stock purchases. The investment needs to rescue workers who have been laid off not fat cat CEOs. One would think this would be obvious but lobbyists are fighting hard right now to get a stimulus package that would allow these greedy, gauging measures.

Instead of propping up megalithic, and in many cases, superfluous industries, we need to focus on small and mid-size businesses and the creation of aggressive retraining programs to help people currently employed in non-essential, environmentally destructive industries transition into more societally beneficial sectors.

It is the local, communal business structures that should be the focus of stimulus efforts. Local stores and restaurants are a source of jobs and critical threads in the fabric of society. They connect us to people like and unlike ourselves. They provide a sense of communal identity and connectivity.

Our nation is already sitting with an unprecedented amount of debt due in part to corporate bailouts and tax cuts for the wealthy. That debt is going to truly become atmospheric with the current COVID-19 crisis. What we need is not just stimulus for business as usual but as stimulus to a saner economy and way of living and doing business.   We can’t just throw money at old status quo industries and measures that are digging us further into the hole. A Guaranteed Basic Income and an intense program of support for small and mid-size businesses provides bottom up versus trickle down support.

The coronavirus pandemic is a force of Nature; the economy is not! The economy is human construct. We invented it and we change and shape and tweak it all the time. We created it, which means we can recreate it. This is the time to do exactly that.

Here’s to harnessing opportunity while navigating the danger.

Cylvia

Posted by Cylvia Hayes at 10:46 am