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March 27, 2020

Neoliberal economics and health


March 27, 2020

The world is heading towards a double crisis -- the international health crisis and an economic crisis. Both are interlinked and their combination is deadly for human and economic life. One takes human lives and the other takes jobs, incomes and livelihoods. Both hit the poor and working people the hardest.

The WHO and leading public health experts are warning us about a deepening and more widespread international public health crisis. Almost one-third of the world’s population is already under lockdown or near lockdown situations.

The Covid-19 pandemic has severely impacted the daily economic, social, cultural and routine life of people. Fears are growing that America might become the new epicenter of the Covid-19 pandemic as the number of infected patients is rising there.

Fears are also growing because the American health system is not capable of dealing with a pandemic. The US is the only rich country in the world which has no universal health service and system like Britain and France. The private sector cannot provide free health facilities and care to millions of people. One third of the American population has no health insurance to access healthcare. In a case of an epidemic like Covid-19, millions will be left at the mercy of big business.

On the other hand, international capitalist institutions like the WTO and IMF are predicting a much deeper economic crisis in the world economy compared to the world economic crisis of 2008. The impacts of this economic crisis could be much worse than what the world experienced in 2008.

Both crises are a result of the neoliberal economic model and policies. The flawed neoliberal model caused the Great Recession of 2008. But instead of blaming the neoliberal economic model and policies for that crisis, the blame was shifted onto a handful of bankers. The greedy bankers did play their role in the crisis but they were not the only ones responsible for it.

Now once again, attempts are being made to blame the Covid-19 pandemic for another economic crisis. The fact is that Covid-19 just triggered the crisis. The cause is again the neoliberal model and inherent contradictions of the capitalist system.

Why am I blaming the neoliberal economic model and philosophy for a public health crisis caused by a virus? Because there is a direct link between the two. Let me explain:

The crisis in public health systems hasn’t developed overnight. It is the result of decades-old neoliberal policies to make health a commodity to make profits. Under this policy, health services and sectors were opened for big business and private investors. Neoliberal free market policies played an important role in crippling the public health systems.

Neoliberalism has been the dominating economic philosophy in the world for at least three decades. The international capitalist class through their economic arms like the IMF, World Bank and WTO imposed policies of austerity, cuts, outsourcing, privatisation and increased role of big business in public health over the years; this has deteriorated public health systems.

In many countries, conscious efforts were made to reduce the role of the public sector and state in the health sector. Jobs were cut, the number of hospital beds reduced, hospitals privatised and cuts made in health budgets. These policies increased healthcare costs and the cost of medicines. Public investment in infrastructure, equipment, research and development of vaccines, medicines and skills was reduced to let big business and multinationals take advantage of the situation and maximise profits.

Sick pay and other health benefits of working class people were reduced. The current system conceived and organized to make desperate and near desperate workers labour with the minimum of pay and benefits is a public health disaster by design.

The food industry is also contributing to the public health crisis. To maximise profits and to bring down the prices, food companies are producing sub-standard and unhealthy food. An international independent commission should be formed to determine the practices of meat producers and packed food producers. Human health must not be compromised for the interests and profits of big business.

The WHO has declared eight public health emergencies since 1981. From the HIV outbreak in 1981 to Covid-19 in 2019, eight major epidemics have occurred. According to one leading health expert, “since 2009, there have been five declarations of international public health emergencies: the swine flu pandemic in 2009, a polio outbreak in 2014, the Western Africa Ebola outbreak in 2014, the Zika virus outbreak in 2015 and another Ebola outbreak in the Democratic Republic of the Congo in 2019. Between 2011 and 2018, [the] WHO detected 1,483 epidemic events in 172 countries. The Organization qualified them as signs of a new era of high-impact and swiftly spreading epidemics”.

In the last 10 years, one epidemic emerged every two years on average. No alarm bells rang in the world capitals. The big pharma companies are more interested in producing medicines which can make more profits. Big business and big pharmaceutical companies have little or no interest in non-remunerative research on infectious diseases such as Covid-19.

The problem is that the neoliberal model is based on profits, free movement of capital, free trade and deregulated markets. It works well for the capitalist elite but deprives the poor from essential services and utilities.

The writer is a freelance journalist.