Hidayat Greenfield, IUF Asia/Pacific Regional Secretary

There can be no doubt that the COVID-19 pandemic and the prolonged crisis we face for the next decade exposes the vulnerability and weaknesses of the prevailing political and economic system.[1] It also exposes how our values have been displaced: individualism over collectivism; economic growth over social justice; consumption over environment. But in most cases, it simply means there are no values at all.[2] Over the last 45 years the fundamental tenets of neoliberalism have gone from anti-establishment ideas and ‘radical’ policy to become the everyday logic within which virtually everything is decided.[3]

In 2020 we saw so clearly how neoliberalism created the vulnerabilities that allowed a zoonotic disease to become the worst global health crisis in 100 years and the most severe economic decline since the 1930s. Yet in 2021 we see international and national policies on health and recovery still operating within the iron cage of neoliberalism. We cannot save lives and livelihoods unless it is profitable. We cannot provide health care and social protection unless it is a commodity. The universal human rights to food and nutrition, housing, health care and education exist only as an individual right to participate in the market – to buy these as commodities. It is a product in the economy, not a service to society.

Even what appears as public and free now (COVID-19 vaccines) is simply an instalment plan. The costs are added to the national debt to be paid by future generations.

In the OECD countries, governments borrowed USD 18 trillion from financial markets in 2020 in response to the COVID-19 pandemic. This is a 61% (USD 6.8 trillion) increase over 2019. It is the highest single increase in government borrowing in history. In 2021, this government borrowing will reach USD 19 trillion. [4] However, 25% of the money borrowed in 2020 will mature before the end of 2021, requiring even more borrowing. With an average term to maturity of 7.7 years, the rest will be repayable just as we are trying to come out of the 10-year global recession.

Combining this government debt with private sector debt, the pandemic response in 2020 led to increased borrowing of USD 24 trillion, with total global debt now at USD 281 trillion. This 355% more than the total dollar value of all goods and services created (i.e., the total sum of global GDP).[5] This is not an argument against public spending in a time of crisis, but the basis for concern about the debt cycle and more structural adjustment in future. We should also expect another financial crisis in Europe and Asia-Pacific, including the impending banking and mortgage crisis in China.

The repeated cycle of debt, crisis and structural adjustment is already familiar for less developed countries. This occurred in the context of a massive shift in wealth from South to North – from developing to developed countries. A new study quantifies this shift in wealth at USD 62 trillion from 1960 to 2018. If lost growth is included, the amount is USD 152 trillion.[6] The biggest shift in wealth occurred during structural adjustment under the neoliberal policies of the IMF and World Bank in the 1980s and 1990s.

The same structural adjustment forced the privatization and commercialization of hospitals and health care, water, everything. Now these countries are also borrowing to finance health care and to order patented vaccines.

The pharmaceutical companies praised for their COVID-19 vaccines are today fighting against moves by governments the remove of patent protection and allow the generic, mass production of vaccines. These vaccines are a commodity to be sold for profit, not a public good. Governments can buy them and make them available to citizens for free. But they cannot manufacture them to make them freely available to all.

So today we are not seeing a restoration of public health care and public services through government spending after 20 years of privatization and commercialization. We are seeing the costs nationalized spread out over the next 20 years of debt repayment. The financial markets are cashing in on human suffering on a massive scale.

The UNCTAD Trade and Development 2020 report warns that if we maintain austerity policies (meaning the neoliberal policies that do not allow public spending on social protection and public goods and services), then we face “a lost decade” from now until 2030. Increased global unemployment, reduced social spending and social protection, and declining real wages risks “… a transfer of income from workers to profit earners of approximately USD 40 trillion by 2030”.[7]

Preventing such a massive transfer of income from workers to profit earners is surely our most important political task, alongside tackling climate change and preventing the next pandemic.

To stop this massive shift in income from workers to profit earners, we need to restore public goods and services; increase social protection and increase government spending and public investment, including in the IUF sectors. To do this governments need to cancel national debt and restore the tax base. At a minimum this requires and end to tax havens and tax holidays, restoring corporate taxes, and re-introducing a capital gains tax and regulatory instruments such as the Tobin tax.[8]

A significant part of this public spending and investment must be used to tackle climate change and biodiversity loss. This can be done in the context of addressing the disease drivers (which includes unsustainable agriculture and food systems). We could develop organizing and collective action on both climate and biodiversity and preventing the next pandemic. This is the COVID-19 era in which the next pandemic is already taking shape. Nothing has been done yet to tackle the human-mediated disease drivers that will cause the next pandemic.[9] So it is not a matter of if, but when.


[1] Reasserting collective rights and taking collective social action in the COVID-19 era – IUF Asia/Pacific (iufap.blog) 27 August 2020, vulnerability, insecurity and the future of work – IUF Asia/Pacific (iufap.blog) 16 October 2020.

[2] As Dee Hock, former chief of the Visa bank-card operation, observed: ”It’s not that people value money more but that they value everything else so much less – not that they are more greedy but that they have no other values to keep greed in check. They don’t know what else to value.” Quoted in “The money society”, Fortune, July 6, 1987.

[3] In turning the academic ideas of Friedrich Hayek and Milton Friedman into a political program, Thatcher and Reagan were considered radicals within their respective political parties. Now it is mainstream thinking today, even within the social democratic and labour left.

[4] OECD, Sovereign Borrowing Outlook for OECD Countries 2021, OECD, 2021.

[5] Institute of International Finance, Global Debt Monitor COVID Drives Debt Surge—Stabilization Ahead, 27 February 2021.

[6] Hickel, J., Sullivan, D., Zoomkawala, H., “Plunder in the post-colonial era: Quantifying drain from the global South through unequal exchange, 1960-2018”, New Political Economy, 30 March 2021.

[7] UNCTAD, Trade and Development Report 2020: From Global Pandemic to Prosperity for All – Avoiding Another Lost Decade, UNCTAD, 2020

[8] UNEP, Preventing the Next Pandemic – Zoonotic diseases and how to break the chain of transmission, UNEP, July 2020. The seven human-mediated factors identified as “disease drivers” are related directly and indirectly to activities in the IUF sectors: 1) increasing human demand for animal protein; 2) unsustainable agricultural intensification; 3) increased use and exploitation of wildlife; 4) unsustainable utilization of natural resources accelerated by urbanization, land use change and extractive industries; 5) increased travel and transportation; 6) changes in food supply; 7) climate change.