How money ruins people's lives
money or life
The coronavirus is spreading rapidly, the number of deaths is increasing every day, but there are already demands to return to normal soon. The reason: the economy can no longer be expected to take protective measures for the population. "The cure must not be worse than the disease," said US President Donald Trump. Dan Patrick, Vice Governor of the state of Texas, offers to risk his life and that of others to restart production because he is "unwilling to sacrifice the entire country." In Germany, too, there are warnings that closed shops and production stoppages are ruining the economy: "The stalemate cannot last longer than the summer," says VW board member Jürgen Stackmann, "society and the economy can't stand that."
The demand to lift or weaken protective measures for the benefit of the economy and the stock market is often criticized as inhuman. But it is based on a real contradiction: "We may not want to admit it, but there is a trade-off between the fight against the virus and the destruction of the economy," as US financial journalist Clive Crook puts it. This weighing is now carried out, the pros and cons are discussed. But nobody asks why the decision between survival of people and survival of the economy is so pressing? Of course it is not.
Victim: The fact that the prevailing economic system demands human lives is nothing new in principle. There is good statistical evidence that poverty shortens life. Most of the casualties, however, are usually to be found in poorer regions of the world, for example in Africa. This is mostly blamed on nature: infections, droughts, floods. However, the spread of the coronavirus and climate change show that "natural" events today - unlike 1000 years ago - are very socially determined, both in terms of their causes and their consequences. Nature only poses the problem. How big it is and how many sacrifices it demands depends on the use and distribution of economic resources - that is, on the economic system. The lost years of life cannot be explained by the fact that there are simply too many people. "There are too many infected people, they all die at the same time," said the Spanish doctor Daniel Bernabeu on Thursday, explaining the fact that he currently has to decide who to treat in hospital and who has to die. What he actually means: There is a lack of resources.
Supply: The protective measures against Corona are ruining the economy, it is said. What's the problem? It should be noted that outside of the health sector, there is no shortage of necessary goods. Many factories are shut down and shops are closed. But the production of what is necessary continues. Apartments, electricity, vegetables and even toilet paper are available. There is also no acute shortage of goods that are not currently being produced - there is enough stock of cars and smartphones for the time being. And sometimes you can do without asparagus. Nevertheless, the World Trade Organization (WTO) warns: The destruction of the economy as is currently the case is normally only experienced in wars - only without the rubble. Why is the economy destroyed when people are put on compulsory leave?
Utilization: If the task of companies were simply to produce things that people need, there would be no serious problem at the moment, at least in the rich north. But in the prevailing economic system, companies calculate differently: They invest a sum of money, hire workers, pay them a wage, have goods produced and then sell them. They only give what they produce in exchange for payment, because their ultimate goal is a surplus in the form of money. They then re-invest this increased money. The supply of people with goods and services is made dependent on the success of this operation.
The lockdown interrupts this process. Result: companies cannot produce, cannot sell, they lose revenue. They therefore do not buy any means of production and cut jobs. This in turn means that employees and other companies lose income. The economic agents feel this individually as a progressive or impending lack of money: They cannot pay.
The problem can be illustrated using the example of Apple. The US company lives from regularly bringing a new iPhone onto the market every year. But production is currently at a standstill, the delivery of the new 5G Iphone will probably be delayed by a few months. In principle, that would not be a problem for consumers, there is no shortage of smartphones. However, due to Apple's production stop, orders to suppliers over $ 260 billion are on hold. That can ruin the suppliers, and in the long run also Apple and all employees attached to them. Because the capital does not realize itself and is thereby destroyed.
Growth: According to calculations by the Munich Ifo Institute, a lockdown can cost the German economy between 255 and 500 billion euros. "Cost" here does not mean that money has to be paid that is missing. Rather, according to Ifo, the costs are incurred in “lost added value”, that is, in the fact that new production and sales are not constantly being made and capital is thus utilized. Similarly in China: The "destruction" of the economy results from the fact that, according to China's statistical office, companies made 38 percent less profit in the months of January / February than in the same period of the previous year. That is what "the economy cannot stand".
Capitalism is not what economics say of it: a work-sharing relationship to the production and distribution of goods. If it was just that, the economy could take a few weeks off. But the prevailing economic system depends on buying, producing and selling at a profit without interruption. Over the past 20 years, the return on productive capital has remained relatively stable at six percent, so the money invested has increased by six percent every year. The supply of people is made dependent on this growth - if it fails to do so, hardship and misery ensue.
Politics: Virus and lock-down are now interrupting payment chains and thus growth, and are pushing the system to the brink of collapse. In politics, this does not lead to criticism of the system of production and distribution. Instead, she takes it for granted and sets out to maintain it. With credit. The G20 states have announced government aid of over 5,000 billion dollars to compensate for the defaults in the private sector. They take on a large part of it as debt. Their central banks are now running unlimited bond purchase programs to ensure that interest rates stay low and that governments do not go bankrupt.
The governments distribute the borrowed money to employees, self-employed, companies and banks and thus maintain the capitalist cycle - against the logic of the system, which would actually result in a general collapse. The states prevent this collapse with the help of new debts and fake a halfway functioning business life: the public sector becomes the lender, investor and cost bearer of last resort. You can also put it this way: The states do not socialize production and distribution, they leave them in private hands and instead socialize the debts with which they keep the private sector afloat.
With their new trillion debts, states are paying the price for maintaining the system of private production for profit even when it no longer works. However, your debts will eventually fall due. The logic of capital calls for accounting. It is therefore logical that politicians, economists and managers call for an end to the production stop as soon as possible, even if this endangers people. And it is also logical that this demand should come up first in the USA, where people are more exposed to fluctuations in the market economy due to poor social security.
Whenever the economy is up and running again, one thing is certain: the world's debt will be gigantically inflated. Part of the national debt will be on the balance sheets of the central banks, so the government will have it with itself. The other part will exist as global financial assets - in the form of government bonds - in the hands of private investors. The latter should not be forgotten when the question is ultimately asked: Who pays?
nd journalism from the left thrives on the commitment of its readers
In view of the experience of the corona pandemic, we have decided to make our journalism permanently freely accessible on our website and thus make it available to everyone who is interested.
As with our print and epaper editions, our work as an author, editor, technician or publishing employee is part of every published article. It is what makes this journalism possible.
Volunteer now with just a few clicks!
- What is sex like after a vasectomy
- What do intelligent people think of themselves
- What's your sad family story
- What are the top film production companies
- Will artificial intelligence and automation end racism?
- How long do DNA samples last 1
- Mixing Xanax and Adderall is dangerous
- What is human consciousness made of?
- Which language has the shortest longest word
- Can we trust personnel consultancies
- What was the bloodiest battle in World War II
- Why do cities forbid electric scooters
- How do I get started with cold emailing?
- Chinese food is very popular in Japan
- Tiberius was a successful leader
- Would you help a homeless stranger
- How does alcohol sterilize?
- Which app is best for uploading podcasts
- What is the longest hike on Maui
- What Are Some Good Post Apocalyptic Movies
- What two breeds of dogs make a Boingle
- I am a natural writer
- What is a crater
- Are you satisfied with your own passion