Like it or not, right now the state is the dominant actor. The influence of the state on the market must go hand in hand with an increased influence of citizens on the state too.
Hundreds of billions of euros of public money is reserved to be pumped in the private sector and economy in the following 2-3 years. Last time this happened in 2008, it was followed by a terrible austerity across the continent, and led us to further inequality, bleeding out the social and health services and created the rise of divisive identity politics. We were just getting back on our feet, when the pandemic hit. In the midst of the climate emergency, this amount of money released to shape the market can be a blessing. But only, if it is used to reshape the economy and lead us on the path of green and just transition.
The pandemic and its impact on society showed us crystal clear what is the most important, essential and core of all economic activities. We clapped for health workers, begged for schools to reopen, and queued up for social support to weather the turbulent times and make ends meet in our families and businesses. It was public services, and public money that mattered. And whilst we had to be isolated at unprecedented levels, we also experienced our interdependence on one another. Will these services get priority when the nearly 700 billion euros are allocated?
With this amount of money, the Eu can finally set on a completely new course, and achieve, what many have been calling for: a systemic change. The European Environmental Agency´s latest report urges for that:
Europe will not achieve its sustainability vision of ‘living well within the limits of the planet’ by continuing to promote economic growth and seeking to manage the environmental and social impacts.Europe’s state of the environment 2020: change of direction urgently needed to face climate change challenges, reverse degradation and ensure future prosperity
The EU now can make member states, public institutions, civil society and businesses concentrate on caring services and reimagine the European welfare model, from community through municipality to state level, and beyond. The new welfare model, built on interdependence among humans and also between humans and the environment, should become a contemporary caring model for Europe, which would – as outlined by the Care Collective – finally incorporate the ecological challenges citizens already face in the heating climate – as argued for by Eloi Laurent – and get rid of the racist, hierarchical and sexist practices that are present in the current one.
Hand in hand with the process of reviewing the economic governance of the Union, we can end the era when the GDP and economic growth are the sole measure of development, that keeps pushing us into austerity and devalues wellbeing and human life when the economy is in trouble.
With the help of the recovery and resilience facility, the EU can encourage the relocation of many of the essential production to the continent, to create jobs, cut emissions and end exploitation abroad. President van der Leyen, has been using expressions that compare her Commission’s European Green Deal to Kennedy´s Man on the Moon mission. It is a helpful comparison, because that mission was a cross-societal effort, and not only a deal between the political and the business elite, as the European Green Deal is currently looking like. As Mariana Mazzucato said, we more or less know what is meant by the Green but have no idea yet, what is the Deal? The EU and its member states must recognize the efforts and added value of the not for profit sector in the recovery and the green and just transition towards resilience. As a basic guarantee, it must have a renewed and up to date social contract between workers, employers and the state.
The influence of the state on the market is massively growing, and the concentration of capital is inevitable as a result of this process This trend must go hand in hand with an increased influence of citizens and communities on the state too. The sharp decrease in trust levels after the spring wave showed by the latest Edelman Barometer shows that trust in public institutions, and especially governments is critically low right now.
The projects that are funded from recovery money, should take priority for public-commons partnerships, as opposed to the failed model of public-private ones. Care, compassion and community should always overrule the market-mediated forces of individualised self interest. As a result of the recovery and resilience facility public ownership should grow in state funded innovation and research, in the field of technology, pharmaceuticals and other sectors.
Like it or not, the state is now the main actor, and it has the power of a systemic level change. The crucial question is, whom will it make a deal with and on what. The corona crash will create more concentration of power and wealth and it will bring the market and the state closer to one another. But, will the state finally set the course of the green and just transition, or will we, as Grace Blakeley put it in her new book ´Corona Crash´: `watch as democracy is finally consumed by capitalism?`