How not to let another crisis go to waste Published in "Global Policy Journal", May 2021

Global Policy Journal, May 12, 2021

“Never let a good crisis go to waste,” goes a common policy maxim. It is the rallying cry of leaders pursuing bold agendas for shaping a more prosperous, sustainable and inclusive post-COVID era, from the UN’s call to build back better, to the European Commission’s new long-term strategy to “prepare for the next generation”.

The bold agendas bear some resemblance to those after the global financial crisis, when leaders pinpointed a “new normal” that required a comprehensive reset of policies and practices. The “old normal”, however, turned out to be stickier than expected, propelling the planet closer to a climate collapse, inequality to record heights, and globalization into retreat. As Mariana Mazzucato has put it, the policies rolled out in response to the financial crisis left us just as broken, unequal, and carbon intensive as before. What must happen so that in ten years we don’t look back at yet another crisis opportunity having “gone to waste”?

Many would point to the Sustainable Development Goals and to the Paris Agreement, the world’s common denominator on how to thrive within planetary boundaries. But perhaps another starting point should be a careful look at the promise and pitfalls of the idea itself, the claim that crises are now or never moments to enact ambitious policy agendas.

Never waste a good crisis

While attributed to various modern-day politicians, from the UK Prime Minister Winston Churchill at the peak of WWII to then Whitehouse Chief of Staff Rahm Emanuel at the peak of the financial crisis, the carpe crisis motto dates back even longer, to the Renaissance philosopher Niccolò Machiavelli to whom every crisis was an opportunity for change – though his understanding of that term had little to do with its meaning today. In his tumultuous age, seizing a crisis opportunity primarily meant the opportunistic assertion of force.

And indeed, to most ordinary people the COVID crisis is simply that: not an opportunity but a threat to their physical health, civic rights, and way of life. Research shows that these fears should be taken seriously. On top of millions of lives lost and hundreds of millions of jobs destroyed, Freedom House found that in the pandemic the condition of democracy and human rights worsened in 80 countries where governments reacted “by engaging in abuses of power, silencing their critics, and weakening or shuttering important institutions, often undermining the very systems of accountability needed to protect public health”.

Corporate and financial elites, perceived as insulated from or even winners of the crisis, are subject to similar concerns. As Oxfam pointed out in a recent report, the world’s wealthiest long re­covered from the economic ripple effects of the pandemic whilst the poor and vulnerable will need a decade to recover. The unbalanced recovery not only deepens distrust, it also boosts populist allegations of crises not just being a necessary evil but a perfidious tool of capitalist rule to advance agendas that further deepen injustice and inequality.

Of course, reality is more complex. COVID may have stacked the cards in favour of the powerful in some places but changed fortunes in others. While populists like Jair Bolsonaro in Brazil or Manuel López Obrador in Mexico consolidated their grip on power, Donald Trump’s fall from grace is much associated with his ill-handling of the crisis. And, while in the business world digital behemoths like Amazon and Google vastly expanded their influence, it was not “big pharma” but small upshots like Moderna and BioNTech whose technologies produced life-saving vaccines in record time, and who are now likely to change the industry for years.

Plasticity versus paralysis

There is no one-size-fits-all narrative about how power performed in the pandemic. And yet, there is a disquieting red thread. The Edelman Trust Barometer, a comprehensive global trust survey, shows that trust in government is on the backfoot in democracies and autocracies alike. And, while people trust business overall, their CEOs, many rewarded in the crisis with big bonuses, are less trusted, too. At the far ends of the political spectrum, the retreat of trust produced wild conspiracy theories that are spreading like wildfires in the digital echo-chambers of the social web.

The growing trust deficit reflects an important yet poorly understood paradox, a tension between what could be described as the plasticity- and paralysis-effects of a crisis. The plasticity effect points to the catalytic power of a crisis: an insight or idea alone is rarely transformative unless an external shock is lending it a hand by disrupting structures of interest and power that were perpetuating the old. The paralysis-effect describes the opposite capacity of a crisis to hold actors back. It is likely to grow in significance when a crisis severely capsizes the infrastructure and resources of an economy, when the crisis response is creating anger and dissent in the population, or when the crisis puts the competence of leaders into doubt.

Many leaders around the world have emphasised the plasticity effect of the pandemic, its role as a potential accelerator of necessary and inevitable transformations. But on balance, most economies are struggling with the paralysis-effect and, despite its boost to digitization, a net-positive impact on scienceproductivity and cooperation is uncertain at best. Hopes for the pandemic’s plasticity-effect to change the game on other global issues such as climate or biodiversity loss might consequently be overblown. Unless leaders carefully address the conflicting political dynamics inside a crisis, they will not only “waste the opportunities offered by a good crisis” but even jeopardize the small window of opportunity they had by causing anger and resentment.

Reward the “maintainers”

First, society must recognize and reward the colossal work of care and repair. Millions of people are busy healing the wounds the crisis has inflicted on society. Simply claiming that “there is no return to normalcy” because “normal is broken” disregards what the majority of people do every day. And yet, such declarations are commonplace as “disruption” is the ideology of our time. What happens later, the mundane labour of care and repair, is getting less attention, let alone respect and appreciation, despite its massive impact on people’s lives and livelihoods.

To be clear, with two of the past five years having been the hottest ever, with global temperatures way above pre-industrial levels, floods affecting millions in South and East Asia, and unprecedented wildfires raging across entire regions and continents, there is no doubt that fixing the fractures and repairing the ruptures is not enough. We must do better.

And yet, it would be foolish to think that what is no longer sufficient is no longer essential. The vast majority of humanity’s doing is about keeping its ordinary existence working rather than inventing new things; and every time we invent new things, we inadvertently also invent new ways for these things to break, which means we also need to invent new forms of care and repair. Without paying attention to maintenance, “disruption” is dangerous.

Nothing makes this point as clear as a pandemic. When last spring millions stepped on their balcony to support health and other frontline workers, it marked a rare moment of gratitude for members of society who are taken for granted at best or even treated as “problems to solve” at worst. But as the pandemic lingered on, balconies emptied, and millions of these workers continued often exhausted, underprotected, and struggling to make ends meet.

No doubt, we have to build back better, but it can’t be achieved whilst turning our backs on those who keep our ordinary life going. The crisis recategorized many “maintenance” jobs as essential but that hasn’t translated into better conditions for caregivers, cashiers, or delivery drivers. Irrespective of a heightened awareness for this work, the gap between employees spoiled in the fancy offices of the digital economy and those toiling in its fulfilment centres is growing.

Recognize dissenting voices

Second, as societies move from intensive care to rehabilitation, from response to reconstruction, politics must return from top-down to bottom-up legitimacy; “top-down” means that those who are vested with executive power should decide because of their higher competences, whereas “bottom-up” presupposes that people should shape their own destiny.

It is common to frame the choice between both as an ideological decision when in fact it should be a situational one. Even the most freedom-loving person would approve of their car launching its airbag without prior consent before it smashes into a tree. The “emergency brakes” many governments put in place to battle COVID are defensible on this ground. Yet, in the vast majority of cases it takes both expertise and popular consent to arrive at a legitimate decision. Expertise generates truth, and voice generates trust. Both need one another. As Minouche Shafik argues, problem amount “when experts try to be politicians or politicians try to be experts”.

The rise of populism in the aftermath of the global financial crisis presents a cautious tale of what happens when this boundary is poorly managed. Despite an economic recovery on its way, leaders around the world suddenly found themselves grappling with political movements which, although oftentimes mimicking fascist language, defied old categorizations of left and right. They marked a novel axis of opposition politics between technocrats and populists, between old parties which to many stood for callous politics with no true alternatives, and new movements which promised an “exit option” from the system at large.

The rift that opened at the national level turned international institutions into targets, too. In his last book Ruling the Void, the political scientist Peter Mair described the European Union as a house built by politicians without any room for politics, while at the national level, leaders happily pretended to merely be a branch of Brussels. The same, argues the historian Quinn Slobodian, holds true for other international institutions of the post-WWII order which, he claimed, primarily emerged to shield the “global economy” from the vagaries of representative democracy.

Mair worried at the time that, although the worst of the economic crisis was over, the political crisis was just beginning. Brexit and Trump would prove him right. Today, the rise of new movements like “Qanon” in the US or Germany’s “Querdenker” may be the beginning of another anti-establishment wave. Parties then and now responded with the reflex of calling for a united front of the reasonable against the irrational. What backfired then may do so again as leaders risk pouring oil into the flames of extremist, anti-elitist or anti-science movements. As societies move from responding to rebuilding, the “reasonable” must again emerge from the bottom up, in open and informed dialogues. The price of populism is huge, from slow growth to decaying institutions to international tensions. To diminish its noise, people must be given more voice.

Maybe the opportunities emerging from the last great crisis were missed because leaders did not take the issues seriously, lacked the political will, or the technological might. Mostly though it went to waste because leaders around the world failed to prevent an economic crisis from turning into a crisis of trust in national and global leadership.

The comprehensive stimulus packages and welfare programs launched by governments around the world suggest that policymakers learned that lesson. No country can shape the future without first addressing the pandemic and its consequences. And, as advanced economies slowly move towards recovery, the next leadership lesson should be not to conceive of the continuing crisis in the world’s poorest countries as someone else’s problem.

However, resolute measures to control the virus coupled with fiscal stimulus packages at home and generous aid and relief programmes abroad won’t suffice. Only when we recognize and reward the essential work of keeping societies afloat and listen and respond to the voices of many, will leaders earn the trust to do what they must: to build back better.