Will austerity politics be the next crisis?

By Lila Sax dos Santos Gomes

The pandemic is over. At least for most of the countries in the European Union. Despite some of the highest number of infections since the beginning of the COVID-19 pandemic, the number of hospitalizations has rapidly decreased, offering no legal grounds to continue with mask mandates and compulsory home office. With the temperature rising and the daytime hours increasing people want to spend more time together anyway, so the pressure to return to “normal life” is high. And so as of May 1st Germany, as one of the last European Countries still implementing COVID-19 restrictions, will get rid of  most of them. 

But even if the pandemic subsides, at least until next autumn, a different kid of crisis is on the horizon. How will governments face the mountain of debt accrued during the pandemic? Will they continue to offer support to recover from the crisis or will the fear of becoming over-indebted steer them towards austerity politics? And what effect will this have on those who have been hardest hit by the pandemic?

For centuries, austerity politics has been seen as a way of recovering from crises. Austerity politics essentially means the reduction of public services, less investment in social protection and a rollback of government support. After the global financial crisis of 2008-09 the banks were bailed out by tax dollars, followed by years of cuts in public spending in an effort to reduce government debt.  These measures took a toll on women and marginalized groups. It has been estimated that between 2008 and 2018 austerity policies will have cost women €94bn since 2010, against €15.5bnbn for men.

Women and vulnerable groups are impacted by austerity politics in a multitude of ways Cuts to public services such as education, childcare and social services hit women threefold.  These services generally assist women in improving their economic and societal position, because women end up taking on any additional care work resulting from these cuts and because women make up a large proportion of the (often underpaid and overworked) workers in these sectors.  The COVID-19 pandemic has been referred to as a “shecession” due to the disproportional loss of jobs and income experienced by women. Women in informal or temporary work, already subjected to difficult and precarious working conditions, are often the first to lose out when businesses close or cut staff. Health systems are often hard hit, and access to fundamental health services is reduced or restricted. 

The decision to reduce funding of public services, in health for example, is fueled by a neoliberal ideology that the free market will resolve access to public services, such as health care, rather than the norm that access being a fundamental right that should be protected by governments. Individuals are seen as being responsible for their own health and well-being; State-funded programs are considered an “extra” resource  to be done away with in times of crisis. This ideology fails to recognize that inequality, discrimination and poverty themselves fuel ill health, exacerbating the vicious cycle through which ill health is increased by poverty and poverty, in turn, traps individuals and communities in ill health. It is exactly in times of crisis that even more attention should be paid to the distribution of resources, making sure that those most affected by the current crisis – be it a global health crisis like the COVID-19 pandemic or the ongoing climate crisis – are targeted by support systems run by governments. 

The failure to recognize this can be seen in the unequal distribution of resources, for example in the economic support programs for example in Germany during the COVID-19 pandemic. Although the government offered a series of economic support programs, a recent study by the Hans Böckler Stiftung showed that the gap between high and low incomes in Germany will continue to grow due to the corona pandemic. So far in the course of the crisis, people with already low incomes have been affected almost twice as often as people with high incomes.

Economic recovery policies must focus on redistributing funds to balance and restore unequal distribution of resources in society. Not only for economic reasons, but also to protect their own legitimacy and maintain democratic principles. In general, the growing division between those “who have” and those who don’t is one of the biggest dangers for modern democracies. When people can’t access health care, when they can’t afford to heat their apartments despite having worked their whole lives and when public services are understaffed and inefficient, they lose faith in the elected representatives. People are then more vulnerable to right wing populist ideas or turn their back completely on the idea of a representative democracy. Brexit, Trump, Le Pen, all of these decisions were not only made by those who voted, but also by those who didn’t. 

In the end, if governments choose austerity politics rather than a redistribution of resources, it will not only continue to disadvantage women and those who have already been most harmed by the pandemic, but it will harm our democracies as a whole.

Cover Image: Almost 100,000 people marched to the Minnesota capitol on January 21st, 2017 to protest Republican President Donald Trump, whose rollback of social services severely impacted communities of color and women. Credit: Fibonacci Blue

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