Pandemic crisis may trigger societal restructuring

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Photograph: Geralt/Pixabay

Once this crisis is over, the new economy must prioritise people’s and nature’s wellbeing over profit-making for a few, Llim Mah Hui and Michael Heng write.

The Chinese word for crisis consists of two characters – “weiji”. Wei means danger and ji means opportunity. Every crisis is pregnant with danger and risks but also with opportunities – for some to make money, for others to learn valuable lessons, and for society to reorient or restructure its priorities, institutions and even the system.

Major crises are moments when classes in society contest for power to restructure the economy, politics and society. The failure of President Hoover to deal with the devastations of the Great Depression led to the election of President Franklin Roosevelt (1933-38) who introduced major structural reforms in the economic, financial and political spheres.

Roosevelt’s “three Rs” policies were relief, recovery and reforms. He implemented large scale public works to mop unemployment, introduced social security safety net which still exists today, tamed and regulated finance by separating investment banking from commercial banking and set up regulatory watchdogs for the stock market.

The “three Rs” led to the eventual recovery of the economy and most significantly to a well-regulated financial system that did not experience major financial crises for over 40 years. Government took on a bigger role in the economy. Full article on IPS website

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