Day 55: Articulating the new state

18/05/2020

Lockdown Day 55

I heard Jan Breman in conversation with other researchers (Ravi Srivastava, Atul Sood, Renana Jhabvala) on the labour and economic trajectory that India has taken with its economic package announcement. This triggered some thoughts. But first, let me quote Breman verbatim, from the webinar today – 

In imagining the state, in the reform package the principles are set out. The reform package will be on self reliance, It will be on privatisation and it will be on small government. These are tenets of neoliberalism .That is the direction the current state wants to move ahead.

Crisis such as the pandemic is a good time to test theories that have held sway in the past. The pandemic has turned most countries into a welfare state in a single stroke. It is neither a product of historical accretion nor a political compromise, in its current form. One could argue that Robert Goodin was theorising the state in normal times and with data on its behaviour over normal years. 

What is the current form and function of the state? This question should now be asked because literally every country in the world has fallen back to its governments to respond to the crisis. In fact, it is seen as extraordinary if the head of states have not led the action. Brazil’s President is reported to have said ‘So What?’ What Should I do?’. The ripples of it went far and wide, within Brazil and outside it. This is the current state of the world – everyone has cowered behind the government’s shoulders. Does this indicate that a revision of theories of state and welfare state in particular, must be revised? 

Social assistance has been regarded as a key feature of the welfare state. The economic packages declared by major countries, which are regarded as liberal, capitalist economies, have all included social assistance as a part of the package. This change took less than a few weeks of spread of a life threatening virus which continued to claim thousands of lives and literally suspended the economy into a pause.

The next question is, if this social assistance is here to stay long term. One way to think of it is that a start has been made in states which were weak on social assistance. It should only strengthen from here. In the progression of the state, this is a good start. Privatisation in an economy is seen as further strengthening of neoliberal, capitalists state. The concern seems genuine. However, does it remain a true capitalist state if the state gets to define what strategic sectors are and what would be the limits of operation of capitalist enterprise? What we are likely to see in the post-Covid era is an assertive, patronising state which controls capitalist growth. It is the state that the private sector has counted on to bail themselves out.

In India, it appears to be 1991 all over again. A host of ordinances are initiating major economic changes – in corporate law, taxation, fiscal management and agriculture, as opposed to the law route. This route to development and economic reconstruction will have repercussions on the post-pandemic trajectory of the Indian state. 

In short, modern political imagination is being significantly shaped by the pandemic. The post-pandemic picture would be an interesting meeting point for the state, market and society. 

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