The Burner Episode #221: Of Cows and Coffee

Good morning. This is The Burner. I’m James Butler and it is Tuesday April 21. We are still in lockdown.

And just at the top of the show, a little bit of a plea that I will make from time to time. If you’re enjoying The Burner – and I hope you are because otherwise there would be very little reason for me to do it – please hop on over to your podcast app and give us a review. This really helps us get that little bit more visible and draw people in. That takes a couple of minutes at most of your time. Of course, making things does indeed, very sadly, costs money. So, if you’d like to keep me on coffee, which is also rather sadly the drug in which most of Western culture runs – miserable and unexciting stimulant that it is. Do also pop on over to novaramedia.com/support and subscribe if you haven’t ready.

And, for some reason, that makes me think – perhaps after discussing dystopias last week – of Aldous Huxley’s novel Island, the rather lesser known counterpart to his earlier and far more famous Brave New World. An exercise in utopia of a sort, compared to that earlier dystopia, mescaline-infused and precarious, strange, like all systemic critiques of the Contemporary world are, and tremendously interesting. One worth reading in lockdown perhaps.

Now, how bad is the economic crisis likely to get? The default economic assumption of most central bankers and treasury departments has been “things are going to get bad, really bad pretty quickly and then things are going to get sharply better”. This is of course the infamous V-shaped recovery on which many businesses of many kinds are depending. The hope being that, just because lockdown is a measure instituted by the government, it’s just an external constraint imposed on otherwise a fundamentally sound economy, [with] all sorts of pent-up desire for things, commodities just waiting and ready to be unleashed over a market hungry for demand [after this enforced chill].

[O.P.U.L.E.N.C.E. You own everything, everything is yours.]

But is that really true? How many businesses can survive the lockdown by entering suspended animation? And how will we behave afterwards? Certainly businesses are reaching out for life support. Nobody really calculated the UK furlough scheme, which opened yesterday, [which] looks initially like it will be paying the wages of a million people from 140,000 firms. That number is perhaps set only to rise as the scheme has already been extended by a month beyond the initial proposal.

It’s hard to imagine that it will not need to go further and last longer than was initially expected. It’s already coming in at three times the expected cost before the extension, nor is this a uniquely British picture.

In Washington, the federal lending program for small businesses ran out of its initial cash of $349bn after just a couple of weeks. In New York, the Merrill grants program for small businesses has already run through its cash in a similar space of time.

Is this just businesses seeing an opportunity for some cash even if they’re not particularly badly affected? Maybe, but I don’t think so. And does it matter what happens in the United States? Yes.

We’re in a somewhat unique situation, with a global political and economic hegemon, experiencing a period of deep dysfunction and decadence with the kind of crap Caligula at its top and comically corrupt administration – an increasingly dynastic element to its putatively equal society. What happens in the American economy affects the rest of the world, just as it did in 1929 and back in 2008.

Back in 2008, Mervyn King, then governor of the Bank of England, took a relaxed approach to the financial crisis in the US, claiming that the UK had decoupled in a perhaps Gwyneth Paltrow way from the United States. But for anyone who remembers that period, well… You know that just wasn’t true. The US sneezes and the whole world catches the cold.

There’s one area where it becomes appallingly clear that, despite our tendency to focus on structural problems and constraints, politics and the quality of our leaders and the decisions they make really matter.

It is fatuous, for instance, to imagine – as the US treasury secretary Steven Mnuchin nonetheless does – the $1k stimulus check will somehow be enough to cover people for 10 weeks. It’s already abundantly clear that it’s being used for food, bills and rent. Not to mention, though it has had maybe less attention than it should have worldwide, photos of vast lines of cars stretching back a mile or more [of people queuing for] food banks in the Southern United States.

And that is a consequence of the kind of politics and politicians now in power; family dynasts, robber barons, spivs, fraudsters, crooks, Hollywood producers, and the like. That, in turn, perhaps suggests a lesson to those of us on the left – having crashed headlong into the wall of electoral defeat or the cynical stitch ups which make up so much politics – who would hope to turn away from politics itself or who hope that politics can just be got around by doing something else that can circumvent it; whether that’s direct confrontation at the point of exploitation in trade unionism of traditional new forms or building up community strength and support through community organising. My point isn’t that such things are bad – in fact, they’re entirely necessary – but that they don’t necessarily provide a means of leapfrogging politics itself, especially not in developed liberal democracies, [and so we must pay attention politics and the quality of our leaders and the decisions they make].

[Woman: I mean it’s one banana, Michael, what could it cost, $10?
Man: You’ve never actually set foot in the supermarket, have you?
Woman: I don’t have time for this.]

Back to the crisis itself.

The shock is already partly visible through unemployment claims, [with] data in the United States [showing] that it might hit a rate as high as 20% for the month of April. This is one reason [why] there’s a political force behind demands, especially in the US, that the economy needs to reopen. The way that that force acquires strength is that it rolls together two separate needs. One is the push from business owners, [who want] their businesses need to return to normal in order to start making money so that their profit margins can return. [This,] perhaps, also highlighting how exposed and precarious many of those enterprises actually are. And the other is the need that comes from a wider mass of people: people who need to pay their rent and put food on their family’s table.

These interests are not the same, but when conservative politicians roll them together, they acquire real force. However, what one needs is profit and what the other needs is wages. We’d be wise to keep these apart in our heads and recognise that the solution, frankly, is that one side of this needs basically helicopter money for people, not bailouts for businesses; it’s not the same as the other side and rolling them together obscures much more than it reveals.

It’s harder to get data for the UK; our stats run a few months behind and so tracing the effects on employment are harder. However, we have good indications, like the massive spike in claims to universal credit, which tell us that things are getting really very bad here too. You can also look at things closer to real time like energy consumption data to get an idea of just how substantial the dip in economic activity is. The effect this has on how people behave economically isn’t yet completely clear. Will we all rush out and buy lots of things in an uncertain time when lockdown is lifted? I am sceptical.

There are lots of questions here and I think we should be clear that we’re working without much guide. Nobody really knows what the medium term effects on the economy will be. Forecasting is, at best, erratic. There should be, by the way, a boom in now-casting: grabbing real time data from whatever source to try to track what’s actually going on, whether in terms of actual deaths from coronavirus. For instance, speaking to grave diggers has been done in Mexico after scepticism about the official figures, or [we could try tracking what’s going on by] trying to infer wider patterns from more rapidly reported data, like oil price or food purchases.

It’s also worth noting that, unlike any previous pandemic, we live in a world which has extremely rapid and global means of communication, which in turn feeds back into what we actually know about what’s going on. Communication itself has an effect here; but it’s also worth noting how universal the effect is on so many industries and the questions [this] opens up for how those sectors might change in the wake of the crisis. The aerospace manufacturing industry is screwed pretty badly and perhaps actually even more so than the commercial aviation industry itself. With Richard Branson begging for a bailout, nationally I think we should use this moment to try to force some change in this most destructive and polluting of industries and ask whether the high technological sophistication of aerospace manufacture can’t be put to better ends itself.

But, equally, high street retail also looks pretty screwy. Both massive retailers like Marks & Spencer and Next, as well as commercial landlords, the people who own the properties and rent commercial space, have written to the government saying that the fate of the high street [is] already looking pretty dire and will be decided in the next few weeks, not the next few months. They say quite many viable companies will collapse without rental support. Even massive high street retail chains like Pret a Manger are eyeing the future nervously. They’ve brought forward their plans to sell their coffee packaged in supermarkets.

Might even the experience of walking down the street look and feel pretty different after this? Will they be colonised instead by the platform giants and dispersed maybe with retail specialists, but the collapse of general retailers?

As they point out much of the government’s loan program isn’t that useful to them because banks, which take on 20% of the risk of the loans, are very, very wary about lending to shops at the moment. And even if they do get those loans, the support looks like a few weeks worth at most. If you want a sense of both how wide reaching a crisis is and how it accelerates trends that were already in place, the high street is one place to look.

But another might be dairy farming. According to the National Farmers Union, a quarter of UK dairy farms have become financially unviable because of falls in milk demand and prices. That, in turn, has a knock on effect on the closure of restaurants, cafes, hotels and canteens. A huge chunk of their milk purchases, [as they] normally cater to the food service market, [has] been cut, [with] prices and orders from thousands of farmers [vanished] – [this] just as, right now, they reach the annual spring peak in milk production.

Now, UK farming, and dairy farming in particular, wasn’t in a good place to begin with. There are similar crises in fruit and vegetable farming, as well as with meat farming. But many dairy farmers are looking at negative returns on a litter of milk. And banks, here too, are very nervous about lending to farmers, especially tenant farmers who are among the worst hit. You might think this is weird, that this is perverse, because in the medium term, as the global effects of the pandemic shake out, we might get to a point where questions about food security – about the domestic production of food rather than ultra-cheap imports through complex supply chains – becomes a hot political issue and the government UK government’s basic contempt for agriculture, which has long been overlooked, changes rapidly. But that’s a little help right now in the immediate future. After all, you can’t furlough a cow.

Again, this tells us something about how widespread and how near universal this crisis is; how it touches on things you might initially think were unlikely to be affected by a pandemic. But it also reveals that the effects so far seem to be primarily acceleration rather than change. The UK high street, at least in its retail aspect, was already dying. The poison of renter-ism is already sapping the British economy. Aviation already relied on a massive government subsidy and UK agriculture was already in a pretty dire state. It has, by the way, it always puzzled me, the rate of death by suicide among farmers is not a hotter political issue than it is currently in the UK. It really should be.

But just like in the political sphere where coronavirus has accelerated and sharpened the trajectories of government, rather than change them to new direction, it has brought out weaknesses and problems, which already existed. The new ones it has created, however, seem at the moment relatively minimal. So, what might be new about the pandemic crisis and what might be new about its effect? We’ll only see these as the lockdown begins to lift.

I’ve got my eye on two things. So far, as behaviour among the wider population is a question. What are the consequences of lockdown in isolation on mental and physical health itself? As I’ve said before, slightly facetiously, we’re conducting an experiment on a grand scale of giving most of the population in Western Europe at least some of the behavioural symptoms of clinical depression. What feedback does that actually have on people? Will it disappear in a kind of orgiastic explosion of spending and various other things after it lifts? Additionally, it seems to me one of the very common experiences of the lockdown is a deep yearning for sociality or socialisation of some kind, to see people face to face. But, at the same time, there is an increase in fear of it, a hesitancy to get close to people in public, a kind of twitchy nervousness at the thought of large groups of people close together. What does that mean for everything from commuting to clubs, pubs and nightlife after this has done? With so much of the economy resting on a base of assumptions about how human beings like to socialise and how we act socially, what happens if that changes?

Looking beyond these micro and macro political questions, [but rather looking at] the world order, speaking to Le Monde yesterday, Jean-Yves Le Drian channelled the fears of many of us saying: “I read in here that the world after the crisis would have nothing to do with the world before. I share this wish, but my fear is that the world after will look like the world before, only worse. The point, however, is to change it.”

All right. A few small things. One thing that’s been on my mind while making this show for the past few weeks is how ill-prepared many of us have been intellectually for the political and economic impact of the pandemic. I mean that separately from the government’s obvious failures on pandemic preparation and the political issues around that. We’re used, for instance, to thinking about disasters of a kind, which are both created and then responded to by authoritarian governments. Think the Reichstag fire there. Or emergencies or crises which arise externally and unexpectedly and then provoke massive reaction, mission creep, and shift the course of governing powers entirely. The most obvious example there is terrorism, 9/11 [being] the classic case study.

However, we’ve devoted less time in political theory to natural disasters or pandemics, which are assumed maybe to institute temporary emergency measures but ones which – because they don’t have volitional human actors involved – are maybe less worrying to think about politically and which have only passing effect. But that’s not how this crisis is shaking out. That’s especially true as, this overnight, Trump has announced that he’s going to somehow ban all immigration into the US as a response to the crisis.

It’s this dearth of intellectual resources, I think, which have left people reaching back to the Athenian plague and Thucydides, or the black death, imperfectly but usefully the early stages of the AIDS epidemic. But none of these are perfect comparisons in terms either of their remoteness in time or their differently distributed defects, or the complex political role of sexuality in the last case.

The same is true in social science, it seems. Much academic ink has been spilled, for instance, in thinking about the Anthropocene or thinking about nonhuman actors, but relatively little [has been spent], with some exceptions, on the nature and implications of pandemics or post pathogen capitalism. So, on that front, if you’re reading anything interesting or have been thinking about this too, why not drop me a line? ([email protected]). Because I do think this is important.

We have long considered the role of pathogens on public health and politics as largely limited to or analogous with basic questions of political economy. The cholera epidemics were very closely correlated, of course, with both geography and class; poor people live lower down or closer to marshy or unclean water. [The cholera epidemics were] as well correlated with the capacity of municipal government to provide sanitary infrastructure as well as the development of applied scientific reason itself.

That classic late 19th century mode of thinking basically shapes the way we still think about pandemics. However, in this case, the social conditions which give rise to the pathogen and make it possible to spread are different. Yes, they may involve sanitation and crowdedness in space and classic political economic questions, but this is a [inaudible] pathogen. It involves questions about human intrusion and rapacity in the biosphere, encroachment on the natural world as well as the rapid spread of people through commercial travel and the nature of, at least for a class of people, a largely frictionless world.

So, lots to think about that. And if you pop over to the Novara Media website, you can hear an interview with Will Davies that we broadcast on Friday, which touches on just some of those issues. Much, much more thinking to be done there though.

Headlines today

On other stories, Airbnb landlords are moaning that they’re screwed, and the platform isn’t helping them. I find myself curiously unmoved.

The contact-tracing system being developed by Apple and Google might need a vast chunk of people unable to use it because it’s built for technology unavailable on basic phones or older smartphones and that might leave many of the most vulnerable, and the older population or poorer parts of society here in the UK, not to mention the basic models which are more prevalent in various countries in the global South, without the help that it might provide.

The WHO rings an alarm bell saying only a tiny proportion of the global population, may be as few as 2% or 3%, appear to have antibodies in the blood showing they’ve been infected with Covid-19. There is, in other words, is still a long way to go with this crisis, whatever the politicians say.

The Commons returns to offer some kind of scrutiny, in a new digital format, which will doubtless have its horrors.

News this morning that Keir Starmer will make his forensic debut at Prime Minister’s Questions tomorrow, declining to wait until Boris Johnson recovers from coronavirus. Apparently, Downing Street has banned the word exit from any discussion of its exit strategy, insisting it talk only if the next phase instead.

Also, pop on over to novaramedia.com to catch our interview with John McDonnell last night. There’s lots there.

And do, please go and leave us one of those reviews. It really, really does help.

Otherwise stay safe, stay home, wash your hands and don’t be a prick. That’s it. This is The Burner.

I’ll see you tomorrow.