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Eco123 Revista da Economia e Ecologia
Tuesday, the 21st Abril 2020
An editorial by Uwe Heitkamp
Six weeks were enough, that is to say, 42 days, for the world economy to be reduced to 25 percent of its capacity, and for this whole “house of cards” (Pope Francis: “Our House”) to collapse, affecting everything and everyone: companies operating in the building and property sectors, the automobile industry and its entire supply chain, aircraft manufacturers and aviation companies, all forms of tourism, especially catering and hospitality, and also companies like Adidas, even football clubs, TUI and TAP, and many more. All sectors, from the service sector to the industrial sector, are like the dominoes of the system, in which “one little cough” was enough for them to start falling and to pull “the other pieces” down with them into the abyss. Complete surprise and astonishment, followed by the inevitable complaints, are the order of the day, as well as people begging for State money …
It seems impossible, but again bankers and the heads of public listed companies are asking for money from the State. Have they been converted to communism? They always seemed to me to be real capitalists! It’s not good for them to be begging for State support again! I wonder, and my readers are undoubtably asking the same question, whether the handsomely paid and intelligent entrepreneurs and executives were fully aware of the vulnerability (and reduced resilience) of their globalised system, which has always followed only the mantra of growth and is now collapsing before their bewildered eyes, just because some people started to cough…
Usually we all take a holiday once, or even twice, a year, in the summer – but this year the holidays have been brought forward. They are already taking place in the spring, and we are now recovering from the stress of our recent rampant economic growth. In view of this, it’s absurd to speak of a collapse and of houses of cards that are tumbling everywhere, leaving everything in ruins. Did no-one take any precautions for what might happen in the event of a lockdown? This is why almost everyone, beginning with journalists and ending with politicians, is using such expressions as the war against the virus.
But I am not at war. Let’s see what we can all achieve together amid these “ruins”, although 180 countries, which six weeks ago were still counting on growth and prosperity, are now entering into a deep recession with millions of unemployed. The World Trade Organisation (WTO) estimates that the global trade in goods this year will fall by 32 percent. These are mind-boggling figures, writes a journalist for an international economics magazine. Is this so? The result will be bankruptcies of companies and entire states. Uprisings. Revolutions, possibly.
Fear has taken hold of all those who yesterday were still talking about 25% profitability, without investing a penny in the ecology. There are three things that must happen if we are to free ourselves from this old-fashioned and fragile economic system.
Firstly: everyone who wants to invest must now withdraw from any investment funds linked to coal, gas and oil, and invest in renewable energy; in values that renew themselves, in a circular way, without causing any waste.
Secondly: we need laws that define a third type of property ownership, and those laws must become a reality. The polar regions cannot be exploited to exhaustion in terms of their fishing or mining resources. There is an urgent need to declare land, air and water as resources that belong to everyone, to identify them as assets that must be conserved. No economic process should be allowed to generate toxic products, and the fundamental elements needed for the sensitive balance that permits life on Earth must be protected. So, we need a new form of ownership. There must be some land whose sale is prohibited, either to me or to businesses, so that its natural resources are not exploited. And the sea is one of these resources. What we call sustainability has to be defined in real terms and we have to learn to live according to this definition, managing life in a circular economy.
Thirdly: people need a basic income. It’s not banks and airlines, tourism companies and car manufacturers that now need to receive money from the State. That would be money wasted, money thrown out of the window.
Every citizen of a democratic state now deserves the unconditional social investment of 500 euros a month. This will then become the seed from which their confidence will grow in the future and it must be accompanied by investment in a better health service, in clean mobility and in healthy agricultural practices. And, in this way, the foundation stone will be laid for the construction of the New Green Deal recently mentioned by European Commission President Ursula von der Leyen. We now have to fulfil that promise.
