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The coronavirus crisis has helped popularize an essential truth: There are no libertarians in a pandemic. The rapid spread of Covid-19 is already ripping apart both America’s fragile health care system and its economy. The stock market crash is merely the first symptom of what will soon be a system-wide crisis, one that could rival not just 2008 but also 1929. A vaccine could be 18 to 24 months off. If so, we’re likely to see not a single global outbreak but a series of waves, as with the Spanish flu at the end of World War I. That would keep the economy sputtering for months.
In reaction to the pandemic, even very conservative politicians are embracing sweeping responses. In the Senate, Mitt Romney has called for the government to write a $1,000 check for every American, while Tom Cotton—perhaps Trump’s most rabid supporter in the chamber—tweeted about the stimulus deal that Speaker Nancy Pelosi negotiated with Treasury Secretary Steven Mnuchin, “The House relief bill doesn’t go far enough & fast enough.” Cotton called for “stipends to affected workers and their families so they can buy food and pay the bills during this crisis, plus help to small and mid-sized businesses weather the storm.”
Romney and Cotton are thinking more imaginatively and on a larger scale than the congressional leadership of the Democratic Party. The Pelosi bill is a step in the right direction, offering universal coronavirus testing, food assistance, and extended sick leave for some workers. But because she caved in to the House Republicans’ demands, the sick leave measures are far more limited than they should be. Carve-outs to protect small and large businesses mean that upwards of 80 percent of American workers wouldn’t be covered by the measure.
Congressional Democrats have to be much bolder. The European social democracies show just how much can be done. Denmark has reached a deal between unions and large employers to stop layoffs, with the government covering up to 75 percent of wages. Norway has promised to pay the self-employed 80 percent of their precrisis earnings for the duration of the pandemic.
The best response to this crisis is a robust social democracy. Sensible measures would include an emergency universal basic income with job guarantees, low-interest loans to big and small businesses alike, pressure on banks to suspend mortgage payments for the duration, a ban on evictions, and nationalization of factories to produce medical equipment and medicine.
Such actions would be costly, but interest rates are now below inflation. This means the government can run up debts that won’t have to be repaid for many decades, if not centuries.
The faction in US politics best positioned to make arguments for large-scale social democratic spending is the insurgent left, led by Bernie Sanders, Elizabeth Warren, and Alexandria Ocasio-Cortez. This group has been divided by the politics of the presidential primaries. Warren has, quite notably, refused to endorse Sanders for the Democratic nomination. Ocasio-Cortez has been Sanders’s most important surrogate, but her recent comments indicate she wants to make peace with the party’s mainstream.
These divisions are tragic, preventing what is the best hope for America: a united front on the left that pressures congressional Democrats to make maximum demands. Warren doesn’t have to endorse Sanders, but she does need to underscore that she shares his view that a large-scale economic response is needed. The primaries make clear that the Sanders-Warren wing commands at least 40 percent of the party—enough to influence the thinking of the rest.
If Sanders, Warren, and Ocasio-Cortez find a way to speak with one voice, they can push the Pelosi–Chuck Schumer–Joe Biden wing to act with urgency. Otherwise, we’re stuck in a world where Romney and Cotton are to the left of the Democratic Party’s leadership.