TRACES OF COVID-19 IN THE ECONOMY

         A pandemic is an almost perfect political scapegoat, since it is not born mainly from ideological discussions or criticism of the macroeconomic behaviour of the government. In addition, in the future, as soon as there is time for vaccinations, effective drugs or the autoimmunisation of the population, there is always the certainty of defeating it. Regardless, possible economic difficulties are now also accompanied by health risks that have a depressive effect on national economies. The pandemic presents enormous challenges to the hospital and health systems, aside from negligible economic impacts on social security.

         In fact, every pandemic is a universal problem that demands solutions on a universal scale. Of course, this is not the only issue that requires such treatment. Even so, the collective responses to this crisis could open the gap for viable efforts to other pending problems, such as government indebtedness, distribution inequalities, and especially global warming.

         Of course, the inclusion of densely populated countries in an interdependent economic and health care system complicates epidemiological treatment. Economically, it causes breaks, interruptions, deviations in the production chains in which the world division of labour is maintained. The above-mentioned disorders, as distributed according to the epidemiological limitation and the scope of measures to combat them, entail high costs. Hospital networks, aviation firms, tourism, restaurants, transportation, some manufacturing sites, hotels, cinemas and theatres are candidates for major disorders.

         Unfortunately, it is a supply-side initial shock that affects activities that often use abundant labour, where the best-paid or the best-protected are not always available. The reduction of infections leads and will lead to the fact that the national authorities limit the normal functioning of markets, companies and events that require people to pile up. These facts, as much as they contradict or undermine the advantages of integrated markets, have had to be applied in more and more countries and have been applied throughout China, Italy, Great Britain, France, the United States and Latin America.

         As a result, serious temporary effects can be expected, which make the policy of protecting official and hidden employment an inevitable priority. Moreover, the geographical distribution of the epidemic is uneven, with the highest population density of countries, often it also intensively affects the most developed regions.

         The demands and possible responses of governments regarding the epidemiological problem in question do not end there either. Some countries use monetary policy by lowering interest rates and extending maturities to alleviate the indebtedness of companies and families. Without completely excluding this policy, there is a risk of confusing a health and employment crisis with a liquidity or banking crisis, that is, complicating the choice of issues to be protected or taken advantage of.

         Regardless, the response to the coronavirus is or will force us to cover large economic losses, strengthen social programs, and ensure a rapid recovery in public and private investment. Without exhausting the treatment of the problems of the international economy, gaps have formed that need to be pointed out. There has been almost no reference to the dilemmas created by demographic aging, immigration, general or gender inequalities. Finally, the effects of international competition expressed in tax breaks that narrow the capacity of states to cope with both economic and distributional imbalances are almost set aside.

         As a result, it is worthwhile to clearly recognize the signs of another serious global crisis, both in the inadequacy of monetary policies or the automatism of the markets, and as predictors of downturns and crises. In turn, the observed phenomenon is the proliferation of crises, barriers to employment, barriers to equal enjoyment of well-being.

         Faced with problems that are close to each other, poorly predicted and, perhaps, beyond our national capacity to solve them, government strategies should be flexible and address several goals. Either to strengthen social protection systems, or to compensate for the decrease in employment or the effects caused by the avoidance of public and private investment, it will almost certainly require expanded government loans and transfers.

         In principle, when exceptional circumstances are encountered, it will be necessary to respond with attempts of the same kind. As a result, the crisis can open the door to unopposed progressive initiatives, whether in expanding the rights to access to health care, exploring the advantages of basic income, or partial implementation of unemployment insurance, which will soon be limited to modern. Possible unemployment will be equivalent to remaining unconcerned in the face of an explosion of informality, refusing support to companies or families, perhaps giving up unbearable social responsibilities. Without continuing to completely correct structural distortions, the world centres are making a new attempt to break the foreseeable economic recession by flooding countries and the world with liquidity, and then public spending at previously unknown rates. Perhaps the magnitude of the worries and benefits is associated with the risk of falling into an irreparable crisis, not fully resolved in our current way of life. 

Yaşam Ayavefe