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Indybay Feature
Never waste a good crisis
by G Speckmann, L Kempe, J Arps and N Tugel
Monday Feb 22nd, 2021 7:40 AM
The negotiation of society after Corona is now beginning, and it is now important to strengthen positive tendencies such as the expansion of the public health system, a more planned economy and social solidarity. But these appeals only cover up their own helplessness and lack of advice. No one can say who is even supposed to implement the demanded improvements.
Never waste a good crisis
Even in the Corona pandemic, parts of capital are making big profits - that's no coincidence

By Guido Speckmann and Lene Kempe
[This article published on Jan 19, 2021 is translated from the German on the Internet, Verschwende nie eine gute Krise – ak analyse & kritik (akweb.de).]


Has a good laugh: Tesla founder Elon Musk is now the richest person in the world. In December, it was time for a second time: the federal government addressed the population with an urgent appeal to stay at home if possible, reduce social contacts and work in a home office. Personal restrictions, deprivations, but also financial risks would now have to be accepted in order to protect the lives of older people in particular. The state, the message goes, is doing what it can. Finance Minister Olaf Scholz (SPD) still has the bazooka at the ready.

However, the billions that Scholz, the new figurehead of a supposedly strong state, has so far blown up are not reaching those who really need them, or only in small amounts. For many, the ongoing crisis is associated with enormous social and financial risks. While the vast majority of people nevertheless support these and new restrictions in the name of fighting the pandemic, parts of capital are securing billions of euros in the midst of the global economic and health crisis. In doing so, they make one thing unmistakably clear: before the virus, we are still a class society.

Riding the storm
Tesla founder Elon Musk, for example, has so far been little affected by the pandemic. In the race to become the richest man in the world, he fought his way past Amazon founder Jeff Bezos in the Corona Year 2020 with a lead of 1.5 billion US dollars. Musk's private net worth now stands at more than $188.5 billion, up more than sevenfold from 2019. And Musk is not alone. According to the annual Billionaires Report, released in October 2020, billionaires' wealth worldwide was up 27.5 percent at the end of July from the last survey in April 2019 - a new record in the midst of the pandemic. "Riding the storm" is how the authors christened their report. For even from the perspective of the super-rich, the Corona year got off to a thoroughly turbulent start.

In February and March, the global billionaires' club lost 43 of its members. However, as the stock markets recovered, the sentiment curve for the super-rich quickly turned upward again. Thanks to the expansion of the money supply by central banks and government economic aid, billionaires were able to profit from the "breathtaking rallies" (Welt) on the stock market, among other things. In the following weeks, the economic sectors of technology and - surprise - health proved to be particularly profitable. The enormous resources spent by states on Covid-19-related health care were reflected in a roughly ten percent increase in the wealth of billionaires from the health care industry.

The link between crises and profits is no accident; it is inscribed in the global economic system and also legally guaranteed by institutions of private law. Katharina Pistor, a professor at Columbia Law School, has impressively elaborated the general importance of legal norms for the structural manifestation of inequality and the progressive transfer of wealth from the bottom to the top in her recent book, The Code of Capital. Although the author largely omits other forms of power and domination in capitalism, such as racism, the existence of classes or patriarchy, the topic could hardly be more topical. Pistor describes how private actors have increasingly taken control of the creation and distribution of wealth and prosperity, and thus also of social (in)security, via the instrument of law throughout history, but especially under neoliberal auspices. Especially in times of crisis.

Before the virus, we are still a class society.

This principle, it turns out, has not been overridden by the Corona pandemic and the supposed rebirth of the strong, guiding state - on the contrary: speculating on and with the crisis could be impressively observed on the German stock market over the last ten months. Investors initially bet on so-called stay-at-home stocks, exchanged them for the Corona losers (e.g. TUI and Lufthansa) that were brought through the crisis with state money when the vaccine came into play, and are now, in the second lockdown, again turning to the pandemic winners: Food delivery services, online pharmacies or online stores like Zalando. Hedge funds were not among the biggest winners in this crisis, but they nevertheless successfully speculated on a decline in the value of a wide variety of securities or took advantage of price developments. (1) Also soon after the start of the pandemic, large law firms began preparing lawsuits against government Corona measures. Why? Because they are allowed to. Current law allows them to do so.

ATM for corporations
Foreign investors may now soon be able to sue states for damages if they can claim before international arbitration tribunals that, as a result of a Covid 19 measure, they have been disadvantaged vis-à-vis domestic competitors, for example, or deprived of future profits. The right to bring such claims before special arbitration tribunals is guaranteed by a global network of some 3,000 investment or trade agreements that contain special investment protection clauses.

"Investor-state lawsuits," as Pia Eberhardt of the NGO Corporate Europe Observatory (CEO) describes it to ak, "are a kind of superweapon for the rich." Only those who have the capital to invest abroad or can make themselves a foreign investor through clever shell companies have access to this legal system at all, she said. According to Eberhardt, the legal basis knows only hard-core property protection: "The possible damages know no bounds and often include compensation for completely hypothetical lost future profits. That makes the regime a kind of ATM for corporations - and super dangerous for public budgets and democratic decisions in the public interest."

Several NGOs drew attention to the danger of a veritable wave of lawsuits as early as this summer. (2) Claims worth billions, but also the sometimes-gigantic legal costs, could then further restrict the scope for action in coping with the long-term pandemic damage, especially of the poorer countries. The ongoing proceedings before international arbitration tribunals already represent an enormous burden for many countries. For example, according to a study by the Transnational Institute (TNI), Latin American countries together were already facing claims totaling $40 billion from pending lawsuits in August 2020. This was roughly four times the amount that the World Bank, the Inter-American Development Bank, and the Development Bank of Latin America together had made available to countries in the region in the form of loans to address the Covid 19 crisis as of July 2020. (3)

The image of the happy crisis winners* who bet on the right horse is thus not only skewed. It also obscures a basic mechanism of the international financial system, namely that the same people always bear the costs, while the others will also profit from the next crisis.

Against the backdrop of the massive publicity offensive by major law firms, several NGOs called for a moratorium on proceedings already underway and a ban on lawsuits related to Corona measures. To no avail. Not only do current proceedings continue; the International Centre for Settlement of Investment Disputes (ICSID), based at the World Bank Group in Washington, also set a new record with 58 cases registered last year. (4)

With regard to the Corona measures, interventions by the Mexican state in the electricity market, for example, due to the decline in electricity demand caused by the pandemic, could now lead to a dispute. There were also concrete declarations of intent from investors with respect to Peru. The country had partially suspended highway tolls during the pandemic. Foreign investors involved in the toll system now want to sue for the losses they allegedly lost as a result. Bolivia, Argentina and Guatemala are also already facing specific threats from international law firms and/or investors, according to TNI.

Political instrument
Of the actual lawsuits filed, none so far explicitly relate to Corona measures. "Law firms, however, continue to diligently advertise them," says Pia Eberhardt. Even during other crises, such as the Argentine economic crisis at the beginning of the millennium and the Arab revolutions, it took months to years for lawsuits to be filed or made public, she said. "All experts assume that there will be investor lawsuits against Corona protections." The system of private arbitration courts has thus not only become a business field in its own right for financially powerful investors, it also gives them enormous opportunities to influence government policies.

For example, the system of arbitration courts plays an important role in explaining why policymakers are not addressing the climate crisis to a sufficient degree. For although there is talk everywhere of switching to renewable energies as a condition for meeting the Paris climate targets, fossil capital continues to invest blithely in the extraction and burning of oil, coal and gas. According to estimates, energy companies would have to write off up to 20 trillion U.S. dollars by 2050 as a result of the energy transition, i.e. they would have to accept asset losses. (5) But they continue to invest. And they do so, the explanation goes, because they assume that the regime of private arbitration will guarantee them billions of dollars in compensation should states decide to phase out coal or oil. This could be because the states pay the money out of fear of lawsuits, or because the corporations win it through lawsuits. Corporations could then claim what's known as indirect expropriation, a fuzzy term that includes any situation in which the state deprives an investor of the use or benefit of its investment - even if only for four months.

Investor-state lawsuits are a kind of superweapon for the rich.

Pia Eberhardt, Corporate Europe Observatory
The very existence of the arbitration regime could prompt states to offer compensation in advance. German lawyer Tobias Stoll, for example, suspects this connection for the €4.35 billion compensation for German lignite operators, who are to cease operations by 2035. A broad definition of the term "investor" also allows private equity funds and other financial investors to file lawsuits in private arbitration. With success: "Investors in fossil fuels are already used to," summarizes journalist Ben van der Merwe, "bringing ISDS disputes, and have usually won the day." States have won only 29 percent of fossil fuel disputes, he says.

Lobbying fossil capital
When there is billions of dollars of new money to be distributed, the already well-oiled lobbying machinery of fossil capital really kicks into high gear. What the gas industry in particular has put together over the past year is not only a masterpiece in shameless lobbying for the purpose of securing filthy lucre. It is also a masterpiece in deceiving the public and in greenwashing. Because: Hydrogen, which is currently being sold to us on all channels and by all politicians as a green and clean energy source of the future, and thus as an important element in the fight against climate change, is by no means that. (6) Hydrogen is a green sham and the result of a 60 million euro lobbying offensive by the gas industry, which is behind the hydrogen industry. James Watson, secretary general of Eurogas, the gas industry's main lobbying organization, characteristically spoke of "a new era for gas in Europe" when the new EU hydrogen strategy was published last July.

Corporate Europe Observatory evaluated 200 documents and published the result in December in a study entitled "The hydrogen hype", which has received little attention in Germany to date. The conclusion is: Hydrogen was sold to the political decision makers as a clean, climate-friendly energy source and as a way out of the Corona crisis. Countless papers, emails and letters were sent to EU politicians* with messages to this effect. Between December 2019 and September 2020, representatives of the gas industry met 163 times with the responsible EU Commissioner Frans Timmermans, two other EU Commissioners or their staff*.

Even before Corona, the lobbying of the gas industry by consulting agencies and organizations such as Hydrogen Europe or Hydrogen Council was in full swing. As it became apparent that the EU was launching recovery funds and stimulus programs to mitigate the economic crisis triggered by the shutdown, these activities intensified. "During this period, Commission officials responsible for climate and energy policy recorded an average of three meetings per week with major polluters such as Total, Shell, FuelsEurope, and Hydrogen Europe," the CEO report says. Particularly impressive in this is a tabular overview. It shows how fossil capital demands found their way into the EU document and what their environmental consequences are: It is 0:6 behind.

In front is the gas industry, which can count on a windfall for its "low-carbon" hydrogen projects from numerous EU pots and programs, some of which have yet to be specified. For example, around 30 percent of the funds from the 750-billion-euro Next Generation EU development instrument are earmarked for "climate protection", i.e. for subsidizing fossil-based bogus solutions such as low-carbon hydrogen. In addition, numerous EU member states, including Germany, have adopted national subsidies for hydrogen.

The Corona crisis is thus only the latest example of how powerful factions of capital always find ways to profit from the crisis of others, and in doing so often act as crisis drivers themselves - such as the climate crisis.

Against this backdrop, it is also necessary to turn the myth of the collective effort that would now have to be made in view of a common concern from its head to its feet: Not everyone is pulling together in the fight against Corona. And that is not the way it is supposed to be. For inequality has become so deeply inscribed in the national and global economic and social system(s) under the auspices of decades of neoliberal structuring that not even a global threat, a virus potentially deadly to all people, can change it. Although financial market players and the super-rich are not immune to the risk of infection and a potentially fatal, severe course, they are not in the same boat. They are riding the ocean liner past the small ships and amplifying the waves.

Notes:
1) Mixed report card for the "magicians of the markets," online at: http://www.nzz.ch, August 12, 2020.
2) Seattle to Brussels Network, Open letter to governments on ISDS and Covid-19, online at: http://www.s2bnetwork.org, June 22, 2020.
3) Cecilia Olivet, Bettina Müller, Juggling crises. Latin America's battle with Covid-19 hampered by investment arbitration cases, online at: longreads.tni.org/, August 25, 2020.
4) 2020 Year in Review. International Centre for Settlement of Investment Disputes, online at: icsid.worldbank.org, December 21, 2020.
5) Ben van der Merwe: Why investor lawsuits could slow the energy transition, online at: energymonitor.ai, Dec. 17, 2020.
6) The EU hydrogen strategy, while aiming for green hydrogen, allows for a transition period so-called blue hydrogen produced with gas; the CO2 released is to be captured and stored underground - a highly controversial technique. Since there will never be enough green electricity for clean hydrogen in the EU, it is to be imported from Africa, for example. The danger of a neocolonial energy import system looms.
____________________________________________________

The situation is not "open", it sucks
In the Corona crisis, some leftists see an opportunity - perhaps out of forgetfulness?

By Jan Ole Arps, Nelli Tügel and Paul Dziedzic
[This article published on April 21, 2020 is translated from the German on the Internet, Die Situation ist nicht »offen«, sondern scheiße – ak analyse & kritik (akweb.de),]

A woman in USA flag dress holds up a sign that reads "Social Distancing = Communism"
This Trump supporter has similar expectations as some on the left about the possibilities of the Corona crisis.
While business groups and liberal commentators* are already calling for a return to normalcy, many left-wing observers* in recent weeks have diagnosed an entirely new and "open situation" because of the Corona crisis. The negotiation of society after Corona is now beginning, and it is now important to strengthen positive tendencies such as the expansion of the public health system, a more planned economy and social solidarity. But these appeals only cover up their own helplessness and lack of advice. For so far, no one can say who is even supposed to implement the demanded improvements in the midst of lockdown and quarantine. Instead of blinding oneself with (journalistic) actionism, now would be the time to learn from leftist mistakes in past crises.

The Corona pandemic seems like a burning glass for social conditions: It highlights the shortcomings of the health care system as well as the failure of the market to cope with crises. It documents once again the immense vulnerability of poor and racially declassed people, it proves the hell in prisons and refugee camps.

The right, where in power, has also behaved as might be expected: right-wing government leaders initially ignored all scientific evidence and denied the dangers posed by the virus (U.S., Brazil), indulged in fantasies of strength and invincibility, demonstrated their contempt for the weak and vulnerable (Boris Johnson initially relied on rapid "contagion" and diligently shook hands in hospitals before becoming a Covid 19 patient himself). Many governments, legitimized by the fight against the epidemic, have expanded their repressive capacities, restricted fundamental rights, or even, as Viktor Orbán did in Hungary, stripped parliament of its power by emergency decree and swaggered to the position of autocrat.

But even in states that are less openly committed to capitalist misanthropy, the record is overwhelming. Italy and Spain, whose health care systems have been cut to the bone by EU-imposed austerity policies, are experiencing mass deaths in hospitals. You couldn't see the catastrophe coming? Wrong. Science has been warning for years - not only about climate collapse, but also about the danger posed by epidemics. Alone, the warnings were ignored because, as with climate protection, they would have required measures that contradicted corporate profit goals.

Reminiscence of the last crisis
In the meantime, social life in many countries is at a standstill, production is paused or running on the back burner, and many businesses also remain closed. Austerity and austerity targets are passé, states have taken billions into their hands to prop up companies and made access to unemployment benefits easier. Car companies are temporarily producing breathing masks and protective clothing, and nationalizations are being considered aloud.

Such extraordinary measures stimulate the political imagination. One wonders why things are not regulated more sensibly in other ways, whether a window of opportunity is not opening here for the restructuring of the economy in accordance with social needs. This is precisely where the appeals described at the beginning dock.

an illuminated city and empty street crossing at night, taken from the air
When life is on standby, it's easy to start dreaming. Tel Aviv during the Corona curfew on Passover, April 2020. photo: Omri Silver, CC BY-SA 4.0
But anyone who remembers the global economic crisis of 2008/2009 will become more pessimistic. Back then, too, far-reaching measures were taken, companies were temporarily placed under state care and billions were pumped into production and consumption. After the crisis, mountains of debt remained - and huge repayment demands. "The rich should pay for the crisis" remained a pious hope.

In 2008/2009, thinking about alternatives to capitalism became socially acceptable, even far into the conservative media. But what followed was not a new attempt at socialism. Even though major protest movements emerged in many places around the world a few years later - uprisings in Arab and North African countries that toppled dictators, occupations of squares in Europe, Occupy Wall Street in New York - they were rarely successful. Instead, the transformation of the global economic crisis into a sovereign debt crisis by the EU and the German government strangled attempts at awakening in southern European countries. The "debt" incurred in 2008/2009, which in reality redistributed the debts of banks and corporations to society, became the ultimate instrument of blackmail.

The "Arab Spring" also came to an end: in Egypt by the coup of a new military dictator, in Syria by Assad's strategy of massacre, which turned the uprising into one of the bloodiest and longest civil wars in recent history. This historic defeat of the left favored the triumph of right-wing populism, not only in Europe. Hope for overcoming it was offered by the new movements, revolts and uprisings of 2019 - but these no longer find a mention in most left-wing analyses published these days.

The Corona aid is a gigantic redistribution program to capital.

The fact that leftists have not politically come to terms with the defeats of the period after the last great crisis until today is a serious omission. If optimistic slogans are now presented again in the Corona crisis, as if the experiences of the last ten years had not existed, the trauma threatens to repeat itself.

What we can say about the time after Corona
While the situation is unfamiliar, it is by no means "open". Even in this crisis, politicians are trying to impose the interests of "the economy." Already, the federal government has subsidized companies with hundreds of billions of euros; money that it finances primarily through the tax payments of wage earners. So the Corona aid, just like the measures taken in 2008/2009, is a gigantic redistribution program to capital: the growth of the economy, the generation of profits is a social imperative. Without companies making profits and wage earners paying taxes, the state has no money with which to take whatever measures it wants. In capitalism, the determining factor remains the economy, even if - a surprising experience for everyone - it is on standby for a while.

At the latest when a calculability of the Corona virus is reached (by more reliable figures about mortality and ways of infection, sometime by knowledge about treatment possibilities), this virus will also be calculated into everyday life like the annual flu.

As soon as the political assessment dominates that the virus is "under control", the economic crisis becomes the all-dominant topic. Politicians have long been preparing the population for the upcoming rounds of austerity: "Most people will be poorer for the time being after the Corona crisis," stated Baden-Württemberg's Minister President Winfried Kretschmann (Greens) at the beginning of April. At the same time, he announced his intention to recoup the state's expenses for the Corona aid within ten years by making savings in the state budget: "Money doesn't fall from the sky." At that time, the Daimler Group, also based in Baden-Württemberg, just like its competitors BMW and VW, had already announced that it would pay out billions in dividends to shareholders. A large part of the employees of the German car companies have been on short-time work since April at the latest; the short-time wages are paid by the Federal Employment Agency - as is the case with the 650,000 other German companies that have applied for short-time work.

The great bustle that has broken out among leftists is primarily an attempt to escape the feeling of powerlessness, to compensate for the loss of their own ability to act.

In order to facilitate a return to normality as quickly as possible, especially in the interest of the economy, the first restrictions are now being loosened. New monitoring and control instruments over the mobility of the population and far-reaching restrictions on meetings and gatherings outside of paid work are intended to help in this regard. Labor law is also coming under fire, as can be seen in the "systemically important" sectors, where, as in hospitals, restrictions on working hours are being ground down and staffing floors are being lifted.

For leftists, all this is not a great opportunity, but a great danger. We have neither alternative proposals for dealing with the epidemic, nor - thanks to the ban on public gatherings - any means to lend weight to whatever demands are being made. The great bustle that has broken out among (publishing) leftists is primarily an attempt to escape the feeling of powerlessness, to compensate for the loss of our own experienced ability to act.

What can we do instead?
Of course, experimenting with new forms of protest and trying to make ourselves heard in public debate is important. But instead of lapsing into helpless actionism, we should first pause. The analysis of one's own situation and past experiences are now prerequisites for naming fields in which gains in terrain for left-wing, emancipatory and social politics are possible.

Every new situation encounters spaces of experience that are shaped by past situations and their processing. With regard to the global economic crisis, there is a widespread feeling in Germany that the German government's crisis management got off relatively lightly, which is why there is now a great deal of trust in the government. In southern Europe, on the other hand, people remember the German-European debt regime and the lack of solidarity on the part of the local left and trade unions.

For answers to the Corona crisis in Europe, it would have to follow that the national limitation of left crisis politics should be avoided and that networks for organizing across national borders should be established from the very beginning. For post-Corona politics will take place in an even more nationally fractured Europe, in which German capital interests will continue to dominate. So far, however, the German trade unions seem to be back in the crisis-corporatist mode of closing ranks with the companies. They have suspended or postponed their collective bargaining rounds. In times of standstill, it is difficult to strike, and in the case of protests in the health sector or in food production, there is a fear of a public outcry.

When it comes to experiential spaces, it is also advisable to look at the uprisings and protest movements that shook many countries last year: Chile, Ecuador and Haiti, Guinea and Sudan, India, Hong Kong, Iran, Iraq and Lebanon, and to some extent France. Even if many protests have also paused since the beginning of the Corona measures: Have organizational structures, experiences, and solidarity networks emerged in them that can help find responses to the lockdown? How are feminist movements responding? How are self-governing structures in Kurdish areas dealing with the threat of the pandemic?

In the U.S., there have already been wildcat strikes against continued exploitation despite the Corona threat, such as in the auto industry, food production, transportation, and Amazon. This probably has to do with the union-building work of recent years and the ability to act that has been acquired in the process. If this is true, what can be learned from it? Does anything remain from the election campaigns for Bernie Sanders and Jeremy Corbyn, whom, when they were successful, many leftists in Germany also cheered? And in this country: How can the experiences in places with strong tenant movements now help to win solidarity-based action? In Spain, calls for a rent strike were already circulating. Can the tenant protests here learn from this? What has worked in years of care strikes and health care struggles, and what hasn't?

If there is an opportunity for the left through Corona, it is to overcome the fixation on output and develop more solidaristic ways of relating.
Finally, the left's responses to Corona so far also reveal a lack of its own modes of relating. Instead of throwing out the thousandth analysis on Corona and taking comfort in the deceptive feeling of being active, we need a discussion about an emancipatory way of dealing with fears, desires, grief, with relationships and needs in times of loneliness. There are hardly any examples of this so far, and so it becomes apparent that the often-lamented social devaluation of care and caring activities finds its counterpart in leftist thinking and action.
This is a good time to learn from the experiences that marginalized groups, depressed or other sick people have with emotional and practical mutual help and dealing with loneliness and isolation. If there is an opportunity for the left through Corona, it is to overcome the fixation on output and develop ways of relating in solidarity that can survive crises.

JanOleArps is an editor at ak.
Paul Dziedzic is an editor at ak.
Nelli Tügel is an editor at ak.
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