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Ann Pettifor on Coronavirus Capitalism

Summary:
Interview with author and campaigner Ann Pettifor, getting her take on the economic consequences of Coronavirus. I specifically ask Ann about the prospects of a debt write down, and whether we may be able to achieve lasting change from the embers of this crisis to capitalism. Ann Pettifor: What’s happening is, I don’t know if ...

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Interview with author and campaigner Ann Pettifor, getting her take on the economic consequences of Coronavirus. I specifically ask Ann about the prospects of a debt write down, and whether we may be able to achieve lasting change from the embers of this crisis to capitalism.



Ann Pettifor:


What’s happening is, I don’t know if there’s a word for it, because it’s more than momentous, really, it is extraordinary. I have to say that I’ve always prided myself on my predictive qualities, but I did not predict a pandemic, and I hadn’t really thought about pandemics enough. There’s a wonderful professor at Oxford, Professor Ian Goldin, who did. He wrote a book six years ago saying this was a big threat to globalization. To be fair to him, Bill Gates also, in 2015 did a Ted Talk in which he warned about pandemics. I missed that. But nevertheless, the principle I was arguing was that it would take a shuddering shock to get politicians to sit up and think about, and change. And that’s what we’ve had. We’ve had a shuddering, an extraordinary shock. Actually we’re about to have what I think would be a catastrophic great depression.



Ann Pettifor:


Today, the US unemployment numbers came out. They have made 3 million people unemployed in a week. This is unprecedented in history. If you look at the unemployment claims, the graph, the chart, it goes like this, dah, dah, dah, dah, then occasionally bumps up in 2007. Today it went like that. That is huge, and that’s just the United States.The thing that that is good about what’s happening is that airlines are being grounded, companies who are not sustainable are being closed down, and we know, for example, that China’s emissions were cut by a quarter. Over the last quarter, Chinese emissions were cut by 20%. So, we can see emissions coming down as a result of the collapse in economic activity. That’s the good news. The closure of airlines is also going to contribute to that good news. The bad news is the cost of the destruction of the economy.



Ann Pettifor:


The other bit of good news is the suspension of capitalism. Capitalism can’t cope with a crisis. Capitalism can’t cope with a pandemic. That’s how pathetic capitalism is. Instead, so what do we find? The state moves in, and the state bails us all out, and by the state, and I want to stress this so emphatically, that’s me and you. So, when we think about the state, we think about bureaucrats and big government departments, and politicians, and we feel it’s not part of us. That is not at all the case. Without 30 million British taxpayers regularly paying their taxes, PAYE at the end of the month, or once a year if they were freelancers, and so on, there would be no state, there would be no Bank of England, there would be no quantitative easing, there would be no bailouts. The fact is that the Bank of England is backed by this collateral, because we have a sound tax collection system, and the joy of it is that we had one 30 years ago, and a hundred years ago, and we will have one in 30 years time, and in 100 years time, because we have the public institutions that underpin it.



Ann Pettifor:


That’s why the state has been able to intervene. I really want to stress that, because we don’t understand our role in all this. But you need to understand that the British state is backed by 30 million taxpayers. It has immense powers to create the credit in exchange for collateral that the Bank of England can create, and it’s called quantitative easing, but you can just call it Central Bank money if you like. The Federal Reserve has got backing the Federal Reserve, 60 million American taxpayers, because it’s twice the size or more. I don’t know if it’s 60 million, I think it’s even more than that. So, the dollar and the Federal Reserve is more powerful. So, they’ve been able to act. What we’ve seen is that we’ve seen capitalism collapse, in a nervous jitter, and the state, and the taxpayer, and society, come to the rescue of capitalism.



Ann Pettifor:


The crucial thing for me now is that we set terms and conditions for these bailouts for these bastards who’ve paid themselves bonuses, who’ve bought back the shares on their companies. I was reading about McDonald’s today, whose stock market prices went up like that. Why? Because they were buying their own stocks, and who was buying? The managers were buying them, and who was making the money out of it? The managers were making the money out of it. Now the stocks are going like that. Who’s going to pay? The workers will all be sacked, or whatever. So, I want us to understand really importantly, our role in all of this, and how vital we tax payers are, and how much leverage we have.



Ann Pettifor
I’m Ann Pettifor, author and analyst of the global financial system, and co-author of The Green New Deal (2008). I predicted an Anglo-American debt-deflationary crisis back in 2003, and in September, 2006 published The Coming First World Debt Crisis (Palgrave). I am known for my work on the sovereign debts of low income countries and for leading an international movement for the cancellation of debts, Jubilee 2000.

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