Mankind has always faced the threat of large-scale death and destruction from disastrous situations. Mention of Pompeii, Krakatoa, Chernobyl, Tsunami in Asia, Ebola in Sierra Leone and DRC, Banda Aceh, and New Orleans evokes powerful images for many people. Despite all the advances in technology, disaster effects will continue to affect communities in many significant ways.
COVID-19 is the most serious challenge the world has faced since World War II. Mobilizing to meet the challenge requires the complete dedication of social resources. Yet, just as most nations’ political economies left World War II more just than they entered it, we can hope that the proposed measures by various experts, if properly executed, will help build new solidarity underpinning a far stronger and more just political economy.
We have all witnessed the speed with which supply chains have collapsed, companies are facing bankruptcy, and mass unemployment ensues. Covid-19 has triggered an unprecedented global financial crisis and is forcing many states to develop rescue packages on a scale not seen before.
Scientific scenarios are becoming an important tool for political decision-makers as they tackle the Covid-19 pandemic. Models of the Corona Crisis developed by researchers, and predicting shocking infection and death rates, have persuaded governments around the world to adopt strict lockdown measures and reduce economic activities to a minimum. The magnitude of this decision is now becoming increasingly apparent. The measures adopted have triggered a global economic and financial, social, and political crisis that is affecting both industrialized and even more so developing nations, jeopardizing efforts to achieve the United Nations Sustainable Development Goals.
Governments tackling this crisis face unprecedented challenges. Their task is made all the more difficult by the death of economic scenarios and models that could support decision-making in this situation. And the world is experiencing a new wave of political economy with losers and winners.
The COVID-19 pandemic strikingly illustrates the intersection of politics, economics, and other considerations. Public health experts have long warned that the world was likely to face a major pandemic and called for greater preparedness. Yet policymakers who have to focus on the next election find it difficult to invest the time, money, and political capital to address the abstract possibility of a future crisis.
As the pandemic races across the world, the policy response has continued to be tempered by political realities in a particular country. Some members of the public, and some policymakers, have resisted the recommendations of public health experts, hoping for relaxed restrictions and a return to normalcy before the dangers have passed. At the same time, business interests have pressed for exceptions to benefit themselves, and for substantial subsidies—bailouts—to help them through difficult times.
Every government faces tough decisions about the appropriate measures: what restrictions to impose and when to loosen them, where money will be spent and how it will be raised, and what national concerns can be limited to favor international cooperation. These decisions have to take into account public health recommendations, economic considerations, and political constraints as well.
Political economy is said to be about how politics affects the economy and the economy affects politics. Governments try to pump up the economy before elections so that so-called political business cycles create ebbs and flows of economic activity around elections. By the same token, economic conditions have a powerful impact on elections.
But as different companies and individual persons continue to count loses other sector players are smiling all the way to the bank and praying Covid-19 stays around for a while for example, the COVID 19 has led to the robust development of sanitary ware industry both small and large scale to meet the daily high demand for masks, and alcohol distillers diversified into the manufacture of high-end sanitizer liquid required by everyone as one of the ways of preventing the spread of the COVID virus, this high demand also creates employment and income to some section of our population.
Agriculture as an industry has continued to grow as a result of demand for food as people stay home, and many people opting to spend their time opening up land for agriculture since they are out of the office and now have ample time to closely supervise their projects, this has increased supply beyond demand thereby affecting prices greatly to the extent of farmers crying to authorities for intervention in regulating prices and provision of markets for their produce. There has also been a shift of people leaving towns to rural areas as covid19 bites deep into their pockets, this is likely to improve rural incomes and standards of living in the long run.
Those manufacturing COVID 19 test kits can only pray that we take long to come up with the vaccine and they continue making profits since their products are requested for globally and in short supply still, this is now a new area that is highly profiting from the Covid-19 pandemic, they have produced test kits to meet global demand and in many countries, these test kits are becoming political issues and governments in power did not find it easy in defending themselves against all accusations, of corruption and misuse of resources in procurement processes.
We have also an increase in demand for temperature testing guns that many people never knew existed before the COVID 19 pandemic and it’s an industry that is making profits as it struggles to meet new global demand for temp guns
Governments are locking down citizens in an attempt to prevent the spread of the virus and be able to manage small number that may eventually get infected, however citizens see it as a sinister motive to curtail their freedoms of association and worship and this is pitting the leadership against their citizens, and since many countries are in the election year, there must be a balance between keeping their people alive and loss of votes.
Many of global citizens are counting loses as they had to lose their jobs as companies downsized to cope with reduced demand for their products and services, these who lose their jobs are a thorn in the foot for the governments in place, as they must find a way of sustaining them and this is not an easy or cheap thing to venture into and failure to help, when you are faced with election months away is simply suicidal and they also present their demands with this in mind for they know you need their votes, or else they switch camp and this is not desirable too.
Those in both formal and informal employment were affected by the lockdown, the boda-boda riders, saloon, markets, arcades, schools and their various stakeholders, taxi operators, students hostel owners, bar and restaurant owners, and employees were as much affected, entertainment and leisure industries were equally hit by the lockdown, so all those who were surviving through the provision of services in these economic sectors were much affected and require government assistance to meet various challenges presented by the lockdown.
We are entering the election period, and many people who have been benefiting from the previous elections will not be earning as they had anticipated.
The government has called for an election that is free of the traditional public campaign rallies due to its risk factor regarding covid19, and this is pitting the government against opposition leaders who think that their rights to meet and talk to their potential voters has been curtailed and they are calling for defiance and government is not ready to risk the lives of its people at the altar of the political expedition, and truthfully many are seeing sense in what government is suggesting, after all, u can meet your voters in their homes, on media platforms, both traditional, and new media.
However this is also bad news for the entertainment industry whereas musicians have been making good money hired by different politicians to entertain their crowds this time around it won’t be happening and they are not happy with this decision by Electoral commission and government, but we are in a war and some traditions must be dropped as we engage the enemy (COVID 19), who is no respecter of color, religion or political affiliations.
So this decision is becoming political as it does not only affect the politicians and businessmen but our general population that usually benefits from these political rallies by providing goods and services to various camps, and these are also voters who are likely to enter voting both with this anger and punish the “one that has denied them business and vote opposition in retaliation”, these are considerations that government should have in mind as it comes up with standard operating procedures against COVID 19 pandemic especially during the election period.
However, all is not lost the scientific elections as has been termed benefit media house owners who will be making good money in pricing for space on their radios and TVs that politicians will be using to reach out to their voters as the new campaign method. Those making placards and posters will also be making profits because they are on high demand than before as an alternative to public rallies.
Our policymakers, therefore, should be aware that, macroeconomic trends can boost or ruin an incumbent`s chances in an election, features of the economic organization or activities or particular firms or industries can have an impact on the nature and direction of their political activities
Politicians also act as analogous to firms, with voters as consumers or government as monopoly providers of goods and services to constituent customers during an election period.
A basic economic principle is that any policy that is good for society as a whole can be made to be good for everyone in society, even if the policy creates winners and losers; this was evidenced in the covid19 lockdown period and will be so post-Covid19.
Also, a basic political economy principle is that the winners don’t like compensating losers. And the battle is joined, not over what is best for society but rather over who will be the winners and losers. What is best for the country may not be best for my region, or group, or industry, or class—and so I will fight it. This is how things run around the world, the government`s policies however good they are will result in winners and losers and must be opposed by some section that will be losing out, so we shouldn’t be surprised to see this battle here as we head into election 2021.
Even in democracies, citizens might agree that politics obey the golden rule: those with the gold make the rules. Special-interest groups do seem to play an outsize role around the world, democratic or not. These include wealthy individuals, powerful industries, big banks and corporations, and formidable associations.
Political economists don’t usually take stands on complicated moral and ethical issues of this sort. They try to understand why societies choose to do what they do. In fact, there are plenty of powerful interests in favor of international trade and investment. The world’s multinational corporations and international banks depend on an open flow of goods and capital. This is especially the case today when many of the world’s largest companies depend on complex global supply chains. And this supply chain has been disrupted by the Covid-19 pandemic and no one will be spared by the consequences. A typical international corporation today produces parts and components in dozens of countries, assembles them in dozens more, and sells the final products everywhere. Trade barriers interfere with these supply chains, which is why most of the world’s biggest companies are also some of the biggest supporters of freer trade, and a lockdown is something they will not want to entertain.
Special interests as well as voters on different sides of every issue fight their battles in the political arena. But the rules of politics vary a lot from country to country. The way a political economy is organized affects who wins the battle over policy and this must be carefully studied by the policymakers as they come up with Covid19 guidelines especially during election period not to end up ruining the chances of the incumbent.
A logical starting point is elections; governments that don’t satisfy their constituents don’t remain governments very long. So we might expect governments to choose policies that benefit the economy as a whole. However, the economy as a whole doesn’t vote but people vote. We should also be prepared to see a number of governments lose elections to newcomers who will take advantage of the covid19 pandemic to emerge as best alternatives.
Politicians need votes from the people who decide elections. The decisive or pivotal voters vary with a country’s electoral institutions and social divisions. In most political systems, the best targets are swing voters, who might change their vote in response to the policies of an incumbent or the promises of a challenger. If the poor vote for the incumbent and the rich vote for the opposition, for example, the middle class could be decisive.
Political economy as we saw above is the integration of political and economic factors in society. Inasmuch as just about everyone would agree that politics and economics are intricately and irretrievably interwoven politics affects the economy and the economy affects politics this approach seems natural. It has proved itself powerful in understanding governments and societies; it can also be a powerful tool for those interested in changing governments and societies. Policymakers should hold these important lessons in mind today as they tackle the COVID-19 pandemic as they come up with their SOPs.
The economy both under initial lockdown and under a longer period of twelve months or until effective vaccines and treatments are available will require rapid retraining, modification of licensure and regulation, public-private partnerships, extensive social support, and the maintenance of critical infrastructure and a pro-poor policy regime.
The elections different nations are about to undertake will heavily depend on how particular governments handle the issues of COVID-19 and its effect on the likely voter’s livelihood and how strategic each camp will be and how responsive government in power is seen to have been to the citizens’ interests and basic needs.
Mr Kayondo is a political analyst and eductor
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