 Now, today we're going to discuss about the impact of the corona virus pandemic on international political economy and on the stability of the post-war liberal international order and its progeny, which is the neo-liberalism in the coming few years. My guest today is Inderjeet Parmar, he's a professor of international politics at the City University of London and currently is also a visiting fellow at LSE Ideas. Hello Inderjeet, how are you? I'm very well, thank you and really good to talk with you again. So let me begin by asking you, how is it in London, especially with your Prime Minister being in the grip of corona virus, is London really learning the hard way that the best antidote against this borderless and classless corona virus is actually a proper lockdown? Yeah, I think they were very, very slow to react and to some extent the Prime Minister was the slowest of all and he went on television to say that everything was fine, this wasn't very serious, that he'd been going around shaking hands deliberately with corona virus patients in hospitals and then a couple of weeks later he's diagnosed with some mild symptoms and they are mild I think and he seems to have recovered or is recovering as is the same with Prince Charles, but I think more than that kind of blasé attitude towards his own personal health, I think there was a kind of deeper political reasoning behind it too because the government, this Conservative government has carried out several exercises over the last few years to do with how a global pandemic would affect the national health service and whether the national health service for example could really handle something like that on that scale and each of the exercises, the last one was in 2016 showed that no, the NHS was not in a position to be able to handle such a crisis but they buried the reports each time and because they would have had to spend a very large amount of money on the national health and other public services and so on to kind of restore it to some sort of decent level. So I think there was a kind of slow response because it went against the austerity agenda which they had championed as the only alternative for the last decade or so. So I think the US also reacted very slowly and we know how President Trump has been flip flopping and misleading and providing wrong information and being corrected by his own advisers and particularly his other people on the health front. So I think they both, neither of them want really to recognise that there is such a thing as the state and that the state does have more functions than just taking care of a kind of marketplace or for corporate deregulation or for empowering corporations that actually to have a truly resilient society and economy you actually need a large infrastructure which usually can only be largely supplied by a strategy by the state because the amount of resources are required for it and I think they're both learning and have learned very much the hard way and I think the societies are paying the price for that and it's not an entirely classless because I think if you're poor and you're a working-class person they have received very little compensation, they have been treated much worse, many of them are still having to go to work in the US car factories for example, many are having to go on wildcat strikes, the postal workers are still working on the whole in most countries. So there's a lot of working-class people who are not heavily unionised as they used to be and haven't fewer protections and it's hard for those occupations to be for people to work from home you know in a middle-class kind of administrative managerial teaching and so on you can work from home a lot more easily but if you're building a house or a flat or a shop or you're delivering letters and so on then you have to be out there and that means interacting with everybody, the chances of you being infected are very high and spreading the infection, there's no protection being offered for them, masks are not available, hand sanitised and so on are not available and consequence of that is that so it's felt differently, experienced differently by different classes of people as well although of course we know the royalty and right in number 10 Downing Street and in near the White House and the Congress and so on people have called it but the chances of working-class people catching it in certain professions have been much higher so learning a lesson slowly is very very costly in a number of different ways and I think that is a source of great anger that in effect the people have had to lead the governments by not showing up to work by going on strike and making complaints and that's actually what has forced the government in this country, teachers stopped showing up to school because they had caring facilities, caring responsibilities for elderly relatives and people with conditions, children stopped, parents stopped delivering their children to school because they themselves are looking after vulnerable people at home and therefore the child could bring something back, the people led, the government followed very slowly. That's because now that's one important thing that we are seeing that the true class character of the capital states is now very very starkly visible now in the entire lecture. I was reading a report on the Guardian which states that there are a lot of the homeless in the Americans are being put in the parking lot and despite there being so many hotels around, despite there being so many schools which are empty similar things are happening in India. The migrant workers have been left to find themselves. They are on the highway walking about 400 odd kilometers so the class character is becoming more and more visible. Correct. Next question what we are seeing is that this virus is actually you know sort of rocked and rattled the global financial markets and these stock prices are plunged and the bond yields have equally plunged. This health crisis is fast becoming an economic nightmare and which will expose us to sort of unprecedented financial crisis in the coming years or in the coming you know. In such a gloomy scenario is there a light at the end of the tunnel? Well I think we always have to have hope but we have to be realistic also and I think as you outlined that this is a financial, well the global health epidemic has exacerbated to a kind of degree probably previously unseen the the coming market crisis and we know that the stock markets have been soaring for quite some time because of the tax cuts in the United States and the increased levels of dividends and so on and the stock buybacks and the just increased level of gambling and the cheap money which made that all possible. So if you like publications like The Financial Times and The Economist and many others as well were predicting that at some point the kind of roller coaster character of the financial markets was going to come to another grinding crash along the lines of maybe as bad or worse than 2008 and so if you like there was that kind of fear of that already so there is an underlying structural problem and what the global pandemic the COVID-19 has done has added a kind of new dimension and it's actually closed down large amounts of economic activity and that has had an effect of worsening that particular crisis. So I think we have that and I think what it truly shows to objective observers is that that entire system is deeply flawed and it kind of lurches from one deep crisis to another that that kind of focus around ideologically around the people armed with money taking the decisions will actually lead to everybody having economic growth and prosperity and stability and peace and so on but that model actually does not really work it doesn't deliver and it's increasingly failing to deliver and we can see the effects as you said you have empty hotels empty schools but you have large numbers of homeless people who are out in parking lots and so on and that entire kind of system if you like has been shown there's a light being shone on it and it's been shown to be deeply wanting and the light at the end of the tunnel I guess is at the same time when we look at who is now keeping people alive who are the workers who are keeping the society to some extent together who's delivering the medicine from pharmacy to homes who's delivering the medicines who's who's working in the hospitals keeping them clean who are the people who are delivering all the food and other necessities who are marginalized workers who have been treated very badly through cuts in in the state spending on health care for example but also cuts in regard changes in technology which have created this huge gig economy which has created a very precarious workforce so I think what you've got is you've got several million workers who previously were on the receiving end of all the bad elements of technology automation and cuts in state spending suddenly are seen as publicly seen as heroes and they're seeing that actually there is a great value in the kind of work that they're doing and this is accentuated and it seems to me that that is actually a very very important development that development I think with a public sympathy for those people as well and the support for them allied with what were existing protests from the Green New Deal extinction rebellion the people who wanted to deal with climate change in a more radical way and wanted to if you like reform the corporate economy away from smokestack industries towards clean technologies and that kind of thing I think that the two allied together I suspect are probably provide us with a degree of hope that you've got a kind of movement from below which says you've got to recognize people who have been living any precarious positions there is a building blocks for a kind of movement for change some of which are already there some of which have become apparent because of this particular crisis and I think if a leadership could be formed around those and I think the other final thing I would add is there is that even that Davos the World Economic Forum and the reports that they see look at hedge fund managers and other reports who talk about the kind of coming sort of breakdown of the international system breakdown of the society the growing levels of inequality political polarization and the kind of capacity for breakdown in societies I think there are those elements there too and I think it's a question of can something develop leadership develop which confuse bring together and kind of make a reform movement out of that I think that is our hope that ordinary people are now kind of seeing we're all watching the news every day to see how it's all panning out and I think I think that is the light at the end of the tunnel that I would I would look to see because I was reading another story somewhere in the newspapers about how the how the nurses from Kerala are working in you know United Kingdom and doing a human service moment so but the next question flows from there and so will this have got kind of a globalized virus sort of promote more anti-globalism will it lead to more protectionism not just in trade but also severely impact the movement of labor across continents and yeah because this idea of social distancing can get converted we're seeing this happening to social ostracization so I think sure you know and it definitely is going to make international travel almost so what do you think yeah well I think there's so many different tendencies which are already existing so there was a rise of nationalism and a kind of parochialism in many parts of the world already at the same time there are those who are opposing it and I think what we could see from even among the populist nationalists of the right and even on the if you like the left who are opposed to various kinds of free trade agreements which were diminishing the rights of labor and labor protections for example what you could see even with those groups was that most of them are not arguing for an isolationism and a kind of complete detachment from the world because the real reality of it is is that the other thing which the COVID-19 pandemic has shown is is that our food other supplies our raw materials our masks for protection medical equipment and many many other things they're actually our global supply chains you can't sort of say well we're going to be internationalists unless you want to basically have no supply of large amounts or you're going to be a regear your economy or your agriculture which is unlikely to happen because this is a result of two centuries of economic strategy which was open to agricultural products rather places and sending out your products industrial and other to the rest of the world so so I think there's going to be there's going to be very interesting because even the most arch nationalists like America first Trumpists had to recognize the United States is deeply embedded in global supply chains and even those who have started to move a little bit out of China into Southeast Asia a global pandemic doesn't care about nationalism it is truly without nation it is truly global it says where it's coming and so I think it's going to have to be probably a little bit of each a recognition that nations and nation states have got to have infrastructure at home that you cannot be entirely kind of if you're like you know play just one role in the international globe in the global economy but you've got to have some level of resilience through diversification of your economy such that you can weather storms of this kind that means a state intervention to maintain at the same time as recognizing that you are dependent on other parts of the world for much of what you do and that your businesses and your economies your educational systems and so on are global but at the same time and therefore you need to keep that open but the management of the global what the state does at the national level the interstate system the intergovernmental systems have got to step up to deal with at that level and then mobilize the various private sources forces as well so you've got to recognize that if you like there's a sensible level of nationalism and nation state activity within a system so something which recognizes that you do we live in the local but we are affected by the global will this will this kind of what we are seeing now the kind of movement we're seeing in the economy will it lead to greater de-dolarization of the world economy as one would say and especially when one sees that the oil you know prices in a nosedive in this scenario it was happening before itself but this is actually accelerating the entire process so is it possible that the dollar loses its sheen fast and as a reserve currency of the world and you know we move faster towards natural order that's a tough one yeah it's a difficult one i mean from what i read and i'm not an economist um what i've read is a large number of large amount of money is actually going into dollars and out of dollars at this crisis point so the dollar as a reserve currency which is backed by the federal government remains a store of value more highly prized than any other currency and i don't think that chinese currency or the euro or the euro is anywhere near the levels at which people are keeping their money in dollars so you look at the dollar against the pound i think we're back to what it was in 1985 during the height of the miner strike when it was almost one to one so i think the dollar remains a very powerful currency but the longer-term trend is for a multi polarity and a kind of distribution of economic power far wider than it used to be and i suspect that is going to carry on but i don't think we should underestimate the power of the united states just not just the dollar but the entire international payment system that is the kind of the infrastructure behind the operations of the system itself so the ability to weaponize the dollar is something that has been sharpened up quite a lot in the last three years or so and donald trump is one thing he knows he knows how powerful the levers that he can pull so that when you want to starve iran and to sort of to apply sanctions on it you can apply the kind of the u.s sanctions very very strongly so i wouldn't write off the dollar just yet but certainly the u.s has lost leadership politically more countries are looking to others and themselves much more and i think that then opens away for other chains of relationships other reliances because the u.s is effectively signaled for quite a few years now that they wanted to pass more of the burden of global leadership on to others in any case militarily as well as financially and so on and institutionally i think that tendency is probably going to be strengthened but i think the power of the u.s is probably likely to be greater than any other single state or combination for quite some time so do you think that the u.s is going to really know that the chinks in their entire health system have been exposed are they going to spend a little more on the health sector are they going to reduce their spending in defense by any stretch of imagination and so and what is going to be their attitude towards China you know immediately now when during the ongoing crisis when trump used the word the chinese virus and then backtracked and now he's seeking his health so in this respect do you think is there going to be any shift in the u.s-china relations you know especially after this yeah it could be actually i think it'll probably exacerbate certain tendencies which are already in motion i think in the kind of long term longer term goal of the united states is really the subordination of the chinese ambition regionally and globally and the chinese model and i think in that regard the EU is probably on very kind of closely allied even if their way they want to do it is different with the u.s. u.s has declared China's strategic strategic rival the EU has declared it a systemic rival both are quite similar both want China to kind of diminish the level of its role of its state in the in its technological sectors and so on which they believe are leading to their you know kind of superiority so i think there is that so whatever weapon they can use in order to promote that agenda especially the u.s they'll do that so some of them are talking about the Wuhan virus the chinese virus some of them are talking about making china pay for this the debate about highway in britain and in other countries is kind of being reopened so this could lead to a certain amount of movement on that kind of a front but in the longer run as well the interdependence the role of china in the global economy is very very powerful and probably going to increase so the interdependence of economies of the u.s and china of southeast asia of the whole world of europe on the chinese and other economies in the east is going to continue and i think they don't want that to to to diminish really what they would like is a kind of subordination of china and chinese ambition because they they fear china as a global power and that global power is going to then challenge their positions economically financially institutionally and maybe at some point militarily as well so i don't think that goal has changed this covid-19 i think some forces will seek to use it as a weapon to in that particular ongoing ongoing struggle thank you so much wonderful speaking and i'm sure in the coming days and months we're going to have more conversations on these issues because this is not going to go away so soon thank you so much once again