Coronavirus and financial panic

Image: Elyeser Szturm

By Antonio Martins*

The coronavirus served as a trigger. It partially interrupted the production chains of certain industries, services such as aviation and tourism and, in certain locations, commercial activity. It then reveals how financialized capitalism is as devastating as it is fragile.


“No wind helps those who do not know which port they want to reach”, wrote Seneca, playwright and Stoic philosopher, two thousand years ago. Carnival week was marked by two facts of enormous depth and repercussion – and by a banal and recurrent factoid. The coronavirus has spread across the world, with major outbreaks in South Korea, Iran and Italy, and a trail of new cases in dozens of countries – including Brazil, where there are already hundreds of suspected cases of contamination. On its back, a tremor is shaking the financial markets of the planet. The stock exchanges record expressive and consecutive falls (with great impact in São Paulo). The risk of a prolonged crisis is growing, capable of spreading through the production chains and reaching the banks.

The two events expose, each in its own way, the global disorder caused by capitalism in its financialized stage – and in particular the missteps of Brazil, in the midst of chaos. Therefore, an enormous space is opened for initiatives, pedagogy and political mobilization. But the chip didn't drop. All it took was a scoundrel tweet, from a silly president, and the opposition deviated from what matters and would give it strength, to get lost, once again, in the opponent's agenda. There is time to correct course – but will there be wit and courage?


Viruses have, of course, no political significance – but the epidemics caused by them do. The current one makes clear the disaster of a globalization without democratic institutions and without public policies. Faced with a possible pandemic, there is a lack of international coordination, responsible bodies, resources, highlighted the unsuspecting The New York Times.

The World Health Organization, the UN agency dedicated to the subject, is trying to manage with the laughable annual budget of 2,2 billion dollars – 545 times smaller thanue to the increase in wealth of the five hundred biggest billionaires on the planet in 2019. The absence of international action will be felt in the lack of measures to contain the spread of the virus around the world, and in the possibly tragic consequences, in populous and impoverished countries. Think Bangladesh, Indonesia or Haiti.

But the coronavirus exposes, in particular, the neoliberal policies of dismantling public services and the governments that adhere to them. Brazil, where Michel Temer and Jair Bolsonaro have frozen social spending and keep the SUS under constant threat, is a classic case. The particular characteristics of the disease demand solid and equipped health systems, and States capable of investing promptly and coordinating policies.

Lethality is moderate (around 2% of those infected); but the ease of contagion is remarkable; and the need to hhospitalization, intense. The Chinese example reveals that, in the affected areas, between 25% and 70% of the population can be contaminated, when there are no strict control measures. About 15% of those affected need iinternaldog; and 5%, intensive care. Just do the math, considering the population of your city, to see the seriousness of the threat.

Facing it requires, in particular, three components: a robust hospital network; prevention and isolation measures; ability to adopt vast emergency actions, such as the suspension of classes and shows and, often, the stoppage of almost all productive activities. review china, where the coronavirus now appears to regress. There, a region with 89 million inhabitants was isolated, two hospitals with a thousand beds built in ten days, the entire population invited to remain in their homes. Also notice the Hhotel Costa Adeje, in the Canary Islands (Spain), where the identification of a single case led the authorities to strictly quarantine 723 guests, who were allowed to leave their rooms, wearing masks, only for brief meals.

Nothing no Brazil suggests that we will have a similar effort. The authorities try to support, with the help of the media, a discourse of false tranquility – which blocks the necessary awareness and mobilization. masks are missing and immunoglobin and drags out the process to acquire them abroad. Hospitals lack ventilation equipment, crucial equipment against the disease. The Minister of Health does preposterous statements, saying he expected the virus to “behave” as in China – without making any reference to the measures adopted there and absent here.

From a government that strives to devastate public services and denies Science itself, what can be expected? Mobilization will have to come from outside. But it allows, on the other hand, to highlight the need for new directions. Over the decades, Brazil has built up vast experience and knowledge in Public Health. It is expressed, in particular, in hundreds of extremely qualified, politicized researchers, defenders of the SUS, today far from government bodies. It would not be difficult to mobilize them, build with them a clear set of responses to the new emergency, present them to the population, compare them with the official paralysis. Combine complaint with high-level proposition. Inform and mobilize – including on the streets.

The list of proposals would certainly open the repeal of Constitutional Amendment 95, which froze social spending for twenty years. It was a central decision of the government installed after the 2016 coup. The political environment at the time made it difficult to question it. Now, an unprecedented gap opens: the health of the population is at risk; every effort to protect it is necessary; it is not possible to accept that existing public resources are diverted to financial speculation.

Crises always create opportunity. But taking advantage of them requires seeing and acting.


As the week progressed, a second global crisis arose, emblazoned in all letters across the headlines of relevant international media. Financial markets are in a panic. Losses on the main stock exchanges are close to 15% and already compare those of the critical days of 2008. More: the economy itself will be hit hard, with the risk of bankruptcies and mass layoffs. The possibility of contagion from banks is not ruled out, which would multiply the power of disasters. Brazil, where the reprimarization of the economy has been going on for a long time – but has been accentuated in recent years – is particularly fragile. Here, too, an enormous field of political dispute will open up.

The coronavirus served only as a trigger. It partially interrupted the production chains of certain industries – the automobile industry, which uses components produced in different countries, is the typical case. It could also seriously affect services such as aviation and tourism and, in heavily affected locations, commercial activity. But what has been seen in recent days has much deeper roots and reveals how financialized capitalism is as devastating as it is fragile.

The magazine The Economist, explains. The declines in the stock exchanges were provoked, and are likely to continue, mainly due to speculative movements. Huge global funds, which make investments aimed at financial profit without real investment, were in a situation of imbalance, after suffering from the devaluation of the first affected shares. This forced them to part with the papers; but the size of these sales generated new waves of instability, in a chain reaction that has not yet been interrupted.

Then began a race for safe assets, in which large funds tend to take money from applications considered risky. This is the case of papers that express corporate loans. Part of the companies – even those that are able to raise funds in the global financial markets – start to have difficulties in rolling over their debts, and may default. If the process is not interrupted, the banks themselves enter the line of contagion. And the situation gets worse because there has been, in recent years, a new financial deregulation movement. After the most dramatic effects of the 2008 crisis, the limits then imposed on reckless operations, which generate great profits and great risks, were being removed.

Just like the health crisis, the financial and economic storm opens up a huge window – both to denounce ongoing policies and to propose their mass reversal. Brazil will suffer a strong impact, because in global crises sales and prices of commodities agricultural and minerals are the most exposed. But the central debate will be about what to do. The usual neoliberal recipe is twofold: oblige the majority to tighten their belts; save the rich.

Nothing compels you to follow this script vulgar. The US case is the most eloquent. Bernie Sanders has grown in recent weeks, and tends to advance further by exposing an opposing project to voters. It implies radically expanding public services (in particular free health…); defend and extend social rights; establish the Guaranteed Decent Employment policy; tax the rich and corporations; strongly combat inequality and, in particular, financial speculation.

His example demonstrates that there is immense space for a left willing to dialogue with the concrete needs of the population and, at the same time, propose profound changes, in a post-capitalist sense. The crisis, with its enormous power to jeopardize what seems normal, will multiply this condition. Anyone willing to take advantage of it?


In recent days, Bolsonaro's cunning tactics in relation to the far-right demonstrations scheduled for March 15 have become clear. Again, it's two-faced. On the one hand, he republished – but does not assume… – the exhortation to the coup, clearly suggested by the organizers (“The generals await the order of the people”). On the other hand, he devotes his time to whimpering against the alleged persecution he says he suffers from the media, Congress, governors, the left – in his words, “the powerful”. The objective is obvious: to feed the demonstration, generating, if possible, three weeks of incessant controversy about it. And, in particular, convert it into the most important fact of the period, freeing the government from answering for the crises that really matter and, if possible, reducing them to secondary facts.

The supposed “controversy” with Congress, which was fueled by a speech by the Minister of Institutional Security, General Augusto Heleno, focuses on imposing parliamentary amendments. The Executive would be upset at having to spend part of the Budget on expenses that deputies and senators create and the Planalto Palace is obliged to pay (although it may delay).

The falsity of the dispute can be attested to by two simple facts. The tax amendments were instituted in 2015 with the vote of the then deputy Jair Bolsonaro, and expanded in 2019 thanks to the support of the PSL, his party at the time. Furthermore, no president released more parliamentary amendments than Jair Bolsonaro. It was BRL 5,7 billion in 2019 – 3,04 billion just in the Social Security counter-reform vote. Liberation is a kind of anticipation. If this does not happen, the values, although “taxable”, may only become available at the end of the year or fall into the black hole of “remainders to be paid”. The Executive therefore maintains bargaining power. And no president pleased deputies and senators more than this one, now feignedly upset...

The staging of a fake race with Congress is a calculated scam, which, in addition to diverting attention from the crises, brings two additional advantages to the president. First, he invents a highly unpopular fictional “adversary” for himself – and gets another chance to maintain the “anti-establishment” mask essential to his image. Second, he pools the left, his real enemy. To oppose Bolsonaro, she will be seen by the majorities as an ally of the characters most associated with corruption and who have been most committed to withdrawing people's rights and providing favors to the great economic power. It is worth remembering that now, when they timidly criticize the captain, Rodrigo Maia and César Alcolumbre, the presidents of the Chamber and of the Senate, accuse him of… disturbing the progress of the Administrative and Tax counter-reforms. These same ones, which further devastate public services and social rights…


The option of facing Bolsonaro on the ground and under the terms he proposes is certainly a shot in the foot. The defense of democracy is among the most noble causes, but it is impossible to sensitize the majority of the population in favor of a corrupt and anti-popular Congress. The Impositive Parliamentary Amendments were harshly condemned by the left, when imposed by the Legislature on Dilma in 2015, in the form of a “bomb agenda”. Falling into the trap set by the captain will mean allowing him to guide the course of the national debate at the exact moment when it is possible to expose the very concrete disasters produced by his policies; advancing in central themes such as Health, Social Rights, Work and Public Services; retake the initiative.

There is still time to correct the course. The two crises – the health and the economic – will develop in the next few days, and may little by little become inescapable issues. A set of clear proposals capable of frontally challenging Bolsonarism on the ground where it is most fragile could polarize the national debate.

Three days of fights will oppose, in the coming weeks, the act called by the ultra-right for 15/3. On March 8, there will be International Women's Day. Six days later, the tribute to Marielle Franco, on the second anniversary of her murder. On 18/3, acts in defense of Education and Public Services. What will be the character of these manifestations? What will be done before and after them? Two opposing hypotheses seem possible today.

The first is built around the reactive and bureaucratized bias that the institutional left has assumed since the crisis of the Lulista project, in the Dilma government – ​​and in particular after the 2016 coup. control. The narrative is repeated according to which everything, including 2013, was nothing more than a conspiracy by the elites.

It is spoken to converts. The childish bait launched by Bolsonaro is taken. In the acts – marked by the deafening presence of the sound trucks and the equally authoritarian and rival aesthetic of the huge balloons – the keynote will only be the defense against one more blow. Participants will leave as they arrived, commenting on keynote speakers and unprepared for what will come next.

In the second hypothesis, another tradition emerges, which also makes up the repertoire of the left. The gigantic #elenão, the feminist waves, the LGBT+ parades, the self-convoked acts in repudiation of the murder of Marielle Franco, the arrivals of the landless, the homeless and the indigenous to the center of the metropolises, the marches in defense of of Education in May 2019. The parties are present, but the protagonism is shared with the crowd. The creative immensity of posters, painted bodies, songs and dances emerges.

Above all, it assumes an agenda that provokes, instead of (or even to) defend itself. The marches refer to a concrete democracy – which implies society's right to the Common – health, education, work, a dignified life, a new relationship with nature. Congress is defended against authoritarian attacks, but there is also talk of reinventing politics with new forms of participation and direct action.

Bolsonarism is in fact being faced. The current dynamic is reversed, forcing you to respond. A situation is created in which each participant sees the acts not as a show where illustrious personalities speak – but as a moment where ideas are shared, to then take new initiatives. Also, because the fight against fascism will be prolonged and will need millions of activists permanently capable of speaking, listening to the other, creating.

The battle in defense of democracy and a breathable country seems increasingly intertwined with what the Brazilian left wants to be in the XNUMXst century. An unlikely repeat? A possible recreation? As Bertolt Brecht said almost a century ago: "don't expect answers other than yours"...

* Antonio Martins is a journalist, editor of the site Other words.

Article originally published on the website Other words.

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