In the dystopian future envisaged by George Orwell in his novel 1984, the government dictated all aspects of the lives of its citizens.
Welcome to the panicked new world of 2020.
The US Federal Reserve has been pumping liquidity into the bond market in response to an unprecedented collapse of economic activity. The Fed’s holdings already amount to 34% of US GDP, and as the economic pain grows, this number will only go up. In land of the free, the decisions made by an unelected, independent body will chart the path of the economy for years to come. The Fed is not alone: holdings of the six largest central banks in the world are already the size of the entire US economy.
The market, as most economists understand it, is a cruel, but impersonal and de-centralized allocator of resources, guided by the logic of accumulation and returns. But the scale of the recent intervention has disrupted these underlying precepts, distorting the financial market. The resulting domino effect will be wide-spread, and states may have to intervene to save the failing markets. The command and control systems which will have to be enacted for this purpose will be centralized, with governments increasingly choosing winners and losers in the economy.
In addition to unprecedented government intervention in the economy, the pandemic has also precipitated hitherto unimaginable levels of government control over citizen’s lives. Large parts of the world are in some form of lockdown, with any movement closely monitored by government officials. Even countries which are loosening restrictions are doing so with the threat of even more oppressive controls if people do not adhere to government advisories. South Korea, touted as an exemplar for the world to follow, fought the threat by flagrantly violating privacy, encouraging people to surveil each other. The voices of dissent against this most Orwellian of programs were drowned out by desperate calls in other countries to implement similar schemes.
The fear that the power vested in governments, even if they are elected, can undermine individual freedom of citizens, has long troubled political philosophers. This concern is reflected in the many checks and balances built into the constitutions of countries around the world. But In recent times, as the resources at the disposal of modern states have expanded enormously, constitutional checks have rarely kept pace. Institutionalization of fiat currencies vested governments with powers that sovereigns of the past could only dream of. The right to legal violence vested in most modern states has been abetted by the tremendous improvements in the instruments of violence. The proliferation of the internet has breached the veil of ignorance between the government and the governed. While these structural shifts have been significant, none of them have caused the current rapid expansion in government power.
Understanding the long-term repercussions of decisions taken by Governments today
Contrary to the popular narrative that states can only usurp overarching power through force, in our current scenario, it was a virus that did the trick. There was no power grab, no subversion of constitutional processes, no battle for ideas and no long, bloody revolution. There is no villain in this piece. We have simply discovered that faced with the threat from the virus, most of us have been unwilling to pay the price of freedom.
Watch: The big choice to make in the post-pandemic world – Totalitarian Surveillance or Citizen Empowerment
It is possible that large-scale state intervention is the only possible way to save millions from death and destitution. But the desperation of our current situation must not blind us to the long-term repercussions of the decisions taken today. Not all the consequences of the changes currently afoot will be undesirable; but those few bright spots are unlikely to make up for the loss of our individual freedom.
1984 in the real world was not like the 1984 envisaged by Orwell, in part because of the warnings contained in the book. Let us make sure that the message of 1984 is still heard loud and clear in 2020.