Structural Changes Are Needed To Address Coronavirus

The U.S. Capitol is reflected in water as negotiations on a COVID-19 economic bailout continue on March 24, 2020, in Washington, D.C.

Responding to and properly recovering from the COVID-19 pandemic will require structural reforms that fix underlying problems in America’s economy and democracy. Structural reforms are necessary to protect public health, mitigate the risks of future outbreaks, and ensure the eventual recovery benefits most Americans.

Too many workplaces lack adequate safety protections, millions of Americans still don’t have paid sick leave or health coverage, and roughly 2 in 5 people have virtually no savings to cover a financial emergency and cannot afford to stay home. Almost as importantly, the pandemic and the political response to it will inevitably reshape the country’s economy. After the financial crisis in 2007, the big banks that caused the crisis managed to become larger and more powerful, and the rich got even richer. In contrast, most Americans struggled through the recovery, and by at least some measures the economy had not fully recovered before the coronavirus pandemic started.

In all future COVID-19 response legislation, progressives at the federal, state, and local levels should push for structural changes that, for example, provide paid sick days and paid family and medical leave to all workers, make it easier to join unions, and ensure elections are protected from meddling. Without these types of changes, the United States will continue to risk and demean people’s lives as well as repeat and exacerbate many of the failures of the response to the Great Recession. So far, Congress has taken only very modest steps toward structural reform—providing some workers with emergency paid sick days and emergency paid leave to care for a child whose school or place of care is closed as well as funding a portion of the amount necessary to protect elections during an outbreak. The pandemic may continue for quite some time, during which it will become increasingly obvious how America’s structural problems exacerbate COVID-19 risks, how unfair the current economy is, and how vulnerable democratic processes are.

Weakened protections have put workers and democracy at risk

The U.S. economy clearly has long-standing problems. Wages for the typical worker are stuck near the same level they were at almost five decades ago, while the vast majority of the economy’s gains benefit only those at the very top. Women earn less than men for the same work. Black and Hispanic people have roughly one-tenth the wealth of whites. Union membership as a share of the economy is near record lows despite majority interest in joining a union. The number of industries where companies have monopoly power is near record highs. Health care costs are high and rising. Companies commonly force workers to sign away their legal rights, and many economic activities are causing the planet to heat up to dangerous levels. The list could go on and on.

The COVID-19 pandemic is hitting vulnerable, low-wage workers the hardest. As restaurants close, they are laying off bussers, waiters, and cooks; airports are shedding wheelchair attendants, baggage handlers, and cabin cleaners; and even manufacturing firms are laying off workers. These jobs are often held by people of color, and especially women of color. In contrast, many white-collar workers can work from home and order supplies from delivery workers, who are often so-called independent contractors with few rights But even white-collar workers have trouble getting tested for COVID-19, while well-connected elites skip to the front of the line. These inequities are likely to grow and become increasingly obvious the longer the pandemic persists.

Similarly, prior to the pandemic, American democracy was already under threat from voter suppression, secret spending from corporations and the wealthy, and a political system that too often responds to the preference of the rich but not those of regular citizens. States need to act quickly to prepare to operate their elections during a pandemic; the need to do so in a way that provides access to the ballot box for everyone should concern all voters, especially with President Donald Trump’s history of violating norms—from refusing to comply with congressional investigations to soliciting election interference from foreign governments.

Intertwined problems require large-scale reforms

Progressives may fear that pursuing broader reforms is somehow opportunistic, but the country’s ability to recover from this unprecedented crisis is dependent upon such change. All workers need access to paid sick leave and paid family and medical leave—not just those who had it before and those who recently gained it as part of emergency measures. Workers also must be able to negotiate with their employers about safety measures and accommodations to new working conditions and ensure safety measures are followed—which unions help workers navigate. Citizens are more likely to follow government public health directives to remain quarantined or report for work if they are an “essential employee” when they trust their elected leaders are looking out for the public interest and are ensuring employers provide needed protections.

These economic, public health, and political issues are connected. For example, the Trump administration delayed for weeks fully invoking the Defense Production Act, which would direct companies in the production of needed personal protective gear and lifesaving equipment. Instead, the administration allowed an uncoordinated bidding war over inadequate supplies, just as industry lobbyists sought. Due to the lack of supplies, the Trump administration changed health care guidelines to weaken public safety by requiring that health care workers with a high risk of exposure to the coronavirus be provided with only a simple face mask rather than the originally recommended specialized masks known as N95 respirators. The hospital industry supported the move, but health care workers opposed the new guidelines.

Some nurses have resorted to wearing garbage bags in an attempt to protect themselves. Inadequate safety protection against COVID-19 is not just a danger for health care workers; workers in grocery stores, warehouses,  factories,  food production, and delivery also report being forced to work in conditions that present a high risk for infection. Unfortunately, too many companies are putting their workers at risk—and too many companies feel they can get away with it.

Structural reforms are also good preventive medicine. If firms had less monopoly power, they would have less influence with policymakers, and thus bailouts and regulatory giveaways would be rarer. If bankruptcy rules were fairer to collective bargaining agreements, workers would have less to lose from orderly restructuring in bankruptcy. If women and people of color were paid equitably and more workers were unionized, then more people would have adequate resources to weather a temporary storm. If large, profitable corporations actually paid U.S. taxes instead of playing shell games, government could properly fund needed public health programs. Without structural reforms, trillion-dollar bailouts and stimulus will be the new normal.

Finally, unless workers gain more power, their economic conditions are likely to deteriorate sharply. When the economy returns to normal, workers will have far less leverage to secure raises—unemployment will no longer be near record lows, union density will have fallen even further, and many workers will have depleted their savings and be desperate for work. The types of jobs that are increasing during the crisis are gig delivery jobs that typically pay low wages—a trend that is likely to continue. At the same time, large corporations are likely to dominate markets even more, as they have the capital and political connections to endure the economic downturn. Massive companies that control online marketplaces are already gaining even more market share as smaller, brick-and-mortar firms remain closed.

If history is any indication, corporations will actively work to restructure the economy to their benefit throughout the crisis at the expense of workers. Corporations have already succeeded in securing billions of dollars in giveaways not directly related to the pandemic—such as a tax break for real estate investors—and will continue pushing for more. For example, some gig companies have tried to deny their workers access to unemployment insurance by fighting existing standards and have attempted to create a new category of employment with few rights.

It seems highly likely that the public will recognize these problems and become angry during or in the aftermath of the crisis. Progressives should channel this political energy in fruitful directions and make clear the policies they think will help.

If progressives do not start a robust debate now about how America’s economy and democracy can and should work, the opportunity to make change will likely diminish. Bailed-out firms will have even more economic and political power to block reforms. Conservatives will claim that any progressive policy is a form of socialism, conveniently forgetting that they support massive government interventions to help corporations and protect the powerful. Pundits will worry about deficits and maintain that progressive priorities are no longer affordable now that Congress has bailed out large companies.

There is a need and an opportunity to start fixing America’s underlying problems right now. Progressives should seize the moment and explain what needs to be done to fully respond to the COVID-19 pandemic and prepare the country for a strong recovery.

David Madland is a senior fellow at the Center for American Progress.

To find the latest CAP resources on the coronavirus, visit our coronavirus resource page.