During the pandemic, innovators and opportunists improvised bold new ways to move money from the state into private hands – it was like the seizure of assets in a socialist state – only backwards.
In an emergency governments will turn to compulsion to get things done. In wartime manufacturing capacity will be requisitioned, farmers told what to grow, broadcasters switched to propaganda. We expect this – and we’re ready to accept a loosening of rules to speed things up, to save lives.
In the pandemic, governments everywhere activated laws – some of which had been passed years before for this purpose – obliging the private sector to support the state’s response to the outbreak. In the USA, the Defense Production Act was invoked, directing businesses to switch capacity to ventilators and PPE equipment – essentially a wartime response to the crisis, not unlike the epic programme that provided thousands of warplanes and tanks to the allies in WW2. This Truman-era law has been used by several Presidents since and it was Donald Trump who did so as the pandemic took hold in 2020, even as he was busy endorsing bleach and necking hydroxychloroquine (Biden has subsequently used the Act to push vaccine production and energy independence).
Being a socialist state obviously gave you no magic advantage in the plague years but in Cuba, despite the blockade, the country’s highly effective natural disaster response system quickly switched to managing the pandemic and, as a result, the country has done better than most – including, obviously, its near neighbour across the Straits of Florida – in limiting deaths and economic damage. The response of the country’s excellent medical system, and in particular its DIY vaccine programme, was so successful that American scientists want access to it. Sensible governments will all be rewriting their resilience plans along Fidelist lines.
In Britain it was different. To be clear, the British Covid crony-enrichment programme probably wasn’t unique. No crisis, war or catastrophe ever goes unexploited anywhere in the world. Profiteering is universal. But in Britain it seems to have been particularly entrepreneurial and deeply integrated with government. When the book is written it’ll be like something from Bulgakov or Vonnegut – a surreal and quite dark montage of titled spivs, lingerie millionaires, ministers on the make, dodgy pub landlords, nervous-looking civil servants…
This baroque clusterfuck of chancers and pin-striped conmen and their credulous Parliamentary enablers worked like a kind of decadent, mirror-Communism. Collectivism run in reverse. Like when revolutionary governments nationalise land and manufacturing without compensation or when Third World nations seize copper mines and oil wells. Only it was all the other way around.
An effective machine was quickly built, by a coalition that’s familiar to us now from twelve years of government. This is the coalition that brings together the more entrepreneurial Tory Parliamentarians – the thrusting, post-Cameron crowd, not the old gits with dinner on their ties – and the younger generation of business opportunists they socialise with – not the titled Plc crowd of the 20th Century but the risk-taking, leveraged, post-crash types. Millennial gangsters.
And they built an ad-hoc but highly efficient money funnel – in a matter of days. It was a slick, fast-track mechanism, Paypal for shysters. The Government called it the ‘exceptional procurement exercise’ (this long apologia for the scheme is quite a read – and includes a list of the firms involved and who proposed them). It came with full state authority and an explicit exemption from examination and it moved cash from the state into the bank accounts and off-shore trusts of business owners and their families, with no questions asked.
The stated logic of the operation was that the only way to move fast enough, to meet the unprecedented needs of the NHS while every other national health system was competing for goods in the same market, was to harness the energy and entrepreneurialism of the connected class, the old boys and old girls, the highly-tuned supply chain of dinner parties and text messages and Parliamentary drinks receptions (and all those incandescent emails, of course).
And the whole regime was very very 21st Century. Agile, ‘open source’, low-friction – a kind of hyper-modern reverse expropriation. Just-in-time enrichment for connected chancers. Contracts were awarded fast, before businesses existed to fulfil them in fact. In all, 430 contracts were awarded via the ‘high priority mailbox’. Margins were enormous. We’ve learnt that a simple forwarded email could trigger a transfer of hundreds of millions of pounds. Epic paydays for wise-guys from every corner of capitalism. Many of these firms, of course, also became eligible for Covid furlough payments and claimed again – a spectacular double payday for many.
And, let’s face it, this is before you even get to the much bigger transfer of wealth – via the vast Bank of England debt-purchase scheme and the government’s direct support for business – to asset owners. These multi-million pound PPE paydays are going to look really silly next to the really big payday.
- Richard Brooks’ long and detailed special report on the PPE procurement scandal for Private Eye is magnificent.