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Covid-19: Free money’s great, but we need universal healthcare

Sameer Dossani is a PhD candidate at the Institute for Economic Research on Innovation in Tshwane and co-founder of the website which builds tools to promote peace and undermine prejudice. Sameer holds a Masters degree in Women’s Studies from LaTrobe University, Australia.

A good place to start, given the nature of the current Covid-19 crisis, is with the healthcare system. Countries that had a strong response to the crisis — South Korea, Japan, and China, for example — all had strong public health infrastructure.

As the number of people infected with the Covid-19 virus continues to climb, governments are turning to measures that would have been unthinkable even a few weeks ago. One of the key measures being considered and, in some cases already implemented, is a policy that some social democrats have long been calling for — a Universal Basic Income (UBI). More colloquially it’s known as “free money”.

On 17 March, the United States joined a list of countries that includes Ireland, Hong Kong, Australia, Denmark, Sweden and Norway in moving forward policies that would transfer public funds directly to people. The rationale for these measures seems pretty obvious — most of us are impacted on in some way financially by the situation.

Hourly workers being told to stay home are often not being compensated by their employers; small businesses are still paying rent on stores in empty malls or office parks. Putting money directly in people’s hands also means that they’re likely to spend it, which would give a significant boost to flagging economies. There’s no doubt that the government should find a way to provide additional cash to workers affected by the anti-Covid-19 measures, either through the existing social grants scheme or something else.

But will these measures be enough? The short answer is “no”. The lesson of the past few weeks is that the institutions we have — at a global level, not just in South Africa — are woefully insufficient to meet the needs of a world in crisis. If we are going to build resilience in a world where scientists predict that more crises are inevitable, we need more than a few rands in our pockets.

A good place to start given the nature of the current crisis is with the healthcare system. Countries that had a strong response to the crisis — South Korea, Japan, and China, for example — all had strong public health infrastructure. These countries were able to invest at short notice in much-needed medical equipment and, in the case of China, to build massive new treatment facilities. We’re still hopeful that those sorts of things won’t be needed in South Africa, but if they are, does anyone believe that we are adequately prepared?

If we aren’t prepared, who is to blame? There is a tendency to blame the post-apartheid regime for South Africa’s failing public services, but the shift towards privatisation of healthcare began in 1977. In the 1980s — perhaps as it became clearer that apartheid’s days were numbered — the regime defunded public health services as membership in medical aid schemes became the norm for white South Africans.

When apartheid ended in the 1990s, the ANC government did not undo the bias towards private provision of healthcare and the standard of care in the public sector continued to drop. The HIV/AIDS epidemic, which could have been a wake-up call, was also managed through the private sector — NGOs, most of which were tied to international donors.

Theoretically, it doesn’t matter who provides healthcare as long as everyone has access to it. But in practice, we know that in order to ensure universal coverage, a country needs to have a strong public system that is free at the point of entry. To give the example of the US, we know that people are unlikely to see their doctor even when they are sick if they think they’ll have to pay to receive care.

Private services may provide good care for those who can afford it. But disease doesn’t care about the race, class, gender or sexual orientation of the person it infects.

When it comes to contagious disease, we are all as vulnerable as the most vulnerable among us. Given the HIV/AIDS pandemic, South Africa should have learnt that lesson long ago. But it’s not too late. In addition to distributing money to help working people survive what might be weeks without a paycheck, we must find a way to revamp our public healthcare system.

Where would the money to invest in such measures come from? It may surprise you to know that we already have it. The richest five South Africans alone have a combined net worth of some R300-billion. Progressive taxes on top income earners can generate more than enough funds to finance a strong public health system. These should include measures that would effectively amount to a maximum wage — a 99% tax on annual income earned over R10-million, for example.

Investing in the health sector will also create desperately needed jobs, and not just in the health sector. Health workers will spend money in the communities in which they live and work, ensuring that local vendors can see an uptick in their business.

To those who would say that these measures are too extreme, remember what we’re talking about here. Globally, the death toll for this virus is more than 9,000 people and most of those are in countries such as China and Italy that have much stronger health systems than we do.

According to the academic literature, good public health is only possible when everyone has access to well-funded public systems that are free at the point of access. The difference between a top earner taking home R10-million or R15-million is trivial when compared with the value of a single human life.

We should already know this, but if it takes a pandemic for us to learn, so be it. DM


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