Iliyan Stoyanov
Ted Talk
Everyone has a personal relationship with COVID-19. COVID is the one who shut down everything. Our new reality is travel restrictions, and social distancing in public. Those of us who are lucky enough to have work are working from home. We all recognize these “symptoms” of the virus. The true damage we cannot see as easily. Under the surface, the virus is tearing apart the fabric of our society.
But before we delve into it, let me introduce myself. My name is Iliyan Stoyanov, and I am a high school senior. Just like you, I am a victim of the modern plague. Thankfully, no one in my family has gotten sick, but there have been other casualties: my robotics season was cancelled, and I’m stuck doing school from home.
The economic crisis is one of the most complicated outcomes of the COVID crisis. Economics are complicated in the first place, and COVID is just making it harder to decipher. But in essence, there are several factors that break the way we have run our society in the past.
The first reason comes from the low-paying work that often falls below our notice. All of a sudden, we have realized how we cannot do without these jobs, going as far as to label them “essential”. Whether these are retail, transport, or manufacturing positions, they are critical to our economy, pre- and post-lockdown. However, aside from a few hashtags, we are not treating these workers as essential. Most are still being paid minimum wage, which has been stagnant since 2010, the longest stretch of time that it has gone unchanged. If we adjust to inflation-adjusted dollars, it is even worse, because according to the Federal Reserve, the minimum wage is nearly at the lowest buying power it’s ever been. This means these essential workers are not being compensated for the additional risk they are untaking while working during a pandemic. Their job might be essential, but it doesn’t pay like it is. In fact, NPR reports that jobless Americans are receiving more money than those working essential jobs under the CARES Act’s extended unemployment benefits. This all seems unfair, but why does it matter to you personally, in the middle class? Well, these Americans are more likely to become sick than anyone else, and they are less likely to be able to afford healthcare, a deadly combination. This will not only drive up fatalities, but it also means that there are less people working our essential jobs. And if essential jobs stop, so do food deliveries, utilities, and infrastructure, dooming the entire society, giving you in the middle class a stake in this.
The issue of the poor getting poorer is one of the reasons for the massive unrest the country has been experiencing. As Yuval Harari wrote in his chronicle of human nature “Sapiens”, once a hierarchy stops working for a part of the population, they will do their best to gum up the works and create something better for themselves. Howard Zinn agrees with this in his own work “A People’s History of the United States”. Zinn points out examples of this all over American history. To protest their stagnant wages, the entire city of Seattle was shut down by the unions, establishing their own order in the city. Today, this manifests as the BLM riots: the downtrodden parts of society rise up to make their voices heard.
The next issue is the polar opposite: the rich have been getting richer during the pandemic. According to Forbes magazine, the richest Americans’ net worth’s have grown by over 637 billion dollars over past months, according to Business Insider. This is in spite of record unemployment figures! So where did this wealth come from? First of all, a large chunk of the CARES Act bailouts went directly to corporations instead of the people. Rather than helping the lowest common denominator, that money went to corporations with lots of overhead, meaning that although that money might have been intended to help regular people, it’s effect was blunted.
There are also other reasons for limiting the growth of the gap between rich and poor. One of the greatest dangers to our economy is the so-called K-shape recovery. K-shaped refers to the trend that only some types of businesses will recover from the downturn, while the rest remain in recession. A full recovery happens much slower than in a typical crisis. And, it gets worse. Most of the sectors that remain in recession are the service industries, which employ low skill labor. In fact, NPR claims that less than 2% of high skill positions have been lost, as compared to over 13% of lower skill positions, where on average African Americans and Hispanic people are more severely affected. Once again, this increase in the gap between rich and poor will only contribute to the growing discontent sparking rioting across the country, because the hierarchy no longer works for everyone.
Now that we understand the problems, we have to explore solutions. How can we fix this issue? We can start by mandating higher wages for our essential workers. This would serve to bring more wealth to the poor class who work those jobs. More wealth means more healthcare resources within reach, and thus reducing the toll of COVID-19 on those most vulnerable. It would also serve to equalize the society, which would have the dual purpose of avoiding the K-shaped recovery and reducing the inequality that fuels unrest. Another potential solution is to pass a new stimulus package, focusing more heavily on helping the lower classes overcome the challenges they face.
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