As the COVID-19 crisis grinds on, it’s increasingly clear that the UK’s broken economy – an economy based on the extraction of rent – is deepening the pain. In August, people were prematurely cajoled back to the office, amid rising panic at the ‘hollowing out’ of city-centres built on inflated commercial property values. In September, students were herded back into overcrowded university accommodation, which duly became the epicentre of the second wave. Many suspected that this predictable disaster was allowed to unfold at least partly because of the dependence of universities and private landlords on rental income from student halls.
Meanwhile, the divide between private renters and homeowners yawns ever wider. While buy-to-let landlords have been able to access mortgage holidays, their tenants struggle with escalating rent debt. Social movements are gearing up to resist evictions after the temporary ban was lifted. While the government’s stamp duty holiday has helped house prices to bounce back, there is no sign whatsoever that jobs and living standards will do the same.
Housing itself is just the most egregious tip of a very large iceberg. Everywhere you look, COVID-19 is widening the gulf between those who own assets and those who owe debts. Buoyed by central bank interventions, capital markets have seen the promised ‘V-shaped recovery’ – but for everyone else, this is now a distant fantasy. Our economy and our politics seem increasingly oriented around the interests of asset owners, and increasingly uncaring about the fates of everyone else.
