Lessons from the past

How governments reacted to the aftermath of Spanish flu is still highly relevant

THERE is much to be gained from learning from past epidemics and wars in terms of successful government interventions to alleviate poverty.

The 1918 Spanish flu pandemic, as well as the two world wars, provide interesting insights into how governments at the time addressed unemployment and social need, some of which could be replicated in the pandemic we are living through today.

By 1920, the Spanish flu had killed 40 million people worldwide and infected 500 million – a quarter of the world’s population.

The second wave which began six months into the pandemic ended up being far worse than the first.

The spread of the pandemic was exacerbated by World War I where troops were living in close contact in highly mobile units. Tens of thousands of soldiers died from the Spanish flu rather than from conflict.

In South Africa in 1918, workers dying from the Spanish flu were treated as bits of machinery to be written off, and the disease killed 12 880 workers on the gold mines.

Despite these losses in South Africa and elsewhere, the economic impact of the Spanish flu was surprisingly mild and short-term. Industrial production went down, but that was also due to falling defence production as World War I ended.

The pandemic only caused a 0.5% decline in annual output as jobs involved less social contact in the areas of farming, fishing and forestry. By October 1918, business had decreased by 70%, but this was short lived.

The response to the pandemic was notably different from today, as US President Woodrow Wilson never publicly mentioned it.

Some public health commissioners – like the one in Chicago – rejected closing businesses, which resulted in much higher death tolls. This is in contrast to US President Donald Trump, who speaks publicly about the pandemic almost daily.

Due to high mortality rates there was a shortage of labour in many sectors, which ironically led to higher wages.

This is not the case today because of the greater mobility of workers. By the end of the pandemic, however, the unemployment rate was high – 12% in the UK – and governments could not afford to go back to business as usual, but were compelled to develop universal welfare systems to confront social problems. Annual inter-allied conferences were held to find common strategies to combat poverty in the post-war years.

Liberal governments enacted social reforms in 1919 in health, housing, education and unemployment policies.

The establishment of the International Labour Organisation under the League of Nations in 1919 introduced measures aimed at social justice such as the eight-hour workday, unemployment prevention, and the regulation of work conditions for women and children.

States that had abstained from intervention in labour relations put social security at the centre of protection against market dysfunctions.

The UK introduced the Unemployment Insurance Act in 1920, which extended insurance to 20 million workers, and the UK Ministry of Health was established in 1919.

There was the abolition of school fees for the poor and increased access to education. Large-scale housing programmes began in 1922, which saw the construction of 110 000 houses.

Legislation in France saw the construction of 260 000 houses, and new protections for small landowners. France also began the partial or total covering of costs for healthcare.

In Austria, unemployment insurance was introduced, and the government limited the dismissal rights of employers.

In 1920, compulsory health insurance was introduced in Austria.

Sadly, fascism that emerged in a number of countries abandoned unemployment insurance systems and suppressed unemployment agencies.

World War II had a further devastating effect on social welfare, and the conflict ultimately killed 60 million people. The war created welfare constituencies such as disabled war veterans and their surviving dependants.

Belligerent countries ended up spending 10% to 35% of total social expenditure on civilian and military victims.

The UK passed the Family Allowances Act in 1945, and the National Assistance Act in 1948. The Ministry of National Insurance started paying allowances of five shillings a week for each child.

The responses of governments to social needs following World War I, the Spanish Flu, and World War II showed that an activist federal government was essential to prosperity.

While the context and the world have dramatically changed, history suggests that interventionist national governments are needed to lift people out of poverty.