The £60 million in bonuses paid out to the family of Easyjet’s founder just weeks before the company secured a £600 million loan from the Treasury, while Richard Branson lobbies for government support from his Caribbean island, tells you everything you need to know about bailouts: the public take the risk, while the private sector take the profit. Of course government needs to intervene when jobs are at risk, but not by handing over a blank cheque that’s promptly pocketed by bosses and shareholders.
If public money is used to bailout a company, there must be basic conditions attached. We might, for example, expect that companies pay their taxes; that public money should be used to support workers, not provide bosses with bonuses. Bonuses and dividends should be out, and a guarantee that people on low wages won’t have their salaries cut should be in. We all pull together in a crisis; it’s time that those in charge did some of the heavy lifting, too. A maximum pay ratio and employee representation on boards would be a good start in making sure that companies are fit for a post-Covid world.
There’s the question too about bailing out polluting companies. With restrictions on travel likely to last for some time, do we want to prop up the existing airline industry, or use the opportunity to transform it? Making sure that companies adopt climate targets in line with the Paris Agreement, with plans to meet them, might mean we emerge through the pandemic with industries fit for the future, rather than ones set to destroy all our futures.
Use this moment to transform our economies and we might begin to see innovative solutions that work for all of us: a complementary transition fund could begin to build the fast, clean, travel network of the future.