The justice of compensating for the quarantine is once again one of the main societal concerns. Previously made mistakes are leading to more and more flawed interpretations and force us to go back to the origins of the crisis. Did companies, which received “quarantine relief” from the government, have a right to breathe, move and change? In economic terms, it means to pay, invest, purchase, trade and transfer.
Already at the beginning of the quarantine, we were forced to rethink the basis of the relationship between the society, the government which represents it as well as the people and companies affected by the quarantine. The Constitution pointed to the only answer – private property should be temporarily seized and its use restricted in order to satisfy societal needs.
The attempt to compare the quarantine to the restriction of economic activity is inadequate – restricted economic activity does not stop as long as certain requirements are met. However, in the case of the quarantine, economic activity was completely forbidden. Thus, the Constitution gives rise to the duty to fairly compensate for the temporary seizure of property. Precisely, to compensate rather than to support or provide relief.
If this thinking was prevalent at the beginning of the quarantine, the question of whether it’s rightful to support businesses would not be as divisive as it is now. Then, we could think in agreement about fair payment and compensation. This situation would create possibilities for transparent, proportional and swift compensation since discontinued economic activity or a sharp revenue decline would be the only criteria to receive it.
Imagine that the quarantine continues for three years rather than six months. In this scenario, nobody would suggest that people who have lost their jobs and livelihood and their companies should live off their savings. It would become clear that those who have lost jobs and livelihood due to societal needs have to be compensated for their losses and allowed to look for new ways to earn a living.
Perhaps companies are shifting to e-commerce – that is great. Maybe they have found new niche markets or changed their work profile – bravo! Nobody will complain that companies’ accounts are not empty. However, many people claim that if companies are not struggling, they are not worth the support.
It is not difficult to understand the essence of relentless change and transformation. Is it hard to understand that a company needs to invest not because its account is showing zeros, but because the society has obliged to stop operating? Finally, is it hard to grasp that companies need to have money at all times to be able to buy, pay, and invest and so that a company with an empty bank account cannot function? The ability to finance purchases is particularly important now, when the price of materials is going up and their supply is interrupted.
At the beginning of the first quarantine, we had to warn the government that payments to employees should be made directly without involving their employers. Employers were made into intermediaries between the government and employees for which they now receive a lot of criticism. At the time, we warned that the involvement of employers could have negative consequences – people who have no choice can start acting irresponsibly and recklessly, while at the beginning of the crisis, many people were losing their minds due to the feeling of insecurity and uncertainty.
Finally, the manager may take steps to save the company that are not necessarily successful (no one has managed to revoke mistakes yet), as a result of which, employees would suffer but the blame would be put on him. I would not be surprised if these cases were frequent in Lithuania. However, it is very surprising that rather than focusing on them, the dissatisfaction has been directed at companies that managed to pay their downtimes, managed to act as intermediaries for the government, and did not end their economic life – paid the dividends, continued to make purchases.
If, after having received and paid out subsidies to their employees, companies were obliged to consult with governmental institutions regarding the terms for their activity, these terms and which institutions should be consulted should have been specified beforehand. Of course, I am being ironic here. If these restrictions were not planned, antagonizing society for companies’ decisions, regardless of their economic rationale, is both unlawful and unethical.
These concerns are especially relevant when we all know that the government did not stick to an economic diet itself. While the majority of companies started saving and optimizing their finances, governmental institutions were the only ones that did not do that. For some clients, the service stopped completely and continues to be late under the pretense of quarantine, while money from the budget is being paid out as if there were no quarantine.
Mistakes are costly. “Support” rather than allocation of compensation cost the society a lot of lost time – the support reached the people and companies late with reductions and bureaucratic delays. Secondly, the allocation of “support” cost a lot of resources and time for governmental institutions, while it could have been administered quickly, transparently and automatically. Therefore, if anyone cares about using society’s time and resources efficiently and promoting trust, they should focus exactly on these reserves.
