April 2020-ongoing.Last updated May 10th.
In this section, I break down three areas, exacerbated by the Covid-19 pandemic, that I believe make up key challenges to work over the last 40 years – wealth, systemic inequality, and health. I go on to outline some questions I think are most pressing and, given how startling the economic depression and health crisis is expressing what I am hopeful for.
During the late 1960s and into the 1970s, a series of postwar political changes, including environmental regulations, consumer protections, and economic volatility, pummeled the American business community. These changes were taken as direct attacks on corporations by the American business community. In response, Virginia Lawyer and future Supreme Court Justice Lewis Powell penned a now-infamous memo to the U.S. Chamber of Commerce calling for business leaders to rise and counterattack. Powell’s memo activated the playbook, which we have been living with since the 1970s, for free enterprise and corporate domination. Powell writes:
The day is long past when the chief executive officer of a major corporation discharges his responsibility by maintaining a satisfactory growth of profits, with due regard to the corporation’s public and social responsibilities. If our system is to survive, top management must be equally concerned with protecting and preserving the system itself. This involves far more than an increased emphasis on “public relations” or “governmental affairs” — two areas in which corporations long have invested substantial sums.
As I have tried to process what is happening to work in this crisis, I keep coming back to the challenges that have been building since Powell’s memo (over the last four to five decades).
I think these challenges to work can be broadly outlined in three major areas – wealth, systemic inequality, and health.
- Wealth. Real wages for working families have been flat for four decades, while we have seen massive increases in productivity. Workers, despite flat wages, have had to contend with increases in housing, transportation, fuel, food, healthcare, and education. While studies show that ~50% of American workers are living check to check, and many small businesses on the brink of collapse with only two months of payroll on hand, wealth for the 1% has substantially increased.
Jobs. In addition to wealth inequality, the economic depression from the crisis is a disaster for Jobs.
The U.S. labor force is about 165 million people. On May 7th, the labor department reported massive claims in unemployment insurance representing 20.3%, and 33.5 million jobs, of the U.S. labor force. (2). Given unemployment only accounts for people actively looking for work, it does not reflect the true economic devastation leaving out workers who have experienced a reduction in pay or hours. As a comparison, in the great recession of 2009, unemployment reaching 10%. During the Great Depression, unemployment rose to 25%.
A report by the University of Chicago Becker Friedman Institute finds there are 3 new hires for every 10 layoffs and it estimates 42% of those job losses will become permanent.
2. Systemic Inequality. If we look back to the last several decades, every time global capitalism gets into trouble, the systems proponents and beneficiaries jump in to rescue it through credit expansion, cuts to interest rates, leading to further volatility and crashes.
In the run-up to the slow-moving train wreck which was the 2007-2009 crisis, the expansion of credit, repackaged and sold as financial products, created a massive bubble. The bursting of that bubble brought down global financial corporations and revealed a system built on racial capitalism.
The racial capitalist system deploys targeted and abstracted financial mechanisms to lure working class and precarious communities further into debt in the form of subprime mortgages, student loans, and other dubious financial products. Underrepresented communities and people of color assume the most debt for college education, only creating additional leverage for a system that does not offer them enough space or opportunities. The banks bet against the repayment of their loans in the knowledge Wall Street would be bailed out – again – when a crash inevitably came. The banks and the beneficiaries of these bailouts are not on the side of working people – if they were, they would have bailed out homeowners, instead of foreclosing on homes and forcing the public to endure austerity.
Debt. The current $6 trillion bailout by the U.S. federal government makes the 2008 bailout, which backstopped the global financial system, seem like child’s play. The second wave of bailouts will take the total U.S. state intervention to about 10 trillion.
While this current bailout does include some provisions to Main Street, it mostly backs up Wall Street. Despite the government claiming relief for small businesses, many have been unable to navigate the Small Business Association’s byzantine relief process, with minority-owned businesses taking the biggest hit.
In addition, larger companies, such as airlines, were given relief in the form of recoverable loans from the Treasury Department. This is a bailout for big business with only a handful of last-minute provisions thrown in for workers, such as keeping them on the payroll for a limited time. A transitional bailout that put workers rights before corporations would include, for example, a provision to help these companies only in return for a public equity stake in them. (3)
3. Health and well-being. Capitalism is a patient in shock. Efforts to keep it alive are creating even greater inequality and wider divisions between those who control and run the political economy and those who are subjected to its material conditions.
The inequitable division of earnings and availability of steady work across racial and gender lines is becoming further exposed. In addition to medical workers, it is lower wage workers bearing the brunt of the essential frontline work in this crisis and facing the hazards of exposure to the virus.
Neoliberalism has privatized and depleted the healthcare system here in the U.S. and around the world. During this public health crisis, workers have continued to show up on the frontline, despite not having access to the appropriate personal protective equipment, healthcare, or the other basic needs, such as housing, that they deserve as a human right. Medical workers are operating in brutal conditions with only sporadic supplies of protective gear. Other essential workers, such as delivery riders, grocery clerks, and postal workers, whose jobs also require human interaction and cannot be done remotely, are facing the risk of infection every day without hazard pay. Around the world, frontline workers are organizing to protect themselves. In a protest on May 1, Amazon warehouse workers were joined by nurses and transit workers to fight against unsafe working conditions at the Amazon JFK8 warehouse in Staten Island, New York. The Families First Coronavirus Response Act passed on March 18, 2020, addressed some of these issues, but it did not require compliance from companies like Amazon to provide paid sick leave. (3) And, it wasn’t until Amazon warehouse workers protested that they were even provided with personal protective equipment inside the warehouses.
Dan Patrick, the lieutenant governor of Texas, took the battle of wealth over health to a new level when he appeared on Fox News stating:
“there are more important things than living. And that’s saving this country for my children and my grandchildren and saving this country for all of us.”
However, when businesses open too fast in a health crisis, it is the most vulnerable members of society who suffer, such as the elderly and poor communities without access to isolation or adequate healthcare. It is also frontline services workers, delivery workers, and cashiers, who are disproportionately from black and minority ethnic groups.
This lack of social and financial protection is a hallmark of the neoliberal gig economy, where risk is passed from the corporation onto the individual, despite the absence of a social safety net. The “freedom” promised by the gig economy may feel flexible at times, but it deprives independent workers of health insurance and benefits, dividing them into atomized units to be surveilled. This takes a psychological toll on workers.
As economic provisions dry up, death rates have spiked, not only due to Covid-19, but also in certain demographics due to drug overdoses, suicides, and alcohol-related diseases. (4) The scale of human devastation is far more widespread than the direct harm of COVID-19.
A recent conversation in Strelka mag in early May between Andreas Petrossiants and Franco “Bifo” Berardi explores how this trauma has opened the way for social reprogramming. Berardi writes:
Capitalism does not give a damn about protests and people’s awareness. But now it’s different: the living body of humanity (and the interactive mind) have been somewhat paralyzed by the presentment of the end: in short, a global trauma. Yesterday, the conditions for revolution were present: the sinking of democracy, the arrogance of the powerful, rampant poverty, violent exploitation, ecological devastation, and widely accessible information about what is going on. But, to quote the Invisible Committee: “Reasons do not make revolutions, bodies do.” (5)
Capitalism is destroying us. Mike Davis, who has studied capitalism’s effects on sustainability e.g. food scarcity, jobs, de-carbonization, and public health, believes we have now entered a new historical epoch.
But to put it in more classical language, the super-capitalism of today has become an absolute fetter on the development of the productive forces necessary for our species survival. (6)
This is a time of survival on many dimensions and I am hopeful the growing momentum in the strikes which have emerged around rent and debt cancellation, strikes against unsafe conditions, workers refusing to go back to work, etc. will create change.
The scope of this crisis raises lots of questions about what kinds of systemic changes are needed to our financial and political economy. And, how our most ailing citizens will be supported during the economic depression.
I am left with six questions that keep me awake at night.
1. Can we abolish this system for something new?
2. How will people sustain themselves without jobs and relief?
3. What are the urgent reforms and transitional demands to make of the current system? For example: paid sick leave mandates for all employers; abolishment of debt and rent #Cancelrent (Michael Gianaris’s Senate Bill S8125A); universal healthcare; hazard pay for front-line workers; and, internet for all.
4. How can we build on the momentum of current political organizing to get more people involved in down-ballot voting?
5. What new types of autonomous, social grassroots organizations will help us rebuild more equal and just systems?
6. Now that fewer people are working, how will our collective relationship with work be reshaped?
I would like to leave this page on a note of optimism by expressing what I hope for:
- Formally recognizing frontline workers as essential, beyond a crisis, so they can receive the wages, healthcare, and support they deserve. (7)
- Breaking free from the ideology of individualism in neoliberal work that seeks to divide us, hurting our labor power, forcing us to work more hours for less pay.
- Small wins against urgent issues, such as wins in down-ballot elections and swaying more elected officials to support workers.
- The long-standing efforts of mutual aid and how many more people are drawn to these movements. I recently watched this video written by Dean Spade and Ciro Carillo that left me energized. (8)
- Pew Social Trends
- Over the past 7 weeks, 33.5 million UI claims were filed, representing 20.3 percent of the 165 million employed and self-employed workers reported in February 2020. Press release.
- As noted in these reflections from the People’s Policy Project the paid sick leave requires compliance of employers of 25-to-499 employees leaving out huge enterprises like Amazon, lots of mid-market firms, and franchises that remain open.
- Deaths of Despair and the Future of Capitalism
- Andreas Petrossiants and Franco ‘Bifo’ Berardi in Strelka mag
- Mike Davis in Portside
- Heroes act stimulus
- Dean Spade’s website has additional materials on mutual aid.