COVID-19/GLOBAL

Down to Earth - - Covid-19 / Global Economy - STATE CAP­I­TAL­ISM

we can think about what might hap­pen if we try to re­spond to the coro­n­avirus with the four ex­treme com­bi­na­tions:

1) State cap­i­tal­ism: cen­tralised re­sponse,

pri­ori­tis­ing ex­change value 2) Bar­barism: de­cen­tralised re­sponse

pri­ori­tis­ing ex­change value

3) State so­cial­ism: cen­tralised re­sponse,

pri­ori­tis­ing the pro­tec­tion of life 4) Mu­tual aid: de­cen­tralised re­sponse

pri­ori­tis­ing the pro­tec­tion of life.

State cap­i­tal­ism is the dom­i­nant re­sponse we are see­ing across the world right now. Typ­i­cal ex­am­ples are the UK, Spain and Den­mark.

The state cap­i­tal­ist so­ci­ety con­tin­ues to pur­sue ex­change value as the guid­ing light of the econ­omy. But it recog­nises that mar­kets in cri­sis re­quire sup­port from the state. Given that many work­ers can­not work be­cause they are ill, and fear for their lives, the state steps in with ex­tended wel­fare. It also en­acts mas­sive Key­ne­sian stim­u­lus by ex­tend­ing credit and making direct pay­ments to busi­nesses.

The ex­pec­ta­tion here is that this will be for a short pe­riod. The pri­mary func­tion of the steps be­ing taken is to al­low as many busi­nesses as pos­si­ble to keep on trad­ing. In the UK, for ex­am­ple, food is still dis­trib­uted by mar­kets (though the gov­ern­ment has re­laxed com­pe­ti­tion laws). Where work­ers are sup­ported di­rectly, this is done in ways that seek to min­imise dis­rup­tion of nor­mal labour mar­ket func­tion­ing. So, for ex­am­ple, as in the UK, pay­ments to work­ers have to be ap­plied for and dis­trib­uted by em­ploy­ers. And the size of pay­ments is made on the ba­sis of the ex­change value a worker usu­ally cre­ates in the mar­ket, rather than the use­ful­ness of their work.

Could this be a suc­cess­ful sce­nario? Pos­si­bly, but only if COVID-19 proves con­trol­lable over a short pe­riod. As full lock­down is avoided to main­tain mar­ket func­tion­ing, trans­mis­sion of in­fec­tion is still likely to con­tinue. In the UK, for

BAR­BARISM IS THE FU­TURE IF WE CON­TINUE TO RELY ON EX­CHANGE VALUE AS OUR GUID­ING PRIN­CI­PLE AND YET REFUSE TO EX­TEND SUP­PORT TO THOSE WHO GET LOCKED OUT OF MAR­KETS BY ILL­NESS OR UN­EM­PLOY­MENT

re­spond to this pan­demic. The sub­se­quent fail­ure of the econ­omy and so­ci­ety would trig­ger po­lit­i­cal and so­cial un­rest, lead­ing to a failed state and the col­lapse of both state and com­mu­nity wel­fare sys­tems.

State so­cial­ism de­scribes the first of the fu­tures we could see with a cul­tural shift that places a dif­fer­ent kind of value at the heart of the econ­omy. This is the fu­ture we ar­rive at with an ex­ten­sion of the mea­sures we are cur­rently see­ing in the UK, Spain and Den­mark.

The key here is that mea­sures like na­tion­al­i­sa­tion of hos­pi­tals and pay­ments to work­ers are seen not as tools to pro­tect mar­kets, but a way to pro­tect life it­self. In such a sce­nario, the state steps in to

Vol­un­teers shop for gro­ceries dur­ing the lock­down, in Arese, Italy pro­tect the parts of the econ­omy that are es­sen­tial to life: the pro­duc­tion of food, en­ergy and shel­ter for in­stance, so that the ba­sic pro­vi­sions of life are no longer at the whim of the mar­ket. The state na­tion­alises hos­pi­tals, and makes hous­ing freely avail­able. Fi­nally, it pro­vides all cit­i­zens with a means of ac­cess­ing var­i­ous goods—both ba­sics and any con­sumer goods we are able to pro­duce with a re­duced work­force.

Cit­i­zens no longer rely on em­ploy­ers as in­ter­me­di­aries between them and the ba­sic ma­te­ri­als of life. Pay­ments are made to ev­ery­one di­rectly and are not re­lated to the ex­change value they cre­ate. In­stead, pay­ments are the same to all (on the ba­sis that we de­serve to be able to live, sim­ply be­cause we are alive), or they are based on

that com­mu­nity re­sponses were cen­tral to tack­ling the West African Ebola out­break. And we al­ready see the roots of this fu­ture to­day in the groups or­gan­is­ing care pack­ages and com­mu­nity sup­port. We can see this as a fail­ure of state re­sponses. Or we can see it as a prag­matic, com­pas­sion­ate so­ci­etal re­sponse to an un­fold­ing cri­sis.

These vi­sions are ex­treme sce­nar­ios, car­i­ca­tures, and likely to bleed into one another. My fear is the de­scent from state cap­i­tal­ism into bar­barism. My hope is a blend of state so­cial­ism and mu­tual aid: a strong, demo­cratic state that mobilises re­sources to build a stronger health sys­tem, pri­ori­tises pro­tect­ing the vul­ner­a­ble from the whims of the mar­ket and re­sponds to and en­ables cit­i­zens to form mu­tual aid groups rather than work­ing mean­ing­less jobs.

What hope­fully is clear is that all these sce­nar­ios leave some grounds for fear, but also some for hope. COVID-19 is high­light­ing se­ri­ous de­fi­cien­cies in our ex­ist­ing sys­tem. An ef­fec­tive re­sponse to this is likely to re­quire rad­i­cal so­cial change. I have ar­gued it re­quires a dras­tic move away from mar­kets and the use of prof­its as the pri­mary way of or­gan­is­ing an econ­omy. The up­side of this is the pos­si­bil­ity that we build a more hu­mane sys­tem that leaves us more re­silient in the face of fu­ture pan­demics and other im­pend­ing crises like cli­mate change.

So­cial change can come from many places and with many in­flu­ences. A key task for us all is de­mand­ing that emerg­ing so­cial forms come from an ethic that val­ues care, life, and democ­racy. The cen­tral po­lit­i­cal task in this time of cri­sis is liv­ing and (vir­tu­ally) or­gan­is­ing around those val­ues.

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