Fuel Price Hikes Hammer South Africa’s Working Class 17:53 Sep 20 0 comments
The Davos Blind Eye: How the Rich Eat the Poor and the World 18:07 Jan 26 0 comments
Riflessioni sullo stato di crisi del capitalismo 06:41 Dec 24 0 comments
Currency Workers Vote for Change With RWDSU 19:33 Jun 15 0 comments
Germany refuses Greece an honourable surrender over austerity 21:22 Feb 20 0 commentsmore >>
Recent articles by Andrew
Recent Articles about International Economy
Basic Income & Billionaire preppers
Three futures: Barbarism, UBI Warehousing or Anarchism
The crisis is fundamental rather than temporary because there are two underlying factors that are irreversible. The first is the end of the era where the environmental costs of growth could be mostly discounted in the belief that dilution would neutralise pollution. For much of the industrial revolution the poisonous effluent dumped into the ecosystem had only local severe effects with the vast oceans and atmosphere diluting the pollutants enough that global effects were minor. This is no longer the case with climate change being the most talked about of several examples where the pollution generated by growth can no longer be absorbed without serious global consequences.
Capitalism depends on constant growth and constant growth generates pollution. The stock market boom following Trump taking power is a direct effect of him tearing up environmental protection legislation, profits will increase because business will have to cover less of the environmental cost. Our children will pay the bill for this short lived boom for shareholders.
The Abolition of Work, or Employment?
The second fundamental aspect is automation. For much of human history the amount that could be produced was very closely related to human effort. In a given set of conditions the only way to produce more was to spend more human hours in production. At times of empire building this drove incredible cruelty as expansion was dependent on conquest, robbery and enslavement of populations who were then worked so hard that their death rate greatly exceeded the reproduction rate.
The wealth that the European powers built the industrial revolution on was generated in precisely this way, resulting in the deaths of hundreds of millions of people around the planet as overwork and underfeeding left them vulnerable to disease and starvation. But the industrial revolution also changed what had been a simple relationship between the amount produced and the amount of human labour required. New machines started to allow a single worker to do the work that once would have required 5, 10, 50 or 100. This process was not independent of the environmental problem above but rather a cause of it as fossil fuels provided almost all of the replacement muscle that drove the machines.
In today’s networked age we are seeing a change that will have a bigger impact than the industrial revolution on human society. As machines have become smarter the need to have a worker guiding their actions has shrunk and shrunk. We have reached the stage where very complex operations like driving a car on a busy road - that humans can only legally do after a period of intense study - can now be done far better by computers. It will take a while for production and the legal system to catch up but essentially we are already at the point where taxi drivers, bus drivers and lorry drivers are hanging on to those jobs by their fingernails. Retail stores including fast food restaurants are replacing check out workers with machines. Banks and insurance companies are removing the ability of customers to call into branches or talk to a humans on the phone, again people being replaced by machines.
Trump & Brexit were driven by the false idea that it was migrants who were ‘taking jobs.’ Actually it is robots and realistically as smart automation escalates there are very few jobs that will not be replaced. A tiny number of new jobs will be created but the low and unskilled workers most affected by automation are locked out of those jobs by lack of access to education.
Resisting the Machines?
In the early period of the industrial revolution we saw a very, very much weaker version of this as textile workers found that a machine like the ‘Spinning Jenny’ allowed a single relatively low paid unskilled worker to replace dozens of skilled spinners. They resisted, with some initial success. There are several lessons from that period.
Perhaps most importantly is that although the replacement workers operating the Spinning Jenny replaced dozens they were considerably worse off than any worker they replaced. The combination of deskilling and lack of ownership by the worker of the machines that produced allowed the extreme ruthlessness of early capitalism that saw children working 12 hour days for pennies in extremely unhealthy conditions that killed many of them. The capitalist got rich, the replacement worker was poorer than any of the 10 or 20 they replaced. In fact that’s how the capitalist got rich, suddenly they had the same amount of goods from the labour of one worker that they previously had to pay 20 for.
Secondly skilled workers were aware of exactly what was happening and not only managed to organise against this but put up a really strong fight. Under the brutal dictatorship that existed at the time that executed and transported those that resisted they had to be very secretive. This means we don’t know the fine detail of how they organised that resistance. But we do know that well organised, armed and large groups of workers who we know as the ‘luddites’ mobilised over relatively long periods of time to rise up and smash the machines. And that it took the deployment of considerable military force over a period of years to put them down.
This happened in Britain during the Napoleonic wars. Historian Eric Hobsbawm has pointed out that although that war was a life and death struggle for the British ruling class at one point they had more troops deployed putting down the luddites than fighting Napoleon. The luddite movement smashed thousands of machines and was successful in slowing down the rate at which their wages and conditions were destroyed but over a couple of decades the employers imposed the new machines and with them the new and brutal working conditions and low wages.
Machines replaced some skilled workers in Britain bit by bit over decades,the luddite resistance of the 1810’s was followed 20 years later by the Captain Swing riots against the introduction of agricultural threshing machines. Todays automation is affecting a very, very much larger percentage of the planet’s population over a very much shorter span of time. Left to ‘market forces’ and state repression we can expect something very much more severe but also involving far more people.
The Crisis is Already with Us
There is in fact a strong argument this is already in progress, the Arab spring of 2011, Occupy and other moments of resistance are driven in part by mass youth unemployment. Occupy is a well documented response to the capitalist crisis, in the case of the Arab Spring Cairo based Dorothea Schmidt of the International Labour Organization looked at the forces “that brought these mostly young people onto the streets. An extremely high youth unemployment rate of 23.4 per cent in 2010, is one major but not the only cause for these popular uprisings” Rising food prices related to the impact of climate change on production was also key in the Arab spring. The uprisings that started the revolution in Algeria and Tunisia were directly caused by rising food prices and riots in response, elsewhere they were an often mentioned backdrop.
Drought, in part from climate change, was a significant factor in the forces leading to the Syrian revolution and extremely brutal Civil War that still rages on. Satellite measurements show that the Tigris-Euphrates basin is losing groundwater at a faster rate than anywhere else in the world, except Northern India, due to poor rainfall and over extraction in particular by Turkey which has reduced water flow to Iraq by 80% and Syria by 40%.
From 2006 the drought in Syria was causing tens of thousands of farmers to abandon their land and move to the cities, adding to youth unemployment. One academic study concluded that this water crisis in Syria “contributed to the displacement of large populations from rural to urban centers, food insecurity for more than a million people, and increased unemployment—with subsequent effects on political stability. ”
This causal factor has also been mentioned in studies of activists from the region. In Burning Country: Syrians in Revolution and War the authors say “The situation was made worse by the severe drought plaguing much of the country since 2006. Rural areas such as the Jazeera (in the east) and the Hawran (in the south) were particularly hard-hit. By 2010 the drought had pushed between two and three million Syrians into extreme poverty, destroying the livelihoods of around 800,000 farmers and herders”. The also noted other familiar causes “neo-liberal reforms were accompanied by the dismantling – by cutting subsidies – of the economic safety net for the poor. Inequality grew, until 50 per cent of the country’s wealth was concentrated in the hands of 5 per cent of the population. High unemployment, underemployment and low wages made it harder and harder to make ends meet. In 2004, just over 30 per cent of the population (5.3 million people) lived in poverty, rising to 62 per cent in rural areas … Youth unemployment stood at a staggering 48 per cent, with young women four times more likely to be unemployed than young men”
Revolution in Rojava, which often takes a sharply different perspective on the Syrian conflict to Burning Country, also talks about the same causal factors pointing out that “In 2012-13, long-predicted water shortages became a reality” and points to the difficulty supplying water now presents to the revolution. “Wheat and cotton are Serekaniye’s main crops. Water for irrigation must be pumped from 200-500 meters below the surface, and the pumps need to be powered by electricity, which has been cut off”
The World Has Changed
When you are in world changing historic events it’s often hard to see that is the case. Instead things appear disconnected and driven by individuals, group and ideology. Taking a step back for a moment and we begin to see how climate change and unemployment although driven from Silicon valley, the Ruhr and Shanghai has first disrupted regions which are comparatively economically marginal like Syria, Egypt and Iraq. We can see how the tumult that has spread out from there has then precisely shaped conditions in Silicon valley and the Ruhr as ‘refugee panic’ politics started to shape domestic politics. True the automation that is most visible in those regions is the automatic mass killing of the helicopter gunship and the remotely operated or autonomous drone, again linking us back to the US. The political shocks are not separate but part of the same crisis and can only get much worse as the crisis escalates.
There is no going back. We can delay things by smashing the machines as the taxi drivers of Paris have fought Uber. The experience of the Luddites (and indeed of print workers and dockers last century) tell us such a fight is not futile. In the short term it can protect wages and conditions, allowing that generation to raise their children in relative comfort but those children don’t inherit those well paid jobs.
History tells us that the market driven quest for profit will create replacement machines and will station soldiers to guard them. And today we are at the edge of that moment when those soldiers will no longer be humans whom we can call on to revolt but will be machines themselves. The forces the US has deployed over much of the planet still require infantry but most of the ongoing killing is already being carried out by human-machine hybrids that were science fiction two decades ago.
There is a third factor worth mentioning, this one isn’t irreversible or new but rather a pattern of history. Thomas Piketty’s ‘Capital in the 21st Century’ may have been too technical to be completed by many of its readers but it provided a clear illustration that the wealth gap was rapidly increasing. And more importantly a warning that at a certain point the effects of that gap on society made it almost impossible to reverse without major warfare.
One measure of the escalating wealth gap is how many of the super rich hold the same wealth as the poorest half of the planet’s population. A decade back you could fit them in a big jet plane like a 737, there were about 350 of them. A few years back that number had shrunk to about 50, a coach-load. A couple of years ago it had shrunk to a small bus-load. The latest Oxfam figure is that it is now a single car load, if you cram the 8 of them into a SUV. Half of American adults have seen no increase in real wealth since 1980, for the top 1% wealth tripled in the same period and the increase was much greater for the top 0.1 and 0.01%.
There are already examples in Mexico and Johannesburg and elsewhere of what happens when the incredibly rich and the incredibly poor are crammed into the same urban landscapes. It’s an urban landscape of mansions surrounded by high walls, razor wire, CCTV cameras, attack dogs and ‘shoot to kill’ security. Those inside live in constant fear of those starving outside and as a consequence increasingly brutal regimes of repression and murder become normalised.
The Corporate Tech Overlords
Apple is now the largest corporation on the planet, a corporation whose business model is built on removing elements of choice and control from their users in the belief that the CEOs know best. For an increasing number of us, access to news and communications is overwhelming filtered through Facebook algorithms. In the last decades a psychological science of manipulation has developed where the goal has been to influence our unconscious minds against both rational thought and better instinct.
Trump’s idiotic neuro-linguistic programming where everything is fantastic, bad or fakenews seems to have been enough to reach into the fear centres of a sizeable minority of the population. The Economist reported that the best single predictor for a Trump voter was poor health, indeed what other than sickness makes us vulnerable to hucksters preying on our fears? Increasing insecurity in the workplace and subjecting welfare payments to various tests adds to creating a constant situation of stress in many people’s lives that makes them vulnerable to the politics of fear and scapegoating.
The tech elite form a tiny, tiny percentage of the world’s population but now hold in their hands an enormous percentage of the world’s wealth. The 8 people who own as much wealth as half the world include Bill Gates (1), Carlos Slim (4), Jeff Bezos(5), Mark Zuckerberg (6) and Larry Ellison (7). Those five are all rich from the technological revolution of the last decades.
Gates, the richest of them, has become a sort of benevolent dictator. Having made an enormous fortune he is now claims to be distributing that pile to those he considers to be the most deserving poor. This has made him personally responsible for the life and death of millions of people on the planet, in particular the children he has chosen to save though funding inoculation programs. The stated goal is to prevent 11 million deaths by 2020.
We can be grateful with regard to Bill that a lucky dice roll meant that this Pharaoh has chosen a benevolent old age - no doubt with an eye to how he is remembered - but history is littered with examples of the rich and powerful who were not. How long do we want to gamble on that dice roll. Larry Ellison for instance spent 130 million on his latest super yacht and 500 million on buying the island of Lanai.
Amazon CEO Jeff Bezos was named the world’s worst boss by the International Trade Union Confederation in 2014 as representing the “inhumanity of employers who are promoting the American corporate model” There have been several exposés of the terrible conditions of poorly paid Amazon warehouse workers, one reminder of the costs of automation, but as a New York Times article showed conditions for White Collar workers are also terrible in Amazon’s ‘race to the bottom’
A lot of scientists are aware of these crisis. Stephen Hawking for instance has warned several times of the consequences of automation and the futures which lie before us. But is there a way out? Are we doomed?
Our methods of political discussion and decision making remain trapped in technologies that are hundreds of years old because the limits that imposes suits those who have wealth and power. That is illustrated by the complete ease with which complex cross border financial transactions can be instantly completed. Yet the parliamentary system alongside them is still at the equivalent point as when those transactions involved meetings in particular dockside coffee shops to decide how the risk would be divided on ship voyages that would take two years to return. The parliamentary system remains as is because a process that involves the selection of a few to represent the views of millions without being subject to mandate or recall is a system where those few can be bought. [Read more]
There are Three Futures.
The first future is the default one, what happens if we do nothing and just allow the invisible hand of the market to rule. It’s the process of the last 40 years, unleashed by the neoliberal bloodletting that started literally with the dictator Pinochet in Chile and developed under Reagan and Thatcher. Under this future the wealth gap becomes even more extreme, the powerful become even more fearful of the rest of us and we increasingly fight each other for the reduced resources that are allowed to trickle down to the jobless majority. At best we hope for benevolent pharaohs like Gates rather than self obsessed ones like Bezos or Zuckerberg so that we are at least allowed to survive rather than starve or die in the resource civil wars. But perhaps there is no hope at all if the worst climate change models play out and a positive feedback loop results in run-away warming.
The second is the one that an increasing number of the elite are turning to because they also aren’t that keen about the world of fear and helicopter gunships that also lies in their future. Economist Mark Blyth has a nice line on this that “the Hamptons are not a defensible position”. The Hamptons being the super rich zone on the beaches above New York where billionaire New Yorkers have their weekend mansions. Perhaps in recognition of the indefensible nature of this strip of land an hour from the millions in New York it has recently emerged that several tech billionaires have bought large landholdings in New Zealand where they are building luxury bunkers. New Zealand being sparsely populated and a long way from anywhere else being judged to be the safest available bolt hole if the shit really hits the fan as a result of the future they are building.
The New Yorker published a long read on these super wealthy ‘preppers’ in which they quote LinkedIn billionaire Reid Hoffman. What he had to say deserves a lengthy extract he “recalls telling a friend that he was thinking of visiting New Zealand.
Hoffman then estimates half of his fellow Silicon Valley billionaires have acquired some sort of “apocalypse insurance,” hideaway in the U.S. or abroad saying “The fears vary, but many worry that, as artificial intelligence takes away a growing share of jobs, there will be a backlash against Silicon Valley”. “I’ve heard this theme from a bunch of people,” Hoffman said. “Is the country going to turn against the wealthy? Is it going to turn against technological innovation? Is it going to turn into civil disorder?”
It would be a pretty miserable world to live in even if you were one of the wealthy few gazing out at the chaos from behind electric fences. Evan Osnos, the author of the New Yorker piece, visited the Survival Condo Project, a fifteen-story luxury apartment complex built in an underground nuclear missile silo in Kansas and was told ““It’s true relaxation for the ultra-wealthy,” he said. “They can come out here, they know there are armed guards outside. The kids can run around.” The apartments, all of which have been sold, cost 3 million dollars for a full one and come with the assurance that in a crisis you will be picked up anywhere within 400 miles by an armoured truck to be brought to the silo. The truck has a heavy machine gun mounted on it just in case the mob gets in the way. There are also armed guards and a sniper tower protecting the compound although the view from deep underground has to be provided by LED screens acting as windows that show a live view of the Prairie above or if the owner prefers a pine forest or even a busy New York street scene!
That gun-toting fear ridden underground existence sounds a little bit miserable, something many of the super rich recognise. And how certainly safe is flight anyway? The same New Yorker piece talked to a ex investment banker Robert H. Dugger who reported on a dinner party conversation of one such group of billionaire preppers where on hearing of plans to fly to safety in the event of a mass rebellion a guest asked ‘Are you taking your pilot’s family, too? And what about the maintenance guys? If revolutionaries are kicking in doors, how many of the people in your life will you have to take with you?’ The questioning continued. In the end, most agreed they couldn’t run.”
Finally the super rich also have to again consider that Climate Change is such a global threat that sooner or later it might even get them and their descendants. Of course the poor will die in their droves first, indeed they already are, but there is a danger of hitting a positive feedback tipping point where the Earth ends up like Venus, so hot no one survives.
So it’s perhaps not surprising that a section of the super wealthy elite favour reducing the problem created by the escalating wealth divide, as Dugger says “It’s a reason most of them give money to good causes”. This future is the warehousing strategy of introducing a Universal Basic Income (UBI) for those lucky enough to be born in the already industrialised zones where most of the super rich live. When the need for our labour ends rather than leaving us to starve (and perhaps rob them if not revolt) the elite want to give us enough of an income to survive on. UBI would involve every citizen or resident (and that distinction is important) being given a regular unconditional sum of money in addition to any income received from elsewhere. In most forms of UBI this is enough money to look after essential needs including housing and healthcare.
This warehousing may appear more attractive to some of us but it also moves us inside the borders of fear. It inevitably involves escalating the slamming of the door on those trapped outside because of where they happened to be born. Thousands of people have died trying to cross the EU borders this year without the magic of the right passport. Even as I type this I’ve received a new notification that dozens of bodies of the drowned have just been found along the coast of Libya, another ship must have gone down.
UBI would also do little against the other looming disasters related to growth and pollution, in particular climate change. It would have some impact as the super wealthy would be slightly less powerful so environmental protection laws would be stronger but capitalism and its need for incessant growth would survive and continue to deepen that crisis. UBI has also become a cover in many countries for the final abolition of the welfare state as parties say they will fund it by abolishing entitlement to services which people will then have to buy.
In countries like Ireland where a welfare system exists mainstream parties have started to talk about UBI as a way of eliminating bureaucracy and introducing market competition. In practise that translated into eliminating yet more jobs - in the public sector - and replacing only some of them with what would be much more insecure private sector jobs. UBI was even favourably put forward - as ‘negative taxation’ - by Milton Friedman, the chief economist promoting neoliberalism who also advised Pinochet on the post-coup destruction of workers’ gains in Chile.
The third future requires a leap in social organisation that is at least as big as the leap that was made between the absolute monarchies of the 1600s and the republican democracies that spread from the 1780s. That is at a planet wide level we abolish inequality of access to resources and inequality of power. There will no longer be some people who own super yachts and entire islands while others watch their children die of starvation. The full environmental costs of growth will have to be factored into every new development because we will no longer havr a system where some can use their wealth to evade the consequences while others are forced to live in the filth generated.
That future has been glimpsed as long as humans have been around. Arguably we spent our first couple of hundred thousand years in something quite like it. Gather Hunter societies didn’t have a surplus that could be hoarded and that lack of wealth meant there wasn’t much opportunity for power. Biology placed limitations that today we can escape, for instance child birth often killed women, but in many respects they were quite equal societies.
It was only with the creation of agriculture that large surpluses of food could be produced and hoarded. And that meant that humans could fight each other to get control of the hoard, and perhaps quite quickly that translated into those with control paying a segment of the stronger and more violent section of the population to keep the rest in check. We spent the last 10,000 years developing that system to the absolute monarchies and it’s only in the last 200 years we have begun to limit the power of the hoarders through politics. The danger is that military automation means they are about to escape those limitations we imposed through mass organisation.
That third future is now more possible than ever before. We can produce enough to ensure all our needs, globally, are fulfilled and automation rather than being a threat can mean that we can end work. From the agricultural revolution on most of us have had to work long hours for the hoarders to survive and perhaps had little control over that work. Automation could mean that the hard graft of paid work vanishes to be replaced by work for pleasure. The difference between back breaking work in a field 10 hours a day harvesting potatoes and spending a few hours a week pottering around in your garden.
Discussion and decision making have also become vastly simpler. Only 40 years ago there was no way for masses of people to communicate with each other over distances. Discussion was one-to-many only, via radio and TV or in print media. Today a vast host of online tools allow such many to many discussions. Issue based voting has also become very much simpler, even if its major use now is click bait polling by online news sites. And electronic tallying means that complex polling is now very straightforward, there is no need to limit decisions to simple yes/no choices when the full range of options can be polled and counted instantaneously.
The third future is one without the division into order giver and order taker or the related one into rich and poor. These would not simply be huge economic and political transformation, the effect of them would also would transform in a very deep way what it means to be human. Our interactions would no longer be governed by fear and power, our potential to live fully would be released. The mental and physical labour we performed would be to enrich all those around us rather than a question of performing repetitive tasks because that alienation from our own labour is the only way of keeping a roof above our heads.
We are so close that we can almost reach out and touch the world which earlier people could only imagine. But the window of opportunity to bring it into being may be short, indeed for the reasons outlined above it is already closing, We know from history how we can win: through collective organisation. And today that is easier to do than ever before in many respects, in particular the access almost all of us have to global mass communication. The question is are you willing to take the step and start organising with others to make this dream the future we will step into?
Words: Andrew Flood (follow Andrew on Twitter)