At the Edge of Tomorrow: The Future of Capitalism

It seems that humanity is about to enter a new phase in history, leading to a new world order and a corresponding daily life.  We barely know how the post-corona period will be like.   Yet, we certainly have some predictions.   In this article, I will discuss the relationship between  the corona virus and the future of capitalism.

Intellectuals as well as influential public figures have been arguing for a long time that we are in the midst of a global wave.  This global wave is best materialised in the forms of rising social inequalities, increasing populism and corresponding fascistic measures like we observe in Brasil, or, mental health crisis resulting from work place despotisms, or, merciless economic growth, pushing the planetary system into climate change and mass extinctions as we observed in Australia in the last quarter of 2019.  All these phenomena are global. The contextual differences in various countries only determine the intensity of these situations. In other words, no society on the mother earth is sui generis, meaning following its unique path. We are all in the same ark, namely in the same socio-economic system, late capitalism.

The afore-mentioned global wave points out that humanity confronts with a social, political and economic crisis, penetrating to every cell of society.  However, coronavirus has just exposed this crisis into daylight. This is what makes the recent crisis different from preceding ones, making its visibility and consequences radical in its impact on human lives anywhere in the world.  Thus, we can argue that the social condition of pandemic is just an acute and intense continuation of pre-pandemic period of late capitalism.

Even the benchmark institutions of post-1980 global system, IMF and World Bank, recently published reports on social dimension of this global wave: Rising socio-economic inequalities and they warned against their adverse effects on societies.  Likewise, in the Davos Meeting held in 2018, the inequalities were debated. Even the global elites – plutocrats – were arguing that the world is in a transformative period. So there has been a sense of change in the air for a long time.

Recently, Slavoj Zizek wrote a short piece in which he underlined the importance of forming a new, invented communism in face of this crisis, He argued that this new communism has to be built on new solidarities. In addition to this, Yuval Noah Harari also mentioned that the world will choose either dictatorial governments or a new solidaristic society in post-corona period.[i]  They both outlined a new solidarity.

My colleague Seren Selvin Korkmaz and I, we also wrote the global turmoil three years ago at Open Democracy and put forward that the world needs left-transformation, rejecting economic growth, and demanding social and political justice in return.[ii] In one of my pieces written in 2018 at Open Democracy, I coined the term ‘political precariat’, implying that globally burgeoining precariat should come together and be political, rejecting all socio-economic policies imposed on it in recent decades.

In my recent book in Turkish (We are All Precariat: Dangereous and Hopeful Future, Nota Bene publishing, March 2020), I am more elaborated on the concept of political precariat. I believe that the social explosions, which started in the last quarter of 2017 in Iran and Tunisia and lasted through recent three years in different geographies including France, Algeria, Sudan, China, Iraq, Spain, Lebanon, Chile, had much in commons. These were the demands of revalorisation of work, rejection of insecurities in daily life and desire for a new world away from economic growth, speed, political exclusion and oppression.

Those reactions were literally social cries against organized capitalism and populists. However they were far away from bringing a genuine change because they were disorganized and there was no political principle and organization uniting them.

But now the contagion of Covid-19 makes the possibility of a transformation real. It is well understood with this contagion that the world order as such cannot be sustained unless there is a radical change either in the distribution of the resources or in the relations of production.

It can be argued that the post-corona period will most likely force a change either in the relations of distribution of resources or in the relations of production or perhaps both.

There is a political difference between these paths. Whereas the plutocracy may want the former one, the burgeoining precariat (put forward by British economist Guy Standing[iii]) and working class around the world have to prefer a change in the relations of production since it is obvious that the issue at stake is bigger than a mere re-allocation of wealth: The ecological system in trouble, the climate change and the insecurities of billions of precarious lives around the world make them to adopt the latter view, a change in relations of production.

Dani Rodrik and Stefanie Stantcheva point to a similar argument in their op-ed article published at Project Syndicate.[iv] For them, the whole problems result from the production system of capitalism. So they say we have to reorganize production. But it does not necessarily mean that this proposal will be adopted by elites and plutocrats.

The tension between these two views will show us tomorrow’s capitalism. In other words, we are at the edge of tomorrow and the decision will be totally political. The social explosions like we observed in George Floyd protests and the  reactions against these kinds of movements in the process ahead will determine the way that humanity will take. For example, Nouriel Roubini in his recent op-ed at Project Syndicate underlines the class dimension of Floyd protests.[v] To him, it is not only about racial injustices in USA but also social inequalities and economic insecurities of different identity groups.

At this stage, it can be at least argued that the new world should criticize economic growth model, motivating the relations of production in recent 40 years. But how can it be replaced? Is there any alternative production system that can sustain humanity’s needs, bringing a social peace between different social classes and protect the ecological system at the same time? Actually there is; but the alternative progressive models are not perceived so strongly in the public opinion.

But the contagion has also exposed crucial contradictions inherent to late capitalism. The governments around the whole globe call people to stay at home. It sounds a great idea when there is a virus out there. But the world has a problem. What about the bills, credit loans given by banks, the rent of the homes? The call for lockdowns drags the system into a dead end.

This where the social class perspective comes in the picture in this crisis. The majority of world population namely people forming precariat and working class need to stay at their homes. But the question is; how this will be possible in practie while they have no social and economic security? The economic and social insecurities that people experienced in their daily lives form important parts of socio-political crisis, emanating from the economic growth model imposed after 1980s.

Here we encounter with the crisis of redistrubution mechanism of late capitalism: The elites and riches possess more resources than they need or can use. On the other hand, precariat could not even sustain its basic necessities like housing, paying the bills and credits they have taken in the pre-crisis period.

This is all about the underlying principles of late capitalism: «Make people vulnerable by depriving them of alternative resources and make them dependent solely on wages.» It should be confessed that this principle and its mechanisms have worked well for over 40 years but it has stopped in front of a wall where it can not move anymore. That is why, it is most likely we will first observe a dramatic change in the relations of distribution.

Actually, you can see it in the imply of Canadian Prime Minister Justin Trudeau: You, do not worry about money, you care about your health, money is our job. This is a signal of change. Health Minister of Spain, Salvador Illa, declared that private hospitals can be taken under state control. This is the opposite of privatisation wave that we have seen in recent decades. In Turkey, Health Minister Fahrettin Koca declared in a press conference if the ministry detect a shortage of masks in the market because of their profitability, he said the state can seize  all these products for public’s sake.

Thus, it seems that we are about to experience a radical change in the relations of distribution in near future. On the other hand, a change in the relations of production seems a long shot for now. But the social explosions and emanating reactions have a potential to transform that area as well. It depends on what and how we – the precariat and its organic intellectuals – do. It is obvious that our cultural and political practices will have an effect on the future of capitalism.

Alphan Telek