Postcapitalism - A Belated Review

Is capitalism coming to an end? Perhaps not its end, but it is facing a number of difficulties. These aren't episodic issues that can simply be reformed away by enlightened politicians or ironed out by a spot of Keynesian demand management here and there. They are structural, fundamental, and would require a political struggle and defeat of whole sections of capital for them to be sorted out. This, however, is not a counsel for despair. The development of capitalism has brought forth new relationships and technologies that give a glimpse into a future beyond the market, beyond wage labour, beyond the despoliation of the environment. At least this is the image Paul Mason provides us in his well received book, Postcapitalism.

That capitalism allows for the possibility for a different, freer society is hardly a new or original observation. It's the key premise of Marx's analysis and critique of political economy. Individual capitals, or businesses in everyday language, are compelled to innovate and develop to survive. For one, it's bound up with the class relationships underpinning the system. Capital employs labour power to make commodities, be they material, like the laptop I'm writing this blog post on, or immaterial, like knowledge or a service. The worker, or proletarian, receives a wage or salary for their time doing whatever their employer asks of them - an experience, ultimately, not without serious consequences. However, from the point of view of the worker a great deal of time spent in the workplace is completely unnecessary. Say in a five day week, our worker produces £2,500 worth of commodities and receives £500/week in wages, the value of their labour power has been generated on day one. Effectively, for Tuesday, Wednesday, Thursday, Friday they're undertaking surplus labour. Labour, that is surplus to their requirements. When these commodities are sold, that extra value, surplus value, accrues to the employer. Some of it is advanced to cover the next round of wages. Other bits pay off loans, rent, etc. Some is put aside for reinvestment, and what is left is squirreled away as profit.

For Marxism the struggle over the disposal of this socially produced but privately appropriated wealth is the stuff of class struggle. Workers have a clear interest in receiving more of the value they generate but, more often than not, employers are the ones who succeed in drive down the workers' share so they can have an even bigger slice of the surplus. This is not because of greed, though there are plenty of business owners who fit that archetype, but because a business ultimately is compelled to do so. Returns on investments depends on the selling of one's wares. If there is a warehouse filled up with goods, then the capital is effectively frozen. The surplus value a business depends on is stuck and cannot be realised until they're sold off, and that depends on the variables of the market a business sells to. It depends on the competition coming from other capitals. Unless a business is a monopoly and can corner a market, all it can do in response is to extract as much surplus as possible either by lengthening the working day or cutting wages and other liabilities (such as pensions). That route is potentially costly as it runs the risk of stoking a dispute with the workforce. Or by more intensive methods, such as the development and introduction of new production techniques and technologies. Instead of £2,500 worth being produced over five days, the application of new machinery sees the run double. Even if the workers are granted a modest pay rise, the amount of surplus value up for grabs increases. Which means when those goods reach the market they will return more if they are sold at their value, or, to compete, the price is lowered more quantities of surplus value can be realised at the expense of a firm's competitors.

The relationship between production and consumption is the circuit of capital. There can be and are more complex permutations, but the basic outline here will do. It follows then for Marxists that capital constantly revolutionises the means of production, that class struggle and competition enforces an innovate or die imperative. And so capitalism taken as a global, self-expanding social system tends to develop the productive forces, which are the techniques, technologies, the social capacities and knowledges of human beings. This is where the key plank of Mason's argument comes in. He argues this history comes in waves. Drawing on the work of Nikolai Kondratiev, a brilliant Soviet economist who fell victim to Stalin's purges, he makes the case for capitalist development to be periodised. Each of these waves unleash a tide of innovation, and are comprised by the cumulative effects of new business models, new knowledge, new technology and, crucially, new markets. As Mason puts it,

... a long wave takes off because large amounts of cheap capital have been accumulated, centralised and mobilised in the financial system, usually accompanied by a rise in the supply of money, which is needed to fund the investment boom. Grandiose investments are begun - canals and factories in the late 18th century, railways and urban infrastructures in the mid-nineteenth century. New technology is deployed and new business models created, leading to a struggle for new markets - which stimulates the intensification of wars as rivalries over colonial settlements increase. New social groups associated with the rising industries and technologies clash with the old elites, producing social unrest. (2015, pp 37-8)

Following Kondratiev's work, Mason suggests that, as a rule of thumb, each wave or cycle lasts for about 50 years. In the most dynamic upswing phase, recessions tend to be short and shallow as the most productive sectors of the economy attract the most capital. This doesn't last forever, a saturation point is reach and the wave starts winding down. The new markets are saturated, the opportunities for profit are fewer, the quick returns offered by financial alchemy prove attractive, leading to short-lived credit booms, and recessions grow long and deep before a whole range of capital, physical and financial, is liquidated in a slump. Mason believes there have been four such waves since the advent of industrial capitalism. The most recent, the fourth, was uncharacteristically long, its durability preserved by state management of economies and its active intervention to create new markets. The upswing phase of the fourth wave began at the end of the Second World War and comprised Keynesian demand management, the foundation of the welfare state and, in most of the developed countries, some form of historic compromise in which the state, business, and organised labour collaborated. As the wave crested in the 1970s, so crisis set in followed by the downswing. This was still marked by the revolutionising of technique, knowledge, and technology, but ultimately the wave ate itself as capital increasingly parasited off the structures put in place by the post-war boom. For example, mass privatisations and the colonisation of public services by markets, driven through everywhere by states in the teeth of opposition, increasingly saw capital drain away from productive investment in favour of the short term gains of the money and property markets. That is, until, the stock markets crashed.

Mason's key argument is that with the close of the fourth wave, we should be looking to a fifth wave to lift capitalism out of the doldrums and deliver another 50 year cycle of growth, development and crisis. But where is it? The first part has a great deal to do with the character of the late period of the last cycle. Neoliberalism regardless of variant is congenitally hostile to labour movements and does all it can to undermine the collective strength and potential resistance of workers. Where Labour and social democratic governments have dropped payloads of neoliberal policies, without exception they're punished by electorates, sometimes severely. The result in too many key advanced countries is that workers are atomised, insecure, and not strong enough to force capital to innovate. Remember, the struggle for capital to accrue ever more of the social surplus is limited by the capacity of labour to resist. Where labour is strong, as per the post-war period with its huge union battalions of combative, at least on bread and butter issues, workers, militancy exerted its own pressure on the transformation of the productive forces. Capital had to innovate not just because of competition, but so it could exert more control over the labour process. And this meant displacing living labour by dead labour, the replacement of human toil by machines. With weak labour movements, that pressure is absent from the dynamics of development. And so we have the situation we have now where large chunks of British business prefer to employ record numbers of part-time, casualised workers. And because the market place is stock full of businesses doing the same, innovation has slowed.

The second and more controversial feature of Mason's argument is the changed character of commodities. The central importance of the knowledge economy for capitalism has been generally acknowledged since the 1970s. The spread of information technology and computing power married to the internet and the complex of networks it has facilitated has reconfigured the economy. The production of knowledge and knowledge-related commodities (such as professional services) are increasingly the, for want of a better phrase, hegemonic commodity form. Consider software, music, film, all these these can be downloaded and filed away. They no longer require physical media beyond a device that can play them. These, like the masses of corporate and state documents regularly dumped on the internet, are no longer qualitatively different from one another. It's all machine code. As such, it resists containment because each is infinitely reproducible with virtually no labour time required. And this presents capital with a problem. How can the circuit of capital be completed if, at the end, a good chunk of value stays unrealised because the resultant information commodity is copied and passed it on. If someone sends me a naughty pdf of a book I want to read, I'm not then going to go out and buy it. Hence the pay walls, the crackdowns on pirate sites, the rising cultural clamour of "support your favourite band/author/software house!". And with the strides being made regarding 3D printing, it's only a matter of time before producers of material goods are similarly affected.

The fifth wave of capitalism is stuck, but the first wave of a new system might be appearing. The mercurial ontology of information surges through the circuits the internet built. Innovation then is shifting away from capital and toward the commons, reversing a key feature of capitalist development: its tendency to concentrate knowledge in cadres of managers and other specialists. Once centralised, it's becoming socially diffuse. Effectively our times are caught at the crossroads of two possible futures, between stagnant capitalism and the emerging power of peer-to-peer networks. And this itself is radically configuring the relationship between capital and labour. Drawing on the work of Moulier Boutang's Cognitive Capitalism, which itself is heavily influenced by Hardt and Negri's Empire (a bit more here), increasingly the capacities and skills of labour are self-generating thanks to the ceaseless circulation of social knowledge, and so capital active in the tech and professional service sectors have to go cap in hand to try and ponce off that expertise. Think firms utterly reliant on bedroom coders and hackers, for instance. Mason suggests that Boutang, Hardt and Negri overemphasise this point but does nevertheless point toward a coming irreversible tilt in the relation of capital to labour. Labour as a collective has always been a force of production, but the networks allow for the possibility of it becoming conscious and a potential for its rewiring the social. The only options available for capital to stave this off would be increasing monopolisation (Mason notes the social media and IT giants are only profitable because they have cornered their respective markets. There cannot be multiple Facebooks, YouTubes, Googles and the rest), and/or finding more markets, which would entail an even greater commercialisation of social life.

This would be difficult at the best of times, but centuries of capitalism have stored up a series of problems that are now starting to bite. How inopportune for us. The mass migration of peoples, ageing populations, climate change, and energy source depletion are building up to crisis levels that require concerted action and the overcoming of sectional interest, but the old apparatuses and parties are dimly aware of their urgency, or uninterested in doing what needs to be done. By not having answers to these crucial questions, a political opportunity is offered. Here, Mason offers a number of prescriptions for condensing the consciousness of the networks and encourage discussion (and experimentation) when it comes to the resolution of these problems. And there are a number of political struggles vis a vis the state that includes the defeat and reversal of neoliberal policies, the reshaping of markets around environmentally and socially just outcomes, the production of an economic plan (which owes a bit more to a digital Keynes than a cyber Stalin), and a plan to deal with the mountain of debt piling up against countries, banks, business, and individuals' current accounts. Simple!

In his transition from mainstream to campaigning journalist, Mason has attracted exasperated comment from his peers ensconced in the established (and establishment) outlets. And unless one understands the theoretical infrastructure underpinning his politics, his positions can appear idiosyncratic and a bit strange. But this, ultimately, is because despite capitalism's internal problems and the difficult, possibly existential crises lying in wait, his view has that rarest of qualities in contemporary radicalism: optimism. Reading the tendencies, he has produced a compelling Marxist, yes, Marxist, narrative that locates the current impasse in the long-run structures and contradictions of our social system. Whatever one thinks of Kondratiev's waves, and there are decades of debate about them, his diagnosis of what is happening now is persuasive and fits the facts much better than the nonsense produced by mainstream economics. His explanation of capital's ongoing investment strike fills in the gaps a view that relies on the dearth of profit-making opportunities cannot. His caveated appropriation of Negri et al also seems sensible, but underplaying it runs the risk of ignoring how the bulk of networked workers actually reproduce themselves and their families in jobs to which the network is tangential or not at all present, and how this is changing their cognitive apprehension and appreciation of the world. The warehouse worker is as likely to be on social media as the IT worker.

The big problem, however, is one of agency. Mason spent a great deal of his media career reporting from the front line of global capital, of where the system met its limits and was contested by a wide array of social movements. Power begets resistance, as Foucault often noted, and capitalism is doomed to struggle with the nightmare of its obsolete future as it breaks up labour movements, drives down wages, and vainly seeks to capture the value of peer-to-peer production. But Mason's counterpower, if you like, the network itself is diffuse and incoherent. While on paper the balance is tilting from capital to labour, and in time the consciousness of labour will be conditioned by that social fact, the crises he identifies do not allow for the luxury of slow development. In the mean time, those networked workers have all kinds of views, and while individuated and atomised at the same time as they're linked with others, their politics are all over the place. Opposing networked humanity to capital is all very well, but networked humanity doesn't make for a coherent political project. But there is a potential vehicle. The labour movement with its strange rituals and out-of-time practices is an unlikely condenser, but its rootedness in the realities of work at the sharp end of the changes described in this book make it ideal as the focus. But the exploration of that relationship is going to have to wait for another time.

In sum, Paul Mason's Postcapitalism is an essential work that deserves to be widely read. To reverse a cliche, while the point is to change the world you cannot hope to succeed without understanding it.