In Spring 2020 the first signs of consumer and marketing messages related to the COVID-19 (Coronavirus) pandemic emerged. Like the virus itself, such marketing spread rapidly. The words “we’re all in this together”, and representations of such a sentiment, appeared in adverts and campaigns that were intended to invoke a sense of connectedness, community, and mutual care. Brands wanted people to relate to them and to seek comfort in the form of retail purchases during this time of crisis. Hence, taglines that alluded to togetherness cropped up amid the wave of content that companies created in response to COVID-19, including the marketing of supermarket giants Asda, Lidl, Marks & Spencer (M&S), and Tesco. When noticing this I found myself thinking about the relationship between COVID-19, capitalism, and consumer culture.
Although during the COVID-19 crisis brands have worked hard to cloak their capitalist activities in claims of connectedness, community, and care, to many people it is obvious that the main purpose of such promotional work is to keep the soul-grinding cogs of commerce turning. Despite their efforts to sometimes suggest otherwise, brands are not community organisers. They are not at the core of mutual aid and community care. If anything, brands are often a component of the very structural problems that community organisers strive towards dismantling as part of liberationist work. The imagined “we” that brands brazenly construct via adverts that are meant to tug on the heart strings of individuals during the pandemic is a “we” with money to spend. Such a “we” consists of consumption, not care, and profit, not people.
Are the often overworked and underpaid employees of such brands part of the imagined universal experience that they refer to in adverts about togetherness and weathering this storm with each other? Will such brands make meaningful shifts to substantially improve the precarious work and labour conditions of their employees or will they simply stick to surface-level representations of human connection and care rather than enacting change? There is nothing new about commercial organizations with track records of mistreating and exploiting staff arrogantly making sentimental and marketed claims about the experiences of “you”, “me”, “us”, and “we”. However, this does not detract from the reality that companies being so quick to create such crass content during this ongoing crisis was jarring. Furthermore, the way that some brands have implied that everyone has been impacted by the COVID-19 pandemic in the same way is outright inaccurate.
In a recent op-ed, Martin Sandbu of the Financial Times argues that “the conversion by the IMF and World Bank to support the activist state would put Saul of Tarsus to shame.” According to him, we may be witnessing the rise of a new Washington Consensus, which embraces deficit spending (by rich countries), “temporary solidarity surtaxes” on the rich and businesses, green public investment, and other forms of government intervention. This is not only to address the short-term effects of the pandemic, but also to stimulate demand across the world economy. Sandbu finds evidence of this new consensus in the benign view that the IMF has taken on Biden’s “rescue package”, and claims that “the new Washington consensus could prove as politically powerful as the old one.” In another op-ed in October 2020,
Sandbu characterised this new consensus as follows:
“After 1945, the guiding assumption was, first, that the state knew best, then that the private sector was best. We are about to transcend both, in favour of an economic worldview based on finding ways in which government intervention can guide the private sector to perform better. In that sense, economic planning and the activist state are back.”
It is indeed striking that the IMF, the World Bank, the OECD, the G20, and other multilaterals, have adapted their discourse on the role and place of the state in development. This predates the COVID-19 pandemic. In an open access paper recently published in Antipode, we document the emergence of this new vision of the state in development and outline its key features. Since the early 2010s, these institutions have produced a remarkable wealth of material explicitly concerned with old and new forms of state ownership and intervention. Witness, for instance, this November 2020 EBRD Transition report titled The State Strikes Back, or this chapter dedicated to state-owned enterprises in the IMF 2020 Fiscal Monitor. Our analysis of such policy documents and others suggests that we are witnessing a gradual yet fundamental reorientation of official agendas and discourses about the state. This emerging vision embraces a fuller role of the state in development (than the post-Washington Consensus), including as promoter, supervisor, and owner of capital. Our analysis expounds the material context in which this vision is emerging. Two interrelated transformations are particularly important.
What is new with contemporary (global) leading corporations? If gigantic monopolies are a repeated phenomenon in capitalism’s history, why all the fuss we see every day regarding high concentration?
Leading corporations of the 21st century are intellectual monopolies. These are firms that rely on a permanent and expanding monopoly over portions of society’s knowledge. A recent joint OECD and European Union report shows that the top 2000 corporations in business expenditure in research and development (BERD) concentrated 60% of total IP5 patents between 2014 and 2016 (Dernis et al., 2019).
How did this happen if intellectual rents enjoyed by the innovator were supposed to disappear once the rest of the industry adopts the new technique? They disappeared if the secret was broken, the patent expired, or when another firm innovated, overcoming the innovating firm’s advantage. Knowledge is cumulative and those innovating have a greater absorptive capacity to keep innovating. Aided by a more stringent and global intellectual property regime, the continuous reinforcement of knowledge monopolies has led to a perpetuation of the core, maximizing rentiership over time.
Intellectual monopolies may not monopolize the markets they operate, which can even be competitive markets like Amazon’s marketplace, where Amazon sells its products with millions of other sellers. Their monopolistic condition relies on their capacity to significantly and systematically monopolize knowledge, which generally – but not always – contributes to market concentration.
But his work is often misunderstood, not only by orthodox economists but also by others – such as ‘greens’ – who seek inspiration in his writings. Economists, if they refer to his work at all, have tended to focus on the quantitative labour theory of value, ignoring what Marx called the qualitative theory of value: his critique of the economic categories of ‘bourgeois’ economics which mystify – and hence also justify – the reality of what is really going on. The concept of fetishism is crucial to this theory, but by economists this has been either ignored or treated as the work of Marx the philosopher or Marx the sociologist. Marx introduces the concept of commodity fetishism in the very first chapter of Capital Volume I, where he seeks to get to grips with the mysterious phenomenon of exchange value. Rather than simplistically equating value with price – as is the practice of the market system and mainstream economics – he delves deep into the beliefs and practices that constitute and sustain the capitalist system. In other works, he applies the concept of fetishism to capital, money and interest-bearing capital. By reference to what he calls the ‘Trinity Formula’ he shows how, by presenting profit as the return on capital and rent as the return on land, both profit and rent are taken for granted, and go unchallenged. That the surplus value generated in production accrues solely to capital is treated as somehow ‘natural’.
In my book, I show the continuing relevance of Marx’s theory today, especially with regard to finance and the environment. Both the financial crisis of 2008 and the continuing crisis of environmental destruction are related to the way in which the market increasingly extends its grip over our lives: through the financialisation of everyday life, and through the use of market instruments and market principles that shape our relationship with nature.
The Social Dilemma that is currently streaming on Netflix has garnered much attention by raising a single question – how have we come to accept as normal the fact that a few hundred tech-enthusiasts in Silicon Valley has had an unprecedented impact on billions of lives around the world? Directed by Jeff Orlowski, the Social Dilemma features tech industry insiders raising ethical concerns about business models that shape our everyday digital experience.
Though the docudrama has topped charts, the narrative on reckoning with this digital Frankenstein moment is not new. For example, Black Mirror is a popular show streaming on Netflix that speculates on how unchecked tech developments can result in a dystopian world. What makes Social Dilemma unique is perhaps because it features an array of “prodigal tech-bros” – usually white males who got rich working for big tech, but then got disillusioned and subsequently achieved “enlightenment”.
The tech-bros point out that most platforms were started with good intentions to improve the quality of human lives. However, due to the advancements in AI, coupled with a shareholder model of revenue maximization, these platforms have become weaponized by those with nefarious interests. This has threatened liberal democracies, leading to political polarization. We are warned that a civil war is on the horizon, ironically triggered by social networks apparently aimed at bringing people together.
The state has made a return with a vengeance in economic matters in the past decade or so. Mainly due to the success of the Chinese model and the – less permanent – strong economic performance of countries like Brazil and Russia, the erstwhile Washington Consensus of the superiority of markets over states as mechanisms of economic coordination has been put in serious doubt.
Scholars have picked up on this trend by increasingly referring to the term (new) ‘state capitalism’. Some consider it an undesirable threat to the existing economic world order, while others show how states can effectively promote development and economic growth.
While the term state capitalism has been useful to bringing the state back in yet again into debates in political economy, the term itself is not unproblematic. Indeed, there is a risk that it perpetuates, rather than surpasses, the sterile debate about the state versus the market. Put bluntly: If there is such a thing as state capitalism, what does non-state capitalism look like?Read More »
Kalyan Sanyal’s Rethinking Capitalist Development (2007, 2014) is a rare work of political economy for many reasons. It is written by an economist, but it’s so interdisciplinary that you won’t be able to tell. It is an attempt to theorize capitalism in the postcolonial context from the inside-out rather than outside-in, i.e. with no reference to an ideal type. It refuses to sit neatly in theoretical boundaries — it is not entirely Marxist, not entirely Postmarxist, not entirely neo-Gramscian, not entirely Foucauldian, but a strange concoction of all. Perhaps the only thing that is not rare is that like most interesting and influential works that emerge from the Global South, it too has been largely ignored in the academic circles of the Global North, especially in Economics. Read More »