After the 2008 Great Recession, global, regional, and local economies adapted to the ways they do business. On the global scale, the business and political relations between corporations and nations grew tighter in some areas of the globe, while fraying in others. Economic inequality grew at a rapid rate, and the type of jobs people could get in, say, the U.S. was mostly available in the service sector. While technology companies diversified and disrupted industries to the point that “gig work” became not a side job, but rather the job(s) many stitched together to make a living, it was clear that in the 12 years since The Great Recession, capitalism reconfigured itself into economies where the gulf between the very wealthy and everyone else was at the widest point in recent history.
None of this is new. Bernie Sanders has been talking about these issues since the 2016 election, and part of the reason Donald Trump is now the president is that he was the only one on the right to be talking about jobs and job loss during that campaign. More than one elected official from the midwest has noted that many union members saw Trump as the Hail Mary pass to prosperity (i.e., he was going to bring back good-paying union jobs to their communities). Nevermind the fact that Republicans have rarely, if ever, been politically supportive to policies that increase unions and worker rights. I don’t want this post to about the broken promises of Trump, but ProPublica has a good article from 2019 that examines what happened to the all the jobs Trump said he was going to create — which you can read here.
If there were no virus called SARS-CoV-2 that led to a disease called COVID-19 where people either get very sick or die from symptoms, the economy would still be a fragile construct. Student loan debt in the U.S. is about 1.5 trillion-dollars. The average income in the U.S. is a little over 63-thousand-dollars a year. Corporate profits in the aggregate are over two-trillion-dollars in 2018. The median cost of a house in the United States is about 210-thousand-dollars. The cost of living in the U.S. (CPI) between March 2019 to March 2020 went up 1.5%. The average amount in credit card debt in the U.S. right now is close to six-thousand-dollars. Wages for most workers went up around 3% in 2020 — after reaching almost 3.3% the year before. These are a lot of numbers to group together to create a picture of what the average worker is facing in terms of wealth accumulation. If the virus outbreak didn’t essentially shut down the global economy, these numbers would fluctuate somewhat, but overall the economy writ large would probably grow at around 2% a year — according to most economists.
But now…
All bets are off for a so-called V-shaped recession. That is to say, a sharp decline followed by a sharp recovery. Oil futures took a huge hit, real estate is holding somewhat steady for now. Job losses are massive, production for some industries is at capacity, while industries like airlines, restaurants, concerts, sporting events, rideshares, coffee shops, and a whole host of others have essentially been shuttered. It’s like there’s been a general strike of workers out there — but on a scale like our world has never seen. From what most reputable economists are forecasting, we’re in for a U-shaped recession/depression. Things will stay pretty grim until a vaccine can be created that’s safe and has few (if any) side effects. That’s a tall order, but considering that this virus does kill more older people with pre-existing conditions, I don’t think there are many people who are going to line up for a vaccine that can potentially sicken or kill you. Then again, we’re at a point where “acceptable losses” are being considered by politicians and business people who know the timeline to open the world’s economy back up is too long for capitalism to remain the hegemon it is. I’m not saying that fascism or authoritarian communism is waiting in the wings to start a revolutionary movement, but the more people start to question the status quo, the more they start to ask “what ought to be.” That’s gotta make The Powers That Be nervous. Couple that with a huge part of the world unemployed, scared, and quarantined…and well, that can lead to movements to really change the way things are.
We know the world’s resources are limited and capitalism only accelerates that depletion to the point where an economic system based on constant growth will eventually eat itself into non-existence. Environmental movements, anti-corporate capitalist reactions, and calls for more economic justice have their active members trying to change aspects of our world into something more just, equitable, and fair. But capitalism isn’t about those things, and that’s where we have conflict and contention. So, to explore what capitalism might look like on the other side of this pandemic, I’ve sketched the following possibilities:
- We could see more democracies become under the rule of authoritarian regimes whose priorities are protecting the wealthy while crushing any opposition to the political and business models that keeps the rich…well rich, and the powerful in power. These regimes are unstable because power and money aren’t forces that keep the masses in check — especially if the masses have notions of liberties and rights in their cultural DNA.
- We could see more (small d) democratic movements win political power and begin to reshape capitalism into something like what happened during The New Deal — but updated for 21st-century conditions. That means gig work as a career could be phased out in favor of more stable private union jobs. Unions get a bad rap because, like any human collective enterprise where money is involved, there are abuses to the system. However, (and I write this as a union member), unions are the best organization to protect worker rights, demand livable wages (though, not always successful), provide due process for infractions in the workplace, and generally advocate for employee interests and safety.
- We could see a movement away from global corporate capitalism to smaller-scale capitalism where more regional differences pop up. Since capitalism writ large isn’t one thing (just like socialism, fascism, or communism have variations), there could be a push to break up big companies to allow more opportunities for new players in the game. Yearly growth projections would have to shift away from what Wall Street investors expect, to profit and loss statements that are based on the real amount of business one is bringing in — instead of the quarterly or yearly shell games big companies use to goose their stock prices.
- We could see a big transformation of how we work. With the pandemic in full force as I am writing this, working from home is a reality for many who have stable internet connections, computers, and online communication platforms like MS Teams, Slack, Zoom, and the like. Think about what it means not having to sit in soul-crushing traffic every weekday, or be herded onto crowded trains and buses for the daily grind. Who really profits from this migratory ritual many of us engage in? Automakers, insurance companies, oil producers, commercial real estate, and public transportation. What are the factors that are leading us to a global climate crisis that will make sheltering-in-place look like the good old days? Well, four out of those five industries are certainly big contributing factors. So, if you took 40 to 50-percent of cars, trucks, and SUVs not only off the road but converted them to EVs? What would that do for the air quality in your area? Would we still be fighting in wars over oil? If companies didn’t have to house workers in office buildings and office parks, how would that affect one’s quality of life and the environment? These are things people are experiencing right now — whether they like this new experience or not remains to be seen. But the cost savings to workers, employers, and consumers would be huge. Of course, those savings would affect big industries and their ability to make money in the ways their shareholders expect.
Of course, there are other scenarios I’m overlooking, but you get the idea. After the Great Depression, capitalism went from industrial/factory work to mass production and company men. During the ’80s, capitalism went through de-industrialization in certain regions and relocated factory production to so-called developing countries. Family farms also suffered huge losses as Big Agriculture bought out bankrupt farmers. The rise of white-collar work rose as more headed to college or business schools to learn skills that would get them a job. Now we’re in a post-gig economy where Big Tech disrupted what it means to have a long term career –while lower pay retail jobs abound. Almost every working person who came out of The Great Recession had to work twice as hard to regain whatever wealth was lost in the downturn. Now that we’re in a life or death struggle with a virus that’s shut down our economy, where will we go on the other side of this? “Going back” to the status quo isn’t likely, so that leaves what lies ahead? Time will indeed tell, but the four roads outlined above seem possible — but not always palatable.
