Precarity can be understood as a social bargain that has been lost. The loss of this bargain can be described thus: "The emergence and strengthening of [the] precariat are associated with regulatory dysfunction . . . Precariat is a consequence of the lack of effective institutions for regulating emerging new social relations. Such institutions cannot be replaced by designing effective market mechanisms . . . Precariat is formed wherever stable forms of employment are destroyed." [Emphasis added.] ("Socio-Economic Sustainable Development and the Precariat: A Case Study of Three Russian Cities," Volchik, Klimenko, Posukhova, International Journal, Entrepreneurship and Sustainability Issues, September 2018) Precarity is therefore the loss of the social bargain between workers and employers which was forged in the labor movements of the late 19th and 20th centuries in industrial nations. It can also be seen as the destruction of the social arrangements which were forged and codified into law (such as antitrust and anti-monopoly laws) between ordinary people and the rich.
The destruction of this pre-existing social arrangement has been documented by observers such as economist Guy Standing, a Professorial Research Associate at SOAS University of London. Mr. Standing did pioneering research into the topic of precarity and the precariat, and captured his observations and conclusions in two books which he wrote, titled, The Precariat: The New Dangerous Class, and A Precariat Charter: From Denizens to Citizens. To quote from a 2018 essay by Mr. Standing, "Since 1980, the global economy has undergone a dramatic transformation, with the globalization of the labor force, the rise of automation, and—above all—the growth of Big Finance, Big Pharma, and Big Tech. The social democratic consensus of the immediate postwar years has given way to a new phase of capitalism that is leaving workers further behind and reshaping the class structure. The precariat, a mass class defined by unstable labor arrangements, lack of identity, and erosion of rights, is emerging as today’s “dangerous class.” As its demands cannot be met within the current system, the precariat carries transformative potential . . . "
In his essay, Guy Standing traces the beginnings of the precariat to the deliberate dismantling of social arrangements between owners of big business and workers at the start of the 1980's. This dismantling was part of the process of radical, rabid free-market capitalism pushed by people such as Ronald Reagan and Margaret Thatcher. According to Standing, those who pushed this process ". . . preached 'free markets,' strong private property rights [at least for those who were filthy rich! Not so much for little people . . .], financial market liberalization, free trade, commodification, privatization, and the dismantling of all institutions and mechanisms of social solidarity, which, in their view, were 'rigidities' holding back the market. While the neoliberals were largely successful in implementing their program, what transpired was very different from what they had promised."
Standing describes the process of precarization as it began in the West (especially the United States, the other nations of the Five Eyes, and Europe) and as it was promulgated by various institutions of Western economic hegemony such as the World Trade Organization. But the precariat has also arisen outside of the West. What has been striking is its origin and spread in those regions which withdrew themselves from global capitalism in the early 20th century only to return to the capitalist fold near the end of the 20th century. Indeed, it can be argued that wherever there is a society characterized by connection to the global economy, extreme levels of inequality, and a very small class of plutocrats who control an enormous percentage of that nation's economy, there you will find the precariat in existence. What is more, you will find that the plutocrats of each of the world's major societies share a lot in common with each other. So I'd like to take this post and the next post in this series to describe the process of precarization as it has worked itself out in other regions of the world. Let's start with Russia.
"Funeral for the Middle Class", a protest which took place
in Russia in 2015. In the picture, the "casket" being placed
by the man in the center has the words "средний класс" ("middle class")
written on it. Image retrieved from Obschchaya Gazeta on 21 January 2023.
In Russia, the transition from Soviet communism to free market capitalism was a transition from the Soviet arrangement where "formalization, legal confirmation, and guarantee of a workplace for a worker were the methods which prevented the spread of precarization. The system was oriented toward distribution of social benefits, consolidation of the worker's professional status in the consequent sphere, and work, labour, employment, and housing related stabilities . . ." (Quote taken from "The Precariat In The Socio-Economic Structure of the Russian Federation," Maria Fedina, International Department of Movement for Decent Work and Welfare Society, September 2017.) It was a transition into an employment market which has ". . . 'responded to unfavorable economic transformations by such means of adaptation as part-time and seasonal work, forced vacation leave, secondary employment and employment in the informal sector'. Other forms of adaptation include fixed-term employment contracts, outsourcing of workers, employment on the basis of employment contracts with a condition of work outside the employer’s location, and employment of individual entrepreneurs who have no possibility to run their own business by other entrepreneurs." [Emphasis added.] To break this down into plain language, Russians moved from an economic environment in which housing and employment were stable and secure, and moved into an environment in which many Russian workers today may be forced to work part-time, may be forced into involuntary unpaid time off, or be forced into gig/temporary work where they must assume all of the liabilities of being "independent contractors" yet have no legal way of acting as actual entrepreneurs.
According to the sources cited by Maria Fedina in her essay, up to 85 percent of the Russian labor force faces the possibility of falling into the precariat, while 30 to 40 percent of the labor force belongs to the precariat at any one time. A large percentage of the Russian precariat consists of highly skilled professionals and highly educated people, having achieved at least a bachelors degree. However, the prestige of their professions has been devalued in the minds of the Russian public as a tool to force these professionals into precarious, low-wage arrangements. This is especially true of teachers, as noted in the paper by Volchik, Klimenko, and Posukhova cited above. Also of note is the fact that a large number of the members of the precariat are involved in the informal economy in Russia, where legal workplace and worker protections are entirely absent.
Precarity is therefore a design feature of the present system of Russian capitalism. The origins of this system lie with the Russian oligarchs who arose from the wreckage of the crashed Soviet system. (To see where these oligarchs came from, please read "The Role of Oligarchs in Russian Capitalism," Guriev and Rachinsky, Journal of Economic Perspectives - Volume 19, Number 1, Winter 2005). These oligarchs controlled betweewn 70 and 90 percent of the Russian economy by the time the transformation to a capitalist society had been completed. (See "The Piratization of Russia: Russian Reform Goes Awry," F. Joseph Dresen, Wilson Center.) In the early years of the 21st century, Vladimir Putin used Russian state power to transform these oligarchs into Putin's pillars of support. (To see the definition of "pillars of support", click here.) Therefore, the birth and growth of the Russian precariat can be quite accurately seen as part of the goals and policy of the Russian elites both in government and in the private sector. For their overarching goal is to enrich themselves at everyone else's expense. And Putin truly has shown himself to be a thieving little man in a bunker. For when Putin's government arrested (or in many cases killed) those oligarchs who dared to oppose him, it was not to fight corruption, but rather to establish a loyal base of Russia's wealthiest citizens. The Russian oligarchy is alive and well under Putin (although during the last year they've begun to feel a bit ill. Sanctions can lead to indigestion . . . ).
For members of the Russian precariat, life has become surprisingly similar to life for members of the precariat in the rest of the developed world. These include long working hours, an absence of benefits, no guarantee of employment stability, and a refusal of employers to manage the safety and work environments in which their employees must operate. In an increasing number of cases this has led to deaths of workers and of bystanders, as documented by Katya Zeveleva's piece titled "Russian gig economy violates worker rights with society’s tacit acceptance" (Oxford Human Rights Hub, July 2019).
Russia is but one example of the re-creation of the precariat in a non-Western context. Next week, we shall consider other cases, God willing.
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