The Global Origins And Spread of the Precariat (Part 1)

Last week's post described my own experience of precarity - an experience which continued in surprising ways even through the world of white-collar professional work.  This week's post will begin to explore the theoretical foundations for understanding the precariat, and will begin to trace the present existence of the precariat in the societies of certain nations of interest.  

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.

Precarity - An Introduction

Certain events from the past several weeks have provoked me to think about a topic which I have not studied in depth up to this time.  Those events are largely focused on the collapse of the cryptocurrency bubble last year and the corresponding destruction of the "investments" many poorer people made in "crypto" in order to increase their wealth.  (See "FTX Crypto Crash Threatens Life Savings of Working People", Truthout, November 2022, and "The Cryptocurrency Crash Is Replaying 2008 as Absurdly as Possible", Foreign Policy, May 2022.)  The collapse of economic bubbles in capitalist societies is a worthy topic of consideration in its own right  But my interest now lies in the motives and vulnerabilities of the ordinary people who were led to invest in "crypto" in the first place.  Their choice to invest was one of several coping mechanisms which they employed in order to try to deal with their social and economic situation.  That situation can be described by a single word: precarity.

Precarity is defined by the Cambridge Dictionary as "the state of being uncertain or likely to get worse," and, "a situation in which someone's job or career is always in danger of being lost."  The Journal of Cultural Anthropology describes precarity as ". . . an emerging abandonment that pushes us away from a livable life . . . [It is] the politically induced condition in which certain populations suffer from failing social and economic networks . . . becoming differentially exposed to injury, violence, and death."  The University of Georgia has an article on its "Neoliberalism Guide for Educators" webpage which describes precarity in concrete human terms, starting with the questions "Have you ever or do you currently live paycheck to paycheck?  Do you work 40 hours a week or more and still can't afford rent?"  We who live in the United States may be tempted to look on precarity solely in its American-style manifestations of inequality such as racism and the effects of tycoon capitalism, neoliberalism, privatization, and the destruction of social safety nets.  But precarity is a global phenomenon which can be seen even in ethnically homogeneous societies, as described by Hao Jingfang's "near science fiction" novelette titled, Folding Beijing.  (You can listen to an audio recording of her story at StarShipSofa.)  Precarity naturally arises whenever the people at the top of a society concentrate nearly all of the wealth of that society in the hands of a chosen few, thus creating a massive underclass out of the many who are not of the chosen few.  Those many become the precariat.

It is quite natural to assume that the precariat consist primarily of those historically marginalized populations without access to higher education, whose historical economic and social standing has condemned them to a blue-collar or manual labor or McJob sort of existence.  But while this is true, it is also true than an increasing number of white-collar, college-educated workers have found themselves forced into the precariat due to the destruction of long-standing arrangements between corporate masters and skilled professional labor.  For a recent example of this, consider the large number of lawyers who were laid off in 2022.  This progression of precarity among white-collar workers has been taking place for at least three decades.  (Four decades actually, if one counts the day that former President Ronald Reagan fired all of the air traffic controllers who were part of the U.S. Federal Aviation Administration staff.)

Precarity is quite naturally a highly uncomfortable way of life.  This discomfort - frequently amounting to great pain and distress - quite naturally provokes a search for coping mechanisms from the people who comprise the precariat.  The usual suspects among coping mechanisms include things like the abuse of alcohol, opioids, and other drugs, or drowning oneself in other passive entertainments.  But my focus is on those more active attempts to cope which members of the precariat employ in trying to transform their situation.  So I am planning to write a series of posts on precarity, on the precariat, and on the attempts by members of the precariat to transform their situation.  A tentative outline of that series is as follows:

1. The Precariat - An Overview (This has been partly covered in today's post.)
2. My own experience of precarity
• As a teen
• As a college student
• Surprising encounters in the white-collar world
3. Origins and Spread of the Precariat
• The Link Between the Origins of Precarity and the Rise of Neoliberal (that is, radical libertarian free-market) capitalism
4. The Composition and Location of the Precariat
• Its global nature
• Its local expressions
5. The Coping Mechanisms of the Precariat
• What Doesn't Work
• Unwise "Side Hustles"
• The False Promises of Bubbles
• The Role of the "Advice" (Motivational Speaking) Industry and "Influencer" Culture
• Political Dead-Ends
• What Does (or May) Work
6. The Precariat And the Great Resignation
7. Future Directions Of The Precariat
• As Passive Victims of Forces Outside Themselves
• As Active and Activized Agents Who Take Charge Of Their Own Future
• The Potential for Such Action
• The Possible Constraints Preventing Such Action
• The Precariat in "Babylon"

Each major heading in this list will be covered in a separate blog post.  Each major heading will also require some research in order to do it justice.  But fortunately, the extreme busyness which characterized my life during most of 2022 seems to be easing up.  (I have rediscovered the fact that sleeping, for instance, is delicious!  And I look forward to chillin' with my guitar in my backyard when the weather warms up . . . )  The time taken in researching each of these topics will be time well-spent, and hopefully it will prove useful to the readers of this blog, as I believe that an increasing number of us will be forced to deal with precarity (or even be swept involuntarily into the precariat) in the days to come.

What I Said In My Haste

Today's post is a short break from my essays on the personal, pedagogical work that organizers need to do in order to organize people for liberation.  The title of today's post is a nod to Psalm 116:11, and my use of it is triggered by a few personal events from the last year or so.  While the events are not earth-shaking, they are indeed thought-provoking - as is to be expected when a person loses around $1,000 within the space of a few months.

It started at the end of 2020, when the smartphone I had owned for over five years became hard to charge due to the wearing out of the charger cable and charger port.  That phone had been a budget phone without a lot of bells and whistles, yet it had proved extremely reliable.  When I began to consider replacing it, I looked on my service provider's website for a suitable candidate.  I found that most of the budget smartphones looked extremely clunky and had very poor user ratings.  I also found that the cost of most of the highly rated smartphones was on the order of $1,000.  I hate spending money, but I have been told that buying things that are cheap can cost as much as buying things that are more expensive, due to the cost of regularly replacing the cheap things.  So I narrowed my search to phones in the $500 price range.

This led me to the Google Pixel 4A 5G, a phone whose features included 128 GB of memory, awesome speakers and sound quality, a stunning set of cameras capable of stunning photography even at night, impressive battery life, and a durable front composed of tough Gorilla Glass 3.  I plonked down $500 and soon the phone was delivered to me.  I did not want to take chances with breakage, so along with the phone I bought a highly rated phone case for added protection.

I had hoped that the phone would last me four or five years, but it actually lasted from January to October 2021, when it was destroyed by a drop of less than three feet.  Its tough phone case provided no protection at all, and its Gorilla Glass 3 screen shattered along with the tempered glass screen protector I had installed.  Seeing $500 shattered like a smashed bag of potato chips quite naturally perturbed me, so I contacted Google to find out what recourse I had.  I was directed to an authorized Google repair shop where one of the employees told me that the screen could be repaired for $300, but that the repair shop could not guarantee that the phone would function as it had before it was dropped.  The employee also informed me that in the future I could lower any potential phone repair costs by purchasing either "phone insurance" or a "phone protection plan."  I gave that employee an earful of clean, yet disapproving language, then left.

Finding myself once again in the position of needing a phone that could be reliably charged, I visited one of the stores of my telecom service provider to see what I could find.  I told  my tale of woe to the employees at that store and asked them if they sold a reliable smartphone that could stand being dropped without breaking or being used in the rain without being ruined.  They led me to a phone sold under the Cat brand.  (That's "Cat" as in Caterpillar - you know, the company that makes gas turbines, standby and prime power generators, and earth-moving equipment.)  The particular phone in question was the Cat S62, a phone advertised by Caterpillar as "...the pinnacle of innovation, functional design and rugged durability. Designed primarily for extreme work conditions..."  It too cost around $500!

I was still under the influence of cultural conditioning that told me that I "needed" a smartphone, so once again I parted with my hard-earned cash for a new phone.  I found that the Cat S62 had only a mediocre camera and mediocre speakers.  However, it was possible to hand-wash and hand-disinfect the phone without damaging it.  And the service provider who sold it to me had a 14-day no-questions-asked return/refund policy.  Moreover, Cat had a 30-day no-questions-asked return/refund policy.  Unfortunately for me, my troubles began at about day 60 of my ownership.  I found that the phone would suddenly and randomly change settings without being touched.  Alarm settings, Bluetooth settings, connectivity settings, media playing settings, volume - all would randomly change from time to time - regardless of whether I was holding the phone or not.  At first this happened only occasionally.  But over time, the number and extent of seizures this phone was having began to escalate.  Soon it was turning its flashlight on and off randomly.  The last straw for me came last night, when all by itself the phone called a friend of mine after 11 pm, when he, his wife, and his kids were all in bed.  I realized that once again, $500 of my money had been turned to garbage.  (Perhaps that phone needs an exorcist!)

Today I have bought an old-fashioned flip phone for less than $100.  Once I have waited the obligatory 3 days for any COVID-19 virus particles to die from the packaging, I will try out my latest new phone.  God willing, it will either break within 14 days or last several years.  But buying three phones within a year has got me thinking - first and foremost, about the smartphone industry as a symptom of an unsustainable economy.  For the companies that comprise the tech sector are largely publicly traded.  And as I understand things, that means that like all publicly-traded companies, their share prices on the open market are a function not only of profit levels, but of profit growth.  It is profit growth that drives the passive income streams that form the basis of the retirement incomes of most people and the revenue streams of those aspirational souls who seem to be disciples of people like Tim Ferriss.  Profit growth causes rising share prices and rising dividends.  Profit growth is also the backbone of an economy built on usury.

The problem comes when profits cease to grow.  Slowing or stagnating profit growth can have a variety of causes, but one prime cause is that eventually companies that make durable things face market saturation - that is, they reach the point where if a widget costs $1,000 and lasts 10 years, a stage is reached in which by year seven or eight of a widget-making economy's life, almost everyone who wants a widget now owns one.  That means that the market for widgets declines rapidly to a level in which companies sell only enough widgets to replace the widgets that are wearing out.  This phenomenon is what almost drove the Ford Motor Company out of business during the 1920's.  That means that companies must resort to ever more creative (and unnatural) strategies in order to maintain some semblance of profit growth.

One such strategy is the emergence of a throwaway culture, a culture of restless dissatisfaction with the status quo.  Another such strategy is the strategy of planned obsolescence.  Both these strategies tend to lead to increasingly feature-packed, yet fragile and unreliable products.  The rate of increase of prices of these products tend over time to strongly exceed the rate of inflation.  Thus most cars nowadays cost as much as a four-bedroom house used to cost in the 1970's.  And the price of smartphones has risen to the point that you can buy a smartphone for $2,000 if you so choose.  (That $2000 phone is, not surprisingly, easy to break and hard to fix, according to one source.)  Oh, by the way, have you bought a cutting-edge model of a new home appliance like a washer or dryer lately?  Along with the strategies of throwaway culture and planned obsolescence, there is the rise of "influencer culture" - the creation of armies of paid, immaculately coiffed shills who pretend to be ordinary people who just happened to become famous and who wish to share their tastes in consumerism with the rest of us.

Yet another unnatural and unsustainable strategy is the strategy of rent-seeking.  This is especially prevalent in the world of software nowadays, with the rise of the "software-as-a-service" (SaaS) model of commerce - a model which actually contributes no real value to customers, but which makes businesses vulnerable to data loss and data theft.  Rent-seeking is also now a feature of that portion of the "knowledge" industry that sells textbooks - Pearson, for instance, has begun to offer rent-only versions of textbooks that can only be accessed by an online subscription.  Titles offered under such terms usually cannot be obtained in hardcopy form.  

I believe that a feature of "late capitalism" (as in, "late-stage capitalism") is the seeking of ever-more unnatural and perverse mechanisms and strategies to maintain profit growth.  This is leading to an increasingly distorted society and the creation of ever-higher mountains of freshly obsolete junk.  These mechanisms are the last desperate ploys of the few who have amassed ungodly amounts of capital by fleecing the many who are not rich.  And I believe that the society resulting from these ploys will one day come to an end.  When it does, the times that emerge will require a very different sort of person - one who can be satisfied with living on the fruits of an honest day's labor.  Unfortunately, many people may have a very hard time making the transition.