Precarity, American-Style: The American Enterprise Institute and Small Businesses

This post is a continuation of my series of posts on economic precarity and the precariat.  Past posts explored the manifestation of precarity in Russia and China, two nations which returned to the capitalist fold at the end of the 20th century after abandoning free-market capitalism during the early and middle decades of the 20th century.  More recent posts have explored the spread of precarity in the United States, a nation which has been characterized from its birth by a cultural emphasis on laissez-faire, free-market capitalism and the defense of the "property rights" of those who are wealthy.  This post continues the exploration of precarity in the United States.

At the outset, I'd like to state my belief that the solution to the problem of economic precarity and rampant wealth inequality is to create a society in which the role of small businesses is central and in which private concentrations of wealth and power above a certain size are eliminated by a steeply progressive tax with no loopholes for the rich.  Such an arrangement would fulfill the ostensible goal of socialism without requiring the government to be the owner of the societal means of production.  For such an arrangement would place the means of production directly in the hands of even the poorest of people.

I can already hear the screams of rage which the emergence of such a society would produce among the leaders of the American right wing.  That's okay - sometimes people need to see their sacred cows turned into hamburger.  Yet one area in which we all seem to agree is the importance of small businesses in the American economy and the need to provide support to these businesses.  Presidents and members of Congress from both sides of the aisle have made strong and warm statements of support for small business from the days of Reagan onward.  Indeed, the Republican Party in particular has branded itself the champion of small business.  This has been part of the Republican Party's branding of itself as the party of economic growth in general and of the promotion of economic policies which guarantee prosperity for all.  (Of course, the fact that Republican policies have created many more losers than winners is blamed on the losers, but that's a story for another post.)

Can the Republican Party truthfully say that it has been and continues to be a champion of American small business?  The answer to that question can be found in the policies and activities of some of the lobbying groups and think tanks which are part of the American right wing.  Let's look at one of those groups today, namely, the American Enterprise Institute, or AEI.  According to Wikipedia, the AEI is "...  a center-right think tank based in Washington, D.C., that researches government, politics, economics, and social welfare... Founded in 1938, the organization is aligned with conservatism and neoconservatism ..."  To call them "center-right" may be quite misleading, as their membership has included several figures who are very much hard-right - figures such as Robert Bork, Newt Gingrich, John Lott, Antonin Scalia, and Dick Cheney.  In addition, the AEI is closely aligned with the Koch brothers, according to a Sourcewatch article.  Moreover, some of the recent posts and articles on the AEI website have seemed to give support to the regime of Vladimir Putin.  The AEI has become the dominant brain trust of the American right wing, "the crown jewel of the conservative policy infrastructure," according to a recent Johns Hopkins University case study.  

In 2005, the AEI published a paper titled, "Are Small Businesses the Engine of Growth?"  The abstract of that paper provides a concise summary of AEI's desired policy toward small business: 

"It is a common belief among entrepreneurs and policymakers that small businesses are

the fountainhead of job creation and the engine of economic growth. However, it has

become increasingly apparent that the conventional wisdom obscures many important

issues. It is an important consideration because many government spending programs, tax

incentives, and regulatory policies that favor the small business sector are justified by the

role of small businesses in creating jobs and is the raison d’etre of an entire government

agency: the Small Business Administration (SBA). This paper concludes that there is no

reason to base our policies on the idea that small businesses are more deserving of

government favor than big companies. And absent other inefficiencies that would hinder

small businesses performances, there is no legitimate argument for their preferential

treatment. Hence the paper suggests ending all small businesses’ subsidies." [Emphasis added.]

The paper sought to make a case for eliminating all government agencies and programs that support or incubate small businesses, both at the Federal and State levels.  It twisted a number of statistics in its attempt to make its case, attempting for instance to convince readers that the net gains in job creation  should be ignored in favor of gross job creation when analyzing the impact of small businesses during any time period of analysis.  This position, by the way, is proven false by the fact that reputable agencies such as the World Bank do count the impact of net job creation in evaluating economic performance.  For an example of the paper's mishandling of statistics, consider the part where the author tries to use gross job gains and gross job losses to "prove" that employment in the small business sector was much less stable than in large companies during the year 2000.  The author neglected to notice that during the time period in question, the net addition of jobs by small businesses was always positive, and for firms between 1 and 49 employees, exceeded 10 percent.  Lastly, I would point out the laughably false claim made by the paper that "... larger employers offer greater job security. For both new jobs and the typical existing job, job durability increases with employer size."  (That has definitely not been my experience as a working stiff and cubicle rat!  I guess the author of the paper never heard of the words "downsizing" or "redundancy"!)

The 2005 AEI paper cited above was part of a sustained effort on the part of American conservatives to make a case for eliminating all government support for small businesses.  One such example is the article, "Terminating the Small Business Administration" (2011), along with articles published from 2008 onward which suggested that government support of small businesses leads to negative economic growth.  I argue that the AEI paper, on closer examination, does not present a scientifically rigorous or accurate case.  However, it definitely does express what rich American conservatives want to do to American small businesses.  Consider the following quotes:

"... the real job growth comes not from people dreaming of being small business owners but from people committed to building big companies." [Emphasis added.]

"The paper will examine whether the pervasiveness of the belief that small businesses are the economy’s main source of job creation is warranted. Section 2 will show how this belief is the foundation for many government policies. Section 3 will expose the statistical fallacies that lead people to see job creation patterns where none exist. Besides it shouldn’t matter. Although job creation receives enormous attention in policy discussions, it is rather misplaced. The mere creation of jobs is not by itself an appropriate economic policy objective. Economic growth whether it takes the form of additional jobs or increase of productivity in existing jobs is all that matters. The paper concludes that there is no reason to base policies on the idea that small businesses are more deserving of government favor than big companies." [Emphasis added.]

In other words, the AEI has backed a policy which favors the continued growth of large companies, and the continued growth of American economic productivity even when that growth is not accompanied by the growth of jobs.  We have already seen the results of such a policy in action, namely, in the jobless "recoveries" from economic crises which occurred during the presidencies of Ronald Reagan and both Bushes.  Such "recoveries" left a lot of people out of work for a long time, while those who still had jobs were subjected to ever-increasing demands on their time from their employers in the name of increasing productivity.  To put it another way, these "jobless recoveries" resulted in ever-increasing concentrations of wealth among the richest members of society while drastically increasing economic precarity among everyone else.  It is quite telling that the AEI has pushed so hard for the elimination of all government help for small businesses even though large corporations are the biggest recipients of corporate welfare from both Federal, State and local governments.

Let us close with a couple of questions.  Does real job growth come not from people being small business owners but from people committed to building big companies?  Is it true that the only thing that matters is economic growth, regardless of whether it takes the form of additional jobs or increase in productivity in existing jobs?  I'd like to give my answer to these questions, but I don't have time today, so that will have to wait.  But as a partial answer, consider the following questions:

• How many really big companies can exist in a society whose economy is of finite size?
• Why should most people rally behind continued economic growth if the fruits of that growth are not fairly and equitably distributed?
• Who wants to volunteer to be one of the many poor, disenfranchised, and unemployed who are produced by a system in which the fruits of increased productivity are not fairly distributed?
• Who wants to volunteer to be a member of the salariat in such an economy if the only way to be a member of the salariat class is to work 80-hour weeks?

Precarity, American-Style: Causative Factors

Today's post is a continuation of my series of posts on the subject of precarity.  Today's post will be rather short, since I don't have much time.  However, when considering the state of precarity in which an increasing number of people in the United States now live, it is helpful to study the occupational and economic factors which have led to our present troubles.  As we study economic precarity in the United States, we should therefore consider the following factors:

• The decline of small businesses in the U.S.  This has been due to "the tilting of the playing field to favor massive companies over small businesses," as reported in a 2020 article by Business Insider.  (See also "Monopoly Power And The Decline of Small Business" for a 2016 snapshot of the problem.)  Note that the laws passed by the U.S. Congress and the executive orders issued under the Trump administration only made this worse.  However, the Biden administration has begun taking steps to reverse small business decline by helping small businesses compete for Federal work, as reported by the Federal News Network in a 2023 article.

• The shifting of tax burdens from the rich to the poor.  A striking case in point is the number of states (red states, particularly) whose legislatures and governors have turned them into tax havens for the rich.  (See also, "How the Ultrawealthy Devise Ways to Not Pay Their Share of Taxes," NPR, August 2022.)  Thus these states have come to resemble enclaves of dirty money that are found in the Cayman Islands.  Note that the U.S has recently surpassed the Caymans to become the "world's biggest enabler of financial secrecy" as reported by the international Consortium of Investigative Journalists in May 2022.  But these are merely one part of the overall shift of tax burdens away from the rich which began in the 1980's under Ronald Reagan.

• The use of monopoly and oligopoly power to create monopsony and oligopsony labor markets.  We all know that a monopoly is a state in which there is only one supplier of a particular good or service which is needed by many buyers.  The monopolist can therefore charge whatever price he wants, even if the price is horribly unfair.  Oligopoly is the condition in which there is more than one supplier, yet the total number of suppliers is very small.  Examples of oligopoly include Airbus and Boeing among aircraft manufacturers, or Microsoft and Brave and Alphabet (owner of Google) among Internet search providers, or CVS and Walgreens and Rite-Aid among drugstores and pharmacies.  A monopsony, by contrast, is a situation in which there is only one buyer of a good or service which is offered by many suppliers.  An example of this is a situation in which there is only one employer who can offer jobs to people in a large geographical area.  Thus the many people in this area become horribly dependent on the one large employer, and if that employer uses his power maliciously or suddenly goes out of business or decides suddenly to cut costs, many people will be devastated.  Oligopsony works the same way.  Monopsony and oligopsony are the natural outcome of monopoly and oligopoly.

• The shifting of regulatory burdens from large businesses to small businesses.  A prime example of this is the case of trying to use your own personal car to earn money by giving people rides.  Most cities and states have laws that prevent you from doing this as a private individual.  In this case, there are only two legal ways you can earn money by giving people rides: go to work for a taxi company, or become an "independent contractor" for a multibillion-dollar ride-hailing service such as Uber or Lyft.  The regulatory burden on these ride-hailing services is very small, as seen in the cases of ride-hailing drivers who are injured on the job, or passengers who are sometimes assaulted by the ride-hailing drivers.  Regulatory burdens are now crafted by state and local legislators for the purpose of expanding opportunities for big businesses by smothering small businesses who can't afford the costs of regulatory compliance.

• The innovation-depressing strategies of big businesses.  It can be argued that once a monopoly or oligopoly economy is established, the big players in such an economy will tend to fear innovation, since innovations can be disruptive and can even destroy the pre-existing monopoly or oligopoly arrangement.  Thus it is no surprise that large businesses (and wanna-be large business owners) have evolved egregious strategies to stifle any potential innovations that might threaten their interests.  One such strategy is the misuse of the "non-compete agreement."  These are agreements which employees force new hires to sign, in which the new hire typically agrees not to work for any other business or start their own business within a certain time frame and within a certain geographical area.  Certain versions of these non-compete agreements also force the employee to give up all rights to any invention or intellectual product which the employee may devise while employed by his employer and for a certain time period after the employee stops working for the employer.  (If you work for such an employer, I can understand why you would not be motivated to think very much while on the job!)  The abuse of non-compete clauses in employment contracts has moved the Biden administration to start taking steps to ban them (see this also), which should provide immediate relief from employers who want to try to turn their employees into personal property.

Future posts in this series will examine these factors in more detail, along with other factors such as the absence of single-payer health care coverage in the U.S.  But for now, consider these factors as the means by which the wealthy in this country seek to prevent the American precariat from building individual and collective self-reliance.

Precarity, American-Style: Introduction

Every child had a pretty good shot

To get at least as far as their old man got

But something happened on the way to that place

They threw an American flag in our face

- Billy Joel, Allentown, 1982

This post is a continuation of my series of posts on the spread of economic precarity among the majority of the world's population.  The opening posts in this series explored precarity as a global phenomenon and characteristic of economies in both the developed world and the developing world which are dominated by rampant free-market capitalism.  Subsequent posts described how precarity came to characterize even those societies which withdrew from global capitalism for several decades in the 20th century but which returned to the capitalist fold during the last decade of the 20th century.  It is now time to consider the case of a nation which has been dominated by the "free market" arrangements created by its wealthiest citizens from its founding to the present day - namely, the United States.   It is time especially to examine the late-stage outworkings of those arrangements.  Those outworkings can be summed up as the spread of precarity throughout the United States.  We have looked at other peoples' messes.  It's time to look at our own.

A quick review: the first post in this series defined precarity 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."  That first post also said,

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?"

The University of Georgia webpage cited above describes how precarity was not always a feature of modern American life.  That page describes how under President Lyndon Johnson, the United States began to construct a social safety net that actually worked to bring economic advancement to all Americans and not just the rich.  The page also describes how wealthy business interests organized from the 1970's onward to begin to unravel that safety net in order to protect and expand their dominance over the American economy.  Today's post will explore how the resulting increase in precarity spread throughout the United States.  We will see that, to use a word picture, many of those who thought that they would make out all right by being friends of wolves wound up becoming lamb chops themselves.

Let's consider first a paper titled, "Changes in Precarious Employment in the United States: A Longitudinal Analysis" (Oddo, et al, Scandinavian Journal of Work, Environment and Health, December 2020).  This paper introduces the term "precarious employment" (or PE, as the authors abbreviate it) and describes it as "the accumulation of multiple unfavorable facets of employment quality."   In plain words, PE is the accumulation of those factors in a person's job which make the job more like Hell than Heaven.  The paper measured PE in terms of the following seven variables:

1. Material rewards - that is, the relative adequacy or inadequacy of wages
2. Work time arrangements - that is, how long a person has to work as well as how much control the worker has over his or her own schedule
3. Stability - that is, whether the job has a stable employment contract or whether it is unstable (as in temporary, seasonal, contracted limited-time, etc.)
4. Workers' rights - that is, whether the employer offers benefits such as health insurance or retirement, as well as protection of workers from exploitation
5. Collective organization or empowerment - that is, whether employees are helped or hindered in their attempts to organize themselves for collective bargaining power
6. Interpersonal relations - that is, whether workers have to deal with toxic bosses or bosses who don't allow the workers to control how they do their jobs
7. Training and employability opportunities - that is, whether there is room for growth and advancement in the job

A high score in each of these variables indicated a workplace that provided healthy, long-term employment.  A low score in these variables indicated a workplace of precarious employment.  The authors of the paper measured changes in these variables over time for various populations and geographic regions in the United States from 1988 to 2016.  They then used this data to construct a precarious employment score (PES) for each group and region.  The authors found, unsurprisingly, that the overall PES for the United States increased during that period, rising from 2.96 in 1988 to 3.43 in 2016.  They also found, unsurprisingly, that the PES increased among historically oppressed groups in the United States, such as African-Americans, Latinos, women, and people without advanced education.  However, there were some rather surprising findings as well.  Men showed an 11 percent increase in precarious employment during this time, as compared to a 6 percent increase for women.  Precarious employment also increased significantly among those Americans with bachelors or advanced degrees.  Most surprising of all was the large increase in precarious employment among workers with higher wages.  

As far as regional variations, the American South showed the highest percentage of precarious employment and highest increase in PES.  This is significant because of the way in which state governments in the South have turned their states into attractive places for foreign manufacturers to set up plants - particularly automotive plants.  Yet this strategy has not translated to increased prosperity for the majority of people living in these states.  This may have to do especially with the fact that, starting from the 1970's onward, automotive plants in the United States have increasingly relied on the use of temporary staff to meet just-in-time production targets, as noted in an interview given by Professor Timothy Minchin of La Trobe University in 2021.  Professor Minchin has also written a book about the activities of foreign-owned automakers in the United States.

It is interesting that the beginning and growth of widespread precarity in the United States coincided with the terms of Republican presidents from Nixon onward.  This is especially significant when we examine the presidency of Donald Trump.  The Trump administration used to boast that it had achieved nearly full employment for Americans.  However, what actually happened was that there was a huge expansion of precarious, low-wage work under Trump, whose labor policies classified huge numbers of gig and temporary workers as "independent contractors" without rights to health or retirement benefits or other job protections.  Note that the term "gig worker" includes not only those highly-skilled, college-educated people who can craft a somewhat sustainable life out of present-day flexible, short-term economic arrangements.  It also includes the many, many people who were tricked into working low-skilled menial jobs without benefits for chump change wages, first by FedEx in the 1970's and 1980's, then by Uber, Lyft, Airbnb, and Door Dash, among others in more recent years.  As a result of the expansion of such arrangements, the United States has the highest percentage of low-paid, precarious workers among any OECD economy, as noted by Kathleen Thelen in her paper titled, "The American Precariat: U.S. Capitalism in Comparative Perspective."  At present, around 25 percent of the American workforce falls into the category of low-paid precarious workers.

These facts and considerations are quite naturally a big concern to me, because I am an African-American, and I have had to live my life watching many of my people suffer the malignancy and oppression of American society.  I have also experienced some of that malignancy and oppression myself.  This experience has taught me that the oppression of even one person threatens the peace of everyone who is not yet oppressed, or, to put it another way, allowing injustice against one leads eventually to injustice against all.  This is why I can't look the other way when I see others being oppressed, even when they are not of my "tribe".  But I think that what has blinded the eyes of many white Americans (especially among the privileged) over the last few decades has been the appeals to naked self-interest which have been pitched to them by the masters of the American economy.  So I'd like to return to a theme set forth in the opening paragraphs of this post, namely a description of how precarity has begun to bite even the members of the formerly "middle-class" or "upper middle-class" in recent years.  

Consider therefore a 2019 book by Alyssa Quart titled, Squeezed: Why Our Families Can't Afford America.  I am in the middle of this book right now, and have learned some surprising things, as well as being reminded of things I already knew.  One of the surprising things is how many degreed working female professionals suffer discrimination and career damage simply from the act of having a baby.  Another thing is the link between increasing overall precarity and the increase in costs of child care for working parents.  (Child care and other forms of paid personal care represent one of the fastest-growing segments of the U.S. economy, by the way, although personal care workers receive the lowest wages.)  Yet another thing is how people who once considered themselves well-off find their neighborhoods becoming hostile to them as those neighborhoods are taken over by the super-wealthy - a surprising case of how gentrification hurts even those who thought they were insulated from its effects by being part of the dominant culture.  Case in point: a game between two high school varsity baseball teams.  One was "decently middle-class" while the other consisted of kids from a wealthier nearby suburb.  Each group was cheering their own team, but the wealthier kids - and their parents - began to taunt the kids from the other team by chanting "Lower Average Income! Lower Average Income!" and "Can't your parents afford to feed you?  Can we call Child Protective Services?"  Quart's book also describes the shock and surprise which many formerly smug professionals are experiencing as they witness the dwindling of the value of a college degree in the United States.  We will consider these things in a future post, by the way, as this phenomenon is not just limited to the United States.  As noted in a previous post, Chinese degree-holders are finding out that there are fewer jobs than graduates in the Chinese economy.

As we explore the theme of precarity in the United States, we will consider the mechanisms by which precarity began to appear from the 1970's onward.  We will see, rather surprisingly, the link between these mechanisms and the increasing difficulties faced by small businesses and would-be entrepreneurs over the last four decades.  We will also ask what is to be done about the precarious situation many of us now face.  Here's a hint: I don't believe the answer lies solely in electoral politics or issuing policy recommendations.  While these things can be important, they are not enough by themselves, since they leave the locus of power outside of those communities which are suffering the most from precarity.

Here I speak as a Black man who has studied strategic nonviolent resistance and who has experienced cognitive liberation of the kind which moves me to challenge existing situations of oppression.  My study of precarity in the United States has shown me just how dire the African-American situation is.  But my attempts over the last six or seven years to organize my brothers and sisters for collective action have left me rather frustrated.  So I'd like to ask, How will we begin to change our situation?

First, let's say straight up that passivity and magical thinking will not help at all.  I am thinking of some of the people I have tried to organize and how they have told me that I should join an organization that helps people instead of bothering them.  But my answer to that is to quote from The Little Red Hen.  Others have seen what I was asking them to do and have said in essence, "Well, I don't have the time or resources to help organize my people where I live.  But I know that there are places where we do see Black doctors and lawyers and bankers - I think I'll move there!"  My answer (especially to those who tell me that such a magical place exists in the American South) is to say that there is no "Big Rock Candy Mountain" that they can run away to, and that they are lying to themselves in order to avoid the sacrifices, hard work and potential risks of collective action.

The inescapable reality is that the only thing that will reliably alter our situation is our choice to begin to organize ourselves for collective action.  As Maciej Bartkowski said in his book Recovering Nonviolent History, 

"The guilt of falling into . . . predatory hands . . . [lies] in the oppressed society and, thus, the solution and liberation need to come from that society transformed through its work, education, and civility.  Victims and the seemingly disempowered are thus their own liberators as long as they pursue self-organization, self-attainment, and development of their communities."

Or, to quote from Alex Soojung Kim-Pang,

"Collective action is the most powerful form of self-care."  (Emphasis added.) 

Precarity in the United States: A Preview of Coming Attractions

I have begun research on my next posts in my series on precarity and the precariat.  My focus will shift from precarity in formerly communist countries to precarity in the United States.  I believe we will see a surprising similarity of patterns to those patterns we observed in the Russian and Chinese cases.  We will also see that very few people in the Unites States can afford to be complacent anymore.  I have gathered a lot of material, and like a person who has just binge-shopped a gourmet supermarket, I'll need time to digest it all.  In the meantime I may write a post on another subject tomorrow, but if I do, it will be a short post.  Those who want to get a head start on me in my research on precarity, American style, can consult the following sources:

• The Educated Underclass: Students and the Promise of Social Mobility, Gary Roth, Pluto Press, 2019.
• Immigrant Labor and the New Precariat, Ruth Milkman, Cambridge: Polity Press, 2020.  (Note: Try not to order an e-book copy of this through the John Wiley website.  Wiley has e-book download policies that will make you want to kick furniture and punch walls...)
• "Not 'Just' a Barista: The Story of Portland's College-Educated Baristas, Ned William Tilbrook, Portland State University, 2020.  (Now this sounds interesting!)

And there's much, much more!  Stay tuned . . .

The Precariat In The East: The Chinese Case

Today's post is the fourth installment in my series of posts on precarity as a feature of 21st century life and the precariat as a global cultural phenomenon.  For context, please also read Part 1, Part 2 and Part 3.  In the third post in this series, I wrote the following:

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 . . .

Today's post will consider the emergence of the precariat in China during the last forty-five years.  And it must be said that while precarity is a definite sign of economic inequality in a society, it is also true that there have been unequal societies in which precarity did not exist.  Chinese history spans both cases.  In fact, according to a paper titled, "Understanding Inequality in China" (Yu Xie, University of Michigan, 2010), ". . . inequality has been a part of Chinese culture since ancient times."  Historically, this inequality did not contribute to precarity among the poor in Chinese society.  However, this culture of inequality was a contributing factor in the precarity that emerged after the death of Mao Zedong.  So let us consider the evolution of inequality and class mobility in China from ancient times to now.  

Ancient China

In ancient China, the emperor was the only person with a permanent hereditary position of wealth, privilege, and power.  According to Yu Xie's paper, the emperor governed by two means: first, by the promulgation of the doctrines of Confucius and Mencius who taught that the mission of rulers is to work for the public good; and second, by the use of a vast corps of semi-autonomous administrators and bureaucrats scattered throughout the provinces of the Chinese empire.  The relationship between ordinary peasants and the emperor and his bureaucrats was therefore shaped by two points of propaganda: first, that the emperor and his administrators were actually working for the public good, and second, that for the emperor and his administrators to do their job, structural inequality was necessary.  According to Mencius, "‘There are those who use their minds and there are those who use their muscles. The former rule; the latter are ruled.  Those who rule are supported by those who are ruled.’ This is a principle accepted by the whole Empire . . ."  Therefore, the mission of the peasants was to use their labor to provide material support to this cadre of rulers.  

In order to make sure that the peasants did their part to support their rulers, a system of taxation was developed, and as part of that system, a system of personal registration (hukou (户口)) and household registration (huji (户籍)) was developed.  According to a paper titled, "Governing neoliberal authoritarian citizenship: theorizing hukou and the changing mobility regime in China" by C. Zhang, Queen's University Belfast (2018), this household registration system ". . . continuously served important social and political functions, including military conscription, taxation, local policing, social security and mobility control, for about two millennia in the centralized bureaucratic empire . . ."  Note especially the mention that from time to time, the huji system was used to limit the ability of subjects to move around from region to region in the empire.  This is corroborated by a mention in another paper of how the Qin dynasty used the huji system to limit movement of individual subjects from region to region: "The Qin people [sic] could not freely move outside an administrative unit to which he or she belonged; thus, they had to use credentials for traveling and transfer certain personal documents when moving from one unit to another."  ("In the Government's Service: A Study of the Role and Practice of Early China's Officials Based On Excavated Manuscripts," Daniel Sungbin Sou, University of Pennsylvania, 2013)

Even with this system of registration in place, however, social mobility was still possible in ancient China.  For the rich, whose riches under the existing economic and cultural system were not easily inheritable, there was always the possibility of downward economic movement.  According to Yu Xie's paper cited above, ". . . except for the emperor, the aristocratic and privileged classes were not stable . . . In fact, the emperor did not want the inheritance of the aristocratic and privileged class."  People who got too rich could in fact be repressed and have some of their possessions confiscated.  Also, poor people could advance their family prospects by investing in the education of their sons.  By this means the next generation could climb the rungs of the Chinese meritocracy and become administrators themselves.

By these arrangements, ancient Chinese society was conditioned to accept inequality as the "inevitable" price of the promotion of the social welfare of the entire society.  The system worked and was acceptable to all as long as emperors and their administrators actually ruled for the benefit of all, and as long as there was some room for social mobility among the poor.  However, between ancient times and the present, China underwent subjugation by Western powers, followed by a revolutionary fight for independence.  As a result, its internal systems went through a period of readjustment.  

Maoist China

Maoist China inherited most of the existing cultural institutions which had endured from ancient times.  Maoist China also inherited the toxic mess which Western colonialist powers had made of Chinese society.  However, the responses of the government of Mao Zedong to this mess created new challenges.  One of Mao's early goals was to transform China from a primarily agrarian society to a modern industrial society as quickly as possible.  This led to such disasters as the Great Leap Forward which was launched in 1958.   

In 1958 the system of internal household registration was also transformed into a much more rigid modern hukou system modeled on the Soviet Russian system of propiska (пропи́ска).  It is interesting to note that in its original form, the Russian propiska system, hundreds of years old, was designed to prevent the upward social mobility of Russian serfs.  The Chinese system, borrowing from the Russian system, thus created a society which was the opposite in certain key aspects from the socialist promise of a "classless" society.  

The hukou system had the following elements:

• Starting in 1958, all people had to be registered according to birthplace.
• The person's birthplace was the determinant of whether the person received State welfare services and what kind of services would be received.
• Those whose birthplace registration was urban received State services.
• Those whose birthplace registration was rural received no State services.  Any welfare services they received had to come from communal social arrangements in their village of registration.
• Those whose birthplace was urban were categorized as non-agricultural.  Those whose birthplace was rural were categorized as agricultural.
• The children of the people registered in 1958 inherited the hukou status of their parents.  The children of these children, in turn, inherited their parents' hukou status.  Thus even if you were a child born in the 1990's in a city, if your parents had a rural hukou status, you inherited the same rural hukou status.

The Maoist hukou system created a social hierarchy in which the members of the Communist Party were at the pinnacle.  Immediately below them were the city dwellers who were involved in industrial production.  Below them were the rural peoples, whose mission was to provide food to the industrial urban centers and the leadership of the country in order to fulfill the mission of rapid industrialization.  Therefore, the social mobility of the rural, agricultural hukou holders was severely restricted.  Anyone who held an rural agricultural hukou who tried to move to a city without permission was likely to be severely punished.  Moreover, anyone from the countryside who moved to the city without permission would be denied access to the social services available to the residents of the city who held urban, nonagricultural hukou status.  And the Chinese government made it very hard for anyone with a rural hukou status to change to an urban hukou status.  (See "China's Household Registration (Hukou) System: Discrimination and Reform", Fei-Ling Wang, Georgia Institute of Technology, 2005.)  According to "China’s Hukou System: How an Engine of Development Has Become a Major Obstacle" (Martin King Whyte, Harvard University, 2009), the holders of rural, agricultural hukou comprised 80 percent of the total Chinese population in Maoist times.

One last feature of note in the Maoist system was the danwei (单位) system.  A danwei was a work unit organized in Maoist China.  According to Wikipedia, the workers assigned to a danwei were the bottom rungs of the social hierarchy whose head was the central Communist Party.  Danwei referred not only to the place of work but also to the organization of the work unit.  The danwei also served the purpose of dispensing social welfare benefits to their subjects.  Thus things like health care, schooling and day care for children, and other benefits were dispensed to workers through their danwei.  Once assigned to a danwei, it was very hard for a worker to be fired, because the danwei provided an "iron rice bowl" to their workers, a system of social welfare and livelihood that, while often not comfortable, at least prevented them from having to live a precarious existence.  While this security had its good features, it was part of a system that did not deliver prosperity and national advancement as rapidly as was wished by some of the more forward-thinking members of the Chinese Communist Party.  Therefore, after Mao's death, Chinese social arrangements were again altered in order to attempt to harness capitalism as an accelerator of growth and advancement.  While the alteration did produce results, it also accelerated the increase of inequality in China and began to introduce a rapidly-growing element of precarity in Chinese society.

From The End of Maoism to Today

The changes wrought by the reforms begun in 1978 have been profound.  Two changes are especially relevant, as they have contributed most greatly to the emergence of the precariat in China.  The first is the smashing of the "iron rice bowl" danwei system.  According to Wikipedia, when individual private enterprise became possible once again, private enterprises and foreign multinational corporations were able to out-compete state-run danwei.  This led to the weakening and shrinkage of the danwei, and the increasing number of workers who were thrust out of stable careers with guaranteed benefits into an uncertain labor market.  Thus these refugees from the danwei system became an element of today's precariat in China.  In losing their danwei, these displaced workers lost the social units that once gave them status, identity, and access to benefits.

The hukou system was also changed.  The changes have been coordinated between the Chinese government and large holders of capital in the Chinese economy, and their goal has been to create and expand a large, flexible, and cheap workforce.  The elements of this change are as follows:

• Restrictions on physical movement under the Maoist hukou system have been relaxed somewhat but definitely not eliminated.  
• Hukou status has largely remained unchanged in the sense that it is still difficult for holders of rural hukou to change their status to urban.
• Legal migration of rural residents to urban centers is more possible now than in Maoist times.  However, rural residents who do migrate are still denied access to the social welfare services and legal citizenship rights granted to holders of urban hukou.  
• This arrangement has therefore created a very large class of migrant workers who are paid very cheaply and have few or no rights.  
• Those who migrate legally are more likely to be integrated into the formal economy of the cities to which they migrate, whereas those who migrate illegally tend to wind up in the informal economy.
• Whether formally or informally employed, these migrant workers are not granted stable, long-term employment contracts.  Therefore they comprise another very large sector of the Chinese precariat.
• Many of these people are forced to work like dogs, as evidenced by the "996" schedule imposed by many employers, a schedule which was only recently ruled illegal by the Chinese Supreme Court.
• Those who migrate illegally are subject to the threat of violence either by the State or by their employers.

One other thing to note is that in China as elsewhere, education is no longer the guaranteed road out of precarity into a more stable life.  A 2021 paper titled, "After the Foxconn Suicides in China: A Roundtable on Labor, the State and Civil Society in Global Electronics" describes the exploitation of young Chinese students by the tech industry, thus highlighting the struggle of the large percentage of youth in the Chinese precariat.  This is also pointed out in another paper titled, "The Chinese Race to the

Bottom: The Precarious Lives of Unemployed University Graduates in Beijing’s ‘Ant Tribe’".

Lastly, it should be noted that although the precariat in China is expanding, expressions of resistance to exploitation are beginning to appear as well.  For further information on these, you can read the first pages of Building China: Informal Work and the New Precariat by Sarah Swidler.

I have one or two more global regions to examine in sketching the precariat as it exists in the world today.  Those will require more research, so the next post in this series may need to wait a couple of weeks.

Research Week - End of January 2023

As I noted in my most recent post on the subject of precarity, there is a fairly wide body of research which has been done on the origins and spread of the precariat in the developed nations of the West.  I think it is good also to see how the precariat has come into being and has evolved in those nations that are not historically of the West.  The last post in the series therefore covered precarity as it exists in Russia.  I promised that the next post in the series would cover other non-Western cases.

In preparation for that next post I have therefore downloaded several articles concerning another nation of interest to this discussion.  However, I need time to read and analyze everything I've downloaded so that my next post does not wind up shooting from the hip.  Hopefully I'll be ready by next weekend . . . 

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 - My Own Experience

Last week's post presented a few definitions of precarity as a social and economic phenomenon.  Today I'd like to present a definition which overlaps the definitions previously given while expanding a bit on the personal side of this phenomenon.  From the standpoint of those who experience it, precarity is a state of being in which a person can't be sure that they will have enough money each month to make rent or mortgage payments, to go places by other means than walking or riding a bicycle, to keep the utilities connected, or to cover groceries for the entire month.  This can be due to not earning enough each month for the expenses listed above.  It can also be due to having a job which is in danger of disappearing even though for the present it does provide enough money to cover the bills.

Although I am an African-American and my family is African-American, I was not born into precarity, even though I was born into a time in which I and my family had to face an environment of racial hostility which was as bad as or perhaps even worse than the worst which the Trump years produced in this country.  My life from birth to adolescence was relatively secure because my dad was an officer in the military.  However, once I reached adolescence, my siblings and I found ourselves living in a broken home.  It is not my desire now to describe how this happened or who was at fault.  Indeed, at the time our home was breaking, I could not have provided such a description, as a lot of what was happening went right over my head.  All I knew at the end of it was that I was now living with one parent instead of two.  

I do not want to say anything that would be dishonoring to either of my parents.  However, for the purpose of this post, I must say that the parent with whom I ended up living chose to approach the new, constrained life we faced with a rather - shall we say, interesting - perspective.  Looking back, it seems to me that some of the elements of that perspective consisted of the notion that we should live as luxuriously as possible even if it required Divine miraculous intervention, combined with a belief system and theology heavily influenced by holy-roller Pentecostalism.  Mistakes and bad choices were therefore made, and we suffered consequences such as occasionally running out of food before the end of the month, having utilities turned off, having a car repossessed, and finding it hard to buy clothes for rapidly-growing children.  This parent was not the only source of my personal sufferings during that time.  I too was a complete and utter doofus.  To explain this further, I was an underachiever and quite lazy.  Partly this was due to the fact that I could not stand school, although I was able to do well enough when I applied myself.  But I preferred to spend my time either watching TV, listening to public radio, reading science fiction, or just prowling the neighborhood during the hours when my parent was working swing shift.  Therefore I was definitely not on the college prep track.  

During my freshman and sophomore years in high school, this sort of life was tolerable to me.  But as the Good Book says, "Whatever a man sows, that he shall also reap."  After a while the reaping grew more and more painful.  I therefore started looking for work at a local swap meet, and later got a job at a local drive-in movie theater.  And I began to worry about my future beyond high school.  I knew that I had not prepared myself adequately for college, let alone for any kind of scholarship money.  So it seemed to me that my best chance for eating and having clothes to wear after high school lay in joining the military myself.  Therefore I enlisted.

Thankfully, during my tour of duty I was never in combat and never had to shoot at anyone.  But I quickly got tired of spending my time sleeping in the woods with people whom I could hardly stand, people who got drunk at every possible opportunity.  So I served only one tour and then got out.  My experiences of adolescence had combined with my military experience to produce in me something that had not previously existed, namely a strong desire to better myself and to leave completely behind a lifestyle of just barely getting by.  So I decided to put myself through college.  My heavy exposure to science fiction moved me to choose engineering as a major.  I knew I was in for a long and hard slog to reach my goal, but now I was determined to get there.

I entered my college years with a certain perspective on the world and on the place of educated people in the world.  Part of that perspective consisted of the expectation that corporations and their white-collar workers would continue the same occupational culture which my dad had experienced during his career.  He had served in the military as an officer until he had reached the point where he could retire, then had switched to white-collar managerial work as an employee of a large defense contractor.  Later he retired from that job also and entered into a well-endowed post-retirement life.  He was part of a corporate and occupational culture in which corporations lasted for decades and entered into what I call long-term care arrangements with their best and most loyal employees.  This meant that those who worked for these corporations for a long enough time could expect a guaranteed pension and the sort of stereotypical retirement send-off in which the boss would give the new retiree a gold watch.

The reality I experienced was rather different from this, to say the least.  When I first left the military and moved back to Southern California, I got a job at a defense plant in order to support myself while I was in school.  This was in the last years of the Cold War, and we thought the Cold War would last for decades more.  Therefore we thought our defense plant and others like it would continue in much the same way that public utility companies continued decade after decade.  But then the Berlin Wall fell, and for a time, geopolitical shifts destroyed the economic security of a number of defense contractors.  The plant I worked for was eventually converted to a shopping center.  Many, many people were laid off.

After I obtained my bachelors degree, I went to work for an engineering firm which had once done cutting-edge work for the U.S. Department of Defense and NASA during the space race and the arms race.  However, both national and global political shifts had caused most of that work to dry up by the time I came on board.  The military work never completely dried up.  However, during my first few years at that firm, we worked on prisons (a fact of which I am now ashamed), as well as MEP (mechanical, electrical, and plumbing) design for a number of fast food joints (we're talking about places as small as a typical Taco Bell or McDonald's), gas stations, and amusement parks.  When I first joined that firm a new employee could enroll in the company pension program.  But within a few years, the pension program was replaced entirely by a 401k/ESOP program.  Only the old-timers got anything like a gold watch.  And not a few of those old-timers got the ax during one of several down-sizing periods.  There were times when the cubicle farm in which I worked looked to me like a town in Europe of the Middle Ages must have looked after the bubonic plague had swept through it.  Picture a town with lots of suddenly empty houses.

A major factor which began to affect my engineering discipline (and hence the stability of my career) was the beginning and later acceleration of the automation of many elements of the design process.  This took place as design software companies added functions in their software for the rapid performance of both drafting, layout, and computational tasks which had formerly required humans to do things by hand.  Some of those people I knew who got the ax had been among those who refused to learn the new technology.

My first experience of precarity had been due to personal foolishness on the part of myself and my relatives.  This led me to take the path of education as a means of escape.  I do not in the least regret taking that path.  However, in leaving one realm and entering another, I unwittingly entered a realm of accelerating precarity caused by accelerating large-scale economic and technological shifts outside of my control.  Those shifts were driven by the following factors:

• The destruction of restrictions on capital flows as a result of the deregulation that began under former President Ronald Reagan in the 1980's.  This led to the following:
• An increasing attempt by corporations to try to grow profits by financial trickery, by mergers and acquisitions, and by cutting costs related to long-standing covenants with workers.
• An increasing volatility in the corporate landscape, with long-standing publicly-traded firms suddenly being threatened by either the consequences of ill-advised decisions, or the threat of hostile takeovers, or by the blowing and bursting of economic bubbles, or by the saturation of existing markets.
• The shrinkage of available resources for large-scale transformative megaprojects.  This shrinkage was driven by:
• The political and economic conservatism of Republican administrations in the United States from 1980 onward.  This conservatism tended to lead to cuts in any kind of programs (such as the space program) which had aspirational goals related to the betterment of humankind, although the Republicans always seemed to be able to find money for national defense and law enforcement.  (Unfortunately, however, due to recent Russian thuggishness, it appears that the generous U.S. outlays for defense have been necessary!)
• The beginning of the actual shrinkage of the resource base available for the global and national industrial economies.
• The beginning and later acceleration of changes wrought in work (both manufacturing and knowledge work) wrought by the introduction of automation, advances in telecommunication technology and artificial intelligence.

These factors include things that society can and should collectively decide to reverse, such as the choices and policies of rabid free-market late capitalism.  However, some of these factors should be regarded as inevitable factors that are leading to inexorable changes in the way we procure a living for ourselves and the landscape in which we earn that living.  Seeing such factors in this way should motivate each of us to make whatever personal and communal changes we need to make in order to survive the coming changes.  The technological changes are especially significant, since those who refuse to adjust themselves to prepare for these will wind up being steamrolled by the technological juggernaut.  Each of us may find that he or she needs to engage in a process of constant personal re-education and reinvention.

As for me, I have worked for a few engineering firms since that first firm I encountered after graduating from college.  Some of their offices have gone out of business due to the flat-footedness of managers who were not able to make the mental adjustment to rapidly changing markets and circumstances.  Some of these firms continue to do well to the present day, although their employees must pay certain costs in terms of extensive travel and sometimes long hours.  The challenge for employees is to find an occupational path which provides economic security without working a person to death or imposing unacceptable costs in other parts of the person's life such as his or her family life.  In a future post I will argue that the Great Resignation has provided a temporary boost to workers seeking to navigate such a path.

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.