This is all a bit mad, isn’t it? I’ve spent half an hour trying to work out a snappy intro for this piece, but all it really comes down to is, this is all a bit mad, isn’t it?
The lockdowns are starting up all over the world, Tasmania shutting itself off, France militarised, the US doing it city by city.
The whole sector of the economy that relied on consumer choice is disappearing as the ability to make those choices goes. For a while, there was a brief flurry of, almost, excitement, as people — or one class of people — considered working from home, the couch, Netflix, etc.
Then it was announced one by one that all our favourite shows were going out of production and everyone went, oh. Then everyone went oh, the airlines are going to take a hit. Then they realised, no, the airlines are all going to go broke because no one will be flying. And the hotels. And the restaurants.
Yet even as we start to hear that distancing may have to continue for months and that the virus may be with us for a year, going through several waves, we are still talking stimulus, backstop to an entity — “the economy” — that is dependent on a whole range of activities that no longer exist.
Is this the ultimate victory of the ideology of capitalism; that its abstract relations can be held to still exist even where there is no one to do the relating?
The coronavirus would appear to be god’s way of teaching liberals how the world really works. “The economy” is not an imaginary element; it’s real. But it’s an abstract real, something dependent on multiple processes of less abstract activity.
“The economy” only exists as a separate thing under capitalism, when the majority of production is for sale, of work for wage labour. We talk of medieval and pre-modern economies, but that’s for ease-of-use. In any society other than capitalism production is entangled with other social practices.
Only in our era do we gaze up at something called “the economy”, hovering perpetually above us, showering us with gifts or fire.
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Should this virus period be brief the usual processes of monopoly capitalism — billions in “loans” to businesses that have stripped themselves of capital to return money to shareholders — will probably patch things together. But any more sustained process will simply undermine the abstract level on which a conception of “the economy” depends.
In this new crisis, everyone has become not merely a Keynesian, but a magical money theorist. With a sustained fall in demand over time, pumping in money to large corporations will be not only useless, but inflationary.
The last decade of quantitative easing has been inflationary (though it has been hidden in housing bubbles, etc), but it was controlled by the debt-fuelled expansion of the consumer economy. You know, stuff like, er, going out and travel.
With that in suspension, the last illusion of the contemporary economy has gone. Possibly with it will die the notion that the best way to organise a global economy is around the supremacy of the profit motive, with the occasional restraint put on it when it gets way out of control.
The powers-that-be are now scrambling to put as much money into corporations as possible — to service their debt, but stopping short of keeping their staff on pay. This, aside from being pure bastardry, will only make things worse.
Finance capital with nowhere to invest — not that it does much investing anyway — will draw up more and more of the rescue cash. The ground-level economy will shrivel further.
I can’t see how this can do anything other than promote capital inflation — of land, property, finance and corporate services, etc — but which will look like value-maintenance. The inevitable tilt is to monopoly corporations, renters, finance capital. The plan seems to be to deny the grassroots economy the money it needs to survive independently, while maintaining corporations in their shambling zombie state.
This process will impoverish us all, not stave off economic disaster, and destroy much of what we value in neighbourhoods and locales: bars and restaurants, speciality shops, local festivals and events.
What we need (and fast) is a pause and amnesty on every payment that goes upwards towards finance. That means an immediate pause on evictions and foreclosures of both individuals and small-medium businesses, and a phased-in mortgage payments holiday for a three month period, accompanied by a suspension of rent — both residential and small business.
That’s where the money should be pumped into. Companies like Qantas, after initial bridging finance, and on condition of paying their goddamn workers, should be semi- or wholly-renationalised as we start to work out the way to run a contemporary economy for use and rational purpose, rather than trying to put patches on patches of this debt-fuelled consumer/spectacle economy, which was never sustainable in any case.
A corporation is an abstract real, just as “the economy” is. Qantas is a bunch of planes, data, software, buildings and uniforms — and debt. Any longer than three months out of the air, just cancel the debt, take over the airline.
Repeat and repeat.
Anything less, anything else — well, barring a miracle, we’ll need to substantially reorganise — well it’s just mad, isn’t it? It would just be mad.