archive/so478

[...] When richer families have more children, inequality is reduced [...] "The average upper middle-class familiy is only two-thirds of the size of the average working-class family. Hence, in the absence of modifications introduced by marriage, fresh accumulations, and taxation, the distribution of property would be likely to become more and more unequal." [...] better-off families having fewer children and hence accentuating the tendency towards greater inequality.

[...] One particularly important approach was a political-economic strategy to link the crisis of capitalism to union power. The subsequent defeat of organised labour throughout the core capitalist nations has perhaps been neoliberalism’s most important achievement, significantly changing the balance of power between labour and capital. The means by which this was achieved were diverse, from physical confrontation and combat, to using legislation to undermine solidarity and industrial action, to embracing shifts in production and distribution that compromised union power (such as disaggregating supply chains), to re-engineering public opinion and consent around a broadly neoliberal agenda of individual freedom and ‘negative solidarity’. The latter denotes more than mere indifference to worker agitations – it is the fostering of an aggressively enraged sense of injustice, committed to the idea that, because I must endure increasingly austere working conditions (wage freezes, loss of benefits, a declining pension pot), then everyone else must as well. The result of these combined shifts was a hollowing-out of unions and the defeat of the working class in the developed world.

Unemployment, that more or less well-calculated deregulation of a new market, new technologies, new worldwide competitiveness, would no doubt, like labor or production, deserve another name today. [...] The function of social inactivity, of non-work or of underemployment is entering into a new era. It calls for another politics. [...]

That is why the issue of debt relief necessarily raises historical and political questions about the way such debts have been contracted, enforced, and unequally imposed across whole societies and the whole world. There is, to say the least, always a disparity between the official parties who contract debts and the multitude of people who try to live under the burdens of sovereign indebtedness. In the contemporary global economy, indebtedness should not be viewed as the accidental product of bad luck or poor planning: as we have seen, it functions everywhere as a regime of top-down control and network discipline, designed to replace older forms of social negotiation and political autonomy. As this regime becomes entrenched, every dimension of social life will be restructured according to the wishes of the creditors and their local enforcers, rationing access to everything from work and education to clean water and air, subjecting every component of the local economy to increasingly direct pressures from the global markets. [...]

[...] As soon as the fiction of GDP is abandoned as the criterion of affluence, we have to admit that growth neither takes us further from, nor brings us closer to, affluence. It is logically separated from it by the whole social structure which is, here, the determining instance. A certain type of social relations and social contradictions, a certain type of `inequality', which used to perpetuate itself in the absence of economic progress, is today reproduced in and through growth.

[...] "Before Uber there was in Milan, Italy, in Lyon, France, two or three mini-cab companies that used to compete [...] They've all ceased to exist. The same thing will happen all over the world. You will still have drivers. But that's the most unskilled job in the line. The rest of the money will flow to Uber shareholders in Silicon Valley. So a huge chunk of the Italian GDP just moved to Silicon Valley. With these platforms, the Valley has become like ancient Rome. It exerts tribute from all its provinces. The tribute is the fact that it owns these platform businesses. Every classified ad in Italy used to go into a town newspaper. Now it goes to Google. Pinterest will basically replace magazine sales. Now Uber dominates transport."

[...]

This is an alarming trend, and to an extent, Charlie is right. There's value leaving local hubs and heading to Silicon Valley. But the drain is mitigated by a few factors. First, there is the near-inevitable fact that the large platforms in Silicon Valley will be going public. Their ownership will be much more distributed than those locally owned cab companies, and many of the beneficiaries of those early investments are pension funds that invest in the big venture capital and private equity funds. Those pension funds manage the retirement funds for people in the working class like teachers, police officers, and other civil servants. This doesn't fully account for the loss, and it doesn't negate the irony that the people driving cars for Uber don't have pensions, but it's worth noting in the face of Charlie's predictions. Also important is the fact that there is indeed new value being created in local hubs whenever platforms like Airbnb become an option.

So, even before Thomas Piketty’s book, the topic of ‘inequality’ had arrived in the economic mainstream, and with the following line of argumentation: inequality and poverty are no longer regarded so much as a consequence of capitalist economic growth, but rather as a brake on such growth and as a problem for stability. [...] What stands at the centre of attention are no longer the problems that the poor have with capitalism, but the problems that the poor pose for capitalism and its growth. The demand that follows from this is no longer a fundamental change of economic system, but merely a correction of the existing one – and not a correction of wealth to the benefit of the poor, but a correction of poverty for the benefit of wealth. The goal is not a better life for people – such a better life is only supposed to be a means of making economic growth smoother and faster. [...]

[...] Today's global capitalism brings the relationship of debtor/creditor to its extreme and simultaneously undermines it: debt becomes an openly ridiculous excess. We thus enter the domain of obscenity: when a credit is accorded, the debtor is not even expected to return it--debt is directly treated as a means of control and domination.

It is as if the providers and caretakers of debt accuse the indebted countries of not feeling enough guilt [...]