Periodically, the accumulation of capital reaches a point where such a vast amount has already been accumulated that every addition of surplus value or profit makes only a minuscule difference to the total. Such economic limits combine with social and political ones to produce crises, like the Depression or the Second World War, which are useful to capitalism in part precisely because they wipe out a certain amount of capital value, allowing capital accumulation to restart at a higher level of technological, social, and political organization. After the Second World War, capital and labour came to a kind of of unspoken compromise, whereby capital would give up a certain amount of the profit it saw as its rightful due in exchange for social peace on the labour front and the creation of society able, for the most part, to afford the consumer goods being produced by industry (the car here is the classic example). This post-war consensus saw capital paying workers more, allowing for more consumption, but also for higher taxes; higher taxes, of course, allowed for the creation of the safety-net institutions of the welfare state.
This period, which still looms large in the ideological imagination of the developed liberal-democracies, only lasted thirty years before capital - under pressure from worker and student revolts on the one hand and oil prices on the other - decided to renege on the post-war agreement, recapture the portion of profit it was losing to labour and social programs, and dismantle the welfare state, mainly through privatization, tax cuts, and austerity. This transition, which began in the early 1970s, was to the form of social and economic orthodoxy we know of as neoliberalism. More and more it appears as though neoliberalism itself only lasted until the Global Financial Crisis of 2007-2009. What we are living through is the transition period to a new inflection of capitalism, a new mode of accumulation, similar to the transition to the consumerist welfare state after 1945, or the neoliberal period in the 1970s. Leaving aside the possibility of a socialist or communist revolution right now, the main question to my mind is whether this transition is to a new period of welfare state social protections, or to the final apotheosis of class struggle and the collapse of capitalism. The answer to this question - which will have to be an empirical rather than a theoretical one - will likely determine whether or not a revolution is actually on the table, as it did in the 1930s and 1940s.
Now, one of the strongests concepts of the welfare state was that of the social contract (developed in the 18th century by Rousseau), and this idea dies hard. Indeed, I think it forms the current basis of various calls for rent and eviction freezes, nationalization of industry and health care, and universal basic income. One aspect of the social contract that was still prevalent when I joined the workforce in the 1990s was the idea of loyalty to one’s employer. Anyone who thought seriously about the social contract understood that this loyalty had to work both ways, and the insistence on loyalty to one’s employer in the 1990s became more strident as neoliberal organizations increasingly reneged on welfare-state loyalty to their employees throughout the 1990s and into the new millennium.
The rise of zero-hour contracts and other forms of “gig work” precarity, which were in turn modeled on the almost totally virtualized financial economy, proved to be the indicator that whatever social contract might have existed between employer and worker had been completely destroyed. Nevertheless labour law, which exists to protect the power of capital against labour, bound labour tightly to capital while requiring zero reciprocal commitment of capital to labour. The only way in which capital could be bound to labour, the only way to force capital to take responsibility for its commitment to labour, was through workers’ struggle (e.g. strikes) and collective bargaining.
Twelve years into the transition, we can see how even existing collective bargaining power weighs very little against the power of capital. Libraries are being kept open and staff forced to continue to work with the public despite the danger inherent in the global pandemic and in some cases despite states of emergency being declared. Library workers are being summarily laid off - sometimes through reduction of hours on zero-hour contracts, sometimes even with a collective agreement in place. Budget cuts and layoffs are imminent in many libraries, only held at bay right now because of the crisis, but bound to return in full force when the crisis is over. Governments are stepping in to try to protect workers, renters, and those at risk, but governments are also forcing through austerity budgets designed to wreck the last vestiges of social welfare. In both cases, these are governments born in the neoliberal period, whose understanding of the real contract of the welfare state is almost nil, and whose tendency is to cut taxes, reduce government footprint, privatize, and hope that the invisible hand will protect people. (Spoiler: it will not).
This isn’t good enough. If this crisis does not lead to socialism, and I’m afraid I don’t think it will, it must lead to a refounding of the social contract along welfare state lines. The unlimited power of capital, the inhuman alienation produced by advanced capital accumulation, the complete instrumentalization and isolation of life, has to be reversed through taking political control back and forcing capital - as we did during the Depression and the Second World War, as we did in the late 1960s - to curb its tendencies towards total destruction of the social and ecological fabric of our lives. Capital will never do this willingly; it will have to be forced. Now is the time to force it. However, this is not merely a question of changing our mind, of thinking differently, it is a question of a fundamental restructuring of the economic relations of our society in the service of a new contract. The contract will be temporary, capital will never be able to control itself or its greed for more profit, but it will at least buy us some time to organize again for when that day comes.
Some will think this is reformism, that we ought to be letting the crisis develop so as to sharpen the thirst of the multitude for the revolution. But that kind of accelerationism does no one any good in the long run. What kind of society can we build if we force the economic generators of isolation and alienation, of poverty and dehumanization, to their bitter conclusion.
Needless to say, such a fundamental restructuring will have to reexamine the question of nations in a global context, and this will mean taking seriously Indigenous sovereignty and what that means for the social contract of capital not only with human beings but with the planet itself. Again, capital will not do this willingly, it will have to be forced to accede to the demands of humanity.
Neoliberals will argue that you can’t force someone to be party to a contract: that contracts are founded, as Friedman insisted, on free participation and engagement - indeed, the neoliberal conception of freedom is based precisely on the model of free contract. And yet, the formally free workers under capitalism have been forced to sign contracts for their labour ever since they were driven from the land into the cities and factories. Coercion has never been an obstacle to signing a contract, except in the ideologies and fever dreams of capital.
In addition to Indigenous sovereignty, the “repressive tolerance” of a refounded 21st century social contract will have to apply to those who would dehumanize a section of the population, for dehumanization is the hallmark of instrumentalization, and instrumentalization is the motive force of capitalist social relations. Our conceptions of “free speech” like our conception of “free contract” will have to undergo a massive refoundation on principles other than the primacy of profit and capitalist accumulation. Public servants will no longer get to parade their opinions in white nationalist, phrenological, transphobic rags.
Neoliberalism is over, the crisis is upon us, governments have to respond, and we will have to hold them to account. Elections are not the way to hold them to account: worker resistance is. In a world where public libraries can layoff staff without notice in the midst of a global pandemic, we owe our employers nothing. We produce everything, including production itself; let’s produce everything for ourselves and for each other rather than for the profit of a few who don’t care a fig about us anyway, despite all the protestations and statements of principles coming from “our leadership”.