Some thoughts on the political economy of Covid-19

“The crisis consists precisely in the fact that the old is dying and the new cannot be born; in this interregnum a great variety of morbid symptoms appear”

― Antonio Gramsci

This quote from Gramsci’s Prison Notebooks has been a mainstay of social commentary grappling with the longer term implications of the financial crisis of 2007/8. Zizek (2009) narrates this as the ‘old one-two punch of history’: the tragedy of September 11th and the financial crisis. The hubris which characterised the roaring 90s was overtaken by events, with uncertain consequences for neoliberal hegemony. The ‘war on terror’ rapidly eroded a rule based international order while an increasingly ferocious security establishment pushed liberal principles to breaking point. With the ‘credit crunch’ the leading edge of financial innovation almost caused the ruin of the system, as a consequence of the ontological uncertainty which securitisation had injected into the financial system. The defining motif in both crises was a muscular and proactive state, reaching far beyond the minimalist role which had been accorded to it in recent decades. In spite of history’s vengeful return, we saw what Crouch (2011) describes as the strange non-death of neoliberalism in which political economic orthodoxy was strengthened by a crisis for which it was so evidently responsible. He explains this apparent contradiction by distinguishing between the ideological purity of neoliberal theory and the messy reality of actually existing neoliberalism governance. While the former is committed to market competition under the sign of freedom, the latter entrenches the dominance of global corporations within public life through a ‘comfortable accommodation’ between market, state and the corporation. As Crouch (2011: loc 111) puts it, large corporations are “not just mighty pressures on, but major insider participants in, the political process”. History had returned but the capacity of entrenched power to disrupt its unfolding was more pronounced than it had been for nearly a century, leading to a deep intellectual engagement with the changing nature of capitalism (particularly for example in relation to technology) and the enduring character of its neoliberal variant (Harvey 2007, Peck 2012, Mirowski 2012). This was an interregnum in which nothing really changed while nothing could remain the same. “The powerful have a way of sticking to time-honored strategies even when the reality is radically changing”, as Patel and Moore (2018: loc 216) observe in their panoramic history of capitalist development.

The 2010s were a tumultuous decade in which old certainties melted away, as the unfolding implications of the war on terror and financial crisis produced a world increasingly distant from the imagined liberal hegemony of the ‘end of history’ (Zizek 2009). It was marked by a proliferation of business and consumer technologies widely hailed as ‘disruptive’ even as the term itself lost currency through overuse: the inexorable rise of the smartphone, the mainstreaming of cloud computing, the mass uptake of social media, profound advances in machine learning, breakthroughs in social robotics, the commercial viability of digital assistants, increasingly familiar ‘smart’ technologies in the home and the city, the roll out of 4G and the push towards 5G. Knowledge production also underwent significant simultaneous change as commercial, government and academic researchers sought to take advantage of the data generated across these now ubiquitous socio-technical infrastructures through new and revived intellectual movements such as data science, computational social science, urban science and web science (Carrigan 2019a). The scaffolding of social life has been transformed by these developments, one imperfectly captured in phases such as ‘network society’, ‘platform capitalism’ and ‘surveillance capitalism’ (Castells 2004, Srnicek 2016, Zuboff 2019). This epochal shift in the infrastructure of social order developed conjointly with the cleavage in political economy sketched above, leaving us with unprecedented connectivity capable of reorganising networks, groups and institutions at a moment when a rupture seemed imminent yet strangely foreclosed. Could Covid-19 act as the catalyst for a transition beyond this interregnum? As Davies (2020: 37) put in a prescient essay prior to this crisis, “when an unpredictable shock occurs, we will discover what kind of political economy we are now living with and seeking security from”. 

There are a number of factors which are relevant here. Firstly, a generic tendency for economic crisis to increase capital concentration is compounded by levels of state intervention which larger firms are best placed to capitalise upon. Secondly, stagnant real wages and high levels of household debt across the most developed economies suggest a cost-of-living crisis for the majority of their populations which is likely to hit breaking point. Thirdly, the crisis has placed majority world countries in a double bind, in which necessary investment in health care to manage the pandemic are incompatible with servicing long-standing debt obligations (Blakeley 2020: ch 3). Fourthly, existing trends towards digitalisation are being accelerated by this crisis, with significant macro-economic consequences. This is most obviously manifested in the everyday reliance on digital platforms to sustain social relationships, order online rather than a retail sector which has been decimated by this crisis and make what Bogost (2020) calls ‘life in quarantine’ a comfortable existence for those with the capital to access these services. However it also suggests that the threat of mass automation, increasingly prominent in recent years as part of a ‘rise of the robots’ narrative, might come to be realised as advances in automation offer lower operating costs and increased bio-security to the large firms able to make the capital investment as we begin to approach the end of this crisis. Even if the successful clinical trials of vaccines emerging at the time of writing (November 2020) live up to expectations, the logistical challenges of their delivery and inequities concerning access make it difficult to see an immediate exist point to the crisis. Furthermore, the economic and socio-cultural consequences of the crisis cannot be reversed through the delivery of a vaccine, not least of all because so many of them have been incubated since at least 2007/8. 
If we conceive of the challenge in narrowly epidemiological terms, eliminating Covid-19 would simply be a matter of prohibiting interaction within a population until such time as those with the virus had recovered or died (Economy 2020). The fact this is obviously untenable is worthy of reflection as it reveals the interdependence of social life, as imposed isolation across the entire population would disrupt the material conditions which make that isolation possible i.e. the infrastructure for food, power, water and sewage upon which we depend. The functional interdependence of complex societies, described by Durkheim in terms of organic solidarity, constitutes the point of vulnerability to the spread of the virus. This is what gives crisis measures their unique characteristics, attempting to put as much of the economy as possible into deep freeze while retaining enough capacity to ensure social reproduction (Meadway 2020).

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