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CHAPTER TWO

From Domination to Exploitation and Revolt

As Marxists, we share the premise that Marx’s “critique of political economy” remains the starting point for understanding our socio-economic predicament. In order to grasp the specificity of that predicament, however, we must get rid of the last vestiges of Marx’s evolutionary historicism—even if it appears to be the very foundation of Marxist orthodoxy. Here is Marx at his historicist worst:

In the social production of their existence, men inevitably enter into definite relations, which are independent of their will, namely relations of production appropriate to a given stage in the development of their material forces of production … At a certain stage of development, the material productive forces of society come into conflict with the existing relations of production or—this merely expresses the same thing in legal terms—with the property relations within the framework of which they have operated hitherto. From forms of development of the productive forces these relations turn into their fetters. Then begins an era of social revolution … No social order is ever destroyed before all the productive forces for which it is sufficient have been developed, and new superior relations of production never replace older ones before the material conditions for their existence have matured within the framework of the old society. Mankind thus inevitably sets itself only such tasks as it is able to solve, since closer examination will always show that the problem itself arises only when the material conditions for its solution are already present or at least in the course of formation.¹

This schema is doubly wrong. First, capitalism as a social formation is characterized by a structural imbalance: the antagonism between forces and relations is present from the very beginning, and it is this very antagonism which pushes capitalism towards permanent self-revolutionizing and self-expansion—capitalism thrives because it avoids its fetters by escaping into the future. This is also why one has to drop the “wisely” optimistic notion that mankind “inevitably sets itself only such tasks as it is able to solve”: today we face problems for which no clear solutions are guaranteed by the logic of evolution.

In order to move beyond this frame, we should focus on the three features that characterize contemporary capitalism: the long-term trend of shifting from profit to rent (in its two main forms: rent based on privatized “common knowledge,” and rent based on natural resources); the much stronger structural role of unemployment (the opportunity to be “exploited” in a long-term job is experienced as a privilege); and finally the rise of a new class that Jean-Claude Milner calls the “salaried bourgeoisie.”²

The consequence of the rise in productivity brought about by an exponential growth in collective knowledge is the changing role of unemployment. But does this new form of capitalism not also offer a new prospect of emancipation? Therein lies the thesis of Hardt and Negri’s Multitude, in which they endeavor to radicalize a Marx for whom highly organized corporate capitalism already was “socialism within capitalism” (a kind of socialization of capitalism, with the absent owners becoming more and more superfluous), so that one only need cut off the nominal head to reach socialism proper.³ For Hardt and Negri, however, Marx’s limitation was that he was historically constrained by the centralized and hierarchically organized form of industrial labor, which is why his vision of the “general intellect” was that of a central planning agency. It is only today, with the rise of “immaterial labor” to a hegemonic position, that the revolutionary reversal becomes “objectively possible.” This immaterial labor extends between the two poles of intellectual (symbolic) labor (the production of ideas, codes, texts, programs, figures…) and affective labor (those who deal with our bodily affects: from doctors to baby-sitters and flight attendants). Today, immaterial labor is “hegemonic” in the precise sense in which Marx proclaimed that, in nineteenth-century capitalism, large industrial production was hegemonic as the specific color lending its tone to the totality—not in quantitative terms, but playing the key, emblematic and structural role. What thereby emerges is a vast new domain of the “common”: shared knowledge, forms of cooperation and communication, etc., which can no longer be contained by the form of private property. For, in immaterial production, the products are no longer material objects, but new social (interpersonal) relations themselves—in short, immaterial production is directly biopolitical, it is the production of social life.

The irony here is that Hardt and Negri are referring to the very process that the ideologists of today’s “postmodern” capitalism celebrate as the passage from material to symbolic production, from a centralist-hierarchical logic to the logic of autopoietic selforganization, multi-centered cooperation, and so on. Negri is indeed faithful to Marx here: what he tries to prove is that Marx was right, that the rise of the “general intellect” is in the long term incompatible with capitalism. The ideologists of postmodern capitalism make exactly the opposite claim: it is Marxist theory (and practice) itself which remains within the constraints of the hierarchical and centralized logic of state control and thus cannot cope with the social effects of the new information revolution. There are good empirical reasons for this claim: again, the supreme irony of history is that the disintegration of Communism is the most convincing example of the validity of the traditional Marxist dialectic of forces and relations of production, on which Marxism counted in its attempt to overcome capitalism. What indeed ruined the Communist regimes was their inability to accommodate the new social logic sustained by the “information revolution”: they tried to steer it into yet another large-scale centralized state-planning project. The paradox is thus that what Negri celebrates as a unique opportunity for overcoming capitalism, the ideologists of the “information revolution” celebrate as the rise of a new “frictionless” capitalism.

Hardt and Negri’s analysis has three weak points that, taken together, explain how capitalism can survive what should be (in classical Marxist terms) a new organization of production that renders it obsolete. They underestimate the extent to which contemporary capitalism successfully (in the short term at least) privatized “common knowledge” itself, as well as the extent to which, more so than the bourgeoisie, workers themselves are becoming “superfluous” (increasing numbers of them becoming not just temporarily unemployed, but structurally unemployable). Furthermore, even if it is in principle true that the bourgeoisie is becoming progressively non-functional, we should qualify this statement with the question non-functional for whom? For capitalism itself. That is to say, if the old capitalism ideally involved an entrepreneur investing (her own or borrowed) money into a venture organized and run by herself, thereby reaping the profit, a new ideal type is emerging today: no longer the entrepreneur who owns her own company, but the expert manager (or a managerial board presided over by a CEO) who runs a company owned by banks (also run by managers who do not own the bank itself) or dispersed investors. In this new ideal type of capitalism without the bourgeoisie, the old bourgeoisie, rendered non-functional, becomes re-functionalized as a class of salaried managers—the new bourgeoisie itself receives a salary, and even if its members own part of their company, they earn their stock as part of the remuneration for their work (“bonuses” for their “successful” management).

This new bourgeoisie still appropriates surplus-value, but in the (mystified) form of what Milner calls the “surplus-wage”: in general, its members are paid more than the proletarian “minimum wage” (this imaginary—often mythical—point of reference whose only real example in today’s global economy is the salary of a worker in a sweatshop in China or Indonesia), and it is this difference from common proletarians, this distinction, which determines their status. The bourgeoisie in the classic sense thus tend to disappear: capitalists reappear as a subset of salaried workers—managers who are qualified to earn more by their competence (which is why the pseudo-scientific “evaluation” which legitimizes their higher earnings is so crucial today). The category of workers earning a surplus-wage is, of course, not limited to managers: it is extended to all sorts of experts, administrators, public servants, doctors, lawyers, journalists, intellectuals, and artists. The surplus they receive has two forms: more money (for managers, and so on), but also less work, that is, more free time (for some intellectuals, but also for some members of the state administration, etcetera). The evaluative procedure that qualifies some workers to receive a surplus-wage is, of course, an arbitrary mechanism of power and ideology, with no serious link to actual competence—or, as Milner puts it, the necessity of the surplus-wage is not economic, but political: to maintain a “middle class” for the purpose of social stability. The arbitrariness of the social hierarchy is not a mistake, but its whole point, for the arbitrariness of evaluation plays a role homologous to the arbitrariness of market success. In other words, violence threatens to explode not when there is too much contingency in the social sphere, but when one tries to eliminate this contingency.

Therein lies one of the impasses faced by China today: the goal of Deng’s reforms was to introduce capitalism without a bourgeoisie (as the new ruling class); now, however, Chinese leaders are becoming painfully aware that capitalism without a stable hierarchy (brought by the bourgeoisie as a new class) generates permanent instability. So what path will China take? More generally, this is also arguably the reason why (ex-)Communists are re-emerging as the most efficient managers of capitalism: their historical enmity towards the bourgeoisie as a class fits perfectly with the progress of contemporary capitalism towards a managerial system without the bourgeoisie—in both cases, as Stalin put it long ago, “cadres decide everything.”⁴

This notion of the surplus-wage also allows us to throw new light on the ongoing “anti-capitalist” protests. In times of crisis, the obvious candidates for a “tightening of belts” are the lower levels of the salaried bourgeoisie: since their surplus-wages play no immanent economic role, the only thing that stands in the way of their joining the proletarians is their power of political protest. Although these protests are nominally directed at the brutal logic of the market, they are in reality protesting the gradual erosion of their (politically) privileged economic position. Recall Ayn Rand’s favorite ideological fantasy (from Atlas Shrugged), that of (“creative”) capitalists going on strike—does this fantasy not find a perverted realization in many strikes today, which are often strikes of the privileged “salaried bourgeoisie” driven by the fear of losing their privileges (the surplus over the minimal wage)? They are not proletarian protests, but protests against the threat of being reduced to a proletarian status. In other words, who dares to strike today, when having the security of a permanent job is itself becoming a privilege? These are not the low-paid workers in (what remains of) the textile industry and so on, but that strata of privileged workers with guaranteed jobs (mostly in the civil service: police and other law enforcers, teachers, public transport workers, etcetera). This also accounts for the new wave of student protests: their main motivation is arguably the fear that higher education will no longer guarantee them a surplus-wage in later life.

Of course, the great revival of protest—from the Arab Spring to Western Europe, from Occupy Wall Street to China, from Spain to Greece—should not be dismissed as merely a revolt of the salaried bourgeoisie. It harbors a much more radical potential, one that requires a concrete, case-by-case analysis. The student protests against university reforms in the UK, for example, were clearly different from the UK riots of August 2011—that consumerist carnival of destruction, a genuine outburst from those excluded from the system. As to the uprising in Egypt, one could argue that it did begin as a revolt of the salaried bourgeoisie (the young and educated protesting at the lack of prospects), but quickly became part of a larger protest against an oppressive regime. But to what extent did the protest mobilize poor workers and peasants? Does not the electoral victory of the Islamists indicate the narrow social base of the original secular protest? Greece is a special case here: over the last few decades, a new salaried bourgeoisie (especially in the over-extended state administration) has been created, with EU financial help, and much of the ongoing protest is a response to the threat of losing these privileges.

This proletarianization of the lower salaried bourgeoisie is accompanied by an excess in the opposite direction: the irrationally high pay of top managers and bankers, a level of remuneration that is economically irrational since, as investigations in the US have demonstrated, it tends to be inversely proportional to the company’s success.⁵ Instead of submitting these trends to moralizing criticism, we should rather read them as indications of how the capitalist system itself is no longer able to find an immanent level of self-regulated stability; that is, of how its circuit threatens to run out of control.

The good old Marxist-Hegelian notion of totality comes into its own here: it is crucial to grasp the ongoing economic crisis in its totality and not be blinded by its partial aspects. The first step towards grasping this totality is to focus on those singular moments that stick out as symptoms of the present economic predicament. For example, everyone knows that the “rescue package” for Greece will not work, but nonetheless new rescue packages are imposed on Greece over and over again in a weird example of the logic of “I know very well, but …” Two dominant stories about the Greek crisis circulate in the mass media: the German-European one (the irresponsible, lazy, free-spending, tax-dodging Greeks must be brought under control and taught financial discipline), and the Greek one (their national sovereignty is threatened by the neoliberal technocracy in Brussels).⁶ When it became impossible to ignore the plight of ordinary Greeks, a third story emerged: they are increasingly presented as humanitarian victims in need of help, as if some natural catastrophe or war had hit the country. While all three stories are false, the third is arguably the most disgusting: it conceals the fact that the Greeks are not passive victims; they are fighting back, they are at war with the European economic establishment and what they need is solidarity in their struggle, because this is our fight as well. Greece is not an exception; it is a testing ground for the imposition of a new socio-economic model with a universal claim: the depoliticized technocratic model wherein bankers and other experts are allowed to squash democracy.

Imagine a scene from a dystopian movie depicting our society in the near future: ordinary people walking the streets carry a special whistle; whenever they see something suspicious—an immigrant, say, or a homeless person—they blow the whistle, and a special guard comes running to brutalize the intruders … What seems like a cheap Hollywood fiction is a reality in today’s Greece. Members of the Fascist Golden Dawn movement are distributing whistles on the streets of Athens—when someone sees a suspicious foreigner, he is invited to blow the whistle, and the Golden Dawn special guards patrolling the streets will arrive to check out the suspect. This is how one defends Europe in the Spring of 2012. These anti-immigrant vigilantes are not the principal danger, however; they are merely collateral damage accompanying the true threat—the politics of austerity that has brought Greece to such a predicament.

Critics of our institutional democracy often complain that as a rule elections do not offer a true choice. For the most part what we get is a choice between a center-right and a center-left party whose programs are virtually indistinguishable. At the time of writing, the Greek elections scheduled for June 17, 2012 offer a real choice: between the establishment (New Democracy and Pasok) on the one side and Syriza on the other. And, as is usually the case, such moments of real choice throw the establishment into panic, driving them to conjure up images of social chaos, poverty, and violence if the electorate make the wrong choice. The mere possibility of a Syriza victory has sent ripples of fear through markets around the world, and, again as is usual in such cases, ideological prosopopoeia is having a heyday: markets begin to talk like a living person, expressing their “worry” at what will happen if the elections fail to produce a government with a mandate to continue the EU-IMF program of fiscal austerity and structural reform. But the ordinary people of Greece have no time to worry about such prospects; they have enough to deal with in the present, in which their lives are becoming miserable to an extent unseen in Europe in recent decades. Such predictions, of course, often become self-fulfilling prophecies, causing panic and thus bringing about the very disaster they warn of.

In his Notes Towards a Definition of Culture, the great conservative T. S. Eliot remarked that there are moments when the only choice is that between heresy and non-belief, that the only way to keep a religion alive is sometimes to effect a sectarian split from its corpse. This is our position today with regard to Europe. Only a new “heresy” (represented at this moment by Syriza) can save what is worth saving in the European legacy: democracy, trust in the people, egalitarian solidarity … The Europe that will win if Syriza is outmaneuvered is a “Europe with Asian values” (which, of course, has nothing to do with Asia, and everything to do with the clear and present danger of contemporary capitalism’s tendency to suspend democracy).

Greece is thus Europe’s singular universality: the nodal point at which the historical tendency that shapes its present appears at its purest. This is why—to paraphrase the finale of Wagner’s Parsifal—we should redeem the redeemer. We should not only save Greece from its saviors—the European consortium testing out “austerity measures” in Dr. Mengele-like fashion—but also save Europe itself from its saviors: the neoliberals promoting the bitter medicine of austerity and the anti-immigrant populists. There is, however, something wrong with this idea: the fact it is exactly the response of the archetypal European left-liberal moron—preferably a socially aware cultural intellectual—on the question of Europe today. As a politically correct anti-racist, he will insist that, of course, he rejects anti-immigrant populism: the danger comes from within, not from Islam. The two main threats to Europe, he says, are this very populism and neoliberal economics. Against this double threat, we must resuscitate social solidarity, multicultural tolerance, the material conditions for cultural development, etcetera. But how is this to be done? The main, moronic idea here involves a return to the authentic Welfare State: we need a new political party that will return to the good old principles abandoned under neoliberal pressure; we need to regulate the banks and control financial excesses, guarantee free universal health care and education, and so on. What is wrong with this? Everything. Such an approach is stricto sensu idealist, that is, it opposes its own idealized ideological supplement to the existing deadlock. Recall what Marx wrote about Plato’s Republic: the problem is not that it is “too utopian,” but, on the contrary, that it remains the ideal image of the existing politico-economic order. Mutatis mutandis, we should read the ongoing dismantling of the Welfare State not as the betrayal of a noble idea, but as a failure that retroactively enables us to discern a fatal flaw of the very notion of the Welfare State. The lesson is that if we want to save the emancipatory kernel of the notion, we will have to change the terrain and rethink its most basic implications (such as the long-term viability of a “social market economy,” that is, of a socially responsible capitalism).

Today, we are bombarded with a multitude of attempts to humanize capitalism, from eco-capitalism to Basic Income capitalism. The reasoning behind these attempts goes as follows: Historical experience has demonstrated that capitalism is by far the best way to generate wealth; at the same time, it must be admitted that left to itself the process of capitalist reproduction entails exploitation, the destruction of natural resources, mass suffering, injustice, wars, etcetera. Our aim should thus be to maintain the basic capitalist matrix of profit-oriented reproduction, but to steer and regulate it so that it serves the larger goals of global welfare and justice. Consequently, we should leave the capitalist beast to its own proper functioning, accepting that markets have their own demands that should be respected, that any direct disturbance of market mechanisms will lead to catastrophe—all we can hope to do is tame the beast … However, all these attempts, well intended as they often are in their endeavor to unite pragmatic realism and a principled commitment to justice, sooner or later encounter the Real of the antagonism between the two dimensions: the capitalist beast again and again escapes the benevolent social regulation. At some point, we will thus be compelled to ask the fateful question: is playing with the capitalist beast really the only imaginable game in town? What if, productive as capitalism is, the price we have to pay for its continuous functioning simply has become too high? If we avoid this question and continue to humanize capitalism, we will only contribute to the process we are trying to reverse. Signs of this process abound everywhere, including in the rise of Wal-Mart as the representation of a new form of consumerism targeting the lower classes:

Unlike the first large corporations that created wholly new sectors by means of some invention (e.g. Edison with the light bulb, Microsoft with its Windows software, Sony with the Walkman, or Apple with the iPod/iPhone/iTunes package), or other companies that focused on building a particular brand (e.g. Coca-Cola or Marlboro), Wal-Mart did something no one had ever thought of before. It packaged a new Ideology of Cheapness into a brand that was meant to appeal to the financially stressed American working and lower-middle classes. In conjunction with its fierce proscription of trades unions, it became a bulwark of keeping prices low and of extending to its long suffering working-class customers a sense of satisfaction for having shared in the exploitation of the (mostly foreign) producers of the goods in their shopping basket.⁷

But the key feature is that the ongoing crisis is not about reckless spending, greed, ineffectual bank regulation, etcetera. An economic cycle is coming to an end, a cycle that began in the early 1970s, when what Varoufakis calls the “Global Minotaur” was born—the monstrous engine that ran the world economy from the early 1980s to 2008.⁸ The late 1960s and the early 1970s were not just the era of the oil crisis and stagflation; Nixon’s decision to abandon the gold standard for the US dollar was the sign of a much more radical shift in the basic functioning of the capitalist system. By the end of the 1960s, the US economy was no longer able to continue recycling its surpluses in Europe and Asia: its surpluses had turned into deficits. In 1971, the US government responded to this decline with an audacious strategic move. Instead of tackling the nation’s burgeoning deficits, it decided to do the opposite, to boost deficits. And who would pay for them? The rest of the world! How? By means of a permanent transfer of capital that rushed ceaselessly across the two great oceans to finance America’s deficits. The latter thus started to operate

like a giant vacuum cleaner, absorbing other people’s surplus goods and capital. While that “arrangement” was the embodiment of the grossest imbalance imaginable at a planetary scale … nonetheless, it did give rise to something resembling global balance; an international system of rapidly accelerating asymmetrical financial and trade flows capable of putting on a semblance of stability and steady growth … Powered by these deficits, the world’s leading surplus economies (e.g. Germany, Japan and, later, China) kept churning out the goods while America absorbed them. Almost 70 percent of the profits made globally by these countries were then transferred back to the United States, in the form of capital flows to Wall Street. And what did Wall Street do with it? It turned these capital inflows into direct investments, shares, new financial instruments, new and old forms of loans, etc.⁹

Although Emmanuel Todd’s vision of today’s global order is clearly one-sided, it is difficult to deny its moment of truth: that the US is an empire in decline.¹⁰ Its growing negative trade balance demonstrates that it is an unproductive predator. It has to suck up a daily influx of one billion dollars from other nations to pay for its consumption and is, as such, the universal Keynesian consumer that keeps the world economy running. (So much for the anti-Keynesian economic ideology that seems to predominate today!) This influx, which is effectively like the tithe paid to Rome in antiquity (or the gifts sacrificed to the Minotaur by the Ancient Greeks), relies on a complex economic mechanism: the US is “trusted” as the safe and stable center, so that all the others, from the oil-producing Arab countries to Western Europe and Japan, and now even the Chinese, invest their surplus profits in the US. Since this trust is primarily ideological and military, not economic, the problem for the US is how to justify its imperial role—it needs a permanent state of war, thus the “war on terror,” offering itself as the universal protector of all other “normal” (not “rogue”) states. The entire globe thus tends to function as a universal Sparta with its three classes, now emerging as the First, Second, and Third worlds: (1) the US as the military-political-ideological power; (2) Europe and parts of Asia and Latin America as the industrial-manufacturing regions (crucial here are Germany and Japan, the world’s leading exporters, plus rising China); (3) the undeveloped rest, today’s helots. In other words, global capitalism has brought about a new general trend towards oligarchy, masked as the celebration of the “diversity of cultures”: equality and universalism are increasingly disappearing as genuine political principles. Even before it has fully established itself, however, this neo-Spartan world system is breaking down. In contrast to the situation in 1945, the world does not need the US; it is the US that needs the rest of the world.

Against the background of this gigantic shadow, the European struggles—German leaders furious with Greece and reluctant to throw billions into a black hole; Greek leaders pathetically insisting on their sovereignty and comparing the pressure from Brussels to the German occupation during World War II—cannot but appear petty and ridiculous.

1 Karl Marx, “Preface to A Contribution to the Critique of Political Economy” (1859), Selected Writings, ed. Lawrence H. Simon, Indianapolis: Hackett 1994, p. 211.

2 See Jean-Claude Milner, Clartés de tout, Paris: Verdier 2011.

3 Michael Hardt and Antonio Negri, Multitude, New York: Penguin 2004.

4 There is also an interesting difference emerging between today’s China and Russia: in Russia, university cadres are ridiculously underpaid; they have de facto already joined the proletariat, while in China, they are well provided with a “surplus-wage” as a means to guarantee their docility.

5 True, part of the price paid for this hyper-remuneration is that managers have to be available twenty-four hours a day, thus living in a permanent emergency state.

6 One of Jacques Lacan’s more outrageous statements is that even if a jealous husband’s claim that his wife sleeps around turns out to be true, his jealousy is still pathological. Along the same lines, we could say that even if most of the Nazis’ claims about Jews were indeed true (which, of course, was not the case), their anti-Semitism would still be (and was) pathological, since it represses the true reason the Nazis required anti-Semitism, which was to sustain their ideological position. Exactly the same holds for the claim that the Greeks are lazy: even if this were the case, the accusation would be false, because it obfuscates the complex global economic mechanisms that drove Germany, France and others to finance the “lazy” Greeks.

7 “The Global Minotaur: An Interview with Yanis Varoufakis,” available at nakedcapitalism.com.

8 See Yanis Varoufakis, The Global Minotaur, London: Zed Books 2011.

9 “The Global Minotaur: An Interview with Yanis Varoufakis, naked capitalism.com.”

10 See Emmanuel Todd, After the Empire, London: Constable 2004.