So, you’re interested in socialism. Or, at least, disinterested in the current state of affairs in America. Maybe you were laid off because of the pandemic, seeing unemployment benefits evaporate after just a couple months. Maybe you’re working from home, receiving and responding to emails at all hours of the day. Maybe you’re a frontline worker, dealing with maskless customers and unsafe work conditions alike. Any of these terrible experiences would rightfully lead you to a simple question: Why is it like this?

The answer is complicated. Why are other countries that are also capitalist economies doing much better at stopping the spread and reducing cases? Why is the American stock market reaching record highs as 8,000,000 Americans have “slipped” into poverty since May? Why is it that the Pfizer vaccine for COVID-19 could profit the company upwards of $13,000,000,000? All of these questions are a great starting point for a discussion on the current economic system under which the United States operates.

We already know that the contemporary West was built from the massive (and continuing!) exploitation of the global south. This much cannot be disputed. But what distinguishes this early mode of imperial (and subsequently industrial) capitalism, built on the backs of slave labor and the most valuable government-backed private corporation in all of human history, from the massively exploitative and financial-driven capitalism we live under nowadays?

The answer to that question is a type of capitalism called “neoliberal” capitalism. Regressing from the Kenyesian era of capitalism (known in American history as the “Golden Age of Capitalism”) which focuses on the power of labor to set its wages through collective bargaining, the neoliberal school of economics is merely a recapitulation of the classical school of economics tied to an era of social liberalism. Centering deregulation, marketization, and decreasing trade barriers, neoliberal capitalism emphasizes the importance of the global labor market, encouraging companies to seek out cheaper and cheaper labor. One way to think about this in American politics would be the fact that, despite the rhetoric of many politicians – from Bill Clinton to Donald Trump – American corporations do not “bring jobs back”; rather, they continue to export jobs to developing countries with impunity. According to the Bureau of Labor Statistics, nearly 7.5 million jobs have been lost to overseas manufacturing since 1980, the nexus of the neoliberal revolution. This trend does not seem to be reversing whatsoever.

“…neoliberal capitalism emphasizes the importance of the global labor market, encouraging companies to seek out cheaper and cheaper labor.”

Neoliberalism seeks to ‘disrupt’ industries through deregulation and offloading costs (financial and physical) to the worker, rather than the capital owners. The tech sector is a perfect example of this deregulation push. Uber, touted as a tech company and a revolution in transportation, is merely a way for the owners of the company to circumvent labor unions that exist for other similar industries, such as taxi drivers. The ‘disruption’ may result in slightly better prices for fare, but also results in the deregulated exploitation of the drivers (who now thanks to Prop 22 in California do not have the benefits of full healthcare, unionization rights, or right to set their own rates as independent contractors – truly a devastating result for gig workers). 

So when you see the stock market break records on the same day as unemployment claims also skyrocket, think hard about why that is. When you look at the massive 41% underemployment rate for college grads, think about how corporations have been offshoring jobs for forty years. When you look at the largest unemployment crisis in the history of the country earlier this year (including the Great Depression), think about the deregulation of OSHA and how corporations are able to operate while throwing their workers into the meat grinder, quite literally. We here at Wilmington YDSA would argue that it is inherently built into the capitalist economic system to exploit workers until they are utterly destroyed. But it is this unique form of capitalism—neoliberal capitalism—that is so effective at crushing workers under the boot of capital and steadily grinding out profit for the wealthiest individuals and corporations in the world.

By: Hanson Egerland, Contributor