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“It’s the Economy, Stupid”: What Marx Can Teach Us about the Pandemic

(Photo by Hector RETAMAL/AFP)

“Indeed, when COVID-19 hit, the sunny stock market forecasts President Donald Trump boasted of were belied by record levels of corporate debt and a low rate of productivity growth.”

In his posthumous text How to Be a Marxist in Philosophy, the famed French thinker Louis Althusser recounts a parable to try to explain the relevancy of Marxist thought. A simple man, Grushka, goes to the elders of his village with a pressing concern. A beautiful tree, he claims, is being despoiled due to it having been tied to a donkey. The elders of the village listen to him patiently, before responding. The solution, they claim, is not—as Grushka had thought—to untie the tree from the donkey. Rather, it is to untie the donkey from the tree.

This apologue, which would not be out of place in say a Winnie-the-Pooh story, may seem trite. But it is used by Althusser to illustrate the guiding thread of his own attempt to construct a self-consistent Marxist theory of knowledge: that bourgeois thought cannot reach the truth because it looks in the wrong place. The foremost example of this, in the work of Marx, concerns the “secret” of surplus-value: the way that in capitalism, profits are principally acquired by paying workers less than the value they create. This seemingly straightforward assertion may seem a truism. However, in fact, the “fathers” of political economy—individuals such as Adam Smith and David Ricardo—consistently failed to observe this mechanism of exploitation. This was not for lack of formal brilliance. It was because, as Althusser stresses, they were ideologically blocked from discovering it.

Is it possible that—when it comes to the current viral pandemic—most of us are like poor Grushka, trying to untie the tree from the donkey? The current civil and economic unrest, so we are told, has occurred due to a natural catastrophe. In responding to it, we are presented with two political options. For the (liberal) Left, the solution is to use fiscal policy to strengthen health care services and ensure a sustained lockdown, thereby mitigating the pandemic’s most egregious effects without fundamentally restructuring the economy. For the Right, the favored response is essentially one of capitulation—that it is not such a big deal if some people die, that it is better for a few to lose their lives than for many to lose their livelihoods. While it is clear which of these choices is preferable, selecting one or the other is a bit like having to choose between crucifixion or death by natural causes.

That the workers in these same economies have—in most cases—experienced a relative decline in real wages meant that many of them are unable to endure the burden of even short-term unemployment, having been reduced to living paycheck to paycheck. 

Instead of focusing on what separates these responses, it may be more useful to focus on their shared assumption. This is namely: given that the current upheavals owe purely to the “natural” crisis of the Coronavirus (COVID-19), we must deal with it in a way that keeps intact (to a greater or lesser degree) our existing economic dispensation. However, there are plenty of indications that the origins of this crisis lie elsewhere: in the same neoliberal dispensation that the Right and (liberal) Left are attempting to uphold. Far from being merely “natural,” COVID-19 emerged out of China due to the replacement of peasant agriculture by an industrial meat-centric food system and its callously cobbled-together wild animal trade. It then made its way to the United States, the heart of the global economic system. There its effects were felt deeply not just due to the innate severity of the event in question but also because of the how jittery its economy—which faces a structural crisis on account of the way that elevated levels of automation have resulted in insufficient effective demand—already was. Indeed, when COVID-19 hit, the sunny stock market forecasts President Donald Trump boasted of were belied by record levels of corporate debt and a low rate of productivity growth. A recession, in other words, was overdue.

Even if it surely would have fast-tracked the path to recession, many of the deleterious effects of COVID-19 could have been averted had the proper infrastructure been in place. However, in most nations, the same conditions prevailed. Years of underfunding of health services meant that few jurisdictions had the medical resources on hand to reckon with the pandemic. This problem was compounded by the priorities set by profit-making large pharmaceutical companies, virtually all of whom had eschewed investing in research in infectious disease that disproportionately affect poorer countries. Economically, the fact that contemporary capitalist economies are 70-80% driven by consumerism—a model that, furthermore, requires that turnover times be reduced to close to zero—rendered the repercussions of COVID-19 far more dire than they might have been otherwise. That the workers in these same economies have—in most cases—experienced a relative decline in real wages meant that many of them are unable to endure the burden of even short-term unemployment, having been reduced to living paycheck to paycheck. 

The economist Michael Roberts has claimed that—when this crisis is over—capitalist economists will likely attempt to obfuscate its origin by attributing it wholly to natural causes. This is scarcely a new strategy: the Irish potato famine, for instance, had less to do with a deficit of potatoes than with the fact that it was more profitable to export potatoes elsewhere than to feed the local populace. Should this narrative become ubiquitous, it will be an indication that our society has not advanced beyond Grushka, trying to untie the tree from the donkey.

Is there another way? The Chinese response to COVID-19—while initially hobbled by dissembling and denial—soon achieved remarkable efficiency, with the disease confined to the Hubei province. This admittedly owes partly to the employment of draconian measures, the likes of which could not have been applied in the West. Without condoning all of these, we should acknowledge that China’s success was enabled by the singularity of its system, which is still socialist in many respects: China’s public investment to GDP is 16% per year (compared with 3-4% in the United States and United Kingdom), and it has three times as many public productive assets to private sector capitalist ones (compared with under 50% in the United States and United Kingdom). Due to the enduring effects of the 2007-08 financial crisis, the Xi government has also expressed significant doubt about the desirability of the conversion of China to a fully capitalist model. It would thus appear that—whatever its faults—China is the nation best poised to push for the establishment of a new, less profit-driven form of global governance. To paraphrase the philosopher Hegel—himself an influence upon Marx—it is in China where the wound of COVID-19 emerged. But it is also in China where this we find the possibility of it being healed.

Conrad Bongard Hamilton is a doctoral student at Paris 8 University pursuing research on the relationship between agency and the value-form in the work of Karl Marx. He is a co-author of Myth & Mayhem: A Left-Wing Critique of Jordan Peterson.

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D Iversen
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D Iversen

I would simply ask the author to ask himself, of all of his regular expenses, which one is the biggest? The answer – which is the same for just about everyone – points to the refutation of the Marxist surplus value theory.

Conrad Hamilton
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Conrad Hamilton

Most people’s biggest expense is the surplus value extracted from their labour; this is empirically demonstrable

Carlos
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Conrad Hamilton
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Conrad Hamilton

None of these people actually understand the labour theory of value — there are valid criticisms, but saying e.g. that it ignores supply and demand is approximate at best

D Iversen
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D Iversen

Sidestep