Guy Standing is an innovative thinker and contributor to policy formation. He is best known for his concept of the ‘precariat’ and for championing a universal basic income. In a recent chapter in Economics for the Many (edited by John McDonnell) he introduces a few more novel concepts, and these are the focus of this blog.
Standing’s characterisation of financial capitalism – as ‘rentier capitalism’ – is unexceptional and I will not reproduce it here. But it is worth noting that he lays particular emphasis on the US-sponsored construction of an international architecture of rent-seeking under the aegis of the World Trade Organisation and World Intellectual Property Organisation, which in 1994 adopted the TRIPS (Trade-related Aspects of Intellectual Property Rights). This initiative ‘globalised American-style intellectual property rights, entrenching monopolistic rent seeking by multinationals.’ The intellectual property rights regime has given renewed impetus to the growth of monopolistic corporations: CEOs are (even) freer now to reject free market competition and just ‘buy up potential competitors.’
Calling Piketty to mind, he rightly claims that throughout the world the share of income going to capital has risen and the share going to those relying on labour has fallen. Plus: the share of capital derived from rent has risen even faster, and the share of rentier income going to the higher echelons of those relying mainly on labour has risen.
When productivity rises, wages do not follow. The links between profits and wages, and between employment and wages, are also broken.’
What Standing calls ‘a new global class structure’ has been generated. This is characterised:
By a plutocracy of multibillionaires with absurd power, an elite serving them, a shrinking salariat and a growing precariat.’
He ‘pleads’ with those still ‘clinging to’ Marx’s analysis to recognise that the groups he identifies ‘have distinctive relations of production (work patterns), relations of distribution (sources of income) and relations to the state that make it desirable to identify with the precariat as a group.’ He adds: ‘we must craft and agenda for it.’ He once took me to task for attributing to him, and then rejecting, the idea that the precariat constitutes a class in and for itself, so I best be cautious.
So how does he explicate the concept of the precariat in this recent (2018) chapter? He has, he suggests, three dimensions. First, ‘those in it have a distinctive work pattern’. This he interprets as a life of unstable insecure labour: ‘casualisation, temping, on-call labour, platform cloud labour and so on.’ Occupational identities and narratives have gone. Widespread under-employment creates frustration and stress as well as insecurity.
Second, the precariat has a distinctive social income. Reliance on money wages or earnings is near total. The non-wage benefits obtained by the proletariat are rapidly disappearing. While the salariat gain more non-wage perks, the precariat have lost even those they had. Their real wages have fallen. Most rely on rental accommodation without security or protection. Then came Universal Credit! And third, the precariat has a distinctive relation to the state, involving the loss of cultural, civil, social, economic and political rights. Its members have become excluded ‘supplicants’.
All this is in a sense a preamble to today’s blog, because Standing goes on to discern three groups within the precariat:
- Atavists – those who have fallen from working-class or proletarian communities and feel they have ‘a lost past’. They have relatively little formal schooling and tend to listen to ‘sirens of neo-fascist populism’. It is Labour’s challenge to win them back.
- Nostalgics – these comprise minorities and migrants who feel deprived of a safe home and are losing rights and being demonised. Many are ‘detached from society’. Again, this is a challenge for Labour: to ‘give them a home’.
- Progressives – these are mostly young, attending collage or university, who have been led to believe in ‘a career’ but now feel let down and abandoned. They also see a broken political system. Labour needs a narrative of hope for this group too.
The challenge for Labour, to reiterate, is arrive at a narrative and a transformative strategy that appeals to these three groups. Standing is necessarily brief in his chapter, but he emphasises: (a) a new distribution system based on capturing and redistributing rentier income; (b) as a way of accomplishing (a) the establishment of a Commons Fund, or a democratic sovereign wealth fund, to be supported by a land value tax (LVT) to be levied on all holdings of half an acre or more, plus a levy on the market value of all private developments on formerly publicly owned land, and a levy on profits gained from using public land; (c) a commons levy applied to wealth, beginning with a reform of inheritance tax; (d) a carbon tax and other eco-taxes; (e) a levy on all those using natural resources for profit, on top of what they pay local authorities or landowners; (e) a special levy on all commercial activity being allowed by the Forestry Commission; (f) a commons levy on monopolistic income derived from patents, copyrights, industrial designs and registered brands ‘to reflect the fact that the intellectual property rights regime is an artificial capture of the intellectual commons’; (g) a levy on income derived by Big Tech’s use of our data and metadata; (h) a levy on all online transactions involving apps and ‘requesters’. The Commons Fund, Standing argues, should be administered by independent democratic management. It would, he suggests – based on the Norwegian model – be able to redistribute more than 4% without jeopardising its ‘permanent character’. ‘Every commoner should receive an equal amount’, and the extent of this dividend would increase over time. To render it more progressive and equitable the dividend could be clawed back from those with higher incomes, possibly through raising the upper rate of income tax and corporation tax.
Standing ends by reiterating his case for a basic income, which he claims would be ‘just’, ‘enhance freedom’ and give people ‘security’. He favours achieving a basic income via a Commons Fund.
There is plenty here to absorb. I will venture only a comment or two. I still find it difficult to justify writing about ‘the precariat’ as if it is or could be either solidary or a class in or for itself. Nor am I so willing to give up on Marxian analyses of class, for all the changes that have occurred in class structuration since he was writing. But my notions of (i) capital monopolists (in a capitalist executive), (ii) the state’s power elite, (iii) a ruling governing oligarchy or plutocracy, and (iv) a novel class/command dynamic, are not so far removed, I think, from Standing’s portrayal. I see precarity as a predictably skewed but cross-class feature of contemporary financialised or rentier capitalism (see my recent Society, Health and the Fractured Society). I think his characterisation of (I would say, ‘class clusters’ of) atavists, nostalgics and progressives is interesting and helpful. As for his highlighting of the need for a fresh and telling Labour, left-of-centre narrative and transformative strategy, I agree totally. And of his suggestions for policy shifts: they are bold, imaginative and generally compelling.