Socialist Register 2023 explores the contradictions of the contemporary accumulation regime, and the legacy of late editor Leo Panitch, finds Dominic Alexander

Accumulation is both capitalism’s primary drive and its curse. Accumulation is necessary for profitability in a competitive system, and despite, or even because, of the increasingly vast concentrations of capital held by multinational corporations, competition is as fierce as ever. Yet, as Marx showed, while accumulation creates an ever greater mass of means of production, this in itself begins to throw up barriers to the profitable reproduction of such great quantities of capital.

This contradiction results in the intensification of competition between capitals over labour, raw materials and markets, not the least consequence of which is imperialist tension and war. Another consequence is an impetus to make labour cheaper, not just by driving down wages, but cheapening the social overheads of the reproduction of labour: social care, health, education systems and so on. This even leads to allowing the collapse of infrastructure. Cutting costs to raise profitability becomes the primary aim, far less the use values that such a mass of capital might create; in actuality, the abstract notion of ‘effective demand’ fails utterly to drive the system. The perverse result of the increased accumulation of capital is a mounting scarcity of resources for the things and activities that society needs the most.

Contradictions of accumulation

The assumption that capitalism is regulated by laws of supply and demand, such that consumers get what they want from the market, is proven to be a mirage once it is understood that profitability alone drives production. Seen this way, it is instructive to learn in the essay, ‘Climate Breakdown’ in Socialist Register 2023, that ‘the relative affordability of different energy sources’ is not turning the energy majors in any serious way away from fossil fuels. In fact:

‘current renewable energy deployments are nowhere close to the required scale, but from a profit-perspective there is a surplus [original emphasis]. In the case of solar, for example, significant new production capacity emerging in China 2017 and 2018 encountered a stagnant global market. Apparent oversupply or ‘overcapacity’ subsequently depressed prices to the point that producers have been withholding part of their production in the face of falling profit margins, leading to a wave of bankruptcies’ (Nicolas Graham and William K. Carroll, p.36).

The authors quote another commentator pointing out that for capital, there is little advantage to investing in renewables because ‘there is little surplus value to extract in its production’, since sun and wind, for example, hang ‘like fruit for anyone to pick’ (p.36). This is a compelling argument right there for state-led investment in renewables.

Many of the discussions in Socialist Register 2023: Capital and Politics involve aspects of global corporate systems that relate in one way or another to the problems created by accumulation in contemporary capitalism. The contrast between austerity for social need, and capital’s willingness to chase greater margins of profitability is highlighted by the case of Amazon (Charmaine Chua and Spencer Cox, pp.120-40).

The attraction of Amazon’s business to investment was the possibility of cutting costs by integrating ‘formerly distinct spheres of production, transportation, and consumption into a single e-commerce system aimed at the long-term consolidation and transformation of the retail industry into a vast logistical enterprise’ (p.125). Huge quantities of money were poured into this ambition, yet to little return. In 1999, ‘Amazon’s market capitalization topped $450 billion … Net profits, however, remained deep in the red, totalling a net loss of $6.2 billion’ (p.124). In fact, it was not until 2018 that ‘Amazon’s twenty-year profit problems finally began to turn around’ (p.132). Meanwhile, Amazon’s ‘creative destruction’ has resulted in a net loss of retail jobs in the US (p.129).

In theory, greater productivity in an industry, or cheaper overheads in unproductive but necessary spheres, is meant to create room in the economy for growth of other industries, but there does not seem to be any sign that the huge cutting of infrastructure costs in recent decades has had anything like this kind of effect. Rather, the ‘fragility of internationalized supply chains’ (p.47), has become a major issue, and a significant contributing factor to the cost-of-living crisis and inflation. Rafeef Ziadah on ‘Logistical landscapes’ is very interesting on the massive corporate and geographical concentration that has happened in transport and logistics, particularly around ports. He points out that containerisation itself was not what led to this so much as the ‘interpenetration of “national” capitals and inter-firm alliances linking colonial and non-colonial shipping and port complexes’ (p.49). The social relations of globalisation therefore allowed the technology to unfold in the way that it has.

Workers’ power

In both the discussion of Amazon and logistics in the maritime industry, the problems of precarity, low pay and poor conditions are well noted, but the authors all do argue that these concentrations of capital have also resulted in strategic opportunities for labour as well. In the case of Amazon, the authors go so far as to argue that the giant warehouses placed in urban peripheries have acted as a trigger for the ‘recomposition of the working class’ in those areas.

Fragmented and atomised populations of suburban and exurban workers have been newly concentrated in single workplaces. These are also highly diverse demographics, but class consciousness has been emerging due to the conditions in which the workers find themselves. Christian Smalls’ story of organising the Amazon workers is justly famous, but the authors argue that ‘Amazon’s just-in-time delivery system grants workers immense power’ (p.137). Ziadah reaches similar conclusions about the place of workers in logistics; despite the huge loss of employment in the sector due to its transformation, labour remains essential, and therefore has power.

Pun Ngai and Chen Peier on ‘Infrastructural Capitalism: High Speed Rail and Class Conflict in China’ also point to the growth of workers’ class consciousness and resistance relating to their position in infrastructure. They conclude that the ‘intense class conflicts which have emerged through the deepening of high-speed capitalism could provoke a new wave of destabilizing labour struggles’ (p.220).

The concentration of capital may be a response to overaccumulation, and the decline in the rate of profit (though this last is not touched upon in this volume), but while this has had vast deleterious social effects, it has not in fact removed but just reconfigured the power of labour within capitalism. The empirical reality of this point is certainly worth being stressed as it is in these essays. The rising levels of discontent with the state of society and increasing inequality do not, therefore, constitute a situation without objective possibilities for a fightback against capital.

It is with an awareness of this context, perhaps, that some corporations have begun to place so much emphasis on new corporate-governance strategies summed up as ‘stakeholder capitalism’. For Kyle Bailey, the main effect of these ‘is to neutralize, co-opt, and deflect ongoing popular-democratic struggles to reduce the environmental and social harms wrought by corporations into a hegemonic project of making society and nature safe for capital accumulation’ (p.142).

Stephen F. Diamond, in a complementary essay, ‘The “corporate governance” myth’, argues that debates about ‘stakeholders’ and ‘shareholders’ in corporate structures are effectively an ideological obfuscation. The notion of a separation between ownership and control (management) of corporations obscures the reality that ‘a relatively coherent and dominant class of investors and share-owning senior executives jointly run modern corporations in order to carry out key capitalist processes, namely capital accumulation and the valorization of capitalist profits’ (p.91).

The laws of capitalist accumulation have not changed since Marx’s time, and the bourgeoisie may not be found mainly in family-owned firms as it was in his time, but there is definitely still a bourgeois ruling class. Any notions that new forms of corporate governance could change the spots on this leopard are firmly dispelled in Diamond’s examples and analysis, and additionally in Kyle Bailey’s case study of Unilever (pp.141-164). Richard Saunders’ essay on the ‘blood diamond’ trade in Zimbabwe adds a further case study underlining the problems of pursuing ‘multi-stakeholder initiatives’ to regulate corporate behaviour.

The Chinese economy

The continuity of capitalism’s basic processes seems confirmed by the situation in China, where a very different accumulation regime is showing signs of the same problems as the rest of the world. Difficulties in the Chinese economy matter very much to the global economy, as it has become ‘the driving engine of global capitalist economy’, according to Minqi Li in his contribution. Quoting World Bank statistics, since the crisis of 2008-9, China ‘accounted for 47 per cent of global economic growth’ and ‘66 per cent of global manufacturing value added growth’, among other impressive statistics’ (p.190).

China has been a very high investment economy due to the central role played by the state. An example is one that Pun Ngai and Chen Peier give in their contribution, which follows Li’s, about High Speed Rail, which was ‘aimed at stimulating the economy following the 2008 global downturn’ (p.214). It has certainly required massive investment, which could only have been done by the state: ‘Few countries could overcome the economic and political barriers to develop HSR on such a giant scale’ (p.216). However, it is not at all clear that HSR has been able to answer the problems unleashed in the global crisis of 2008. Earlier in the volume, Patrick Bond noted the global profitability problem affecting ‘emerging markets’ (Brazil, Indonesia, India, Mexico and Turkey). In China’s case an answer to this was its ‘capital’s “going out” via the Belt and Road Initiative to displace its overaccumulation crisis’ (p.78).

China’s economic rise has been accompanied by, indeed depended upon, exceptional levels of exploitation of its labour force, who work under appalling conditions:

‘In the early 2000s, there were more than one million major work safety incidents each year and more than 100,000 workers died each year due to work-related incidents. Since then, China has managed to improve work safety conditions. Nevertheless, in 2020, about 38,000 major work safety incidents occurred, and 27,000 workers died as a result’ (Li, p.192).

In the past, China’s brutal work regime was, nevertheless, delivering gradually higher living standards, at an annual rate of 7-8% annually so that ‘the average Chinese urban worker’s material consumption level approximately doubles every 9-10 years’ (p.196). However, this upward trajectory seems to have stalled, with the rise of living costs, such as housing, beginning to outstrip wages rises in a way ‘that are not fully captured by the official price index’ (p.197). This situation, Li reports, has resulted in a wave of a kind of passive resistance among the young, called ‘lying flat’: ‘do not buy house, do not buy cars, do not marry, do not have children, do not consume (unnecessarily)’ (p.199). This is to escape from the punishing work regime, particularly that required by China’s own version of the ‘gig economy’.

Structures of imperialism

This sort of refusal may not be the kind of collective worker resistance that would be ideal (examples of that are explored more by Pun Ngai and Chen Peier), but it certainly highlights that something is going wrong with Chinese capitalism, and the comparisons Li makes suggest it is not in origin problems that are unique to the Chinese model:

‘When Japan’s labour force peaked in 1995, Japan’s per capita GDP was about 81 per cent of US per capita GDP. When South Korea’s labour force peaked in 2015, South Korea’s per capita GDP was about 66 per cent of US per capita GDP. By comparison, when China’s labour force peaked in 2020, China’s per capita GDP was only about 27 per cent of US per capita GDP’ (p.205).

Li frames the argument so as to suggest that population growth, or not, is the main factor behind the ability of these economies to grow and catch up to the developed imperialist economies, however it is not necessary to agree with that analysis to see an ominous pattern in this data. It suggests firstly that the economic structures of imperialism effectively bake in a global hierarchy that can’t be overturned within capitalist relations of production, even where a country like China retains significant aspects of a state-capitalist economy. Secondly, what capacities capitalism has had in terms of quantitative development, leaving aside other considerations for the moment, are being progressively exhausted.

Here lies an issue which this volume of Socialist Register could usefully have covered. China may be on course to become a larger economy than that of the United States, but it is not necessarily going to become a richer one. That puts into some perspective the increasingly belligerent economic and strategic posture of the West in recent years over China and its corporations. Together with the unfolding of multiple crises in the present, and the inability of the global economy to recover from the 2008 crash, this is a context where imperialist war is an increasingly real danger. At the least, swelling military budgets are no help at all in dealing with the mounting dysfunctionality of contemporary capitalism.

Prospects

The final section of Socialist Register 2023 is devoted to several contributions on the life and work of the late editor Leo Panitch, all of which are interesting, and raise a range of important questions. Inevitably, there are going to be disagreements and differences of perspective here. Nevertheless, it can be agreed that ‘winning substantive reforms and shifting the balance of class forces requires a truly radical confrontation with capital’, although the preface to this statement is that ‘the working class is as weak as it has ever been’ (p.264).

Even if that is not an exaggeration, the formulation underestimates the potential for a rapid change in organisation and militancy during a period of deep crisis. With the last year of increasing worker combativity, that is what may be beginning to happen. There is also in these discussions sometimes something of a one-sided focus on electoral politics and parties, even while the limits ‘that emerged from the experiences of Sanders and Corbyn’ are acknowledged (p.264).

Nevertheless, Corbyn’s insurgent best showed what hunger there is in Britain for a genuine alternative politics, and this is surely true elsewhere. However, there is here also a dismissal of the revolutionary tradition as just ‘insurrectionary politics’ (p.276), or in the 1980s ‘however inspiring 1917 certainly remained’, its memory ‘no longer animated the core identity of socialist politics’ (p.268). These dismissals are too quick, because the politics of 1917 remain a vital source for showing how to build movements which can achieve those major shifts ‘in the balance of class forces’ which would involve ‘a radical confrontation with capital’.