In April 2019, Alan Schwartz, CEO of Guggenheim, an investment firm in Chicago and New York, told a group of tycoons meeting at the Milken Institute, “If we look at the rightwing and the leftwing, what’s really coming is class warfare.” It was a general alarm among the 4,000 business people present, sounded in response to shifting public opinion as a result of social democrat Bernie Sanders’s presidential campaign. A poll, for example, had recently found that 44 percent of U.S. millennials would prefer living in a socialist country.
“Throughout the centuries,” Schwartz continued, “what we’ve seen when the masses think the elites have too much, one of two things happens: legislation to redistribute the wealth … or revolution.”
Now that the $8 trillion injected into the financial markets has done little to ameliorate the coronavirus crisis, and large corporations have been badly affected, the world is beginning to approach the scenario Schwartz outlined. Worse yet, the perception of inequality — which was so clear in 2008 as governments rescued those responsible for that crisis — has now been aggravated as the lives of the workers who paid for that bailout are today being sacrificed on the altar of Covid-19.
Sanders’s reformism was made for times of peace. Now he’s thrown in the towel amid the whirlwind of the coronavirus, throwing his support — with no glory — to Joe Biden and the U.S. imperialist establishment. But the world still faces a crisis like no other. The coronavirus pandemic “has disrupted our social and economic order at lightning speed,” says Kristalina Georgieva, the managing director of the International Monetary Fund. The IMF had expected positive per capita income growth this year in 160 of its 189 member countries. Now that number has been reversed, and the IMF is projecting that more than 170 countries will have negative growth, creating “the prospect of a crisis so profound that its only parallel is the Great Depression of 1929.”
The fractures between the classes are becoming clearer as this economic crisis develops behind the scenes of the health emergency. According to economists at JP Morgan Chase, the industrial paralysis imposed by the coronavirus will rob the global economy of $5 trillion over the next two years — some 8 percent of world GDP. The World Trade Organization predicts a 13 to 32 percent contraction in the global exchange of goods. This worsens the characteristics of the excessively slow post-Lehman recovery,1 with low growth of investment and productivity and high national debts. Economic anchors that worked before do not seem to have the same strength to act as counterweights to the economic downturn. Bloomberg reports that the world’s largest banks expect U.S. GDP to fall 7.5 percent in the second quarter. The outlook in China is no better: ANZ economist Betty Wang has estimated that Chinese GDP will fall 9.4 percent in the first quarter, and could fall another 2.1 percent in the second. Countries such Brazil and Argentina are expected to lose 5 to 6 percent of their GDP in 2020.
But the striking thing is the unemployment outlook. The devastation caused by the improvised methods capitalism uses has combined with the bosses’ insatiable thirst for the workers to pay for the crisis. The International Labor Organization announced that nearly 1 billion workers throughout the world have lost their jobs or had their wages cut, with governments handing over the equivalent of Japan’s total GDP to big business. In three weeks, the number of unemployment claims in the United States reached nearly 17 million, something never seen before in a country where the overall unemployment rate could rise quickly from 3.5 to 20 percent. In China, the latest figures from the National Bureau of Statistics indicate urban unemployment of 6.2 percent in just the first two months of 2020. Dan Wang, an analyst with the Economist Intelligence Unit, said the unemployment rate could rise another 5 percent by the end of the year, corresponding to 22 million additional urban unemployed in China, and another 103 million workers could face wage cuts of 30 to 50 percent.
Add to that the effect the pandemic is having on relations between the world’s most powerful nations, and the old order seems to be bursting apart. The European Union is in the intensive care unit, with Italy questioning the usefulness of an economic union commanded by Germany. China is weakening as the reputation of Xi Jinping takes a hit from the pandemic (while China has apparently contained the outbreak, that hasn’t given it any new economic traction). And the United States has declined as a major power, as has the power of its example on the world stage — something Richard Haass notes in Foreign Affairs magazine.
Kim Moody, a founder of Labor Notes and author of On New Terrain: How Capital Is Reshaping the Battleground of Class War, points out how, for the working-class masses, government politics present the infamous choice between dying of hunger or Covid-19. “On the one hand,” Moody writes, “millions of workers will have no choice but to work longer hours risking infection, while millions of others face unemployment and poverty. Even more than usual, workers are being condemned, whether they do one thing or the other.” At the same time, he notes that so many workers still being forced to do their jobs during the pandemic is overwhelming proof that capitalist profit depends on the human labor force, no matter the fables about replacing humans with robots or the so-called Industry 4.0. This is clear from the fact that even Trump demanded that the U.S. Department of Homeland Security and not the Centers for Disease Control be responsible for determining what is “essential” among the categories of workers in the United States.
The social breakdown in this game of class chess is creating new rebellions. What else can we make of this? For example, massive food shortages in one of imperialism’s main countries, Italy, lead the hungry to raid the supermarkets (begging forgiveness because they are starving). And from the apartment balconies the shouts ring out: “As long as my daughter doesn’t even have bread to eat, nothing will return to normal” Absolute poverty has increased by 5.8 percent since 2008 and now has hit 10 percent in Italy’s south. Pressure on the governments of the Spanish State, Italy, Austria, and Germany, among others, to reopen their economies only accentuates these conflicts, along with the risks of contagion.
A year later, what Alan Schwartz said is no longer some cry in the wilderness. More and more sectors of the bourgeoisie are beginning to sound the alarm about uprisings and revolutions on the horizon, and to link them to the punishing conditions faced by precarious workers.
Warning of Revolutions from the Mouths of the Bourgeoisie
Different Western political regimes find themselves entangled in a highly combustible reality: the most precarious sectors of the working class, beaten down by capitalist oppression, low wages, and exhausting workdays, are the same workers on the front lines of the fight against the pandemic or who must work amid the spread of the coronavirus to ensure the functioning of essential branches of production and distribution — without which society would collapse.
This combination tends to raise the expectations of these marginalized segments of the working class and to bring to the surface social unrest led by these precarious workers, who are praised as “heroes” as they are exposed to contagion. They tend to live crammed together with their families in the impoverished neighborhoods, with little or no access to any health system. They are watching their loved ones being sacrificed to the pandemic as it courses through the open veins of the health catastrophe the capitalists have created.
These sectors of the working class, the real “absolute losers” of globalization, have been on the front line of the second cycle of class struggle that has been traversing the world since 2018. After the Yellow Vest revolt began in France in 2018, important struggles began to emerge from Catalonia to Hong Kong: class clashes in the North African countries of Sudan and Algeria; in the Middle Eastern in Lebanon, Iraq, and Iran; a cycle of popular rebellions in Puerto Rico, Honduras, and Haiti; some revolutionary days in Ecuador and Chile; and a coup d’état in Bolivia.
The Spanish daily El País portrays this situation from the perspective of French society, which experienced the Yellow Vests movement beginning less than two years ago:
From the realization that those on the front lines against the virus are often precarious workers and socially marginalized — the supermarket cashiers and delivery people [from the apps], many of them women and immigrants — to the unequal map of the populations affected by the pandemic, behind this moment of national unity lies what political scientist Jérôme Fourquet calls ‘the French archipelago’ … In an article published in Le Figaro with Chloe Morir, of the Jean Jaurès Foundation, Fourquet illustrates the sociology of precarious workers who continue to go to work and cannot resort to working from home, and the Yellow Vests, the protest movement in France of the impoverished middle classes of the small towns of the French interior. Workers, freelancers and wage earners without diplomas are overrepresented both in the Yellow Vest movement and among those who today are on the front lines against the pandemic.
In France, the coronavirus death count continues to rise in the impoverished suburbs, like those around Paris, and in cities near the Swiss and German borders (such as Mulhouse), home to an overwhelming majority of precarious workers of African and Asian origin. In these places, 5,252 out of 8,598 people have died in hospitals thus far. In the department of Seine-Saint-Denis, another high-density suburb of Paris — with low wages, deteriorated public services, and a high concentration of immigrants — the increase in deaths compared to last year is 61.6 percent, the second-highest in the country after the region where Mulhouse is located (the increase there is 128 percent, according to data from the National Institute of Statistics and Economic Studies).
In England, research by the Resolution Foundation shows that 40 percent of caregivers of children under 25 earn less than minimum wage, and 60 percent of those who help older people in their own homes are “zero-hour” contract workers who do not guarantee regular pay.2 Workers in the food and mining sectors have to accept temporary contracts, while app drivers (such as those for Uber) receive no sick and have no regulated labor rights.
The existence of these discontented masses is worrying the most clear-sighted (and fearful) heads of the ruling class. Andreas Kluth, a Bloomberg columnist, says with uncommon reason that the health crisis exacerbates all previous social contradictions, and sooner or later will give rise to “social turmoil, up to and including uprisings and revolutions.”
The most misleading cliché about the coronavirus is that it treats us all the same. It doesn’t, neither medically nor economically, socially or psychologically. In particular, Covid-19 exacerbates preexisting conditions of inequality wherever it arrives. Before long, this will cause social turmoil, up to and including uprisings and revolutions.
Social unrest had already been increasing around the world before SARS-CoV-2 began its journey. According to one count, there have been about 100 large anti-government protests since 2017, from the gilets jaunes riots in a rich country like France to demonstrations against strongmen in poor countries such as Sudan and Bolivia. About 20 of these uprisings toppled leaders, while several were suppressed by brutal crackdowns and many others went back to simmering until the next outbreak.
As for the situation of the precarious workers, the analyst writes,
Indeed, the less money you make, the less likely you are to be able to work remotely (see the chart below). Lacking savings and health insurance, these workers in precarious employment have to keep their gigs or blue-collar jobs, if they’re lucky enough still to have any, just to make ends meet. As they do, they risk getting infected and bringing the virus home to their families, which, like poor people everywhere, are already more likely to be sick and less able to navigate complex health-care mazes. And so the coronavirus is coursing fastest through neighborhoods that are cramped, stressful and bleak. Above all, it disproportionately kills black people.
In the United States, Black and Latinx communities are being devastated by Covid-19. In Chicago, where Blacks make up a third of the population, they represent 73 percent of deaths in the pandemic. In Milwaukee, Blacks make up 26 percent of the population and represent 81 percent of deaths. In the state of Michigan, Blacks make up only 14 percent of the population but account for 40 percent of deaths. The proportion is no different in New York, the epicenter of the U.S. pandemic. The Latinx community has also been hit hard. These are the most oppressed and precarious segments of the American working class, and the ones hardest hit by the rising unemployment rate — some 16 million unemployed in the last weeks of March.
Philip Stephens of the Financial Times is another scribe of high finance who has warned the ruling class that its responses to the economic crisis and the pandemic may lead the most precarious sectors of the working class to lead social revolutions. Recalling how capitalist states injected piles of money into banks and businesses in the 2008 crisis, unloading the costs on millions of families, he warns against repeating that remedy, which gave rise to convulsions in political regimes that helped lead to the rise of Donald Trump, Brexit in the United Kingdom, and other manifestations of the organic crises3 that are inherent in the aberrations of capitalism in crisis:
A return to austerity would be madness — an invitation to widespread social unrest, if not revolution … Low-wage workers in precarious jobs suffered after the crash of 2008. They will no longer want to do so. The coronavirus should have taught us that our economies cannot function without all of these minimum wage workers caring for the sick and the elderly, supplying supermarkets and delivering packages from Amazon.
This has its cost in lives: 41 supermarket workers have died in the United States, and more than 1,500 are in isolation with suspected infection, according to their union. In a recent editorial, the Financial Times called for “radical reforms” to disguise the enormous sacrifices of the workers, calling out the neoliberal heritage of an “irregular and precarious labour market” that has left tens of millions without access to minimum labor rights. Reactions like this do not indicate liberalism’s beatification but its deep fear of impending class war.
Migrant workers are among the populations most battered by the horrors of poverty and death from the pandemic. They are treated like the slaves who built the pyramids, not only by the oil-rich Gulf States but also by the main imperialist countries. For a long time, they have depended on armies of precarious workers from Asia, Africa, and Latin America to do the “hard work” in their economies in exchange for the meager right to remain in these richer countries as overexploited second-class residents. In these places, jobs in construction, sanitation, transportation, hospitality, and even medical care are dominated by millions of immigrant workers from Pakistan, India, Bangladesh, Nepal, and the Philippines.
As Ben Hubbard reports, Saudi Arabia has declared that more than half of its confirmed cases of Covid-19 are among immigrant workers, and the $2.4 billion package to cover partial wages of private-sector workers will only go to Saudis. Qatar, which will host the 2022 World Cup and has imported a large amount of cheap labor from Asia, has confirmed hundreds of cases of infection in the industrial zone dedicated to stadium construction. “Their societies would literally fall apart if these workers were not there, but there is very little empathy for their situation,” Vani Saraswathi, associate editor of Migrant-Rights.org, told the New York Times. Squeezed into unhygienic dormitories, there is not even the slightest possibility of social distancing. From France to Greece, from Saudi Arabia to Kuwait, the gigantic migrant communities, especially women, become an easy target for health problems.
This passage from health crisis to social crisis is inscribed in the lack of preparation by the capitalists, who have confronted the pandemic with improvised measures. There is no mass testing so isolation can be selective and organized rationally; the situation is even worse when it comes to the supply of ICU beds, respirators, and ventilators. Even the global powers are now desperately fighting over access to such basics as protective masks.
A Rise in Precariousness Amid the Pandemic
But the bourgeoisie is turning a deaf ear to the warnings and instead taking advantage of the crisis to test new experiments in precariousness. Ruth Bender and Matthew Dalton, in the Wall Street Journal, write of the new mode of capitalist overexploitation: the reallocation of labor between companies. “Around the world, former hotel, restaurant and airline staff are moving to grocers, online retailers and hospitals” — thrown onto the front lines with their same low wages and without adequate protective equipment.
The German government has become quite adept at finding new ways to worsen working conditions in recent decades, such as the Hart Plan — which made outsourcing and intermittent employment contracts possible in the 2000s, and the Kurzarbeit [short-time work] system, under which the government allows companies to suspend their employment contracts and pay employees a reduced wage. It is no different now. Chancellor Angela Merkel and Finance Minister Olaf Scholz signed a measure that turns the Kurzarbeit into a means of converting photographers, physiotherapists, music teachers, and waiters into rural workers, busy harvesting crops — a task previously done by precarious immigrants from Romania and Poland. France is importing this “labor innovation,” to be carried out with the same expediency as the German capitalists; French Agriculture Minister Didier Guillaume said the country will need more than 200,000 new rural workers by May.
The Wall Street Journal points to a plan in which McDonald’s, which has been cutting its already minimal wages in countries such as Argentina, will hand over employees to the supermarket chain Aldi Nord-Süd under temporary contracts. The lives of thousands are being put in the contagion crosshairs, all for slashed wages. Meanwhile, outsourcing companies and temp agencies are getting richer every day: in France, the Mistertemp agency is shifting metalworkers and construction workers to work as supermarket cashiers, in logistics warehouses, or for delivery services.
In the United States, companies are using runaway unemployment as blackmail to speed up the new precarious restructuring of work. Some 10 percent of the U.S. working population (16.6 million)4 has already requested unemployment assistance. Monopolies such as Amazon and Walmart profit from the ease of precariousness, taking in thousands of workers from other companies — such as Disney World, which fired 43,000 employees — to work in their warehouses and stores (the Walton family, which owns Walmart, has seen its fortune increase by $165 billion during the pandemic, a combined rise in net worth of 2.6 percent).
The employers’ contempt for the lives of the most oppressed sectors is seen in their plans for workers to continue taking risks. The Whole Foods, Trader Joe’s, and Kroger supermarket chains in the United States are also using low-wage workers reallocated from other sectors of the workforce, and when these new temporary workers began to protest for better pay and health conditions, they were offered an extra $2 an hour (which workers considered an insult).
The bourgeoisie is trying to establish new forms of job insecurity in order to increase its profits. They get presented as measures to “contain unemployment” — a disguise through which the workers don’t always see — but they are actually destined to become part of the permanent arsenal of labor-destruction laws in hundreds of countries. We are seeing the emergence of the “Uberization” of labor — layers of the workforce with no fixed hours and wages “ready to act” at any time of the day without any labor rights. The divisions within the ranks of workers sowed by the capitalists during the last few decades of neoliberalism pale in comparison to this restructuring of the world of work. The precarious exchange of workers increases the punishment that comes with temporary contracts.
This is a labor counterrevolution that, to be imposed, will have to deal with great processes of class struggle. The coronavirus pandemic is bringing all these contradictions to the surface amid the historical economic depression that lies ahead.
The Specter of Freedom
Workers from better-organized sectors who have managed to maintain certain rights have opened a new stage within the second cycle of international class struggle as they seek to preserve their lives and those of their coworkers and families. The (partial) general strike of Italian factories on March 25, calling for them to be closed and for workers to be given paid leave, led to important demonstrations by workers in the Spanish State, who managed to close the Mercedes-Benz plant in Victoria, and in the United States, closing Ford and GM factories. Airbus workers in France even demanded that their employers stop producing useless goods and convert their production to manufacturing ventilators for intensive care units, as did General Electric workers at a factory in Massachusetts.
Health workers, risking their lives on the front line every day, have also been rebelling against governments and the CEOs of private hospitals. Tre Kwon, a nurse at Mount Sinai Hospital in New York City and a member of Left Voice, explained in several television interviews the situation of health care workers, made worse not only by Trump’s policies, but also by Democratic Party leaders such as New York Governor Andrew Cuomo (see here).
One of the major new features in this arena is the entry of the most precarious sectors of the working class into what Moody calls “the two ‘Ps’ of class struggle in the time of plague”: paid time off and personal protective equipment. Initially defensive, these have become extremely important driving elements of the antigovernment, anti-boss revolt among these oppressed layers that are so essential to the functioning of society. Fast-food workers at McDonald’s in Tampa, St. Louis, Los Angeles, and Memphis have walked out, demanding better wages and working conditions, as well as in Argentina, where McDonald’s and Burger King workers protested the halving of their wages and began to move toward unionization. Amazon workers in Staten Island and Chicago have walked out, demanding paid leave. The largest grocery delivery service company in the United States, Instacart, has seen its workers shut down operations across the country, demanding protective equipment. The “essentials” are flexing their muscles against the employers.
What would happen if precarious workers saw themselves as members of the same social class as workers who have better rights and wages? What would happen if unionized workers took on the interests of their class brothers and sisters who are being subjected to outsourcing, subcontracting, and intermittent employment? The strategic positions (transport, large industries, services) in the production and distribution of goods in capitalist society reveal the social weight of the most precarious layers of the working class — which are essential in the pandemic. As we have said, the rise of their expectations resulting from their shock over the efforts of the bourgeoisie to liberalize labor conditions even more will be one of the main focuses of class struggle at this stage. If it is true that the working class has become much more heterogeneous and has undergone an acute process of fragmentation as neoliberalism has peaked — with characteristics quite different from those it presented in the 20th century — then it is no less true that the working class continues to maintain all the strategic positions that make society function. Given that fact, if the working class is organized, it can work political wonders and potentially become the dominant force for emancipation.
Connecting the most precarious sectors of the working class (Black, female, immigrant) and workers with better wage and organizational conditions is a strategic task. Discussing this with members of the Socialist Workers Party (SWP) in April 1939, Leon Trotsky raised the vital importance of combining the most oppressed sectors with Marxism to lead a revolutionary party in the United States.
The characteristic thing about the American workers’ parties, trade-union organizations, and so on, was their aristocratic character. It is the basis of opportunism. The skilled workers who feel set in the capitalist society help the bourgeois class to hold the Negroes and the unskilled workers down to a very low scale. …
We must say to the conscious elements of the Negroes that they are convoked by the historic development to become a vanguard of the working class. What serves as the brake on the higher strata? It is the privileges, the comforts that hinder them from becoming revolutionists. It does not exist for the Negroes. What can transform a certain stratum, make it more capable of courage and sacrifice? It is concentrated in the Negroes. If it happens that we in the SWP are not able to find the road to this stratum, then we are not worthy at all. The permanent revolution and all the rest would be only a lie.
We cannot cast our lot with the reformism of Sanders in the United States, or Mélenchon in France, or its various Latin American “brands,” such as the Workers Party (PT) in Brazil, none of which can confront the capitalists. In a world that will be struck by an economic crisis of historic proportions, it will be fundamental to construct a solid alliance of the heterogeneous sectors of the workers’ movement around a socialist, anti-imperialist, and revolutionary strategy. It will be built only through the processes of class struggle. It is the organizational key for the emergency measures against the pandemic itself, attacking the interests of the capitalists, guaranteeing jobs and full wages, converting production to the manufacture of essential medical supplies, expropriating the capitalists, and nationalizing under workers’ control all the great industrial resources and services necessary to face the catastrophe that threatens us.
First published in Portuguese on April 14 in Esquerda Diário.
Translation: Scott Cooper
|↑1||Translator’s note: Lehman Brothers, then the fourth-largest U.S. bank investment bank and heavily involved in subprime mortgages, filed for bankruptcy in September 2008 — which is considered to have been one of the major precipitants of the global crisis that then erupted.|
|↑2||Translator’s note: A zero-hour contract is one in which the employer is not obligated to provide any minimum number of working hours.|
|↑3||Translator’s note: Here the author refers to Antonio Gramsci, who used the concept of “organic crisis” to explain situations that unfold between nonrevolutionary and prerevolutionary or even open revolutionary situations and that “are characterized by elements of crisis in bourgeois hegemony.”|
|↑4||Translator’s note: This figure has risen to 22 million only a week after this article was originally written.|