Friday, 24 June 2016

Brexit thoughts

For what it's worth, here are some thoughts on the "Brexit". To begin with, there are a number of comparatively limited issues where I suspect that the effect may be positive. For instance, the chances that the EU will adopt the TTIP will probably decrease.

Apart from this, it's hard to find anything to be happy about. Let's first look at the possible effects for the UK. Contrary to what many voters hoped, a Brexit is unlikely to help "ordinary" people economically. This is for two reasons. Firstly, Britain will be hurt economically. Secondly, and more importantly, I fear that outside the EU the UK will adopt an even more neoliberal policy that it already does. Why? Again this is for several reasons.

Firstly, the British dependency on financial capital (and London's role as a hub of global capital) will almost inevitably make policy-makers desperate to ensure as much "freedom" for financial flows as necessary after exiting the EU. Their overriding concern will be to prevent the Brexit from damaging these flows. I see a real risk that the UK will try to turn itself into a financial haven, ready to do anything to welcome global capital. Thatcher will be let loose. Here one might object: but isn't the EU already a neoliberal project? Just look at what it did to Greece. The reply here is: yes, that's true, but while the EU represents a form of "regulated neo-liberalism" - or roll-out neoliberalism, to use the terminology developed by Peck, Theodore and Brenner - the UK stands for a more unrestrained type. Outside the EU the UK will likely return to an even more ruthless, roll-back kind of neoliberalism.

Secondly, the Left will probably be weakened in the UK and unable to offer much resistance. Scotland leaving the UK is a real possibility and if that happens, Labour will be so weakened in the UK that the conservatives will rule the roost for the foreseeable future.

The racists in the UKIP who hope to stop immigration are happy about the result of course. That's just utterly deplorable and I won't waste more words on them.

Next, let us look at the consequences for the EU. On the one hand, there are federalists who hope that the Brexit will speed up EU integration. On the other hand, others think that it may signal further disintegration since Brexit will set an example for other countries. If federalists try to push for tighter integration, countries unhappy with that will try to follow in Britain's steps. To prevent this, federalists have been saying that a Brexit must be costly for Britain: if it exits, it can't expect any favorable treatment, no special exceptions and no easy, fast-track way back in in case it wants to rejoin. The results in regard to the EU, then, seem ambiguous.

Finally, how about consequences more globally, say for global capitalism and the "world-system"? The first consequence is more instability and fragmentation. Global coordination in all kinds of matters will probably become even more difficult than it already is, e.g. in the regard to the climate. A second consequence is a fall in the geo-political status of both the EU and the UK (in the latter case this fall will be even more dramatic if Scotland leaves the UK). A third consequence is that global capital will be able to play out political entities against each other more easily (especially if the UK opts for all-out neoliberalization). Despite the risk for an initial period of economic instability after the Brexit, I suspect many capitalists will be happy.

So if I'm so negative about a Brexit, how come I supported a Grexit just a few years ago? The answer is easy: a Grexit would have meant a set-back to the neoliberal govarnance represented by the EU. It would have meant a rejection of austerity. The greater economic freedom that Greece would have gained through a Grexit would not have been used to pursue a more neoliberal policy. It would also have demonstrated to EU policy-makers that there was a limit to how much they could humiliate small nations and force them under financial tutelage. With Britain it will be the other way round: Britain will likely turn in an even more neoliberal direction. Unlike a Grexit, Brexit won't be framed as a failure of austerity. It will be framed as a matter of British nationalism.

Thursday, 23 June 2016

Andreas Malm on fossil capitalism, steam and water

This isn't the place for an exhaustive review of Andreas Malm's impressive Fossil Capital: The Rise of Steam Power and the Roots of Global Warming (London: Verso, 2016). I'd simply like to pick up one of its central arguments for discussion, namely the critique of technological determinism. Malm vehemently rejects the common idea that steam-powered industrialism was a natural development, motivated simply by the technological superiority of steam-engines compared the available alternatives. He argues convincingly that water was not only cheaper and more abundant than coal, but also at least as efficient as an energy source. In fact, early British industrialization had relied mainly on water mills, not on coal. It wasn't until the years between 1825 and 1848 that a decisive shift to coal occurred. So the argument - proposed by Kenneth Pomeranz and others - that coal saved Britain from a "Malthusian trap" falls. There was no shortage of alternative energy sources.
The transition from water to steam in the British cotton industry did not occur because water was scarce, more expensive or less technologically potent – to the contrary, steam gained supremacy in spite of water being abundant, cheaper and at least as powerful, even and efficient. (Malm 2016:93)
So why did British industrialism turn from water-mills to coal-fired engines? The answer is capitalism. Malm argues that coal gave superior control of subordinate labour. It allowed capital to concentrate production at the most profitable sites, namely the big towns rather than in the countryside, and during the most convenient hours. It also allowed capitalists to bypass the need for collective regulations and coordination that would have arisen from using water.

A factor to which Malm devotes particular attention is difference between town and countryside. Water was found in the countryside, where labour had to be brought to stay in semi-permanent communities, giving rise to patriarchal-familial forms of authority that gave workers bargaining power. In the “feudal castles” of the countryside mill, worker riots were effective since everything belonged to the capitalist. Since workers weren't easy to replace, dismissing unruly workers would just hurt the capitalist.

Steam-engines by contrast could be placed in towns where labor was abundant, cheap and easily replaced. Here mass layoffs were effective. As Malm concludes: “steam had the prime advantage of overcoming the barriers to the procurement not of energy, but of labour” (ibid 124). He illustrates his claim by a nice quote from a letter by Sir Walter Scott in which the latter laments the decline of patriarchal relations between manufacturer and workers:
When the machinery was driven by water, the manufacturer had to seek out some sequestered spot where he could obtain a suitable fall of water and then his workmen formed the inhabitants of a village around him, and he necessarily bestowed some attention, less or more, on their morals and on their necessities, had knowledge of their persons and characters, and exercised over them a salutary influence as over men depending on and intimately connected with him and his prospects. This is now quite changed: the manufactures are transferred to great towns, where a man may assemble five hundred workmen one week and dismiss them the next, without having any further connection with them than to receive [sic] a week’s work for a week’s wages, nor any further solicitude about their future fate than if they were so many old shuttles. (quoted in ibid. 152)
As Malm comments: “water power obliged the manufacturer to form personal relations to his hands... steam power, on the other hand, allowed the capitalist to treat his workers as ‘so many old shuttles’” (ibid. 152).

Steam, then, didn't win because of its technical superiority, but because "it augmented the power of some over others” (ibid. 267). Contrary to what Marx wrote in one of his early texts, The Poverty of Philosophy, the steam-mill didn't give rise to the industrial capitalist, but industrial capitalism produced the steam-mill. Relations of production determine the means of production, not the other way round. Nature is not the driver of social relations, but a product of these relations. Not determinism, but constructivism, is correct (ibid. 276f).

Malm's argumentation is certainly a tour de force, and I'm quite prepared to accept it as a description of the development of British industrialism. However, when it comes to the more general claim that social relations determine nature rather than the other way round, I can't help but notice that he to a certain extent undermines his own argument. His argument that capitalism, not nature, secured coal’s victory doesn't suffice to prove that nature lacks causal power. In fact, the argument only works if it is admitted that natural forces can affect and to a certain degree steer capitalism in different directions.

Let me explain. Malm's own invocation of an alternative water-based capitalism contributes to the impression that the shape of capitalism in fact depends crucially on the energy source upon which it rests. A water-based capitalism would have been quite different from the "fossil" one that actually won out historically. As he himself shows, it would have been rurally based and characterized by less individualist and more corporatist arrangements, paternalistic relations to labour, and less ecological destruction. Presumably profitability would also have been lower. Indeed, according to Malm's own argument, it was precisely because of this power of a natural force (namely water) to shape capitalism in a certain way that capitalists chose to abandon it, turning instead to coal.

What follows from Malm's argument, then, is not really a wholesale constructivism, but an account of a development that wasn't wholly determined either by nature or by society. The steam-mill perhaps didn't give rise to industrial capitalism, but it does seem true that it gave rise to a particular kind of industrial capitalism (while the watermill would have given rise to another kind).

I would add that Malm's evocation of a possible alternative development only makes his account all the more fascinating and thought-provoking. Keeping alternative developments in mind is important for several reasons. Firstly, it makes you wonder how future non-fossil capitalisms might look. This isn't simply a subject fit for science fiction novels, but may also be important in order to be prepared when (if) it happens. Secondly, attention to alternative developments helps us get a better grasp of how and why history has moved forward as it did. An important point made in this book is that a water-based capitalism was once a real possibility. What, for instance, if coal had been less abundant in Britain - perhaps water would have won out over coal after all? Or what if coal hadn'd even existed there? No matter how much capitalists may have preferred coal to keep labour in check, they wouldn't have been able to shift to coal unless coal had been present in the earth. In this sense, there is after all a small kernel of truth in the argument of Pomeranz and others that the presence of ample supplies of coal was a stroke of good luck for British capitalists - not because they would have lacked energy otherwise, but because it allowed them to be more ruthless to their workers.

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