Below, find a brand new commentary from Notes From Disgraceland’s Bjarne Knausgaard who regular readers will recall pens some of the best political/economic color around.
The first link there is to his blog and the second is his Twitter, which you should follow.
No one really ever liked the state, but the great majority permitted its powers to grow ever greater because they saw the state as the mediator of reform. But if it cannot play this function, then why suffer the state? But if we don’t have a strong state, who will provide daily security? (I. Wallerstein)
Social and economic cycles used to move together. This was many years ago. For over 40 years now, the two have fallen out of synch. After each recession, recovery had to be won by making social concessions — this was always considered acceptable expecting the economic advantages to feed back into society. With time, economic progress has decoupled from the well-being of society. Social deficits have grown so large that, unlike the economy, society can no longer recover. The last crisis has taken the form of an autoimmune reaction. We have reached the point of self-intoxication when inner contradictions of the system, which previously could be temporarily ignored, are taking over. The system has exhausted itself – it has collapsed under its own weight.
Overcoming the accumulated social deficit requires deeper social changes. At the root of this quest lies the breakdown of traditional social contract, which started more than four decades ago. In its original form it can no longer be used even as a rough outline.
As divergence between productivity and income has increased, so has the distributional asymmetry of profits resulting in growing inequality, which after decades have evolved into the main destabilizing force. The problem with inequality is not the skew in wealth distribution between those who have some and those who have more (or much more), but extreme fragmentation of society into a rapidly shrinking minority of those who have everything and an exploding majority of those who have nothing. A shrinking middle class in developed economies has grown increasingly vulnerable to poverty while, at the same time, poverty has become a risky and unstable state. This led to new forms of precarity, social marginality, and stratification at the expanding bottom.
As a consequence, the cultural divide has reached such high levels that disputes can no longer be resolved through democratic process. Western societies are at the juncture where they need to develop alternative modes of social organizing and define a new social contract.
Craig Calhoun gives possibly the best summary of the singularity of the present political configuration: Western societies are at the intersection of economic and political crises, which presents the most dangerous development that could emerge from this situation. Erosion of implicit bargain by which people accept damages to society or environment in the pursuit of progress results in recurrent political unrest. Faltering growth brings disappointment to those with rising expectation and elected leaders seek to diminish public freedoms and quash dissent.
There is an urgent need to reconfigure the capitalist state in such a way that harmonizes with the needs of both the economy and the society. This is a painful and politically risky maneuver that requires undoing centuries of institutional baggage. Reconfiguration of the state is the main event of this political moment; everything else is just a distraction.
The main objective of current populist politics is to decouple the two crises by any means. In its current iteration the strategy consists of preventing the lethal mix to be realized, by creating a distraction (economic, social, media, political, as much controversy as necessary…), while the state is being rapidly dismantled. But this cannot be a stable solution, only a way of buying some time. It is just the beginning of a long process of social transformation likely to take center stage in the next decades.
State and social insecurity: From welfare to penal pornography
The transformation that the state has undergone in the last 40-50 years can be characterized at best as inadequate or incomplete, lagging behind, and not adapting to, much deeper technological and economic changes.
The substance of capitalism is the meeting of capital and labor. Capital must be able to buy labor and labor must be attractive enough to be saleable. In that context, the main task (and legitimation) of the capitalist state is to broker this exchange — to see that both of these conditions are met. It must subsidize capital and ensure that labor is worth purchasing (it is healthy, properly trained in the skills and behavioral habits, and is able to ensure the strains of the factory floor). Legitimation crisis of capitalist state lies in transition from society of producers to society of consumers – the prime source of capital accumulation has moved from industry to consumer markets. State subsidies now render capital able to sell commodities and consumers able to buy them. Credit was perceived as a magic contraption in that context. Capitalist state now must assure the continuous availability of credit and the continuous ability of consumers to obtain it. The welfare state is now underfunded because the principal source of capital accumulation has been relocated from exploitation of labor to exploitation of consumer.
As the state was withdrawing from the welfare arena, the existing forces were pushing it to the punitive mode of its functioning. The poverty of the social state against the backdrop of deregulation elicits and necessitates the grandeur of the penal state. This is neoliberalism in action: Subordinate all human activities to the laws of the market.
The unwanted byproduct of economic Neo-Darwinism, unwind of the welfare state, and the rising precarity has been the excess population — the surplus of humanity that is unwanted, inconvenient, and ultimately displaced. There are more people who fall through the cracks than those who succeed — a growing segment of the population that can no longer be reintegrated into a normal functioning of society. These people are neither producers nor consumers.
The response of the state has been to segregate the nonproductive, non-consuming, social element either through their permanent exclusion (e.g. opioids, or other forms of social marginalization) or turn them into profit centers through incarceration (e.g. private prisons). The state has effectively switched from its welfare to the punitive mode of functioning signaling the emergence of carceral state as one of the defining characteristics of the late-stage neoliberalism.
However, no solution has emerged from these, essentially ideological, maneuvers, which have only exacerbated the problem of excess population: The volume of humans made redundant by capitalism’s global triumph grows unstoppably and comes close now to exceeding the managerial capacity of the planet; there is a plausible prospect of capitalist modernity choking on its own waste products which it can neither reassimilate or annihilate, nor detoxify. This has resurfaced as the main problem of neoliberalism that does not have a solution inside the existing paradigm.
The rising social antagonisms and tensions are rapidly becoming a cause of additional loss of social cohesion with precarity and hopelessness on one side against discomfort and entrenchment of the privileged on the other. Growing rage capital is being harvested by right wing populism. Growing discontent is used as the lever arm to reconfigure the sate to a more radical form of carceral, militarized entity with enhanced punitive mandate and further dismantle the vestiges of the welfare state. At the same time, under the pretext of economic and fiscal reform, there is a concerted effort to shake up the constitution and push the system towards a more efficient structure that fosters easier oligarchic repositioning.
The matador enters the rink
In the final stage of corrida, the tercio de muerte (part of death), the matador re-enters the ring alone with a small red cape (muleta) in one hand and a sword in the other. The faena(job) consists of the entire performance with the muleta, in which he uses his cape to attract the bull in a series of passes, both demonstrating his control over it and risking his life by getting especially close to it. Faena ends with a final series of passes in which the matador with a muleta attempts to maneuver the bull into a position to stab it between the shoulder blades and through the aorta or heart (estocada).
Inside the existing neoliberal paradigm, we have already reached the dead end when there is nothing else that could be done. The only thing that remains is to reinvent the status quo through distraction. This brings us to the present moment. Like traditional Spanish corrida, dismantling of the state has assumed a highly ritualized process. In the words of Sylvère Lotringer, it is ritual without the sacred, the tragic without the tragedy. While populist campaigns have masked themselves as de-oligarchification movements centered on their anti-global sentiment, the American version has acquired a distinct flavor. The most recent attempt at transformation is nothing else but an oligarchic repositioning, an attempt to avoid a change by diversion. Trump’s right-wing populism, in fact, is a rearrangement of the oligarchic modes of economic and social functioning.
This is precisely the transformation that took place in the post-communist world in the 1990s. Trump’s cabinet nominations, selection of his advisors and his appointees reflect a desire to engineer a collapse of the state institutions — create new initial conditions resembling a failed state – and rebuild new structures on its rubble. As such, 2016 represents a regressive move towards a more primitive oligarchic structure.
This is the final stage of the American corrida — after wearing the bull down, the matador has entered the arena in 2016. Presidential tweets, the penchant for scandal, controversies, pathological lies, being consistently on the wrong side of every dispute and argument, flirting with constitutional crisis, everything…. All this is the red cape (the matador’s muleta). His job, (the faena), is at the same time to distract public attention, test the system’s resilience, wear down the public and bring state institutions to their breaking point before delivering the final blow (estocada) to the constitution, democracy and the American state.
Contrary to the naïve and misguided belief that Good always triumphs over Evil, history is on no one’s side. The outcome is ultimately binary. Who will be taken out on a stretcher, the matador or the bull? And whom will be the crowd cheering for?
 Craig Calhoun, in Does Capitalism Have a Future? Ed. I Wallerstein et al., Oxford University Press (2013)
 Zygmund Bauman, Liquid Times, Living in the Age of Uncertainty, Polity (2007)
 Loïc Wacquant, Punishing the Poor, Duke University Press (2009)
 Zygmund Bauman, Wasted Lives, Polity (2012)
 Zygmund Bauman, ibid.