The end of the Great Recession, writes Sanford Schram, brought a “return to ordinary capitalism” and, perhaps, a new political moment. By “ordinary capitalism” he refers (following Thomas Piketty) to the pattern of economic growth that produces rising inequality and wealth concentration, a pattern that has characterized U.S. capitalist development for most of the past two centuries, with the notable exception of the post–World War II period. In the U.S. context, the shift has occurred in an increasingly neoliberal policy environment.
Schram reminds us that neoliberalism’s drive to “restructure the state to operate consistently with market logic” is both an economic and political project (p. 25). In social policy, for example, neoliberal practices not only open new markets by commodifying forms of social provision, but also drive market logic and market actors deep into the process of making and implementing policy. In recent years, the neoliberal turn has produced both organizational reforms (such as privatization, devolution, and new strategies for performance management) and a heightened emphasis on policy tools (sanctions and subsidies) that impose a disciplinary regime on noncompliant members of the populations being served, particularly the poor. The book examines a number of policy areas to demonstrate the trend, including social welfare (the use of financial sanctions and personal responsibility contracts for welfare recipients), education (performance measurement through high-stakes testing, market choice through charter schools and vouchers), and criminal justice (behavioral contracts for drug-treatment clients).
How new is this trend? Neoliberalism dates back decades, emerging through a slow and uneven “wave of structural adjustment,” as Schram notes (p. 13). He zeroes in, more specifically, on the rise of personal economic insecurity, or precarity, among growing numbers in the U.S. economy. Economic precarity among workers is not new; like inequality, it is built into the very logic of (and is a necessary condition for) capitalist expansion. Yet the sources and impact of precarity today are markedly different from those of previous eras, in ways that matter for politics. And on this point, Schram’s analysis is rich and insightful.
What drives and defines the precarity of today’s capitalism, he argues, is not only a growing low-wage sector but also a more heavily financialized economy and an increasingly neoliberal policy response. Beginning before and accelerated by the Great Recession, the economy has produced income for those at the top and debt for everyone else, from mortgages to student loans, credit cards, and medical debt: “We have shifted from ‘public Keynesianism’ where the government takes on debt to stimulate the economy to a ‘privatized Keynesianism’ where the government’s job is to encourage everyone else to take on personal debt in order to sustain the economy” (p. 11). This means that low-wage workers and the poor (who have always known precarity and economic hardship) are now being joined by “a growing number of different types of people [confronting] a widening variety of forms of precarity: students with debt and no job prospects; the long-term unemployed, who were increasingly just plain unemployable; homeowners whose homes could only be sold at a massive loss” (pp. 23–24).
The predominant neoliberal policy response has been to marketize social welfare functions, turning to private service providers where possible and aligning public programs more closely with market logic. Clients seeking services are transformed into consumers who are both expected and “empowered” to make choices. Both service providers and consumer-clients are held accountable to market-based objectives, through performance measurement. The drive to generate “market-compliant behavior by as many people as possible” (p. 25) in turn “creates the need to increase discipline on those who do not fit in, cannot participate, or will not benefit” (p. 30). Individuals are expected to assume and even internalize the burden of addressing their own economic insecurity. Precarity today is not just income instability; it extends to “how people are subjectified as citizens who must accept responsibility for handling the shocks of marketization” (p. 71). Particularly for those who are marginalized, the impact has been not only destabilizing but also “de-democratizing.”
Schram’s analysis raises serious questions for politics and policy. What are the political prospects for mobilizing people whose economic positions and experiences of precarity vary so greatly? What policy or institutional changes can blunt the impact of what Schram calls the neoliberal “juggernaut” (p. 71), to address the underlying structural sources of economic insecurity for these disparate groups? To his credit, he takes these questions on directly, though the larger issues remain unsettled and in some cases underdeveloped.
The Return of Ordinary Capitalism briefly examines the Tea Party and the Occupy movement as contrasting political responses to precarity: Both are largely comprised of self-identified members of the middle class reacting in part to economic uncertainty and the threat of downward mobility. Schram then turns to a closer analysis of Occupy and the issue of political strategy. Occupy has drawn withering criticism from some on the left who argue that the movement’s impact has been limited and its opportunities squandered by the lack of traditional political organization and a coherent agenda for policy change. Schram counters that the critical role of protest movements like Occupy is to expose and frame an understanding of submerged issues (such as inequality and precarity) in order to widen the discourse and create possibilities for political mobilization and policy or electoral change. If Occupy’s protests are understood as a politics of resistance with transformative potential, he argues, then precarity can be a unifying rather than depoliticizing force.
Perhaps, but the question remains: Can the “precariat” be considered—or be expected to act as—a collective political agent, or a class for itself? Will the shared sense of precarity create enough common ground to overcome major and material differences in the economic positions and prospects of homeowners, day laborers, and debt-burdened students—and if so, what strategies are needed? Will it unite these disparate groups behind a vision for change, or divide them as they scramble to protect their positions against the threat of downward mobility? If the rise and spread of the Occupy protests affirm the former, the Tea Party and the bitter and divisive politics of the 2016 election may point to the latter conclusion.
Schram argues in broad terms for mobilization or resistance at multiple levels, including protests (such as Occupy), party politics, policy advocacy, the creation of alternative local institutions, and pressure on existing government programs to more adequately serve those in need. More interesting is his argument for a radical incrementalism, one that can “work through rather than around neoliberal policies” (p. 174). As he develops the point, his meaning becomes clearer. Given existing constraints, those seeking change must move incrementally. This does not mean “tinkering with the existing system”; doing so is likely to further entrench market logic and perpetuate current policies. Rather, the aim is to identify and pursue incremental changes that will “lay the groundwork for further changes that over time can help build to a transformation of the existing structure of power, the source of the problems” (p. 184).
Building on the work of Andre Gorz and David Harvey, Schram recognizes that this strategy rests on the capacity to distinguish between incremental policies that lay a foundation for fundamental change and those that reinforce the status quo. This is a difficult and complex task, made more so by the policy compromises and interaction effects that often result from hard-fought political struggles. Consider the Affordable Care Act, a landmark achievement but the product of much legislative compromise: Certain components of the original legislation (such as the public option and the expansion of Medicaid) promised to set U.S. health care on a new foundation; others (preserving the principle of competition and the role of private insurers) not only reinforced but strengthened the market-based status quo. Or consider the interactions between various policies to support low-wage workers: Does a sizable minimum wage hike that is not indexed for inflation reflect pathbreaking reform? What about an increase in the Earned Income Tax Credit in lieu of a minimum wage increase? There is a role for scholars as well as advocates in answering these and other questions through research and analysis, and the author’s argument about the need to do so is persuasive.
Schram has written an ambitious and important book. Readers will disagree on whether the evidence he provides in his sober assessment of our current economic and political circumstances supports his more hopeful conclusions about the prospects for change. But few will come away unmoved or unprovoked by the argument. Perhaps the most valuable contribution he has made is to open a much-needed and multilayered conversation about how economic insecurity and the neoliberal response are reshaping the nation’s political life—on the left and on the right—and redefining both the limits and possibilities for change.
