Industrial Capitalism Needed Us. Primitive Accumulation Doesn’t.
Oligarchs think of us as surplus labor. Silicon Valley thinks of us as a “permanent underclass.” And if they think they don’t need us, everything changes.
We can’t afford blindness to the world-historical forces transforming the foundations of our reality.
Here’s my terrifying gist of the big picture: The oligarchic form of capitalism that dominates today (financialized, rentier-based, asset-inflating at the top, debt-fueled at the bottom) doesn’t need a mass workforce.1 What looks like the “middle class” hollowing out, shrinking, is the working majority becoming surplus labor. Especially white-collar workers.2
The truly scary bit is that surplus labor exists to be controlled through surveillance, repression, incarceration, and erasure. A state that perceives its interests as perpetuating oligarchy perceives human beings that are unnecessary to processes of capital accumulation as objects of threat projection; a problem to be managed. Thus, oligarchy needs a vast repressive security state to control (and eradicate) surplus labor. Where we end up, at best, is something worse than the dystopia of Demolition Man: 90% of us become heavily policed subaltern “Scraps” eating rat sandwiches while the remaining ten-percent live as sleek, tech-saturated eunuchs under authoritarianism.
This is tough medicine to swallow.
I grew up taking for granted that everyone should have access to quality public education; that the state existed partly to regulate safety conditions for workers and consumers; that free speech was an inalienable right; and that, if you were too poor, too sick, or too old to secure yourself, the welfare state should provide.
But what I’ve only recently realized is that these markers of an advanced society were contingent byproducts of labor-capital relations within a particular form of economic production that has been eroding since the 1970s.
Industrial capitalism made labor power possible, not just because workers could leverage their position at the point of production; the state form itself needed healthy, competent masses. Fordist manufacturing, for example, couldn’t function if nobody could read an instruction manual or if everyone was dying from the plague. The “New Deal Order” was a class compromise between capital and labor to regulate safety in the workplace; to offload the basic education of workers to the state; to pacify the masses with the assurance that a lifetime of wage work could one day end while they still lived.
That entire situation is gone, not just replaced by neoliberalism, but now by post-neoliberalism, which is much worse. There are consequences to living in an oligarchic system, even one with elections. If oligarchs think they don’t need us, then we’re surplus. In a democracy, the state would mobilize to make us secure. In an oligarchy, the state would mobilize to manage or “neutralize” dissenters, which is what the US counter-terrorism strategy effectively declares.
The fact that oligarchy needs the permanent war economy underlies the spread of imperialist geopolitics around the world, but there is a domestic corollary to imperialist worldmaking, which is the expansion of domestic repression at home.
We all know that AI is a growing source of unemployment, both because technological increases in productivity justify reducing labor costs for firms and because firms struggling toward profit are using AI as an excuse to cut labor costs regardless of productivity implications.
But the unemployment side of the AI discourse is often in its own bubble apart from the securitization side of AI as an anti-liberatory technology. AI is expanding the surplus labor population at the same time that it’s making the policing and repression of surplus populations more efficient. Silicon Valley bros are not wrong to believe the emergent mode of capitalism is producing a “permanent underclass.” But they are the key agents accelerating that problem while positioning themselves as the solution for managing it. You might call it a final solution. (too heavy handed)
Every day we see more signs of what it looks like for the ruling class to wield state power while viewing its fellow citizens as a surplus population whose labor the economy doesn’t need and whose consent is not required to function: it’s militarism against democracy, it’s dehumanization, it’s the commodification of repression, and it’s the enclosure of both the commons and community spaces. In short, it’s the persistence of capital accumulation but increasingly through primitive, pre-industrial means.
After speaking on the pod about a new paper co-authored by Thomas Piketty, a couple listeners asked for me to share it. It’s called “Human Capital, Unequal Opportunities and Productivity Convergence: A Global Historical Perspective, 1800-2100,” and it presents some data supporting the grim narrative I’m putting forward here:
Over the 1800-2025 period, countries with higher public expenditure also have higher productivity growth. When public expenditure rises by 1% of GDP (e.g. from 10% to 11% of GDP), annual productivity growth increases by about 0.05% (e.g. from 1% to 1.05% per year). The effect is driven by human & social capital expenditure, including basic public services (justice, police, administration, roads, etc.), public human capital expenditure (education, health), and other human & social capital expenditure (research, culture, community, environment, etc.). It also holds after the inclusion of country fixed effects, capital-output ratio and region x period fixed effects (8 world regions interact 6 periods: 1800-1840, 1840-1880, 1880-1910, 1910-1950, 1950-1990, 1990-2025). Other categories of public expenditure [eg, security spending] have no robust significant impact on productivity growth.
I’m probably not the first person to make this observation, but I don’t know off hand anyone else who’s written it down quite in this way. If there are papers or books floating around that make arguments in this ballpark, please let me know!
As Anthropic’s CEO seemingly wish-casted: “AI could wipe out half of all entry-level white-collar jobs and spike unemployment to 10% to 20% in the next one to five years.”