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Uber, Labour and Capital

uber london

TfL’s recent refusal to renew Uber’s operating license has brought into sharp relief some of the complications that arise in the struggle between labour and capital. This distinction of two diametrically opposed classes engulfed in a struggle for supremacy is, of course, Marxist. American and Conservative readers have a tendency to spontaneously combust upon any mention of Marx. This is likely due to the misrepresentation and bastardisation of Marx’s ideas through Cold War propaganda, on both sides, which has produced a whole generation of people who react viscerally to any mention of Marx, presumably due to the existential threat that ‘Communism’/USSR+China posed to ‘The West’. I’ll write separately on Socialism, Communism and Marxism, but suffice it to say that millions of people harbour a virulent hatred for Karl Marx which they cannot coherently articulate. This isn’t to say it’s wrong to hate Marx; rather, it is lazy to do so without having read his work. Few can describe what Communism is and how it differs from Socialism, and of those who venture to propose an answer, fewer still can do so convincingly. We may say that the distaste is prejudicial insofar as it is held prior to examination. Nevertheless, the Uber fiasco in many ways shows that there are still useful insights to be obtained from a Marxist analysis, and as we shall see, the modern capitalist society has yet to provide any real solutions to Marx’s sharpest critiques.

A Brief Introduction to Marx and His Ideas

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For those unacquainted with Marx, please read his work (not literally all of it. See ‘Estranged Labour‘ in the Economic and Philosophical Manuscripts of 1844) because this brief exposition will leave more questions than answers.

He saw the society as split into two antagonistic classes: the proletariat and the bourgeoisie. Sometimes scholars will refer to them as the propertyless worker and the property owner; or labour and capital – this representing each class’s domain of interests in the marketplace, or as Marx called it, ‘political economy‘. The proletariat is the ordinary worker who trades labour (measured in units of time) for wages in the marketplace. The bourgeoisie is the owner of the means of production, or capital, or private property. The owner of capital seeks profit and will devise multiple strategies to do so. The great majority of these strategies result in the immiseration of the worker: for example, labour may be intensified. Intensification the division of labour into smaller, specialised, repetitive actions for greater efficiency, as popularised by Adam Smith’s allegory of the pin factory.

This is mindnumbing and reduces the person to the level of the animal, alienating the worker from his or her own spontaneous creative essence, or what Marx calls ‘species-being‘. It can also involve extended working hours to get a higher daily production capacity. All these are done without a correspondent increase in wages. Remember that the worker is trading time and not productive capacity for wages. It is therefore always in capital’s interests to make labour more productive. Under this arrangement, capital feels itself under no obligation to remunerate labour at a level commensurate with productivity. This goes beyond mere morality and operates on a systemic level. However sympathetic a capitalist may be to worker’s demands, the capitalist system is designed to reward profitability and margins. Therefore, capital is bound to find ways to exploit labour if it is to survive because of the inherent Darwinism that competition produces. In other words, it behoves the capitalist to remain competitive. Should she seek to redistribute profit, she will have less to invest in R&D, leading to her eventual demise as other capitalists capitalise (sorry) on her diminished competitiveness. Capital’s interests are therefore inherently opposed to those of labour, hence Marx’s metaphoric depiction of the two being antagonistic. Let’s not forget that capital in verb form (capitalise) means ‘to take advantage of’. This is zero-sum, with any mutual benefit being merely epiphenomenal.

Objections to a Marxist Analysis

Marx’s critics will rightly say that in a modern post-industrial economy, the distinction between labour and capital is no longer clear and Marx’s schema is ultimately unsuited as an analytical framework from which to assess current events. This is true for pedants, and it is not the intention of this post to be pedantic. These frameworks are mobilised with full knowledge that they are not neat moulds into which society fits. Rather than give a full view, they allow for a sharper focus on a small aspect, and that is precisely what we’re doing. Despite the complexities extant in modern society, which Marx could not have anticipated, his framework proves useful in clarifying three observations: first, the reaction by ordinary Londoners whose class positioning is closer to labour than it is to capital following Uber’s license refusal is indicative of false consciousness; second, it becomes clear that under the capitalist system, all the benefits that capital ostensibly confers upon labour are obtained at the expense of labour; third, it proves that markets are not meaningfully sovereign.

False Consciousness

There may come a time, Marx tells us, when workers begin to see themselves as individuals concerned with their own betterment, with little regard for fellow workers. In a bourgeois society, where the interests of capital take precedence over those of labour, workers have little choice but to enter the job market and compete with other workers in the sale of their own labour. The result of this competition is that workers begin to see each other as threats. In being so steadfastly focused on their own individual interests, they overlook the collective class interests. Instead, they take on the ideology of Capital and begin to see the interests of Capital as identical to their own, not knowing that this merely serves to ensure their continued immiseration at the hands of the very Capital they are working so hard to sustain. This is a form of alienation: they have become foreign to themselves. The result of this alienation is false consciousness: workers perceiving other workers as a threat to them, and instead adopting a stance that is characteristic of capital and not labour. Another way of saying this is that workers adopt the interests of capital as their own, seemingly unaware that capital’s interests are designed to be antithetical to labour.

Labour Turning In on Itself

Whilst Uber was in operation in London, many fellow workers learned of, and were sympathetic to, the plight of the Uber driver. Their existence was liminal, not quite employees and not self-employed in the strictest sense. Legislative frameworks could not accommodate this configuration, and thus the workers fell through the cracks. Whatever ‘benefits’ this furnished to consumers were realized at labour’s expense. Through the shortchanging of labour, Uber fares were cheaper. This benefitted a subset of labour (i.e. commuters not employed by Uber) and is an illustration of how capital creates a framework where labour ‘gains’ from itself. This is made possible by false consciousness, where labour fragments and atomises. Its fragments interact as polarised particles, colliding, yet failing to fuse because they are charged with antagonistic forces.

In the gig economy, positions similar to those of the Uber driver represent the most advantageous form of labour for capital. It is a disproportionately exploitative relationship, unattenuated by regulation. This seemingly ingenious configuration allows capital to engage the services of labour with no strings attached. Under the rubric of ‘self-employment’, workers are led to believe that they are taking charge of their economic destinies by exercising control over their schedules. Right-leaning politicians like to put a positive spin on precarious work, terming it ‘flexible’ and embellishing it in language that corresponds to deeply held values of ‘freedom’. They take the absence of a physical, human boss/supervisor/manager to mean freedom, but power still lies with the company under which they operate. Marx was alive to this trickery and strove to show how the reality of labour was coercive. The savings from lacking commitments to labour mean lower prices for the users of the service. Observe, however, that these tangible ‘advantages’ are realized by labour, at labour’s expense: a worker’s gain is realized through another’s loss. The failure to recognise this is a result of false consciousness, where labour fragments and atomises. Its fragments interact as polarised particles, colliding, yet failing to fuse because they are charged with antagonistic forces.

In the gig economy, the Uber driver represents a form of labour that is very advantageous for Capital. It is a fully exploitative relationship, unattenuated by regulation and government. Critics were quick to point this out because this seemingly ingenious set-up allowed Capital to engage the services of labour with no commitment whatsoever. Despite this, there were benefits. The most tangible were realized by labour at labour’s expense. Through the shortchanging of labour, Uber fares were cheaper. This benefitted a subset of labour (i.e. commuters not employed by Uber) and is an illustration of how capital creates a framework where labour ‘gains’ from itself. This is made possible by false consciousness, where labour fragments and atomises. Its fragments interact as polarised particles, colliding, yet failing to fuse because they are charged with antagonistic forces.

This atomisation manifests in commuters furious at striking tube drivers, unaware that similar historic action has ameliorated Capital’s exploitativeness and produced comparatively favourable working conditions. The ideological mouthpieces of capital are the daily papers who portray fellow workers’ attempts to address their immiseration as creating misery for everyone else. This atomisation manifests in hundreds of thousands of Londoners signing a petition to have Uber’s license renewed because they save money on a journey home (at their fellow worker’s expense). This atomisation is labour seeking emancipation at its own expense. This atomisation is a race to the bottom which holds capital to the lowest of standards by removing any semblance of reciprocity from the relationship; from a reasonable expectation that capital pay fair, livable wages to labour, workers are led to believe that they’re lucky to even have a job, so that decent wages begin to take on the tones of privilege. Fair compensation is no longer regarded a right.

Wage Suppression

It is correct to say that modern capitalism has been a struggle between labour and capital. Indeed capitalist crises are the result of the pendulum swinging to0 far to one extreme, as David Harvey tells us in this very interesting talk. Our most recent crises have been the result of too much power in the hands of capital. One of the most bewildering effects has been the nature of employment following the Financial Crisis. Wages have stagnated (or declined in real terms) and work has become precarious. Why has this happened?

Part of it can be attributed to a political bias towards the interests of capital. Ruling governments enact policies which are designed to make life easier for businesses with the hope that a favourable environment will draw capital inward. This is what politicians mean when they say they are being ‘business friendly’ or that they seek to ‘attract investment’. Theoretically, a business-friendly environment invites capital with the promise of greater profitability in some way. This is achieved, almost always, at the expense of labour. Here are two examples:

  1. Taxation: Taxation is the price capital pays to the state for providing the environment in which it can operate. The state ensures that there is infrastructure, order and property rights (and sometimes labour and markets) without which capital cannot operate. It, therefore, must pay taxes to the state to help maintain the structures that allow it to operate.
  2. Regulation: Regulation, sometimes referred to by politicians as ‘red tape’ represents the conditions that capital must meet to legally operate in a state’s boundaries. It may also be seen as a band-aid that seeks to rectify the corruption of unbridled capitalism. Another way to view it is that regulation represents enshrined responsibilities capital bears to labour and the state.

Politics can court capital by reducing its tax and regulatory burden. The idea is that more of capital’s profits are retained since it has to pay less in taxes or spend less on regulatory compliance. This is ostensibly good for new and existing business because new businesses will require less money to remain afloat and existing businesses will expand their operations by reinvesting the extra profits, resulting in more employment. Some economists are married to the idea that on a macro level wages and employment are in an inverse relationship. The higher the wages, the lower the level of employment. Therefore, there are actual armies of these market fundamentalists who argue that wages should be kept down for the sake of employment. This is another veiled statement that proffers the interests of capital at the expense of labour but is nevertheless put forward as a common sense statement. Observe also how labour is benefiting at its own expense. Earning higher wages is surreptitiously charged with a moral sentiment as it means your higher wages are keeping your fellow workers out of a job. Labour is being pitted against itself and it must make sacrifices for its own collective good. There are economists that like to see themselves as neutral prophets of a science, yet in advocating for low wages in favour of greater employment, they are merely exposing their bias towards capital. This is because it is corporate profits do not always lead to reinvestment. Also, more employment for less wages just results in more people with less – something my American and conservative friends associate with Marx, not their ideological bedfellows.

The Two Faces of Capital

The paradox of capital is its shifting identity. To the Market, it presents a face of abundance and limitless growth. The goal is expansion and increasingly greater corporate profit. It seeks to exceed last year’s performance, with no limit in sight. It seeks to break its own records and set itself on a permanent path to neverending growth. Yet, in its obligation to labour, it refashions itself into a diminishing resource. The pie of remuneration is either frozen or shrinking. The expansion in capital is met by a greater demand for labour. However, as we’ve just seen in the paragraph above, the compensation to labour appears fixed and politicians justify relaxing the obligation further by arguing that it invites greater investment. Instead of growing along with capital, wages remain stagnant: the growth in labour inevitably results in increasingly smaller pieces of a finite pie being offered. Capital always seeks to extract.

Conclusion

Society is no longer split into two neat classes. The assault on labour during the Reagan and Thatcher years shifted the balance of power from labour to capital through the shattering of unions. This produced the erosion of the collective identity of workers as workers. Thatcher’s negation of society in favour of individualism produced a false consciousness that led workers to believe that they were climbing a social ladder in an open, effectively classless meritocratic society where hard work and individual responsibility were rewarded. Workers now saw themselves in competition with other workers. A fellow worker in the office was a threat to one’s own promotion. Wages, therefore, became less a reflection on capital and more a reflection on labour itself. If a worker was earning low wages, this could simply be explained through the language of individual responsibility. In other words, it is the worker’s fault that wages are low. It is up to the worker to exercise agency and put in the sweat equity to earn more wages. In an open marketplace, the assumption is that this was possible and this was a perfect mechanism. It also attached a stigma to collective action because only the individual was in charge of his or her destiny.

Striking was also seen as lazy because strikers were by definition not at work, where they could be taking charge of their destinies and putting in the hard work that would eventually be rewarded. Thus when train drivers go on strike, workers who in their private consciences curse and condemn their own low wages react not in solidarity but in condemnation, for all they see under this ideology is another worker preventing them from pursuing their own aspirations. This is because this ideology forces workers to attach the relative value of their wages to subjective conceptions of self: salary becomes a reflection of self-worth. If they aren’t earning enough, they simply aren’t working hard enough. They fail to recognise that the pressure that labour places on capital through collective action is a powerful bargaining tool which capital-biased politicians have worked hard to quell. Similarly, when Uber’s license was not renewed, many simply wanted the service reinstated because what was immediately apparent to them was the financial hit they’d have to absorb using more expensive services. This is not to say that the Uber fiasco represents a triumph of labour over capital because it doesn’t; rather, it shows how the fragmentation of labour has created a system upon which labour is actively involved in its own immiseration. The worker now operates dissonantly, with an ideological reverence to work, but a practical distaste for it. And those who serve as mouthpieces for capital, encouraging workers to sacrifice health and personal relationships for their jobs are nevertheless given away by their love for Fridays and aversion to Mondays. I’ll close with some of the most penetrating quotes from Marx in service of this very point:

“The worker therefore only feels himself outside his work, and in his work feels outside himself. He is at home when he is not working, and when he is working he is not at home.”

“His labour is therefore not voluntary, but coerced; it is forced labour. It is therefore not the satisfaction of a need; it is merely a means to satisfy needs external to it. Its alien character emerges clearly in the fact that as soon as no physical or other compulsion exists, labour is shunned like the plague.”

Karl Marx, Economic And Philosophical Manuscripts of 1844

Never Stop Believing

“I swam down shit’s creek and came up clean, with a new lease on life like Andy Dufresne” Credit: Columbia Pictures – The Shawshank Redemption (1994)

Jay Electronica, my favorite lyricist, in reference to my favorite film – The Shawshank Redemption – produced my favorite quote, in one of my favorite songs:

“I swam down shit’s creek and came up clean,

With a new lease on life like Andy Dufresne”

Just over a year ago, or fifteen months to be precise, I was in a state of turmoil – call it an existential crisis of sorts. I was a web marketer on the verge of creating a vast empire of profitable websites – or so I thought – when after a string of mortifying failures, I realised that perhaps I wasn’t quite cut out for it.

It’s difficult to put into words how hard that realisation was for me to process, and how painfully my ego was crushed; I was, after all, quite defensive about my choices and wouldn’t hear any criticism. When asked why I’d chosen not to attend University, I’d retort angrily that higher education was a scam and that there were other ways to get rich; and that I was far along this alternative path. Remembering this still makes me cringe – experience really is a wonderful teacher. Indeed, my own words fail me and I may borrow those poignant words from the philosopher;

“The sorrow that tortured me, the shame that overwhelmed me, the desperation that wracked my mind, all these I could then feel, but even now I can find no words to express them. Comparing these new sufferings of my soul with those I had formerly endured […], it seemed that I was in very truth the most miserable among men.”
Peter Abelard, Chapter X: Historia Calamitatum (The Story of My Misfortunes).

This chapter of my life was characterised by misery, and I felt powerless to turn the page. To my mind, I just needed more time: more time undo the failures, to rectify my errors, to redeem myself and vindicate my choices. However, with my 25th birthday rapidly approaching, I soon realised that time hadn’t stood still. Continuing down that road became increasingly unacceptable. Something had to change, and I had to change it.

The events that followed, I’ll save for another time. What I can say, and not without some irony, is that I leave for university in a few days. That part of my journey, which I must admit was the product of a lot of effort and belief on my part bore some lessons. Rather than pat myself on the back for a job well-done; I only want to make one thing pertinent, especially if you feel as though you’re in a rut: your life can change very quickly, but it’s on you to start doing things differently. I know I sound like a self-help author but stay with me, please.

I have throughout my life witnessed first hand what is possible through self-belief. I don’t think the belief itself has magical powers; simply it shifts your focus, which affects your attitude and your actions. Attitude permeates your whole being, and shows itself in everything you do.

I’m not here to give you advice on life’s big decisions. Indeed, most of what I’ve said so far has been frustratingly nonspecific: I don’t know your story, and I’m no sage. I’m only sharing a perspective, and you may take from it what you will.

Do stay tuned for sporadic updates documenting my time at Cambridge. I’ll make sure I actually take photographs and stuff because this post is roughly a thousand words, and well, a picture is less work, and worth about as much!