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The post-Covid world that will arrive… one day

The comrades of Grazia Tanta have send us this text about the post-Covid world.

Submitted to Enough 14. Originally published by Grazia Tanta.


1 – Human beings, instruments of capital

2- The infinite accumulation of capital

3 – Surplus of people

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1 – Human beings, instruments of capital

Among the multiple effects of the pandemic, some – non-sanitary ones – can be highlighted, such as greater difficulty in utilization, by the large emporiums, regarding the scrutiny, classification, manipulation of personal data, for purposes of their segmentation or homogenization, with the norms to be followed and the accompanying surveillance, diluting individual capacities in an alienating and useless work, articulated with a leisure time filled with mind-boggling activities.

These useless activities serve only to convince its practitioner to remain integrated at the circus of capital, however useless their “work” could be from an economic, social or, cultural enrichment point of view. Work, being an effort, only fits if it produces something socially necessary or useful; however, in many cases, the performer’s entire life is crossed without him ever realizing the uselessness or damage that resulted from the application of his time and his physical and soul capacities. This distortion in the lives of human beings has become typical of capitalism and, due to its dimension, leads to damages of an animistic, environmental and sanitary nature that affect large human groups or even humanity; as is the case with military cannon.

In the past, in the dominant classes, especially in the nobility, their main activities were leisure and war, with the delivery of heritage management, the collection of taxes and tributes, to someone qualified for the purpose – an ecclesiastical or a commoner. In the other population strata, in the countryside or the embryonic cities, there was no place for useless tasks, seen as work; everyone knew the purpose and real usefulness of their work effort, even if it was leisure or the satisfaction of a gentleman’s whim. It was a question of guaranteeing subsistence and measuring labor effort according to the needs of the family group and the payment of the tribute to the local master – in kind, young people for war or domestic service in the castle or palace.

In times of epidemic, bad harvests or, devastation by the war – there is no … unemployment benefits or tasks defined by the public authorities to make up for the lack of income, as in the New Deal, the only emigration remained, or the search for occupation in the cities, where productive activity was much more diverse than in the countryside.

Mobility after the European expansion of the sixteenth century was extended to the global space, greed, spirit of adventure, war or through the trade of spices, slaves, weapons .. . This mobility involved areas where complex and even more advanced societies lived than European ones, but which gave in to European colonization. Where this did not happen, as in North America and the Caribbean, the rule was the extermination of its inhabitants and the massive recourse to slavery … covered by the divine figures of the Christian pantheon and its priests.

Capitalism, generating the incessant demand for capital accumulation and benefiting from technologies that generate high productivity gains, could reduce the time dedicated to working, freeing Humanity from labor effort and giving it free time for its use in the delight of culture, sport, sociability …

But it did not and will continue not to. It benefits from the essentials of productivity gains, builds huge bureaucracies and instruments for the control of labor and its workers so that the labor force remains pacified and captured by the logic of capitalism, accepting its subordination to the stars as written in the stars. capitalists.

An entire ideology based on the segmentation of labor income between workers and employers is developed; and these, even though they are very minority, benefit from the majority of gains. Capital leaders say that it is essential to have capitalists because they are the ones who create jobs, pay wages … thus showing the secondary character, the accessory of workers. In the capitalists’ bible, God created the capitalist and, as a result, created the wage earner to ensure the welfare and entertainment of the former.

2- The infinite accumulation of capital

Capitalism conceives no limits for accumulation and invents ways to increase it to infinity, to consolidate its perpetuity and perpetuate its power over the population and the resources of the planet. On the one hand, in terms of the production of goods and services, it seeks to maximize its supply to increase profits; and, on the other hand, in total contradiction, it seeks to maintain restraint in income from work knowing that restricted purchasing power means less consumption, less spending. And, that is why people point to the unreasonable recourse to debt to feed consumerism in all social strata, after the capacity to use labor income has dried up. How do you get out of this?

Of course, this is not enough. This results in dementia inherent in the financial system, which, as a central element in the multiplication of capital, is always overcome by a drive, gluttony that is never satisfied, with the increase and appreciation of the securities it issues; nor with the profit margins it obtains from the transactions it carries out, at all times. Hence the financial crises, the military conflicts and the “investment” in armaments, with the leadership of the managers of the big central banks, of global institutions such as the IMF or the BIS – Bank of International Settlements, which follows the situation of the global financial system; as well as national and political classes that are responsible for managing the impacts of financial folly governments, and turn them in social and economic crisis, with increasing sharpness and increasingly frequent, as can be seen by comparing the Wall crisis Street in 2008 with the one that develops in the coronavirus ride.

Financialization, with the creation of money exponentially, in a virtual way, inserted in networks of data circulation, generated in instantaneously way and linked together, is, at all times, speculative business networks. The material basis of the economy, based on the production of goods and services or domestic self-production and self-consumption, has lost relevance and has become an appendix, a by-product of the market, duly supervised by the state apparatus.

3 – Surplus of people[1]

There is a time of great uncertainty in the face of the virus and fear in the face of the assault on the income of the popular classes. Among the effects of the pandemic, some can be highlighted, such as greater difficulty in using, by the large emporiums, the scrutiny, the framing, the manipulation of personal data, for their segmentation or homogenization; also, with the establishment of standards to be complied with and adequate surveillance, diluting individual capacities in an alienating and useless work; or, with leisure time filled with mind-boggling activities. With these useless activities – not felt as such by the worker – it is intended to give him a false idea about the importance of his work. It is an alienating and pacifying practice – typical of capitalism.

In the pre-capitalist modes of production, labor functions could be painful, but their purposes were known; no one performed functions without knowing the objective, even if it was the satisfaction of a whim from his master. In capitalism, technologies would allow sharp reductions in working time, without loss of income, if all the functions to be performed were recognized as socially useful. This would mean increased leisure time, for study, culture or sport and this would result in the great political question – if the means allow the production of all goods and services useful to Humanity, it is necessary to abolish those who condemn the crowd to journeys of long, painful and low-income jobs. As well as all socially useless or harmful activities.

For the way the crowd – in times of covid-19 – allows for massive unemployment, the layoff, the extended resource to charity, the limitations in the circulation in the physical space, the loss of hours of life with the eyes glazed on the new screen, a very nebulous and not very promising future, it appears that the articulation between the capitalists and the political classes dominates the situation.

In Portugal, what followed the financial debacle caused by the PS-PSD party-state, before and during the troika’s intervention (2011-2015); and, the pacification by the “left” of the sparse contestation then took place, still shows its effects. The Portuguese political class, as in other countries, did not solve any problems of those existing at that time and added the effects attributed to the covid-19.

The occupation of the State by political parties that place all the responsibilities for the economic and social management of society on their members and are attached, remits the population to the situation of meek and soft objects, of subordinates subordinated to the interests of the political class. The virus crisis, which has a duration far beyond what was initially foreseen, reveals, in a first instance, the immense inability of management by the political classes – with emphasis on Western Europe, USA and, Brazil – contrasting with the coldness and capacity observed in several East Asian countries. In all cases, however, there is a constant – the absence of popular initiatives capable of organizing themselves in a network, moving away from the pyramidal logic and the monstrous bureaucracy that characterizes state apparatus; the people stick to the TV and watch, passive, the repetitive spectacle starring hordes of mandarins and writers; and, being stupid, they will be ready to sleep with a mask or bathe in tar if determined by a prime minister.

If humanity cannot, due to physical or institutional limitations, produce the income necessary to accompany the speculative financial drift, it must resort to devices to increase the capital involved in the economic circuit; and in the process, the globalized financial system and the governments that serve it disrupt societies, spread suffering, artificialize economies, offend the planet.

In Portugal, this summer, the savings rate exceeded 10%, which is close to zero (when not negative) values ​​in recent years; and this is related to major drops in consumption and disposable income. The people have the good sense to take precautions for worse days, however, the banking system and governments do not know what may arise; for example, they can penalize accounts with a balance above a certain amount to encourage consumption or, increase the tax burden to reduce the public deficit. The power wants to return to the zero savings rate so that the money can be captured by the financial carousel; its business is to generate debt, not savings. And in 2023, it is expected that in Europe in the euro, there will be no money on paper or metal; everything will be recorded, not on the stars but the servers of the globalized financial system[2], a much higher degree of control over the lives of populations.

Today, the so desired economic growth, that of the nebulous GDP, has as its central and most usual feature, the recourse to debts contracted by families, companies and, States. The financial carousel runs on another stage.

·              As a rule, families are indebted to banks, namely to support homeownership and means of transport, essential needs neglected by States; these, avid tax collectors, gave their satisfaction to the sacred “private initiative”[3]. The debt gear, originating in families, has the following framework:

·              Families are indebted for decades, taking advantage of the low-interest rates granted by banks; and the States show their parasitism by collecting taxes – IMT, Selo and later, IMI, ad secula seculorum.

·              The risk for banks is low because the property is subject to mortgage and surety bonds; the risk is entire of the families, in cases of unemployment or marital separation, for example;

·              Low-interest rates are in line with wages, also with weak developments. And the former do not particularly concern banks, as will be seen below;

·              The creditor banks are not waiting for decades to pass to recover the borrowed capital and interest. They add up a large number of credits, share their value in securities they place on the financial market, recovering the equivalent of a large part of the credit granted to debtor families. This operation is called securitization and corresponds to the constitution of a cascade of successive operations, with the inclusion of new credits, involving successive groups of long-term home buyers or others;

·              Briefly, there is a family debt built up for several decades and a bank granting the loan. This bank will collect several loans of this type (and others) and issue bonds that will be purchased by other institutions, thus recovering a value that includes the value of the totality of these various loans granted. However, he did not cease to be a creditor of that family and others; only an expedient used to anticipate the return of the value of loan.

The transaction put into circulation a value that is the mirror of the housing loans included therein; and, this can be multiplied n times, as many as the securitizations made involving the debts, being able to be associated with a set of mirrors or the constitution of the pyramids of Ponzi, whose maximum value is, theoretically, the infinite. Putting all those debts together, the same bank becomes the debtor of those who purchased the bonds issued but collected money for new investments.

The transaction put into circulation a value that is the mirror of the housing loans included therein; and, this can be multiplied n times, as many as the securitizations made involving the debts, being able to be associated with a set of mirrors or the constitution of the pyramids of Ponzi, whose maximum value is, theoretically, the infinite. Putting all those debts together, the same bank becomes the debtor of those who purchased the bonds issued but collected money for new investments. The financial balance does not change; what is added is the present and future fiscal puncture to pay the public debt and private indebtedness, resulting from the abandonment by the states of housing and public transport policies in favor of the much sung private initiative.

Companies also resort to debt. Low-interest rates are rooted in central bank policy in the same direction, with due repercussions on commercial banking, which in turn develops securitization actions to free up capital for new loans.

Cheap credit – and the almost zero rates of return on deposits – work together to encourage consumption and, at the same time, discourage savings; hence, an almost obligation is formed in the sense of indebtedness… as it is in the interest of the financial system and the political classes that, in the sequence, take possession of the future of people and companies, captured by the obligations in the financial system. The credit training is born, not savings but in the Ponzi pyramid in which it appears the practice of securitization.

These pyramids are also magnified by the constant entry into the “legal” circuits of money from various types of traffic (drugs, weapons, human beings…), corruption, etc. to the joy of the financial system and the distracted eye of the supervision of central banks and other pompous regulators; as a rule, governments are more cautious about fiscal leakage from small businesses and very little about tax evasion from the wealthy [4]. These regulators and national governments have traditionally been distracted by the money that circulates between the visible financial system and the dozens of offshore registries around the world, especially on remote islands.

By maximizing the availability of cheap credit, companies reduce the use of equity; and, in the Portuguese case, it has also become trivialized – and for many years now – the use, by companies, of contributions, due and unpaid, to the sleepy Portuguese Social Security , parasitized by all governments … without any protest from the union world or the parties opposition sayings. The decapitalization of Social Security  is a recurring practice that is part of a tacit agreement within the political class.

The competitiveness of companies will thus arise from low wage levels of workers – atomized and disorganized – in working hours unpaid in precarious work, dismissal or, even facilitated, by layoffs facilitated by the government in covid-19 times.

This whole system based on credit cascades is extremely vulnerable even if anchored at very low- interest rates, to avoid difficulties for companies and, linked to equally low inflation rates; thus, it fosters a high consumer propensity for the population, which, with stagnant wages, embarks on recourse to credit, facilitated by banking.

·              This model of integration of entities – companies, especially the smallest ones, the States and the banking sector – depends essentially on the central bank, which can hardly cancel it:

·              The supply of the financial system cannot be stopped because bank credit would be much more expensive and difficult to obtain without firm guarantees, which many companies could not offer;

·                Its cessation would lead to a huge global crisis, it would be the collapse of a house of cards, with the bankruptcy of countless companies, indebted and with an accumulation of bad loans in the banks. The activation of mortgages would lead to the accumulation of real estate without buyers and, therefore, devalued, with upstream impacts, on construction, which incorporates elements from many industries, services and work;

·                The dismissals of workers and the mobilization of replacement income, coming from the state level, not prevent m difficulties in paying the installments of loans for housing;

The subsequent effects on public accounts (deficits) would affect the usual use of public debt “auctions”, certainly with much higher interest rates than today.

This and other texts in:                                        1/10/2020                        1                                                   


[1] According to the Portuguese Minister of Labor, 42000 companies resorted to the simplified layoff (two minimum wages) and other measures that involved 380000 workers

[2]  The disappearance of physical money in Europe from the euro – today, a value of $ 14.5 ^ 11 – which will incorporate the availability of the financial system for speculation to which must be added the costs of supplying populations with notes and coins, leaving populations without any instruments of exchange other than a direct exchange of potatoes for onions, for example. If you think that the fortune of the five richest people on the planet – Bezos, Gates, Arnaud, Zuckerberg and, Ellison – is $ 414 ^ 9 … it might not be much…


[4]  In Portugal, the BES case is a good example of the interweaving of circuits and the parsimony of how governments view the issue, incorporating into their rosters people who are very well connected with the financial crime or senior law firms. No ruler wants to (or can) show himself as a Robin of the Woods, although the staff of the… sheriffs of Nottingham abound within him.

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