Next year my partner Jackie will turn sixty. For most of her working life that had been the age of eligibility for a state pension the OECD says is the lowest in the developed world.1 But as you may have noticed, the goal posts have shifted.
Of course, many of the world’s workers and peasants have no pension at all. A UN report from 2017 tells us that:
- 95% of people above retirement age get a pension in Europe, compared with 26% in Central and Southern Asia and 23% in sub-Saharan Africa.
- Contributory pension schemes are low in these and other developing regions.
- Tax-financed pensions, provided in 114 of 192 countries, often do not provide income security.
- Pension coverage is lower among women than men since women live longer and are disadvantaged in the labour market.2
The social contract operating in the Western world since 1945, and discussed in a recent post, was premised on two conditions – the global north’s extraction of super profits from the south, and the need for ‘caring capitalism’ in the face of the challenge from the Soviet Union.
The first condition still holds but not the second. Since capitalism’s natural state is that race to the bottom we now call neoliberalism, the social contract will not be retained simply because it is affordable. As a matter of systemic fact this is an impossibility and those who tout the idea of a ‘less rampant’ capitalism – a Third Way, as many dreamers (and a few knaves) have it – grasp neither the nature and origins of profit nor the iron laws of capital accumulation.
Led by the USA and UK, the West at large is tearing up the social contract because the business case for it vanished with the Soviet Union. Since when the world has been systematically, and in many cases violently, privatised.3
I don’t say the ruling classes wanted the crash of 2007/8. I do say they have – with customary zeal and even while their share of total wealth produced has soared – exploited it to shrink the state in an accelerated shredding of the social contract we call ‘austerity’.4
Hence Monsieur Macron’s little altercation with les gilets jaunes. Hence my partner having to wait a further seven years for her pension.
- For ‘developed world’ read ‘imperialism’, my shorthand definition being the global north-to-south export of capital, and south-to-north repatriation of profits.
- The ‘feminising’ of labour in the global south is discussed in John Smith’s Imperialism in the twenty-first century. Using IMF data, Smith finds not only that capital is drawn southwards by cheap labour, ‘business friendly’ regimes and traditional family values and structures which absolve state and employer alike of social care responsibility. He also finds that bringing women in large numbers into the workforce of industrialising nations, again because they are cheaper and – to begin with – more compliant, soon worsens conditions for both sexes.
- Privatisation is not the only driver of ‘our’ wars on the Middle East but, as shown in the case of Iraq by Naomi Klein’s outstanding empirical work in The Shock Doctrine, it is assuredly one of them. It was also a key driver of the Cold War given that the USSR blocked one sixth of the world’s land mass to private profit. Since (a) this truth was seldom grasped by a brainwashed public in the West, and (b) Putin called time on the feeding frenzy under Yeltsin, most people are at a loss to say – beyond a few sound bytes on “Russian aggression” in places they couldn’t point to on a map, in circs they know nothing about and in any case left in the dust by US led carnage in the global south – why Russia remains a bête noire. Nor is raised state pension age in the UK and France separable from privatisation. While most of the ‘debate’ centres on breach of promise, with millions condemned to working years longer than they’d foreseen, private pension providers are eying the opportunities created in exactly the same way private health providers and fund managers across the “developed world” are sizing up the vast markets opened up by a creepingly privatised NHS.
- Update 11/03/20 – reading this paragraph again the next day I see it could be taken as suggesting, anachronistically, that the squeeze on pensions was enabled solely by the crash. It wasn’t, and I speak of an interplay of factors – ideological, financial and political – in relations causal, catalytic and synchronised by zeitgeist. Of Ian Duncan Smith’s talk of a “need” to raise state pension age to 75 I note two things. One, the crash did its bit to prime us for permanent ‘austerity’. Two, bourgeois culture is unable to distinguish “we need to raise pension age to 75” from “to maintain profits we need to raise pension age to 75″. As with other aspects of capitalism’s non negotiable drive to subordinate every other consideration to the dictates of profit, so steeped are we in said bourgeois culture, so locked in its ideological grip, that we have for all practical purposes lost the ability to differentiate a physical impossibility from an impossibility within capitalism.