Pre-publication draft; to appear in:

Korosteleva, E. and Flockhart, T. (eds.) Resilience in EU and International

Institutions (Routledge, 2020).

Chapter 10. Countering precarity: social resilience through a

political economy of trust
Albena Azmanova

“We are all born mad. Some remain so.”

Samuel Beckett, Waiting for Godot (1953)

Abstract: This chapter explores the socio-economic parameters that shape experiences of security
and vulnerability. It argues that contemporary capitalism has generated not just a precarious
class, a “precariat” (Guy Standing), but a precarious multitude, with experiences of precarity
cutting across gender, age, class and occupational differences. Policy efforts and intellectual
critique have so far focused either on fighting inequality through redistribution or on a revival of
the post-WWII, bureaucratic welfare state. As an alternative, this chapter will articulate a policy
set that fosters societal and personal resilience by building what I have
conceptualized as “political economy of trust”. These are reforms which counter social and
economic insecurity at the level of interpersonal relations and interactions, with a focus on
logistics of equitable distribution of risks and opportunities.
Key words: precariat, precarity, globalisation, trust, pandemic, insecurity

One of the most striking features of the Covid-19 pandemic that beset the world in early
2020 has been that, even as it wrecked the global economy and constrained dramatically our
everyday life, it did not engender a radically novel social reality. Rather, it exacerbated existing
tendencies. Most immediately, the meticulous reporting of hospitalisations and deaths brought an
acute reminder of humanity’s innate frailty – the forever lamented precariousness of human
existence. The incapacity of the healthcare systems of the wealthy and scientifically savvy
societies of the global North to promptly contain the contamination revealed yet another type of
pre-existing frailty – a condition of over-arching social fragility whose political origins have
been an object of critique at least since the publication, in 1958, of John K. Galbraith’s The
Affluent Society. This remarkably insightful treatise, preceding by half a century the dawn of our
contemporary networked economy of information technologies and global supply chains,

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sounded an early warning that liberal democracies were shaping themselves as societies of
“private affluence and public squalor” – a world in which economic growth and scientific
progress went hand in hand with the weakening of essential public services such as healthcare
and education, thereby eroding the very infrastructure of our collective existence. The pandemic
has also brought into sharp focus another often discussed feature of our societies – the
unprecedented economic inequalities. Both the contamination and the measures that were
adopted to safeguard public health (from the lock-down to the mandatory deployment of
“essential workers” to dangerous workplaces, often with minimal protective equipment) have
disproportionately affected the most vulnerable groups, exacerbating poverty and social
exclusion. Thus, within a span of two months, the pandemic laid bare a pre-existing condition
that had enabled a medical crisis to become a global social and economic crisis. It eliminated any
vestiges of uncertainty surrounding not only the striking statistics of growing inequality and the
deplorable contrast between abject poverty and obscene wealth. It also revealed that our
societies’ main affliction is that of steeply stratified, but nevertheless overarching, social
precarity – a state of social and economic fragility which has been politically engendered
through a set of public policies and institutions over several decades (Azmanova, 2020, pp. 105-
137).1 The cumulative effect of these trajectories of fragilization – the physiological, the socio-
economic and the political -- has been the radical weakening of us as individuals, of our societies
and our polities, which are brought to a state of perpetual anxiety. Angst is inimical to agency, to
the ability to assume authorship of one’s life – as acute uncertainty inhibits our judgment and
restrains our actions, infusing us with that reactive hankering for security and safety that Erich
Fromm discussed as a “fear of freedom” in his investigation of the socio-psychological roots of
the rise of Nazism (Fromm, 1942). Like Beckett’s two deranged heroes, trapped in an
infantilising madness, all we can do is await, endlessly it seems, for release, normality, and
empowerment.

It is significant that the quest for an alternative future that began amidst the pandemic has
engaged the language of resilience. In early June 2020, the European Green Party held its annual
congress, with the motto “a resilient future is a Green future” and a programmatic statement
urging that “resilience thinking, the ability to adapt to change and to bounce back from shocks
and crises, must be embedded in our answers on our path to recovery”, and vouching that “the
economic recovery should lead to a fairer, more just, more inclusive, more sustainable and above

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all, a more resilient Europe” (EG, 2020). About the same time, the German Defence Minister,
relaying her vision for NATO, advised that “‘Resilience’ should become the alliance’s
watchword,” noting that adaptability has been NATO’s secret to longevity (Kramp-Kerrenbauer,
2020).

If we are, however, to safeguard its critical-constructive potential, we should avoid

reducing the notion of resilience to the reactive term “adaptability” – as adapting to
circumstances implies their acceptance. The heuristic power of the term lies exactly in its
positioning on a conceptual space beyond both a passive adjustment to change and a reactive
quest for certainty. What is that conceptual space? I subscribe to Trine Flockhart’s view,
outlined in this volume, that resilience is the ability to retain the capacity for agency in the face
of adversity, but I also take on board her insight that, although humans are endowed with agency,
they are always engaged in seeking ontological security, and their ability to utilise their agency is
constrained by their need for maintaining ontological security; this embeddedness of human
agency within the quest for ontological security makes change difficult to achieve (Flockhart,
2016). This is why we need to approach agency as a matter of deliberate, purposeful effort, a
political craft (i.e. governance), which in turn presents resilience “as an art of governance and not
just as a quality of a system that can absorb and bounce back from shocks and crises”
(Korosteleva and Flockhart, 2020, in this volume, p. 154). The goal, then, is “to bring about a
more sustainable governing modus operandi to exert influence over a rapidly changing
environment” (ibid, 155). Yet, what kind of influence is resilience to empower actors for? If we
are to accept that individuals are always engaged in seeking ontological security, we need also to
admit that the political projects which emanate from this quest span the full spectrum from overt
oppression (tyranny) and autocracy to liberal and consensus-based regimes. Or, as Korosteleva
and Flockhart (2020, p. 159) caution, we need “to stop resilience from becoming a ready-made
solution for security-predicated measures in the interests of the established power
configurations”. In this way we will nurture the analytical suitability of the notion of ‘resilience’
for conceptualising the logics and logistics of emancipatory, constructive agency understood as
“self-authorship” – that is, the ability of “local communities and real people to actualize their
own potential in ways they specify, and for external governance to support them in this process”
(Korosteleva and Flockhart, 2020, p. 159). These particular parameters in the conceptualisation

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of resilience (in reference to agency, self-authorship, and defiance of extant power
configurations) makes it suitable for the emancipatory agenda of critical social theory.2

In line with the commitments of critical theory, I will deploy the notion of resilience as
an analytic of self-governance and self-authorship directed towards reducing domination by
defying the forces of oppression.3 As formulated by the authors of the Frankfurt School, critical
theory seeks to articulate not the features of a just social order, but the conditions enabling such
an order – what Max Horkheimer discussed as “the enabling conditions for successful
realization” (Gelingen von Vollzügen); that is, critical theory seeks to discern the social
conditions enabling actors to engage in social criticism and transformative political action
(Horkheimer, 1937; Azmanova, 2020, p.29). On this view, our social environment must be
appropriately structured to allow for actor’s critical judgment and constructive social and
political engagement. In this sense, ontological security could be considered as an element of that
structuring which is a precondition for agent-led change, even as the quest for security is inimical
to change – to endorse the admittedly controversial conceptual move Trine Flockhart (2016)
makes in her discussion of agent motivation. This focus on actors’ ability for critical judgment
and emancipatory action implies a view of individual persons with emotions and dispositions
that inevitably will influence how they experience the world and respond to it. This, in turn,
enables a certain type of analytical stance, namely, that of non-utopian emancipatory critique –
as it invites us to inquire about the practical-historical conditions (the “where and how” of
resilience-building) that enable individuals to retain authorship and responsibility over their
chosen historical trajectory.

In what follows, I will endeavour to discern the possibility the current historical juncture
contains for an emancipatory social transformation by way of countering the numerous
tendencies of fragilization that preceded the pandemic. In order to retain attention on the link
between the psychological preconditions for agency and the parameters of sustainable
governance, I will explore the socio-economic drivers for the massification of precarity in the
early 21st century, as these drivers have political origins (in certain policy choices) but they affect
individuals in their mundane experiences of being-in-the-world, thus affecting their capacity for
judgment and action.4 I will do so by applying a formula of analysis which views the relevant
context as a transnational social system – that is, a system of institutionalised social relations and

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the practices through which these relations are constituted. I will distinguish three trajectories
along which experiences of social harm emerge – which I have named “relational”, “structural”
and “systemic” dynamics of injustice (Azmanova 2020; 2018). These trajectories will then serve
as paths for emancipatory building of resilience. In the first part of the chapter, I adumbrate this
conceptual framework. The second part of the analysis will articulate a policy set that fosters
societal and personal resilience by constructing what I have named a “political economy of
trust”. These are reforms which counter social and economic insecurity on the level of social
practices and interactions with a focus on logistics of equitable distribution of social risks and
opportunities.5

A social ontology for the analysis of globalizing capitalism

Among the most powerful drivers of precarity – that is, the social condition of economic
uncertainty – are the competitive pressures of globally integrated capitalism. The global
economy can no longer be plausibly described as a space of national economies integrated
through trade. It is a system of transnational production networks and supply chains which
engulf a multitude of political regimes (from the autocracies of Vietnam and China to the liberal
democracies of Europe) and national economic system (from the state-controlled socialism of
Vietnam and the state-managed capitalism of China, to the free market capitalism of the U.S.).
This integrated marketplace is more than a global economy, understood as processes of
production, exchange and consumption of goods and services. It is also a social system -- a
system of social relations among the actors engaged in these economic processes. The
interactions among the participants in this system are governed by one ordering logic – the
competitive pursuit of profit, which is the main constitutive dynamic of the global capitalist
system.6

This constitutive dynamic is in turn enacted through a number of institutions (sets of

binding norms that guide social practices) with structuring effect, such as the “free” labour
contract and the private ownership and management of the means of production. Even when a
company is nominally owned by the workers (e.g. Huawei) or the government (e.g. China State
Shipbuilding Corp.), it behaves as a private entity in its relations with other economic actors, as

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well as in terms of its decisional power over the economic resources it deploys in interactions
with them. These institutionalised norms are enacted and enforced by the major international
organisations governing the international economy (The World Trade Organisation, the
International Monetary Fund, the World Bank, and the United Nations Conference on Trade and
Development) and together compose the structural dimension in the edifice of the global
political economy as a translational social system.

So structured, the dynamics of competitive pursuit of profit have a far-reaching effect on

the distribution of life-chances among all participants in the system – states, businesses, and
individuals. I borrow the term “life-chance” from Max Weber who uses it to discuss “the
probability of procuring goods, gaining a position in life, and finding inner satisfaction” (Weber,
1922, v.1, p. 302). The term denotes a shared understanding of a successful life and an
accomplished self, as well as the individual psychological experiences of such an achievement.
While perceptions of what forms a life-chance vary according to social context, the material
parameters of that distribution are now uniform and concern the allocation of opportunities for
wealth-creation and its appropriation, as well as the financial and social risks entailed in the
pursuit of profit. The distributive outcomes gain social significance not simply as a question of
the availability (or lack) of the necessary resources for living the life we value; they situate
participants in relation to one another – in this sense I speak of a relational dimension of the
social system.

Uncertainty is a perennial issue for capitalism exactly because it is a highly dynamic, and
inherently unstable system; it “not only never is but never can be stationary.” (Schumpeter, 1943,
p. 82; 1928). Crisis is not an exceptional state of affairs, it is an endogenous element in a process
in which the “gale of creative destruction” that technological innovation fosters eliminates the
old as it brings forth the new (ibid).7 In other words, crisis is generative. The issue of risk as a
source of both opportunities (for wealth-creation and social advancement) and damages (loss of
wealth and social status) thus lies at the heart of the legitimating logic of this social system.
Since its inception, capitalism has sourced its legitimacy from a principle of fairness that
stipulates that entrepreneurial risks and opportunities for enrichment should be correlated. This
means that in the process of wealth-creation, those who endeavour to invest time, effort and
personal resources (which always implies risk of loss and failure), are entitled to the benefits of

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those investments. This remains the ground rule of legitimation also in the context of the globally
integrated capitalism of the early 21st century.

In view of capitalism’s fundamental fragility and instability, attitudes to precarity and

concerns with resilience are therefore closely related to the ground rule of correlating risk and
opportunity – it is the accrual of risk, without matching gains, that trigger legitimate grievances
of precarization and trigger efforts for resilience-building. Such was the case, for instance, when
the first historical form of capitalism – the liberal, entrepreneurial capitalism -- entered a
systemic crisis. By the end of the nineteenth century, the free market had allocated considerably
more risks to wage laborers and others who had little or no opportunity to make real gains in the
economy, while putting them in inhumane, life-threatening conditions. A severe legitimacy crisis
followed, entailing the radical transformation of liberal capitalism into the “organised”,
coordinated, state-managed capitalism of the Welfare State – a process meticulously surveyed by
Karl Polanyi in The Great Transformation (1944). This second historical modality of capitalism
has its genesis in a large-scale policy effort to restore the balance between opportunity and risk
via building a social safety net by means, for instance, of introducing stable employment
contracts and unemployment insurance and limiting working hours and working lives. By
reducing the social risks accrued to workers while enabling opportunities for pursuing valued
life-projects, these reforms empowered them to engage in radical emancipatory politics – from
the youth rebellions against the consumer society in the 1960s to the struggle for racial and
gender equality of the subsequent decades. It might be worth recalling that the men and women
who dared both dream and act big were “bred in at least modest comfort,” in the account of one
of their leaders (Hayden, 1962, p. 45).

The systemic logic of the competitive pursuit of profit, together with the structuring
institutions which enact that logic, entail distributive outcomes that are highly uneven – a
phenomenon that has been well recorded and much discussed (Atkinson, 2015; Galbraith, 2016;
Piketty, 2013; 2015; 2020; Stiglitz, 2013; 2015). For the purposes of this investigation, what is
important to note is that historically, property ownership has been a key factor in creating an
advantage in the production and appropriation of wealth. Owning the means of production not
only enabled the extraction of profit, but also sheltered owners from social risks such as
impoverishment and exclusion (notwithstanding the risk of bankruptcy). In the contemporary

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context, two new elements affect the distribution of life-chances. One of these elements is
digitalisation: information technology (and the requisite skills for its deployment in profit-
making) has enabled a low-cost entry into the global economy with magnified capacity to reap
profit. The second element that strongly affects the distribution of life-chances in contemporary
capitalism is the peculiar form of property tenure typical for the publicly listed corporation. This
form of ownership (hailed as the “democratisation of capitalism”) allows anyone with savings
(or ability to borrow) to partake in the pursuit of profit in a capacity of capital owner. However,
this has also exposed workers (not least through the investment of their pension funds in the
stock exchange) to the risks of globally integrated capitalism, without giving them decisional
control over the management of the company in which the investment is made. Thus, in the
current context, the distribution of the opportunities and risks, the gains and the harms, from
participation in the global economy, no longer strongly follows the capital-labour divide that had
shaped politics in liberal democracies.

Toward the close of the twentieth century, a new axial principle of social stratification
emerged, one related to the exposure to globalization. Globalization’s transformative effect runs
along two trajectories: open markets and information technology, which I have discussed as,
respectively, its “quantitative” and “qualitative” dimensions (Azmanova, 2011a; 2020). These
channel the distribution of opportunities and risks in the global economy. Indeed, individuals and
firms equipped to profit from the new economy of open borders and technological innovation by
reaping the benefits of economies of scale, have seen their fortunes and social status rise.
Significantly, the distribution of life-chances in this context cuts across capital and labor. Both
groups engaged in the old economy have become more exposed to risk resulting from higher
exposure to competition, reliance on cheap labor (the effect of trade liberalization), or the
incapacity to link factors of production to information technology (IT). Companies that have
found ways of using IT’s particular advantage—inexpensive equipment that reduces the reliance
on human labor while increasing the scope and speed of market access—have experienced a
significant increase in the rates of return on their investment. Back in the early 20th century,
much of the income of top earners came from rents on land and property as well as income from
investments in government bonds. By contrast, today’s top earners tend to be either a salaried
employee, for example an executive in a global bank or a company founder, like Microsoft’s Bill
Gates and Facebook’s Mark Zuckerberg (OECD, 2015).

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 Constituted in this way via its core operative dynamic (the competitive pursuit of profit),
and shaped by its structuring institutions (regarding property ownership and professional tenure),
as well as distributive outcomes, the global capitalist economy operates as a social system that
deeply affects the ways in which individuals experience their lives. Experiences of
empowerment and fragility emerge along three dimensions, which I have discussed as
trajectories of domination. I will next review these three trajectories with the purpose of
positioning the discussion of resilience as a matter of countering the social harm produced along
each of the trajectories of domination.
Although inequality does not always produce oppression and domination, the unequal
allocation of material and ideational resources (from wealth to cultural recognition) might
engender the unequal distribution of power in society. Such an unequal distribution of power
entails relational domination -- the domination of one actor or group of actors over others by
way of possessing more resources relative to other individuals or groups. Corresponding forms
of injustice (relational injustice) are impoverishment and exclusion. Without claiming that all
inequalities result in relational domination, we can observe that the lower one finds oneself in the
hierarchical distribution of life-chances, the least equipped one is to pursue socially valued
endeavours, thus becoming trapped in a cycle of continuous disempowerment of the already
weak. Typical resilience-enhancing strategies for countering relational domination deploy the
logic of inclusion and equalization of power (via, e.g., expanding the electoral franchise or the
redistribution of wealth).
Structural domination concerns the constraints on judgment and action that key
structuring institutions impose on actors. Typically, these institutions transform the inequality of
resources into social privilege. Thus, the institution of campaign financing in the United States is
the lever which translates economic resources into political influence. To take another example,
the institutionalised one-wage male breadwinner family model which was prevalent until the
1970s, transformed the gendered division of labour into a hierarchy of social recognition that
ensured male domination. Building resilience in terms of emancipation from structural injustice
necessitates the abolition of the institutions generating structural domination. The point is not so
much to eradicate inequalities, but rather to prevent legitimate differences (including legitimate
economic inequalities) from transforming into power hierarchies by eliminating the institutions
which serve as levers for this transformation. Thus, the exploitation of labor cannot be

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effectively addressed by way of the typical redistributive strategies for building relational
resilience (e.g. via higher wages). This is the case because the institution that enables
exploitation (the private property of the means of production) would continue to perpetuate the
process of surplus extraction from labour without which the survival of the company in
conditions of competition would be endangered. To counter structural injustice, one needs to
eliminate the institutions which structure social relations in such a way as to propagate that
injustice.
Finally, systemic domination consists in the subjugation of all members of society to the
ordering logic of the social system, including the winners in the asymmetrical distribution of
power. In capitalism, systemic domination is generated by the imperative of competitive
production of profit to which the owners and managers of capital, as well as workers, succumb.
Systemic injustice has to do with social harm beyond the unequal distribution of social advantage
and disadvantage. Thus, labor commodification (treating a person’s capacity to work as a good
produced for market exchange) as well as alienation, afflict all who are engaged in the process of
competitive profit production, while the destruction of the environment is a harm suffered by the
whole of humanity, albeit to different degrees. To discern the need and the opportunity for
building resilience against systemic injustice, one needs to examine the way the ordering logic of
the social system engenders precarity for all.
Let us now investigate the ways in which contemporary capitalism poses fragility and
how practising “resilience” both as a quality and a way of thinking about governance, might help
to alter the existing system’s deformities.

Repositioning resilience from inequality to precarity

Strategies for creating the enabling conditions for positive, constructive, and emancipatory
agency emerge along the three trajectories along which social injustice is generated in the
globally-integrated capitalism of the early 21st century. Patterns of social injustice are formed as
a matter of (1) unequal distribution of resources among actors; (2) the constraints on judgment
and action which social institutions such as the private ownership and management of capital
impose on actors, and (3) their subjection to the constitutive dynamics of the social system,
namely, the competitive production of profit.

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Relational resilience
Upon receiving the Nobel Prize in 2013, economist Robert Shiller declared that “rising
inequality in the United States and elsewhere in the world” is the most important problem faced
by society (Shiller, 2013). The outrage against inequality has defined the struggle against social
injustice over the past decade. Conferences, research centres, and even academic degrees in
Inequality Studies have mushroomed.

The evidence of rising inequality is ample and the nefarious impacts of inequality on
societies are well-known. Since 1980, the top 0.1% income group has captured as much of the
world’s growth as the bottom half of the adult population (Alvaredo et al., 2018). Inequality is
harmful to social integration due to, for example, a sense of unfairness or decreased trust in the
government, the market, and other key social institutions. Economic inequality, furthermore,
generates political disempowerment: poor people are less likely to vote, whether due to lack of
education, mistrust in the political system, or inability due to various voter suppression tactics.
Politics in highly unequal societies tends to reflect the preferences of the affluent, as
policymaking in such societies is dominated by powerful business organizations and a small
number of affluent individuals (Gilens, 2014; Gilens and Page, 2014). This, in turn, reproduces
economic inequality: economic inequality and political inequality are thus mutually reinforcing
(Przeworski, 2012). The economist (and eminent left intellectual) Thomas Piketty has urged that
unless we radically reduce inequality, xenophobic populism will overtake liberal democracies
and demolish them (Piketty ,2020).

In the context of the Covid-19 pandemic, the fate of the group which the economist Guy
Standing aptly termed the “precariat”, has been particularly tragic as they have seen their already
insecure livelihoods disappear, while not being able to profit from the emergency funds
governments supplied to employers and workers through the existing systems of welfare
provision. For many, job insecurity and physical vulnerability merge in the impossible choice
between going hungry or getting sick. At the same time, office workers with the right skill set
continue working safely and lucratively at home, and those with capacity to invest have seen
their stock portfolios soar amidst the economic meltdown.

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 Resilience-enhancing strategies on the plane of relational injustice have relied strongly on
taxation and wealth redistribution. In the run-up to the May 2019 elections for the European
Parliament, the Party of European Socialists adopted eight resolutions for an equal society as the
basis of its electoral platform. However, rising inequality is also a prominent issue on the
political Right. During her tenure as IMF managing director, Christine Lagarde repeatedly
warned that rising inequality is detrimental to sustainable growth (Lagarde, 2017). Conservative
governments have raised the minimum wage or made commitments to do so in Germany, the
U.K., Austria, the U.S., and elsewhere. In the same logic of reducing inequality, they have also
lowered the taxes for low-income groups. Currently in the U.K. 42 percent of adults pay no
income tax; the top 1 percent of earners account for over 30 % of income tax contributions (IFS,
2019).

The pandemic, however, has revealed the short-sightedness of approaching social

injustice in comparative terms (as relational injustice) and countering it via redistributive
measures. A focus on inequality implies a comparison between private individuals and the
groups they are part of – which is the main ideological premise of neoliberal policy doctrine. To
recall, this policy perspective that has prevailed in Western democracies since the 1980s had two
pillars: (1) Individuals are held responsible for a thriving society and (2) governments are held
responsible for a thriving business environment. Reduced to the fight against inequality, social
policy becomes a mere adjunct to monetary and fiscal policies aimed at sustained economic
growth. This is the logic of the post-war “neo-classical synthesis” in economics, which conceded
a managing role to (pseudo) “Keynesian” consumption-nurturing policy while reserving social
and economic organisation to the so-called “free market.” According to that logic, a bit of
redistribution through progressive taxes, unemployment insurance and the minimum wage are
acceptable, but they must remain small and secondary to the competitive struggle in the private
sector. This eliminates the notion of collective wellbeing and lays the foundation for what I have
described as a “socially irresponsible rule” – rule which even when responsive to electoral
preferences (e.g. for obtaining growth targets) does not take into account the social consequences
of policy (Azmanova, 2020, pp.115-116). This approach to governance allowed center-left and
center-right governments in the late 20th century to embark on slashing budgets for essential
public services (including for healthcare) and privatizing public enterprises – a trend which the
financial meltdown of 2008 not only did not reverse, but deepened further. It is largely this

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transferring of social responsibility from public authority to private actors and the starving of the
public sector of funds and human resources that allowed the viral outbreak to become a
pandemic. Thus, in 2017, the European Commission proposed, within the Innovative Medicines
Initiative (IMI) – a public-private partnership whose function is to back cutting-edge research in
Europe – to speed up the development of vaccines for pathogens like coronavirus, in order to
“facilitate the development and regulatory approval of vaccines against priority pathogens, to the
extent possible before an actual outbreak occurs” (CEO 2020). The European Commission acted
within its remit of responsibility for public health, which is a competence it shares with member-
states. The pharmaceutical companies on the IMI, however, rejected the idea and the
Commission did not pursue it further. While it is sound economic judgment for the drug
companies as private economic actors to de-prioritize vaccines because they are less profitable
than chronic medical conditions, it was incumbent on public authorities to act responsibly in
safeguarding the public interest, rather than relying on the good will of market actors.
In order to overcome the deficiency of the distributive approach to enhancing resilience,
we need to ask: when does economic inequality become harmful? Under what conditions is the
indisputable statistical fact of wealth and income inequality experienced as a form of social
injustice by individuals?
One obvious answer is poverty: growing inequality is harmful when it entails
impoverishment. This is the case today even in the most affluent of capitalist democracies – the
United States. The bottom 20% of the U.S. household income distribution had an income of
$13,775 per year in 2018 while the poverty threshold for a family of four was set at $25,465 --
nearly twice the average income of the bottom fifth (EPI, 2018). However, to present the harm of
poverty as a problem of inequality entails a grave conceptual error. As philosopher Harry
Frankfurt remarks (2015), the poor suffer because they don’t have enough, not because others
have more and some far too much. Well-being should not be reduced to material wealth and
prosperity should be approached as a process, not as an entity whose distribution presents a zero-
sum game (if some have more others have less). For economically equal societies could be as
affected by poverty and precarity as unequal ones. This leads us to investigate the structural and
systemic factors behind poverty and precarity.

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Structural resilience
The Covid-19 pandemic has brought to light the significance of social infrastructure – in terms of
public investment in science, and the availability of well-funded public health service accessible
to all. Countries which have coped well (e.g. Taiwan, South Korea, Australia, Germany) have
universal and affordable public health insurance programs. The majority of European states have
highly regulated, centrally-managed, comprehensive medical coverage and a system of public
hospitals. Wherever this is not the case (e.g. the Netherlands, Belgium) people are required to
purchase health insurance from private providers which generally operate as nonprofit
organizations; almost all hospitals also operate as nonprofits. However, countries where public
spending had been severely cut as part of austerity policy over the past decade (e.g. Italy, the
U.K.8) have been worst affected by the medical crisis. The case of the United States presents an
illuminating paradox. Americans spend far more on health care than residents of any other
OECD country (nearly 17 percent of U.S. GDP in 2018.), and the U.S. was ranked as the most
prepared for a pandemic. However, the death toll in the US became the highest in the world in
April 2020, with a mortality rate 3 times that of Germany. The U.S. system is a textbook
example of private medicine and patchy public healthcare provision-- around 8.5 percent of the
population is without coverage’ and private insurance, whether employer-based or individually
purchased, accounts for two-thirds of the market.
The divergent policy responses in the U.S. and Europe reflect contrasting policy
philosophies which are likely to have significant long-term consequences. European states used
the lock-down to ramp up capacity in hospitals and boost production of medical supplies, while
in the US crisis management was focused on boosting consumer spending via directly allocating
funds to citizens. This is well in line with the contrasting approaches to healthcare in the U.S.
and Europe – in the former the burden falls on individuals, while in the latter there is more
reliance on state capacity. Notwithstanding differences in managing the pandemic, a cross-
ideological consensus is emerging with regard to the economic recovery, of a return to the
growth-and-redistribution policy logic that was a trademark of the post-WWII welfare state.
Such a policy turn, however, would be unfortunate, as it would undermine the
environmental justice agenda. The inclusive prosperity in the second half of the twentieth
century was achieved through intensifying production and consumption which proved

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detrimental to the natural environment. Solutions must be sought through a fresh analysis of our
socio-historical juncture.

Systemic resilience
The root of social injustice in the current context is a political economy that fosters not just
inequality, but generalized economic uncertainty what afflicts not only the low-income
communities. As a social condition, precarity arises when, in the pursuit of their life-
projects, individuals and the groups to which they belong are made to rely on conditions that are
unobtainable to them. This is effectively the case in our historical juncture. The combination of
automation and global market integration has engendered a highly competitive global economic
marketplace. For the sake of ensuring the competitiveness of national economies, governments
across the left-right ideological spectrum have been pursuing policies of privatization of public
assets, cuts to public spending, and deregulation of labour markets. This has generated massive
economic instability for ordinary citizens of all types -- young and old, the skilled and unskilled,
the middle classes, the poor, as well as the well-remunerated professionals in the “always-on”
economy. Contemporary capitalism has thus created not just a precarious class, but a precarious
multitude. This is an uncertainty to which almost all participants are subjected—apart from the
top 1 percent, for whom obscene wealth is a source of economic and social safety. But this
means that the type of inequality that generates social injustice is not so much inequality of
wealth and income levels as it is inequality of wealth and income security, which in turn
exacerbates the injustice of unevenly distributed social risks and opportunities.

Precarity, thus understood, erodes human agency. Conditions of economic uncertainty—

like the ones that have predominated well before the 2008 financial crisis —trigger conservative
instincts in support of the existing system. When we lack basic certainty regarding our source of
livelihood, we lose control of our existence. In such conditions, the creative energies of social
discontent are trapped by conservative instincts—it is fear that has channelled social unrest into
the reactionary path of xenophobia and autocratic calls for law and order. That is why,
disappointing the Left’s expectation for radicalization of the working class, the conservative
impulses that precarity fostered kept feeding into electoral support to the centre-right and novel
support to the far right at the very nadir of the economic crisis that followed the financial
collapse of 2008. Moreover, precarity is politically debilitating; it directs all our efforts at finding

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and stabilizing sources of income, leaving neither space nor energy for engagement in larger
battles about the kind of life we want to live.

The enhanced societal fragility, but also strategies for enhancing resilience, are rooted in

peculiarities I will proceed to describe as two antinomies of contemporary capitalism --

contradictions which arise in the tension between two opposing tendencies. On the one hand, our

times are marked by the unprecedented emancipatory potential of automation, fed by information

technologies, which is enabling the satisfaction of human needs with minimum input of labor.

There is also a growing awareness across society of the desirability of exiting the labor market:
surveys register that the value of discretionary time is increasing. Western societies thus contain

a growing capacity for, and interest in, decommodification. Yet, at the same time,

commodification pressures in the “always on economy” have increased spectacularly -- on those

in work, the unemployed and those in education. Pressures have increased to focus one’s efforts

on remaining employed and employable – even leisure activities are aligned with the imperative

of becoming and remaining marketable. I have discussed this first contradiction as “surplus

employability”. On the other hand, there is also the tension in the contemporary political

economy between decreased availability of jobs (especially with the thinning out of the social

safety net) and increased reliance on a job as a source of livelihood (“surplus job dependency”).

These two contradictions affect the distribution of life-chances within the system of globally

integrated capitalism. This distribution does not follow the familiar fault lines of center vs
periphery, capital vs labor, skilled vs unskilled labor.

A notable feature of contemporary capitalism is the acute increase in the asymmetrical

distribution of economic risks as public authority, for the sake of enhancing national

competitiveness in the global market, has begun to actively allocate opportunities for wealth

creation to specific economic actors (so called “national champions”) while transferring risks to

other actors and to society at large. In the current constellation, the big winners are those

economic actors who can exercise a rent-type of control (via holding natural monopolies) and
thus exempt themselves from the pressures of competition – pressures which have intensified for

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everybody else. As these pressures are universalized, the phenomenon of universal precarity is

born – a state of insecurity and unsafety which affects people irrespectively of income levels and

types of employment. Precarity is what afflicts the 99%. The negative psychosocial dynamics

comprise anxiety about finding and keeping a job, about impending losses of livelihood

(including stock market volatility), high work-related stress, and damaged work-life balance.

These pressures in turn play out in xenophobic attitudes, mental health disorders, suicides and

crimes of desperation – all of which have been on the rise.9 The anti-establishment insurgencies

in the affluent societies of the global North express widely shared frustrations with four sources

of precarity -- increased physical insecurity (fear of terrorism and disease), political disorder

(corruption and mismanagement), perceived cultural estrangement (due to influx of immigrants),

and employment insecurity due to employment flexibilization or job outsourcing. These

grievances are the four ingredients of a new anti-precarity agenda of public concerns which fuels

populism.

In view of the above diagnosis, what type of resilience-building measures could fortify

our societies, beyond the familiar ideas of wealth redistribution and building a robust public

sector? An important part of the answer is contained in the manner in which the social question

stands in the early 21st century. We noted that social injustice is not so much a matter of growing

inequality but a matter of highly stratified precarity. Let us also recall that we inhabit a social
context marked by a political economy which does not produce good jobs for all while labor

decommodification is technologically attainable. In such a context, the distribution of life-

chances becomes a matter of access to the labor market, as well as capacity for exit from it –

voluntary employment flexibility. Maximizing voluntary employment flexibility through

policies such as a trans-European social insurance, universal basic income, job creation (e.g. via

social enterprise), as well as job sharing (universal basic employment) are at the core of what I

have described as a “political economy of trust” (Azmanova, 2020, pp.169-201).10 This policy

formula enhances both societal and personal resilience because it strikes at the very source of
precarity – the pressures of competitive production of profit which we have allowed too long to

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devastate our lives, our communities and our natural environment.

Conclusion
“There must be something rotten in the very core of a social system which increases its wealth

without diminishing its misery, and increases in crimes even more rapidly than in numbers,”

wrote Karl Marx in the New-York Daily Tribune of September 16, 1859. Over a century and a

half later, the material affluence of the world has reached unprecedented levels, yet in the richest

country the bottom 20% of households have incomes almost half of the poverty threshold.11

Tremendous advances in science have enabled us to edit DNA and measure the gravitational

waves in the cosmic curvature of spacetime, yet governments in the purportedly efficient liberal

democracies of the Global North struggled to ensure the basic protective equipment that medical

personnel needed to do its job during the Covid-19 pandemic in the spring of 2020. At the root of

that failure of governance is a particular social condition that I described as generalized precarity

– the massive economic and social fragility which has been generated by the vertiginous

competitive pressures in the globally integrated market, itself politically generated through the

policy formula combining free markets and open economies that is the essence of neoliberal

capitalism. As these pressures are destabilizing livelihoods, they are at the same time nurturing

conservative, and even reactionary instincts. Disappointing the Left’s great expectations that the

economic and social crisis would radicalize the impoverished working and middle classes and

shift their vote to the left, democratic elections kept pulling the vote to the right. This was the

case because rather than fostering creative experimentation, precarity directs social energies

towards desire to restore the status-quo, even if this status-quo had been infested with injustice –

in this sense precarity is inimical to agency. Precarity intensifies actor’s quest for ontological

security, which nurtures conservative instincts; conversely, the provision of ontological security

nurtures the resilience from which constructive, experimental agency emanates. To be able to

think big again, to be able to embrace bold projects of radical social transformation, such as the
Green New Deal, we need first to regain stability of our livelihoods, by building what I described

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as a “political economy of trust” – a set of policies counteracting the competitive pursuit of

profit. The alternative is to continue waiting for Godot, by that leafless tree, alive mostly for

want of a rope.

ORCID: 0000-0002-2471-2016

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Disclosure: No potential conflict of interest was reported by the author.

Notes
1
Judith Butler (2004) has drawn the distinction between precariousness as a general human condition of
vulnerability, rooted in our interdependence on each other, and precarity, which is socially generated
vulnerability. In most accounts, a distinctive feature of precarity is its unequal distribution – it afflicts
some groups and entails marginalization, poverty, economic insecurity, political disenfranchisement,
and/or violence (ibid; Standing, 2011; Apostolidis, 2017). In my conceptualisation, social stratification is
not a constitutive feature of precarity, which is a condition of politically generated economic and social
insecurity (Azmanova 2020). As a social condition, the state of precarity arises when, in the pursuit of

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their life-projects, individuals and the groups to which they belong are made to rely on conditions that are
unobtainable to them. Thus, no human being, no matter how rich, can have the capacity to secure for
themselves a solid healthcare system (as it requires massive investment of resources in scientific research
and disease prevention, among others).
2
Analysis in the style of what Max Horkheimer (1937) defined as “critical theory” in contrast to
traditional theory is guided by an emancipatory interest (improving the human condition by alleviating
oppressive circumstances thereby reducing domination), rather than confining itself to understanding and
explanation. This idea of a difference between critical and traditional theory that the first generation of
Frankfurt School authors developed is akin to the vision Robert Cox later advanced (1981) about the
difference between critical and problem-solving theory in laying out the foundation of a critical social
theory within the British school of International Political Economy.
3
Suffering, which is the analytical starting point of Critical Theory, is caused by relations of domination
(Herrschaft), understood as illegitimate, “surplus” repression, or oppression. “Surplus repression” is not
simply a matter of unequal distribution of power, importantly, it is rooted in the particular structure of
social relations that enable oppression (Geuss 1981, p.35).
4
Although I cannot elaborate here the philosophical framework underlying my treatment of precarity and
resilience, I deploy deliberately the notion of being-in-the-world (akin to Heidegger’s Dasein and Hegel’s
bestimmtes Sein, and Sartre’s l’être-dans-le monde), which have been used in the philosophical traditions
of phenomenology, hermeneutics and existentialism to discuss individuals’ practical engagement with
their environment, in opposition to the Cartesian abstract agent. It is the attention to the individuals with
their historical situatedness, engaged in a socially specific “way of life”, that prevents us from the
solipsism of abstract individualism: “Being is always the Being of an entity” (Heidegger, 1962, p. 29).
5
I will be drawing on my analysis of contemporary capitalism in Azmanova, 2010; 2011a; 2011b; 2020.
6
I owe the wording ordering logic of the system to Eilish Rose Anderson. In previous work, I refer to the
competitive pursuit of profit as capitalism’s operative principle, or its constitutive dynamic (Azmanova,
2018; 2020).
7
Schumpeter appropriated the ide a of creative destruction from Marx and popularized it.
8
UK’s expenditure on health was 10% of its GDP in 2018, among the lowest in the developed world
(ONS, 2020).
9
Neuropsychiatric disorders affect about 25% of the European population every year; it is one of the top
public health challenges in the region (WHO, 2015).
10
A nascent paradigm shift in this direction is already visible in the European Union. Its components are,
for instance, the temporary employment re-insurance scheme (SURE) adopted during the pandemic (EC
2020), the adoption of a (legally non-binding, so far) policy pillar of European Social Rights (EC 2017),
and the active creation of social enterprise – “an operator in the social economy whose main objective is
to have a social impact rather than make a profit for their owners or shareholders” (EC 2011).
11
The bottom 20% of the U.S. household income distribution has an income of $13,775 per year in 2018.
The poverty threshold for a family of four currently sits at $25,465, nearly twice the average income of
the bottom fifth (EPI, 2019)

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