Will the Coronavirus Lead to Change in Capital-Labor Relations
The prediction about the potential death toll from the coronavirus has become grimmer by the day. With experts in the US predicting that the virus may kill as much as 200,000 people within the country, extrapolation of the prediction to the entire world would see millions perish as the virus continue to rage uncontrollably in corners of the planets that are less capable of implementing measures designed to suppress excessive face-to-face contact among residents without their suffering grave economic consequences. The permanent loss of a significant portion of the world's productive labor force is now not unimaginable.
That threat of significant labor loss reminds of historical studies on the Black Death. The potential parallels are certainly there. Tallies by some historians claim that as much as half of the European population perished due to the Black Death, as lack of necessary medical knowledge and understanding of containment measures caused the bubonic plague to sweep straight from China, where it first originated, via the Mongol armies bent on conquering the steppes of eastern Europe. Medieval Europe saw towns and villages thoroughly depopulated by the pandemic, depressing economic activities for decades, if not centuries.
However, theoreticians do not consider the enormous loss of life from the Black Death is completely negative for human progress. In various studies, historians have attributed the introduction of higher wages and more rights to workers who were fortunate enough to survive the Black Death, as landowners who found themselves without sufficient farmhands were forced to give more to laborers to compete with others for their services. In the long term, it is argued, the increased wages and rights of Black Death survivors led to the breakdown of feudal societies, as workers found themselves less tied to the land and having more of a political voice.
By extension, the positive impact of the Black Death is a more egalitarian society that was much more conducive to the development of a more consumerist and majoritarian society. With more spending power, workers propelled the development of a capitalist system that developed mass production of goods catered to the needs of the average worker rather than the few aristocrats. And with a more political voice, workers came together to gradually take power away from feudal lords, giving way, over the next few centuries, through negotiations and upheavals, the development of democratic societies.
It would be interesting to speculate whether the COVID-19 would be just as revolutionary as the Black Death, should the death toll from the virus continue to grow unabated. In the short term, the similarities are just not there. As the coronavirus rage on, millions are thrown out of work as big firms fire employees and small firms collapse due to lack of business. With spiking unemployment, it is more likely that wages will collapse and firms that survive the pandemic will be able to hire qualified workers much cheaper than the pre-epidemic days, as workers desperate for money bid down their salaries and rights.
However, if COVID-19 indeed claims millions of lives as some experts claim, the situation will quickly change in favor of the remaining workers. As millions of employees succumb to the disease, those that are currently unemployed will quickly find themselves on the frontlines of some sectors, notably e-commerce and logistics, that is now buckling under growing demands of people too afraid to venture outside their homes. As some workers in those industries are already doing, new workers will demand more protection, both from the virus and other potential harms and violations in the long run, as they are hired by firms desperate to field more workers to replace those who died.
The tipping of the balance of power between capital and labor in favor of labor will only be more significant if the coronavirus disproportionately claims the rich and the powerful. Even though current statistics show higher mortality rates from the coronavirus in poorer communities, the virus has claimed several celebrities and has plenty of potentials to spread among the more mobile and intimately intertwined ranks of the global economic and political elite. The number of high ranking politicians testing positive for the virus certainly should not be considered an anomaly.
The question now is only one of magnitude. The conditions are certainly right for a Black Death-style redistribution of rights, wealth, and power from the elites to the surviving commoners. But for the COVID-19 to become a source of significant redistribution, it will have to continue ravaging mankind, affecting a similar proportion of people as Black Death did back in the day. For a pandemic to kill that many people today would certainly represent an irreversible loss of confidence in modern technology and governing institutions. But everything does have a silver lining. A more serious coronavirus death toll may inadvertently lead to outcomes that many socialists around the world have been seeking for decades.
That threat of significant labor loss reminds of historical studies on the Black Death. The potential parallels are certainly there. Tallies by some historians claim that as much as half of the European population perished due to the Black Death, as lack of necessary medical knowledge and understanding of containment measures caused the bubonic plague to sweep straight from China, where it first originated, via the Mongol armies bent on conquering the steppes of eastern Europe. Medieval Europe saw towns and villages thoroughly depopulated by the pandemic, depressing economic activities for decades, if not centuries.
However, theoreticians do not consider the enormous loss of life from the Black Death is completely negative for human progress. In various studies, historians have attributed the introduction of higher wages and more rights to workers who were fortunate enough to survive the Black Death, as landowners who found themselves without sufficient farmhands were forced to give more to laborers to compete with others for their services. In the long term, it is argued, the increased wages and rights of Black Death survivors led to the breakdown of feudal societies, as workers found themselves less tied to the land and having more of a political voice.
By extension, the positive impact of the Black Death is a more egalitarian society that was much more conducive to the development of a more consumerist and majoritarian society. With more spending power, workers propelled the development of a capitalist system that developed mass production of goods catered to the needs of the average worker rather than the few aristocrats. And with a more political voice, workers came together to gradually take power away from feudal lords, giving way, over the next few centuries, through negotiations and upheavals, the development of democratic societies.
It would be interesting to speculate whether the COVID-19 would be just as revolutionary as the Black Death, should the death toll from the virus continue to grow unabated. In the short term, the similarities are just not there. As the coronavirus rage on, millions are thrown out of work as big firms fire employees and small firms collapse due to lack of business. With spiking unemployment, it is more likely that wages will collapse and firms that survive the pandemic will be able to hire qualified workers much cheaper than the pre-epidemic days, as workers desperate for money bid down their salaries and rights.
However, if COVID-19 indeed claims millions of lives as some experts claim, the situation will quickly change in favor of the remaining workers. As millions of employees succumb to the disease, those that are currently unemployed will quickly find themselves on the frontlines of some sectors, notably e-commerce and logistics, that is now buckling under growing demands of people too afraid to venture outside their homes. As some workers in those industries are already doing, new workers will demand more protection, both from the virus and other potential harms and violations in the long run, as they are hired by firms desperate to field more workers to replace those who died.
The tipping of the balance of power between capital and labor in favor of labor will only be more significant if the coronavirus disproportionately claims the rich and the powerful. Even though current statistics show higher mortality rates from the coronavirus in poorer communities, the virus has claimed several celebrities and has plenty of potentials to spread among the more mobile and intimately intertwined ranks of the global economic and political elite. The number of high ranking politicians testing positive for the virus certainly should not be considered an anomaly.
The question now is only one of magnitude. The conditions are certainly right for a Black Death-style redistribution of rights, wealth, and power from the elites to the surviving commoners. But for the COVID-19 to become a source of significant redistribution, it will have to continue ravaging mankind, affecting a similar proportion of people as Black Death did back in the day. For a pandemic to kill that many people today would certainly represent an irreversible loss of confidence in modern technology and governing institutions. But everything does have a silver lining. A more serious coronavirus death toll may inadvertently lead to outcomes that many socialists around the world have been seeking for decades.
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