Tag Archives: capitalist realism

Covid field tales – Part Two: Unmasking State Capitalism or Capitalist Realism?

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A pharmacy in Omsk with the sign ‘We have no masks or antiseptic gel in stock’.

This is the second of a series of Covid tales, made possible by collaboration with Galina Orlova of HSE Moscow. There will be 3-4 texts  on different aspects of lockdown and postlockdown Moscow. These will be based on one long text that will appear shortly in the journal City and Society. That journal, thanks to my colleague Derek Pardue, who is editor, has published some amazing Covid despatches – they are open access –  so please check it out. Space in those dispatches is very limited, so here on the blog I will take a little bit more of a circuitous route.

The last post chronicled the rise of Moscow as the focal point of the disease and its spread in Russia, not we move on to how City Hall has dealt with lock down and in particular what this reveals about ‘State Capitalism’.

To avoid an official ‘state of emergency’ which would have meant taking on a massive financial burden, City Hall adopted various heuristics to manage quarantine. From March 5, the Moscow had a high-alert mode, from the 26th – self-isolation for those 65+, from the 30thself-isolation for all. The delegation of responsibility for their own health and well-being to citizens, after recent restrictions on freedoms, looked neoliberal. At the same time, the scope of quarantine education addressed to ignorant citizens and belief in its effectiveness, suggested the return of Soviet sanitary propaganda (Shok, Beliakova, 2020). In conditions of lockdown uncertainty, the boundaries of self-isolation were delineated by rituals of taking out garbage, buying food and medicine, dog walking. From April 1, fines of 4,000-5,000 rubles were imposed for each violation. On April 15, quarantine met the control society with digital codes for trips around the city. Since May 12, wearing masks and gloves became mandatory in stores.

When the president empowered regions as responsible for fighting the disease, and the prime minister asked the Moscow mayor “organizationally and methodically” to help colleagues “on the ground”, Sobyanin became the face of the ”virus federalism” and the capital’s protocol “counteracting the spread of coronavirus infection” became a model to follow.

Unmasking state capitalism or capitalist realism?

While the self-isolation regime is gone, the ”glove-mask system” remains. Entering public transport or shops without PPE is prohibited – although it looks like the mask requirement will soon be dropped.  Disposable masks – medical blue, three-layered – are found far beyond pharmacies: at newspaper stands, at the ice cream kiosks, in cheap and expensive grocery chains. At the reopened farmfoods store, half-empty due to supply disruptions, masks are at a discount. In May, they cost from 29 to 70 rubles, in March-April – up to an exorbitant 150 and you could buy them only on the Internet from resellers, thirty-times more expensive than in 2019. Prices began to rise in February. At the peak, the government tried to mandate them, but immediately abandoned this measure. The rhythm of the pandemic in Moscow was not only the appearance or absence of masks, but their price in(de)flation.

In the Russia that imported the bulk of masks from China before Covid-19 there were three domestic manufacturers. City Hall not only took ownership of the largest factory but removed its facilities from the city of Vladimir to the capital, turning the pandemic into a “Moscow state business”. Two thirds of masks from the Moscow government (about 4 million items a week) were sold at cost to hospitals and communal services, 500,000 – for a “standardised price” of 30 rubles in the metro. The rest were put into a city administration reserve.

Compared to the free distribution of mask not only in the Paris metro, but on buses in Russia’s Far East, Moscow’s choices provoked discussion of the political economy of PPE. Vladimirites were disgusted by the capital’s betrayal leaving them not only without protection, but one profitable business less. Their objections to internal colonialism were tempered with racist suggestions that the masks from Moscow – now produced by “immigrants from disadvantaged countries of the near abroad” – were now “less hygienic”. Muscovites discussed the superprofit extracted by City Hall, and supposed that “since they bought the plant, the mask-regime will never end.” Stuck between epidemiological citizenship and city-state paternalism, they claimed that the government had no moral right to demand wearing masks without free distribution. Citizens made a hopeless diagnosis – “it’s all capitalism and they don’t give a shit” – and continued to buy masks.

The nature of state-capital conjunctions in the Russian capital has long been a bone of contention. The question of who can sell masks and gloves and who profits from their production is at the heart of thinking about the paradox of Russia’s political economy Ilya Matveev calls ‘dirigisme and neoliberalism at the same time’ to financially benefit insiders. Matveev has been criticised for this argument – with the riposte mainly about the piecemeal nature of actual liberalising reform since 2000. However in many ways that critique (from 2016) was misplaced, and I think the virus response illustrates Matveev’s view well – state capture by interests does not exclude the market ‘for thee, but not for me’. 

Appropriating profitable PPE businesses, strategically significant in an epidemic, City Hall enters the order of state capitalism. Obliging citizens to wear masks and offering them at commercial prices, they interpret civic responsibility in a neoliberal mode as a personal transaction according to the logic of capitalist realism that anathemizes any alternative to marketised relations (Fisher 2009).

Nonetheless the virus’ acceleration of neoliberalism does not completely destroy the legacy of the Soviet social state, instead weakening and transforming it beyond recognition. By sending masks to hospitals at cost price, Moscow combines the logic of minimal profitability and sluggish paternalism. Opting to create a reserve fund instead of free distribution of masks, it reproduces a pattern of deformed care without expenditure, developed by the federal government via the Russian Reserve Fund. State capital accumulation has a perverse obsession with curtailing the circulation – of money, of civic potential, – we call this the political economy of “the untouchable reserve”.

Emergency Reserve

‘Emergency reserve’. The untouchable reserve relates more to a strategic reserve of collected stock for emergency use.

In the next post we will discuss ‘disinfection’ and the ‘smart city’.