Decadence and “late rentier capitalism”

Several commenters have flagged an interesting essay by a British (?) writer, Henry Fudge, entitled “Degeneracy is a Symptom.”

I know nothing of the author’s politics, but his account of what The Problem now is across the developed world has a sort of marxisant flavor, in that it insists — no doubt correctly — that diagnoses that focus on what the non-fraudulent Goffman called “blemishes of individual character,” at the expense of structural socio-cultural-economic explanations, are going to be extremely inadequate. A few quotes:

A young woman in Manchester pays her rent through OnlyFans. She is twenty-four, has a 2:1 in English from a respectable university, and earns more in a quiet month than her father did as a deputy headmaster. She finds the work tedious rather than traumatic, which is, in its own way, the worst part.

A young man in Bolton has not left his bedroom, except for cigarettes and the occasional GP appointment, in fourteen months. He plays a game on his phone in which he opens digital boxes that may or may not contain rare digital cards. He spent £340 on this game last month. He does not consider himself a gambler.

A thirty-one-year-old software engineer in Zürich, on a salary that would have bought his parents a four-bedroom house, lives in a shared flat with two strangers and takes a small amount of cocaine on Friday evenings. He is saving, in theory, for a deposit. He has been saving, in theory, for a deposit for eight years. The deposit required has, over the same period, risen faster than his savings.

A woman in Tokyo, thirty-seven, single, working as a department-store cosmetics consultant, has chosen (the word is doing some work here) not to marry and not to have children. She lives with her mother. Her mother lives with her mother. None of the three women own the flat they share.

A man in Shenzhen has decided to lie down. Tang ping, they call it. He works the minimum hours required to feed himself, refuses promotions, refuses to date, refuses to acquire anything. The state has identified him, and the several million who think as he does, as a threat to social harmony. He has identified the state as a threat to his time.

A teenager in Ohio has lost $11,000 on sports betting in eight months. He is nineteen. He has not yet lost more than this because he has not yet had more than this. He will, soon enough, have more, and then he will lose more. He believes, with the unfalsifiable conviction of the truly devout, that his system is almost working.

You have noticed these people. Everyone has noticed these people. They are the texture of contemporary life. They have, collectively, become the favourite subject of a particular kind of newspaper column, the kind that asks, in a tone of bewildered sorrow, or studied outrage, or sometimes both at once: what has happened to us?

The author’s argument is that all these social pathologies are products of individually rational responses to a rigged social and economic game:

In the Ponzi stage (call it now), wages do not cover even the running costs of the life that previous generations defined as normal. The deposit is unreachable; the family is unaffordable; the retirement is fictional; the career path that was supposed to deliver these things has been replaced by a sequence of contracts. The only way to access the reference standard of living is to acquire assets that rise faster than wages, which means either inheriting them, marrying them, or speculating into them. Productive labour, in the Ponzi stage, is a losing strategy by construction. You cannot save your way to the life your parents had, because the life your parents had is now priced in a currency (asset wealth) that wages do not convert into.

What does a rational agent do in the Ponzi stage?

She does not work harder at the losing strategy. That would be irrational. She pivots to strategies with the property that their upside actually reaches the reference threshold, even if their expected value is poor. She buys lottery tickets, metaphorical and literal. She speculates on crypto. She gambles on football. She starts an OnlyFans. She day-trades. She marries for money. She sells her eggs. She joins a multi-level marketing scheme. She bets her redundancy on a single hand at the roulette wheel of life because the steady strategy has a known terminal value below the threshold she needs to clear.

Or she does the opposite. She lies flat. She withdraws. She refuses to play a game she has correctly identified as unwinnable. She becomes a hikikomori in Tokyo, a tang ping refusenik in Shenzhen, a NEET in Manchester, a deaths-of-despair statistic in Ohio. Both responses, the manic and the depressive, the gambling and the giving up, are rational responses to the same underlying condition. They are the two ways a rational agent expresses the recognition that the productive game no longer pays.

This is the Ponzi stage of being alive. It is what your aunt calls degeneracy. It is what the framework calls mathematics.

The whole thing has a sort of Decline of the West Spenglerian flavor, again in the context of a familiar look at the economic base not the ideological superstructure argument.

We come now to the most important part of the argument, which is also the most uncomfortable, because it implicates the reader (implicates, perhaps, the writer) in a structure of complicity that is easier to ignore than to confront.

Every late rentier society in history has responded to the behaviours of Conspicuous Despair in the same way: by locating their cause in the character of the despairing, rather than the structure that despairs them. This is not a coincidence. It is, structurally, the only available move for the propertied class, because the alternative explanations implicate the propertied class itself.

Readers will notice parallels here with Piketty’s argument of how in the long run the growth of capital value outstrips that of wage labor, which, to put it mildly, is an enormous economic and social problem.

It’s an interesting argument, especially as the author buttresses it with many cross-cultural examples:

I want to end with the observation that the people doing the behaviours I have described are not stupid. They are not depraved. They are not lazy. They are not, in any meaningful sense, worse than their grandparents were.

They are reading the odds.

The OnlyFans worker in Manchester has correctly identified that her degree, in the labour market she actually faces, is worth less than her capacity to sell access to herself online. The teenage gambler in Ohio has correctly identified that the expected value of his wage labour, compounded across his working life, will not deliver the standard of living his parents had, and that only a sequence of high-variance bets has any chance, however slim, of closing the gap. The lying-flat refusenik in Shenzhen has correctly identified that the marginal hour of additional labour, given the rate at which Shenzhen property prices outpace Shenzhen wages, has a negative expected return on his happiness, his time, and his future. The hikikomori in Tokyo has correctly identified that the social roles available to him are not worth the price of admission.

These are not moral failures. These are not character defects. These are correct calculations, performed by ordinary people, about the structure of incentives they actually face. The fact that the calculations produce behaviours their grandparents find appalling is not evidence that the calculators are appalling. It is evidence that the structure has changed.

Your grandparents lived in a hedge-financed world. They could afford to be virtuous, in the conventional sense, because virtue paid. The young live in a Ponzi-financed world. They cannot afford to be virtuous in the conventional sense, because virtue does not pay, and the only strategies that have any chance of clearing the threshold their grandparents took for granted are strategies their grandparents would not recognise as strategies at all.

Ah Bartleby! Ah humanity!