Mairo Cinquetti/Sipa via AP Images
The New York Stock Exchange is seen on Wall Street in New York City on November 19, 2023.
In the hyper-capitalism that characterizes today’s economy, more and more of human life is becoming commodified, used primarily as arenas for corporate profit. In the face of these deeper trends, government efforts to moderate the effects by using transfers to reduce income extremes, or increasing social investment, can be futile sandcastles. Sometimes government policy working through private players, such as Obamacare or Biden’s industrial subsidies to private industry, serves to reinforce this deeper trend.
My intellectual hero, Karl Polanyi, wrote about the relentless tendency of capitalism to turn everything into a commodity. Writing in 1930s and 1940s, almost a century after Karl Marx, Polanyi’s explanation of how this dynamic worked was informed by more history and was more persuasive than Marx’s cruder version.
But when I was young, we enjoyed something of a pause, which some optimists assumed was permanent. Mobilized citizens, democratic governments, and workers organized into trade unions insisted that the preconditions of a good life—health, decent employment, education, housing—must not be treated as mere commodities for maximum profit. The Danish social scientist, Gøsta Esping-Andersen, writing in the spirit of Polanyi, looked at Scandinavian social democracy as an ongoing process of “de-commodification.”
Unfortunately, that was then. In the past half-century, the tendency of capitalism to commodify everything has returned with a vengeance. And commodification, it turns out, goes hand in hand with concentration. As formerly social goods get turned back into commodities, corporations use hyper-concentration to further increase profits.
HERE IS A HANDY LIST OF SECTORS of the economy and society that are more commodified, or more concentrated, or both, than they were fifty years ago.
More Commodified:
Health
The Health System Generally. There are far more for-profit middlemen taking a cut, adding costs, degrading care, and reducing efficiency.
Medicare. Half of it is now privatized and for-profit via Medicare Advantage, and the Medicare drug program is 100 percent private and for-profit.
Nursing Homes. They are increasingly for-profit. More are owned by private equity companies. The for-profits have worse patient outcomes and worse labor conditions than nonprofits.
Hospitals. More are for-profits. More non-profits are behaving like for-profits. And hospitals are on merger and acquisition binges to increase their pricing power.
Insurance. Nonprofit group health plans have been largely crowded out by for-profit HMOs. Health plans have merged with drug plans known as pharmacy benefit managers, to limit choice and maximize profits.
Drugs. There are fewer generics, more price gouging and abuse of patents, even when research is funded publicly.
Public Health and Prevention. The one large oasis of efficient decommodification suffers from chronic under-funding.
Finance
Savings Banks. Nonprofit savings banks and savings-and-loan associations have been turned into for-profits. There are now a little more than 4,000 banks in the U.S., down from over 14,000 in the mid-1980s.
Insurance. Nonprofit mutual insurance companies have turned into for-profits.
The Post Office. The Postal Service is now a quasi-private entity that cannot take public funds, and Congress has legislated favorable terms for competitors like FedEx to make it harder for the Postal Service to compete.
Non-Profit Alternatives. Credit unions have been weakened, and postal savings accounts are virtually non-existent.
Hyper-Concentration. Intensified commodification has gone hand in hand with increased concentration. The Big Four banks (JPMorgan, Bank of America, Wells Fargo, and Citi) are as big as ever.
Hedge Funds and Private Equity. These players own an increasing share of the rest of the economy, treating other businesses like retail or newspapers as commodities to be milked for maximum short-term gain.
Education
Pre-K and Child Care. Early childhood education is moving further away from the de-commodified public kindergarten model—universal and free to all as a public good—and more in the direction of for-profit franchises.
Public Education. Vouchers have made serious inroads. Even “public” charter schools often contract their management to for-profit vendors.
Higher Education. Public higher ed, once free, is now another commodity, encumbering students with debt. Much of the student loan system is commodified. Nonprofit universities behave increasingly like for-profit institutions.
Housing
Social Housing. Public housing has been cut and capped by Congress. Other forms of social housing, such as land trusts and limited equity co-ops, are minimal.
Subsidized Housing as a Profit Center. Virtually all forms of affordable housing, such as vouchers for Section 8 and the Low-Income Housing Tax Credit, use for-profit landlords or investors.
Home Ownership. The tax subsidy system is tilted toward affluent home buyers, and financialized toxic mortgages wiped out a generation of moderate-income home equity.
Transportation
Public Transit. Chronic underinvestment in the most egalitarian and non-commodified part of the transportation system.
Highways and Cars. Public subsidy of the private auto and oil industries.
Pseudo-Public Transit. Uber and Lyft displace public transit and have hyper-commodified conditions for drivers.
Labor and Trade Unions
Unions and Benign Employers. Labor is in part a market. But strong unions and employers committed to stakeholders made labor less of a pure commodity, with long-term safeguards and worker rights. Weaker unions and pressure for profit-maximization have destroyed that social compact.
Task Rabbit and Spot Labor Markets. Gig services put workers into competition with other workers to deliver a service for the lowest price, adding to the commodification of work. See Uber and Lyft above.
Pensions and Retirement. Traditional pensions, with a guaranteed payout, shielded workers from vagaries of market forces, and partly de-commodified retirement. The shift to 401 (k) plans makes retired workers far more vulnerable and prey to private investment companies.
Tech
Surveillance Capitalism. Tech has enabled a form of hyper-capitalism where the product is you and your buying history. This not only invades privacy but shifts the balance of knowledge and pricing power between buyer and seller. It also facilitates concentration.
Artificial Intelligence. AI will, among other things, increase the power of big platforms to know exactly what any buyer is willing to pay for a given product, and products will have an infinity of possible prices, to the advantage of platforms bent on hyper-profit maximization.
Criminal Justice and AI. Face-recognition software and other products make the public criminal justice system more reliant on private vendors and citizens more vulnerable.
Tech and Labor. Tech facilitates systems, such as continuous monitoring of workers and variants on the gig economy, that further commodify labor.
Areas Where Decommodification (Barely) Survives:
Public Libraries. They are oases against people trying to sell you stuff. But the far right has been willing to shut down libraries in order to censor content.
Social Security. Despite relentless pressure and propaganda, Social Security survives as the largest island of decommodification.
Research and Development. Thanks to the National Laboratories, DARPA, ARPA-E, NSF, and NIH, public investment in R&D survives, but a lot of the benefits are captured by private, for-profit companies.
Public Power. Socially owed power companies survive, and are far greener and most cost-effective than their private, “investor-owned” competitors. But they generate only 10 percent of America’s electricity; and efforts to turn private utilities into public ones, as in the recent referendum in Maine, run into a wall of industry spending and lobbying.
Public Radio. NPR and local stations demonstrate that an audience existed for high-quality, in-depth news and whimsy that commercial broadcasters, in their market myopia, simply missed. And public radio broadcasters are compensated as professionals, not as market super-stars. There is nothing like it in commercial broadcasting.
Nonprofit news. See The American Prospect.
PLEASE NOTE THAT WHILE COMMODIFICATION is a first-cousin to privatization, they are not the same thing. Many sectors that are already private are becoming more deeply and insidiously commercialized, as when a hedge fund buys out and pillages an ordinary retailer who had a reciprocal respect for employees, or when CVS crowds out your local pharmacy, or when your friendly local vet is suddenly looking for new and pricey procedures to inflict on your dog because the vet has been bought by a profit-obsessed private equity company.
Can these trends be resisted or reversed? Our colleague, Ganesh Sitaraman, has written a terrific book with Anne Alstott, titled The Public Option, identifying areas where public alternatives to hyper-commodification would be more convenient, efficient, equitable and transparent than the for-profit companies that now dominate. They address everything from banking to education to housing, and a great deal more, with ingenious proposals.
The hard part, as always, is the politics. But that begins with better understanding and in turn with empowerment. Here at the Prospect, our commitment is to enlighten readers on ideas, politics, and power. All three need to be brought to bear on the core problem of hyper-commodification.
