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Is the race to the bottom over? Reflecting on ‘surplus’ populations in Cambodia

Everybody speaks about a ‘race to the bottom’ in the world of work. For brick workers enduring debt-bondage in Cambodia the race might already be over.

Inside the brick kiln. Thomas Cristofoletti, Ruom. ©2018 Royal Holloway, University of London. All rights reserved.

On 8 October 2018 we published the BTS Round Table on the Future of Work, in which 12 experts explain recent changes to the nature of work and offer new ideas in labour policy, organising, and activism. This piece has been written in response.

Tanya Murray Li, a professor of Anthropology at the University of Toronto, describes the millions of unemployed or under-employed people across Asia as “surplus populations”. She writes, “For the 700 million Asians who live on less than a dollar a day, tiny incomes are ample testament to the fact that no one has a market incentive to pay the costs of keeping them alive from day to day, or from one generation to the next.”

This idea of a surplus population puts a whole new spin on the notion of a ‘race to the bottom’ in terms of the trajectory of work. It forces us to rethink the very premise of the metaphor, and also to question how such populations can become lucrative for capital in other ways.

Standard Marxist political economy has long held that a key power differential between companies and their labourers is that there are far more workers than there are jobs. This creates a ‘reserve army of labour’ and thus downward pressure on labour prices – a phenomenon that capital is keen to perpetuate. Yet Li argues that the vast numbers of low-paid labourers are no longer required to further increase profits, even in reserve. Labour competition is already so high and prices are already so low that millions of lives have become simply surplus to the needs of industrial and services sector-led growth.

Profitable only through debt

Our recent research report ‘Blood Bricks’ offers a stark glimpse into one case of surplus lives in Cambodia. The research documents how bricks destined for ascending skyscrapers in Phnom Penh are moulded and fired by debt-bonded families. These families were once smallholder farmers in rural areas. The impacts of climate change and medical expenses pushed them into unsustainable debts, often with one of the many unregulated microfinance institutions in the country.

To deal with their rising indebtedness, they approached brick kiln owners located near Phnom Penh, who agreed to pay off the creditors if whole families moved onto the kilns and worked off the consolidated debt. Cambodian smallholder farmers-turned brick workers therefore entered the non-farm economy by being “adversely incorporated” into broader circuits of capital accumulation. They did this by borrowing from the high-interest microfinance sector that is increasingly characterised by foreign investment and financialisation.

As such, despite being surplus to the requirements of the economy as labourers, smallholder farmers became lucrative in another way; as bearers of debt. The value of their agricultural produce, or their contribution as labourers, is surpassed by their borrowing. This renders everything they own, and even their future wages, collateral to the finance market. This is what happens when the everyday costs of living are no longer provided by the state for pauperised farmers. Debt becomes the only recourse, and credit institutions gain a new – if highly risky – customer base. Ananya Roy, a professor of urban planning, social welfare and geography at UCLA Luskin, has termed this “poverty capitalism”.

When jobs are scant and low-paid, rural smallholders are in a particularly adverse position when it comes to the labour market. The risk of defaulting falls on individual farmers, who are therefore forced into extreme exploitation on brick kilns to stave off creditors. Wider research from Cambodia also documents the appropriation of land by creditors as a result of loan defaults.

The race has already been lost

The ‘race to the bottom’ metaphor in this context thus appears inadequate. Rather than representing an ongoing struggle, the ‘bottom’ is already here for millions across Asia, and in other parts of the world as well.

Advocating for strong labour rights alone won’t make a difference to these surplus populations. Rather, it is the very nature of the economy that needs reform. An economic model which renders their work surplus, and thus allows their adverse incorporation into the economy as bearers of debt and then as indebted labourers, is the issue. It is also the state’s lack of social provisioning. The absence of state welfare or support for the poorest in Cambodia forces them to rely on debt for their day-to-day expenditure.

Therefore in thinking through what “business, politics or organising” can do in response to declining labour standards, we need to step back and ask a more fundamental question. What happens when the lives of millions are surplus to the requirements of growth?

As well as struggling for “decent, stable, and well-paid work”, as Alf Gunvald Nilson argues in this series, we need to explore how economies and the state value people’s lives – particularly those that are surplus to the requirements of growth. This means focusing on social welfare and protection afforded to the poorest, and resisting new ways to adversely incorporate them into capitalism as an alternative to this, for example through financialisation and indebtedness.

The phenomenon of surplus populations is worsening as more and more people leave rural life and find poor prospects of work in the non-farm sector. We therefore need an agenda that addresses poverty outside of work as well as within it.

Round table on the future of work

About the authors

Nithya Natarajan is a Postdoctoral Research Associate on the ‘Blood Bricks’ research project, based at Royal Holloway, University of London. Follow her on twitter @nith1989, or @bloodbricks for the whole project team.

Katherine Brickell is Professor of Human Geography at Royal Holloway, University of London. She is a recipient of the 2014 RGS Gill Memorial Award, and 2016 Philip Leverhulme Prize, and journal editor of Gender, Place and Culture. Katherine is Principle Investigator of the ‘Blood Bricks’ project. Follow her on twitter @kbrickell.

Laurie Parsons is a British Academy Postdoctoral Research Fellow at Royal Holloway, University of London. Laurie is the Co-Investigator of the ‘Blood Bricks’ project. Follow him on twitter @lauriefdparsons.


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