Globalization has been associated to a new financial regime and great transformations in the pattern of economic growth. In the last decades, financial capital has exercised control over the structural forms necessary for the continuing cycles of valorisation of productive capital, thanks to the centralized money at disposal. Indeed, a trend of high expansion of financial assets, while economic growth remains limited and sporadic, has given way to widespread income and wealth inequality. The same policies that have obliterated social services and kept labour cheap have favoured global enterprises and financial deepening.
In his deep social and cultural analysis of globalization, the well-known sociologist Zygmunt Bauman (1925-2007) stated at the beginning in the early 2000s:
“The downsizing obsession is, as it happens, an undetachable complement of the merger mania…. Merger and downsizing are not at cross-purposes: on the contrary, they condition each other, support and reinforce. This only appears to be a paradox….. It is the blend of merger and downsizing strategies that offers capital and financial power the space to move and move quickly, making the scope of its travel even more global, while at the same time depriving labour of its own bargaining and nuisance-making power, immobilizing it and tying its hands even more firmly.” (Bauman 2000, p. 122)
Accordingly Bauman, financial power are business models are interrelated. Capital mobility, liquid strategies and behaviours, speculation, mergers and acquisitions have submitted livelihoods to huge losses in terms of unemployment, working conditions, workers´ rights and income distribution have been relevant. The outcomes were not socially acceptable since the restructuring programs have put pressure on social and economic protections for all workers. Therefore, the apprehension of the dynamics of high finance is decisive to improve the understanding of the social impacts of business strategies in contemporary capitalism. As corporations and investors privilege short-term results, decisions taken by investors to reorganize the business and markets have turned out to increase social vulnerability.
At the heart of Bauman`s argument is that the capital accumulation process and the merger mania involve social relations driven by profit and competition. Consequently, the clear cut between investors and managers favours the redefinition of the labour relations. At this respect, he addressed:
“Flexibility is the slogan of the day, and when applied to the labour market it augurs an end to the “ job as we know it”, announcing instead the advent of work on short-term contracts, rolling contracts or no contracts, positions with no in-built security but the “until further notice” clause. Working life is saturated with uncertainty” (Bauman 2000, p. 147)
What Bauman adds to our understanding about the real-world flexible working conditions is that business liquid strategies shape a social dynamics where the search for flexibility enhances a kind of rationality that is functional to reinforce short-termism. Indeed, in spite of the euphemisms rationalization and capital flexibility, capitalist finance regulates the pace of investment and the process of adjustment of the labour force. Workers are fired to improve short-term profits, and those who remained are responsible for carrying the burden by increasing productivity. In the context of labour flexibility, workers cannot deal with all deep changes occurring in their working environments. Therefore, rationalization and flexibility happen to increase uncertainty in working life.
Indeed, Zygmunt Bauman’s prominent contribution in social and cultural theory enhances our understading of the recent historical trends that have shaped uncertainties, inequalities and inhuman conditions.
Zygmunt Bauman (2000) Liquid Modernity. Blackwell Publishing Ltd.