How class struggle shaped fossil fuel

Submitted by martin on 29 March, 2021 - 9:56 Author: Zack Muddle
Fossil Capital

The devastating and sometimes fatal Texas power outages of February 2021 show “how the Green New Deal would be a deadly deal for the United States of America,” so spewed Texan governor Greg Abbot: “It just shows that fossil fuel is necessary.”

As eye-popping as this shameless lying may be, Abbot only acts as the personified caricature of the irrationality we see systemically with international capitalism. The urgent necessity to halt climate change is universally accepted by scientists. It is the greatest danger facing humanity. Leading bourgeois economists, champions of capitalism, are urging a “green recovery”. Politicians the world over are singing from the same hymn sheet.

Yet prospects of a green recovery are nowhere to be seen. Such hopes are being eclipsed by a fossil-fuelled reboot — already making up in China for any pandemic reductions . The ever-accelerating understanding we have of the devastating impacts climate crises will bring is outpaced only by the continually accelerating rate at which greenhouse gasses are belched into the atmosphere.

How are we to understand or explain this? How are we to change this, and halt global warming?

Andreas Malm's Fossil Capital, 2016, offers a useful starting point for understanding how we got into this mess. In this review, I expound his core arguments, then touch on his shortcomings (another review here).

Fossil fuels for class power

Fossil fuel — mostly coal — was used for heating before capitalism. Coal is considerably more energy-dense than wood or other alternatives, which is important when transporting it into towns and cities. This heating was largely domestic, so fossil fuel use was tied to — and limited by — population size. Population increased only comparatively gradually. There could be no exponential explosion of fossil combustion in “proto-fossil economies” such as fourth century China or seventeenth century Britain.

With capitalism, factories developed and expanded as a way of disciplining workers and regularising production. Having a single external energy source driving its machines enforces a constant pace and even greater discipline, as workers must match that pace. Automation, and with it deskilling, helps capitalists to break workers’ industrial power even more. Before automation, mule-spinning was a skilled job, mule-spinners were not easily replaced, and if they — only 10% of the workforce — stopped work, the whole factory stopped. This allowed militant trade unionism, winning improved pay and conditions. To fight back, and in pursuit of increased profits, capitalists sought external energy sources to power factories, and thereby discipline workers.

Water power could provide this external energy source just as steam could. It was significantly cheaper — water is free, coal is not — and worked better, running more uniformly and so producing better quality cotton. Yet a transition happened from water-power to coal-power. Why? Where many other theories of this transition purportedly fail, Malm presents a compelling account.

At crucial points in the development of capitalism, coal-fired steam-power allowed capitalists greater freedom to move their factories where they wanted, and run them when they wanted. As Malm emotively demonstrates, reasserting their power against workers was worth the higher energy costs and lower quality production for many capitalists.

The freedom to locate factories within densely populated cities gave capitalists access to a greater “reserve army of labour” — potential employees — already used to factory discipline. One of the most powerful weapons of capitalists in the class war is the threat of unemployment, of sacking workers and replacing them with others. This is most effective where there is a significant reserve army of labour.

Building a factory also required a much lower investment of fixed capital than building a factory and a whole village for workers at a good location for a water wheel. Over its whole lifetime, water would nonetheless remain cheaper, due to vastly cheaper running costs. But steam's lower initial investment allowed capitalists to be quicker on their feet against both workers and their competitor capitalists. When a major economic crisis hit, the risk of a larger up-front investment became even more worrying.

The ability to reliably run factories all day, every day, helps capitalists extract the maximum labour from workers. Individual coal-powered factories are less susceptible to unpredictable weather — droughts or freezing — than individual water-powered factories. This allowed more predictable exploitation. This advantage was doubly potent after workers eventually won limits on the clock-time they could be compelled to work for, a battle that Malm sketches in moving detail.

The introduction and expansion of fossil fuels, as the energy basis of production, was thus — Malm convincingly argued — in considerable part a manoeuvre by capital in the offensive against labour. A manoeuvre and offensive that we are still suffering from.

Huge dams and complex systems involving aqueducts could have provided reliable power, located along a wide range of waterways, still significantly cheaper than steam-power. This involved much more technical planning and oversight, preventing managerial deskilling; it required a tricky interdependence of competing cut-throat capitalists using the same waterway; and required big investments of fixed capital. Economic crises and instability made these downsides even more fatal. From its birth, the fossil economy was already fuelled by the irrational peculiarities of capitalist relations of production.

In the last two centuries, global population has grown roughly 7.3-fold, while global emissions have grown over 100 times faster, roughly 730-fold. This uncoupling of carbon dioxide emissions from population is the precise problem. Malm gives us vital insight into how and why this uncoupling — facilitated by the welding of fossil fuels to economic growth — happened.

Today, one-sixth of the world population — all low-income people in the global south — make no net contribution to global greenhouse gasses.

Population, contrary to David Attenborough and the malthusians, is not a problem (see Solidarity 580 and 581). “Humanity” as a whole is not to blame for climate change, as in many narratives. Capital and the ruling-class, not “us all”, has driven it. The current geological epoch, Malm thus argues, is not the “anthropocene” but the “capitalocene”. (For more, see Solidarity 421, “The Anthropocene or Capitalocene?”)

Capitalist growth, GHG growth

Capitalists pursue ever-greater profit, capital seeks maximum expansion, translating on the scale of an economy to unlimited pursuit of growth. Through making profit and expanding capital, more capital is then available to be thrown into circulation again. This self-sustaining growth became dependent on, and welded to, the dominant energy source: fossil fuels.

Perpetual growth, predicated on ever-growing use of fossil fuels, releases carbon dioxide at greater and yet-greater rates. This process, dubbed “fossil capital” by Malm, is the main driver of climate change.

Beyond global warming, the accumulation of capital means an increasing rate of “social metabolism”, a speeding up and increase of material throughput in the withdrawal of resources from nature, their processing, and the discharge of materials back into nature. The more that has been withdrawn and discharged — as a whole — the more can be in the future, driven by accumulation of capital on the back of social metabolism to date.

Through this, capital recognises no environmental boundaries: subsuming, exploiting and degrading nature by subsuming, exploiting and oppressing workers. This is a central engine behind the other environmental threats, too.

That said, the burning of fossil fuels' contribution to global warming is the central ecological focus of this book; it does not aim to theorise or give a good foundation in a Marxist approach to other ecological crises. Malm recognises that “the fossil economy… cannot account for all human influence on the climate. Fossil fuel combustion is only one cause of global warming. … But it is safe to say the burning of fossil fuels is the hard core of the problem [of global warming], quantitively dominant and qualitatively determinant. It deserves special focus.”

International fossil capital

The international scale of modern capitalism brings further dynamics which accelerate climate change.

“Eco-modernism” sees affluence, brought about by capitalism, as the solution to climate change. While greater economic development leads to higher per capita emissions up to a certain point, beyond that point — so the theory goes — the development and deployment of better, more efficient technology, reduces emissions per head of population.

This ignores, Malm demonstrates, the international nature of capitalism, the globally mobile nature of capital.

In pursuit of the most profitable conditions to perform production in, capital relocates around the world. To produce commodities it needs minimum levels of infrastructure, and often education. On the other hand, class struggle by workers can push up wages, pushing down the rate of profit. These features are variable around the world, making some places more or less attractive hosts for different kinds of capitalist production.

This creates a tendency to move production to countries which combine lower labour costs for exportable commodities with adequate infrastructure. Countries — such as China — set up adequate energy and transportation infrastructure to tempt international capital to set up camp there. These infrastructures rely on fossil fuel, exuding carbon dioxide. Only significantly developed fossil economies attract such globally mobile capital. This process drives the development and expansion of fossil economies.

Furthermore, lower-wage economies have lower quality, less efficient, and more polluting technology and infrastructure. Production and capital accumulation thus become more carbon intensive by relocating to them in pursuit of lower costs and higher profit.

Worse still, this relocation is premised on export of the goods, increasing the transport infrastructure and usage as they are shipped around the world from the low-wage exporting economy to the higher-wage consumer markets.

While coal is being phased out in Europe, the world’s expansion of coal-burning capacity is accelerating, particularly in China and India. China is an export-dominated economy, and has 48% of the world’s coal-burning capacity in its power stations, importing coal from around the world. Its power stations are more polluting than the equivalent in Europe or the USA, where most of the goods are exported to.

Some people point to China's pollution as an excuse for inaction in the west, sometimes tied up with xenophobia or anti-Chinese racism. Malm's analysis makes clear why we must point the finger at capitalism internationally, underscoring why our environmentalism, like our socialism, must be internationalist.

There was a strike wave in China in 2010, which pushed up wages in many places. The overall trend for much of the decade since 2011 has been of increasing strikes. We must continue to show solidarity with these.

The rapid process of land displacement, pumping high numbers of individuals into cities as a reserve-army of labour, has begun to slow in China. This is, Malm claims, a contributing factor to the strikes, and so we can expect more. This will allow wages to be pushed up, and potentially in the future for profits to be squeezed. If capitalism continues as now we may expect further processes of relocation of capital and production from China to places with lower wages and more polluting energy sources.

Increasing fossil composition of capital

As well as relocation, another weapon in the arsenal of the ruling class in the class war is automation. That is, reduction of the quantity of human labour – and so the number of workers – involved in a given production process. (There are other factors which sometimes cut in the opposite direction, which Malm doesn't adequately acknowledge.)

Capital also – and more fundamentally – drives towards lower cost of production of commodities. This allows it to increase the relative surplus value extracted, and additionally allows individual companies to temporarily make “superprofits”, while they are operating at above average productivity in a competitive market.

Both these tendencies, as a general rule, Malm argues, introduce to the production process more machinery and energy, heftier means of production, more produced, and greater material throughput per unit living human labour, per hour of work performed.

The labour embodied in the commodity determines its value, and so there is a general tendency for the material throughput, the mass of the means of production, to increase per unit value. In other words, the net material “technical composition of capital” increases. Malm calls this an “iron law”, while it seems to me to be instead a tendency. If the costs of machinery, raw materials, and energy — and the labour in making them — increase significantly, while the cost of direct labour power in production doesn't, we may see occasional moves in the opposite direction.

Being based on fossil power, this gives rise to a for the fossil composition of capital to increase, and with it an increased rate of greenhouse gas emissions.

This latter tendency hasn’t, to date, been effectively counteracted by the drive towards more efficient technology, by supplementation of renewable energy, or by other factors.

Problems for greener energy under capitalism

With current technology it is technically possible to more than meet our energy needs with renewable or low-emissions energy sources. It could be done, in principle, by wind or solar alone: in practice by a mix of renewables. However, these sources, Malm argues, face particular economic obstacles within capitalism.

Fossil fuels have a relatively stable and high price, and this price is paid per unit of energy consumed. This is good for making profit: so long as there is a demand in energy, profit can be made in a comparatively predictable and reliable way for many decades, from given infrastructure.

Contrary to dismissals as expensive, the price of solar and wind per unit electricity has dropped to the level of fossil fuels in recent decades, perhaps less. The continually dropping price of solar panels and wind turbines presents an obstacle to profit-maximisation. The sun and wind — the “fuel” for this technology — are in themselves freely available. The central commodity in the industry is not in the fuel itself, but the panels and turbines, the components of the power plant.

Factories for producing panels and turbines are a significant investment in fixed capital. With the technology developing fast and the prices dropping, factories can become unprofitable in half a decade. The cost of production remains roughly the same as when the factory was built, but the market price has dropped since newer and better factories have superseded it. These markets are more susceptible to crises of overproduction, and investment in them has fallen markedly.

Malm dodges questions about nuclear power, which are controversial on the left, by not mentioning it once. He gives insufficient treatment to geothermal. But his arguments are easily extended.

Over their lifetime, geothermal, hydroelectric and nuclear power plants all have a cost per unit electricity comparable to fossil fuels. However, they are expensive to build. Nuclear is the only one of these for which the fuel is not effectively free — but it is still comparatively cheap. Even for nuclear, the initial fixed capital cost accounts for 60% of its “levelised cost of electricity”. In a market driven by short-term price signals these energy sources are not as attractive investments as fossil infrastructure.

Large wind farms, large solar arrays, and “concentrated solar power” could all generate high-voltage electricity which could travel, relatively efficiently, hundreds or thousands of kilometres. In a large-scale integrated electricity grid, this could mitigate for patchiness in the sun, wind and rain. Electricity storage, for example through hydroelectric dams, could also help provide electricity reliably.

This all requires large scale co-operation and integration, plus significant fixed capital investment.

Government subsidies remain much higher for fossil fuels than renewables.

Infrastructure for fossil extraction is expensive and durable. It is a huge and expanding industry, building further inertia to transition. In this situation, construction of additional renewable energy sources will not automatically displace fossil energy. For the most part, total energy use increases, with renewables supplementing not substituting. Much cheaper energy from renewable sources merely undercuts and thereby drives down the price of fossil energy. (A similar “rebound effect” can also be found with improved energy efficiency.)

To replace fossil energy with renewables – and quickly – will require active suppression of the fossil industry, with huge “losses” on infrastructure which has much more potential life. This runs counter to neoliberalism and will be resisted tooth and nail by a powerful section of the capitalist class.

Where now?

“In the 1990s, the annual increase in global CO2 emissions stood at an average 1 percent; since 2000, the figure has been 3.1 percent — a tripled growth rate, exceeding the worst-case scenarios developed by the IPCC and expressing a trend that still does not show any sign of reversal: the more knowledge there is of the consequences, the more fossil fuels are burnt.”

Fossil Capital is a stimulating and gripping read. It valuably reveals how the burning of fossil fuels has been deeply entwined with capital since capitalism's birth, remaining central to it. This helps explain the mindbogglingly irrational and stomach-churningly terrifying trend expressed in the quotation above (from the book itself).

He has much less to offer on the way forward, on how we should fight for the necessary transition. Malm was or is a member of a would-be Trotskyist group linked to the NPA in France and SR/ACR in Britain. But that group seems not to have offered him a strategy sufficient to avoid a tone of despair infecting Malm's sections on the way forward, and a lack of focus (I think) on the working-class as the central agent for transformation.

His historical analysis clearly elucidates the centrality of class struggle and capitalism in shaping each other, and in driving the adoption of fossil power which then became welded to self-perpetuating capital accumulation. It would be worth reading for the inspiring tales of past class struggle alone. We can take up where he falters, recognising class struggle as only viable way of overcoming capitalism, and so halting the environmental destruction it unavoidably brings.

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