Social reproduction,precarity,and the ‘new asset geographies’

Abstract

This commentary briefly develops Birch and Ward's argument that research on the ‘new asset geographies’ can make important contributions to understanding new and evolving geographies of social reproduction. I argue that processes and mechanisms of assetization connect not only to the making of markets but also of investor subjects, and are empirically and conceptually connected to multi-dimensional precarity in and beyond paid work. The latter signals the potential for more dialogue between researchers working to understand geographies of precarity and the new asset geographies.

The big economic story in Canada in 2022, like in many nations, was inflation: consumer price inflation rose at its fasted pace since the early 1980s, driven by food, shelter, and fuel costs, with prices increasing more than 11% in 2 years (Government of Canada, 2023). While lower in Canada than in other G7 countries like Italy, the United Kingdom, Germany and the United States of America, the Bank of Canada met rising inflation with a similar macroeconomic response – higher interest rates – that has had severe consequences for working people. Households in Canada have higher levels of household debt as a percentage of net disposable income than in other G7 nations (183.3% in 2022 (Government of Canada, 2022b), driven by mortgage and credit card borrowing (OECD, 2023)). As economic growth slowed in the final quarter of 2022, suggesting that a policy-induced recession might already be underway, households were facing an 18% increase in mortgage costs, rising utility costs, and declining purchasing power as wage inflation failed to keep pace.

This perfect storm of higher debt servicing costs, flattening or declining residential property values, insufficient wage gains, and spiraling prices for food and some other consumables (driven in part by COVID-19-related supply chain disruptions) shone a rare spotlight on the costs borne by middle- and lower-income households of the shift to an asset-based economy in general, and the ideology of asset-based welfare in particular. As Simone and Walks (2019: 289) note in relation to the body of literature on asset-based welfare in countries like Canada and the United Kingdom, it is associated with neoliberal approaches to welfare ‘reform’ and ‘requires households to become financially literate with sufficient ability to predict long-term trends of asset values, profitably manage risk and uncertainty in financial markets, and to develop keen understandings of housing markets’ (see also Strauss, 2008). The costs of these shifts have been highly uneven: in the same period (between 2020 and 2022), the least wealthy households (bottom 40%) recorded larger decreases in wealth than the most wealthy (top 20%) of households, despite declines in financial asset and real estate values: ‘Recent economic headwinds have been most acutely felt by more vulnerable households, such as the least wealthy, as their average net worth declined by 12.0% (-$8828), more than double the rate of decrease of 5.9% in average net worth of the wealthiest (-$199,118)’ (Government of Canada, 2022a). Even these data hide significant variations in impacts among and between income groups, however. For those excluded from homeownership in Canada's extremely expensive housing market, rental costs have also spiraled (with annual rates of rent inflation of 24% for Vancouver and 21% for Toronto) (Rentals.ca February 2023 Rent Report, n.d.), without real increases homeownership affordability.

Understanding these distributional inequities and their social, political, and economic consequences in Canada and elsewhere requires not only a focus on financialization and the role that assets play, but also on how assets come into being, circulate in the realm of exchange, and generate both rents and social relations of rent in capitalist social formations already shaped by racialized, classed, and gendered relations of dominance (Hall, 2018). In ‘Assetization and the new asset geographies’, Birch and Ward (2024) synthesize and build on the growing body of work in geography and beyond that seeks to advance conceptual/theoretical and empirical understandings of assetization, its relationship to financialization and the production of value, and the economic, political, and social ‘lives’ of assets. In their account, assetization is both a process – ‘the creation of property that will afford a revenue stream’ – that requires ‘ongoing enclosure based on economic rents which are dependent for valuation on future revenues’, and a mechanism through which ‘sociopolitical relations … are reified in the asset form (Langley, 2021)’.

What crucially differentiates the asset form from the commodity form is that it generates income without a sale (Birch, 2015). In that sense, assets have particular distributional consequences because the revenues they generate are ongoing (albeit not always secure). To understand these stakes, Birch and Ward argue, ‘assets need to be empirically explored and theoretical distinctions clarified’, which in turn connects assetization as a meso-level process to three key ‘topic areas’ in human geography: ‘financialization and the creation of new asset classes, globalization and shifting modes of governance, and inequality and the reworking of social reproduction’. In this short response I address the final of these topic areas to argue that focusing on assetization and new asset geographies is not only of signal importance for understanding new and evolving configurations of class (Adkins et al., 2021) in relation to crises of social reproduction and care (Katz, 2008; Meehan and Strauss, 2015). It also spotlights how micro-geographies of everyday household financialization (Haiven, 2014; Karaagac, 2020) are related to enclosures and accumulation by dispossession, and how assetization links to forms of precarity in and beyond paid work (Feng, 2021; Yulee, 2022). In other words, the third topic area signaled by Birch and Ward but only briefly elaborated itself contains the elements of an important geographical research agenda with the potential to bring into empirical and conceptual contact areas of research that largely remain siloed.

Starting with the question of how assetization as a ‘processual concept … focuses our attention on the details of abstracting capitalized property on the basis of rents’ (and thus accumulation strategies oriented to rents rather than the production of commodities), as Birch and Ward argue, distinct traditions in social studies of finance and critical and political economy offer different approaches to those details. On one hand, the former explores how common belief systems and socio-political norms and practices concretely shape the production of assets and their values. On the other, the theorization of economic rent as fictitious capital (which circulates outside of production and thus does not directly generate value) has been challenged by political economists who call for revisiting the value-theoretical approach. It is worth noting that both traditions or fields (including in relation to value-theoretical approaches to real abstraction) centre or at least express socio-political dynamics of valuation and abstraction. Such a focus reveals material processes and mechanisms of enclosure and their institutionalization (in law, policy, the design or retrenchment of social programs, etc.) that are related in significant ways to social reproduction.

As I have argued elsewhere in the context of how accumulation by dispossession is foundational to both rentierization and assetization (Strauss, 2021), forms of enclosure have direct consequences for social reproduction and are often premised on the restructuring and devaluation of labour: these consequences are when and where macro- and meso-level processes that create new assets and produce new rent relations come to ground through the dispossession of workers and their communities. Birch and Ward point to what we gain from bringing social studies of finance and the insights generated into the social foundations and common belief systems that underpin practices of calculation, valuation, and the construction and mitigation of risk into dialogue with critical political economy approaches that emphasize the materiality of assets. They link these insights to the relationship between financialization, assetization, and the flows and wealth chains that characterize the globalized, financialized economy. But the social studies of finance tradition that focuses on the creation of racialized, gendered, and classed investor subjects; and on norms, practices and relations of financial literacy and responsibility; are equally relevant to understanding the violence of enclosure that underpins many processes of assetization under neoliberalism. For example, public buy-in to the interrelated processes of privatization (of previously public services and infrastructures), financialization (of business models), and assetization (of property) in domains like healthcare, social care, and childcare (August, 2022; Horton, 2019) that generate new forms of contract-based rents (Christophers, 2019) relates to processes of individualization and the cultivation of forms of financial responsibility and asset-based entrepreneurship that justify the enclosure or accumulation by dispossession of collective entitlements and public assets.

Social reproduction is more than the daily and intergenerational reproduction of workers, their families, and communities. It is also the reproduction of class relations, and in particular the reproduction of the working class and capital as a social relation that depends on the appropriation of surplus value (Bezanson and Luxton, 2006). Thus, arguments and empirical research that demonstrate changing dynamics of class in relation to financialization generally, and assetization in particular, are intrinsically also ‘about’ social reproduction. Given that processes and mechanisms of assetization are always-already racialized, gendered, and classed, the growing literature on racial capitalism and dimensions of financialization offers important starting points for tracing these connections (see, e.g. Bigger and Millington, 2020; Fields and Raymond, 2021; Mullings, 2022). And while distinct from production, financialization and assetization are implicated in the forms of restructuring of labour markets, employment relations, and the labour process across industries, sectors, and occupations – and the related restructuring of labour market institutions and systems of regulation – associated with increasing precarity in and beyond employment. Research on the ‘new asset geographies’ that explores, conceptually and empirically, how the uneven distribution of precarity across the domains of social reproduction and production is linked to processes and mechanisms of assetization at different scales thus has an important contribution to make. This contribution is not only vital to understanding evolving socio-spatial inequalities, but also to understanding the politics of assetization as they connect to wider struggles for justice and against the violence of enclosure and dispossession.