By Peter Fousek
It seems that nearly everyone, from major media outlets and economic analysts to folks hopping on Twitter while bored at home or work, has something to say about the recent market activity surrounding a surprising selection of stocks. The securities in question, namely GameStop ($GME), AMC Theatres ($AMC), and BlackBerry ($BB), are unlikely candidates for financial news headlines at a point in time where their respective products and markets have been all but outmoded. Nonetheless, and in fact on account of their perceived antiquation, these companies (and other similarly “obsolete” brands) have become the focus of widespread popular attention.
And yet, only a marginal few of the countless commentaries currently filling up our newsfeeds make note of the most remarkable conclusions to be drawn from these events. This is not to say that the present analyses and examinations are anything short of illuminating: he reaction of regulatory leaders and financial institutions, while largely predictable, are very important for the public to see and process. As in 1987, 2002, 2008, 2020, and any number of other instances of financial distress, we see the powers that be scrambling for means of self-protection while the system that they have constructed for their own benefit temporarily runs the risk of transforming them into its victims.
Of course, market volatility and the resultant risk of financial devastation is an inherent attribute of capitalist economics. But, when the fundamentalist free market works as it is designed, the brunt of that necessary burden is borne almost entirely by the working masses. Whether through exploitative, unjust labor practices during even the best of times, or through the funneling of massive federal funding in the form of bailouts and subsidies to the wealthy while the already minimal safety nets for the workers are further cut during periods of turmoil, we are not hard pressed to find examples of the inequity of capitalism. For proof of the intentional, systemic nature of this injustice, we need only to notice which class it is that takes the risks resulting in frequent crises: the beneficiaries of the system are simultaneously its guarantors, and from their position of power they are able to keep themselves all but invincible to their own carelessness and greed.
While that inherent impenetrability of the capitalist class has not come close to being displaced by the recent events in the market, it has certainly been shaken. Stock market speculators, betting on the failure of a business and doing everything in their power to see it to that end (without concern for the 50,000+ employees who would resultantly lose their jobs) were forced, if only for a moment, to face financial consequences for their profit-seeking irresponsibility. And they were forced to do so not by competitors, peers among the elite, but by members of the working class.
The sad but almost certain outcome of this moment of resistance to the norms of market trends will be the propping up of the hedge funds at risk, and perhaps increased regulation preventing such unprecedented collective action from readily occurring again. We’ve already seen the popular trading platform (ironically named Robinhood) prohibit its users from buying any more of the securities in question—an effort intended to pressure them into selling before the hedge funder’s short positions expire and the elite are forced to pay their dues. And while there is talk of a class action lawsuit against the platform, with reports that Citadel reloaded their short position before instructing Robinhood to block the relevant trades, we cannot expect real justice from a system designed to protect and perpetuate the existing order.
Despite these obstacles, despite these odds, and despite the unfortunate likelihood of an unsatisfactory short-term outcome, these events that we are currently witnessing should be a major cause for hope. One prevalent stance on social media right now is the position that the working-class day traders should sell. On one hand, doing so would benefit the hedge funds that shorted the stocks, as they would be given the chance to buy back at a lower price than when their contract fulfilment deadlines expire. On another, many of the people who have taken part in this mass movement run the risk of losing their money in a world that has refused them any safety net. The greatest cause for optimism comes from a common response to this stance, paraphrased here has it has been stated by many of the working-class day traders in question: we will not sell, because we have nothing to lose.
Many of us who have bought into this moment of collective action against the status quo have done so with the full knowledge that we might not win. Nonetheless, we have taken our position and chosen to hold it, to demonstrate our dissatisfaction with a system designed to subjugate us while empowering and enriching its elite. Because the system is designed as such, we are not afraid to make sacrifices to challenge the present order. The possibility of change is easily worth the risk of losing what we have, because what we have now is worth very little. But the power of our collective action is valuable beyond belief.
The calamity of the COVID crisis has made it blatantly clear that the capitalist class is more than happy to grow its wealth at the direct expense of our most basic rights and safety. The recognition of this flawed reality is reflected, in its early stages, in the collective action taken against those hedge funds who got too sloppy for their own good. This day trader rebellion is not some singular event, and it will certainly not break the current system. What makes it such an incredible historical moment is that it demonstrates the initial awakening of working-class consciousness. The willingness to sacrifice for the sake of a greater good requires us to recognize the injustice of the present order; the events of the past few days have demonstrated that we are beginning to adopt a mindset of that recognition.
To effectively challenge the status quo in a substantial way (such as that achieved by a general strike) the people cannot act out of short-term self-interest. Therefore, successful collective action and resultant progressive change is only possible once our reality under the status quo is so blatantly insufferable that we become willing to sacrifice it for the sake of disrupting the extant order. This is only possible once we realize that the existing system is exploiting us unequivocally, and therefore that we have essentially no chance of “making it” within said system. That realization then compels us to take the only other option: of trying to make it without. The popular resistance demonstrated by the GameStop situation should inspire us to action because in it, we’re witnessing the working-class organically arrive at a trade-unionist consciousness. This indicates that the historical conditions of the present moment are becoming ripe for the working class to achieve class consciousness, from which systemic change can come.
