Reviewed by Sinéad Petrasek
In The Asset Economy, Lisa Adkins, Melinda Cooper and Martijn Konings evaluate the entrenchment of inequality in Anglo-capitalist societies through the mechanism of asset acquisition. Building on their various studies of political economy, neoliberalism and the family unit, the authors collaborate here to provide a fresh perspective on contemporary class stratification. They do so by examining the asset, the cornerstone from which their appraisal of the social totality is modelled, similar to Marx’s treatment of the commodity as the building block of capitalist society.
An asset, however, is not the same as a commodity. Adkins, Cooper and Konings describe the asset as ‘a property title that must be constantly valued as a balance sheet item but often precisely cannot be readily traded’ (16-17). A significant characteristic of the asset is its temporality: ‘it requires an upfront investment of (often borrowed) funds and it is meant to generate returns over a particular future timeframe’ (17). Herein lies the particular ideological valence of an asset-based economy – investment in assets (such as a house) expresses optimism for the future.
What could be more optimistic than buying a house? Home ownership signifies stability, financial security and individual maturity. For Adkins, Cooper and Konings, it is paramount: ‘Although housing is by no means the only asset that plays an important role in the contemporary political economy, it plays a central role in the story that we tell in the following pages. Property inflation in large urban centres is the linchpin of a new logic of inequality’ (3).
The central argument presented here is that the employment relationship is no longer the core element shaping inequality. Instead, it is the acquisition of assets that will determine class position, as assets appreciate at rates much faster than wages.
Readers will find this book highly accessible and duly attentive to the current conjuncture; the reverberations of the 2007-8 financial crisis may have provided the initial catalyst for increased asset inflation, but the preface acknowledges that the effects of the Covid-19 pandemic may even further exacerbate such asset-based socioeconomic inequality. Indeed, anyone who has read recent news headlines announcing record-high home prices and pondered how to reconcile this with the reality of a global pandemic will appreciate the authors’ efforts to explain the trajectory of this phenomenon.
The first chapter provides a framework for interpreting our contemporary economic system as one that is dominated by the logic of assets. In order for an individual to participate in such a system, they must often take on considerable debt and pay it down over a period of time, during which income from employment typically diminishes and the speculative value of the asset increases. It is in this first chapter that the authors place their work in conversation with Thomas Piketty’s Capital in the Twenty-first Century (2014), a reference that reappears throughout the book. While the overview of Piketty’s approach and arguments is sufficient, those who have not read Piketty’s monumental work in full may find themselves lacking context. The second chapter provides historical background for the contemporary asset economy, examining shifting monetary policy in the 1970s and the availability of cheap credit in the 1980s as two key drivers. The third and final chapter examines the ‘new class realities’ engendered by the logic of asset appreciation, focusing on intergenerational wealth transfers and their cultural and affective impacts. According to the authors, paid work and higher education, dual guarantors of class position in the twentieth century, have since faded in importance compared to the relationship to assets. While compelling and intuitive, this comparison is rather rudimentary; The Asset Economy is convincing in advancing its main proposition, but specific case studies and a lengthier, robustly historicized evaluation would have made it stronger.
One might find themself asking whether this intergenerational wealth transfer is truly new, or merely replicates previous historical modes of class reproduction? Piketty, for example, understands the rentier fortunes of the twenty-first century as a kind of return to the rentierism of previous centuries, whereas the authors of The Asset Economy argue that the present-day trends are qualitatively different. As they explain, the new logic of inequality can be understood as a combination of hypercapitalist financialization and feudal inheritance (6). They draw a comparison between the so-called Keynesian household, which assumed a stable wage and a male breadwinner, and the Minskyan household, after economist Hyman Minsky, where the wage is viewed as unstable relative to the expectation that the home as asset will increase in value, such that the purchase of a home is made with an explicit understanding of future capital gain (21).
Thus, the book locates the origins of the contemporary asset economy in the post-war expansion of home ownership and concomitant creation of a broad middle class, a legacy that propped up successive neoliberal policies. Whereas Piketty’s focus is on the wealth of the 1%, Adkins, Cooper and Konings promote a more heterodox approach that acknowledges the relatively widespread accumulation of housing-as-asset. They present their approach as a challenge to Marxist and neo-Marxist analyses of class as understood primarily in terms of work and employment (55). The authors review some recent heterodox economist approaches before proposing their own schema, analogous to Marxist and Weberian schemes, positioning asset ownership as the distributive class mechanism in capitalist society. With it, they seek to demonstrate that regardless of where one falls within the classification, the population as a whole may be categorized in relation to asset ownership.
Politically, this poses a seemingly intractable issue: ‘Key here is an appreciation of the role that housing has played in the creation of a middle class that is often seen as the backbone of social stability and that politicians and policymakers are reluctant to alienate’ (31). This observation rings true in Canada, especially in the largest city, Toronto, where I live. Municipal property taxes are set to increase by a mere $22.00, regardless of the fact that the average home price in the city has now reportedly reached $1 million. What this demonstrates, in line with the proposition of The Asset Economy, is that despite extreme asset inflation (prices that are attributed to homes), the beneficiaries of this asset logic can still expect that they will be sheltered from more aggressive redistributive measures such as augmented taxation.
Of course, certain individuals/groups are more systematically exposed to the devaluation and appreciation of assets like housing. The lack of adequate attention to race, gender, sexual politics or immigration is conspicuous. This is not a complaint made to inspire mere recognition, but rather to point out that historical accounts of asset acquisition and generational wealth in North America, the UK and Australia that do not acknowledge systemic oppression are incomplete. Melinda Cooper’s 2017 book, Family Values: Between Neoliberalism and the New Social Conservatism, ‘proceeds from the assumption that the history of economic formations cannot be prized apart from the operations of gender, race and sexuality without obscuring the politics of wealth and income distribution itself’ (24). Yet, when discussing the expansion of home ownership in the post-war period in The Asset Economy (52-53), there is no mention of redlining or other methods of racial exclusion, though perhaps this is implicit.
Additionally, while the authors deliberately do not focus on jobs, it would be helpful to know which occupations are held by those presently able to purchase assets, such as homes, and contrast this with the wage-based middle class occupations of the previous century, in order to more fully illustrate the disconnection between wages, occupation and asset acquisition in the present.
In conclusion, it is social relations that take the foreground in The Asset Economy, and particularly intergenerational relations as a factor of class society. As the authors rightly point out, this has serious implications for politics. The book concludes with millennials, the generation wherein ‘the economic fault-lines produced by several decades of neoliberal policies are becoming visible, and where we find an increasingly intense dependence on family wealth as a determinant of whether one will flourish or languish in the asset economy’ (91). In order to avoid a repetition of the cycle whereby home ownership simply becomes democratized once again, the relationship to assets must change. The desire for a socialist alternative is growing. With millennials facing a ‘cancellation of the future’, what hopeful version of the future might the left provide? Perhaps, as Marx and Engels envisioned with their call for the ‘abolition of all rights of inheritance’ in The Communist Manifesto, it must begin with decentering the family as the primary economic unit.
1 March 2021
- 2017 Family Values: Between Neoliberalism and the New Social Conservatism Brooklyn, NY: Zone Books.
- 2014 Capital in the Twenty-first Century trans. Arthur Goldhammer, Cambridge, MA: Belknap Press.