Figure 4 Information as a Component of the Economy

As we can see, even in 1990, the proportion of the workforce made up of actual waiters, barbers, salesclerks, and the like was really quite small. It also remained remarkably steady over time, holding for more than a century at roughly 20 percent. The vast majority of those others included in the service sector were really administrators, consultants, clerical and accounting staff, IT professionals, and the like. This was also the part of the service sector that was actually increasing—and increasing quite dramatically from the 1950s onward. And while no one, to my knowledge, has pursued this particular breakdown through to the present, the percentage of information jobs was already rapidly on the increase even in the latter half of the twentieth century. It seems reasonable to conclude this trend continued, and that the bulk of the new service jobs added to the economy were really of this same sort.

This, of course, is precisely the zone where bullshit jobs proliferate. Obviously, not all information workers feel they are engaged in bullshit (Taylor’s category includes scientists, teachers, and librarians), and by no means all those who felt they are engaged in bullshit are information workers; but if our surveys are to be trusted, it seems evident that a majority of those classed as information workers do feel that if their jobs were to vanish, it would make very little difference to the world.

I think this is important to emphasize because despite the lack of statistics, there has been a great deal of discussion since the 1990s about the rise of information-oriented jobs and their larger effect on society. Some, like former US Labor Secretary Robert Reich, spoke of the rise of a new tech-savvy middle class of “symbolic analysts” who threatened to gain all the benefits of growth and leave the old-fashioned laboring classes languishing in poverty; others spoke of “knowledge workers” and “information society”; some Marxists even became convinced that new forms of what they called “immaterial labor”—founded in marketing, entertainment, and the digital economy but spilling outside as well into our increasingly brand-saturated, iPhone-happy daily lives—had become the new locus of value creation—leading to prophecies of the eventual rebellion of the digital proletariat.[116] Almost everyone assumed that the rise of such jobs had something to do with the rise of finance capital—even if there was no consensus as to how. It just seemed to make sense that, just as Wall Street profits were derived less and less from firms involved in commerce or manufacturing, and more and more from debt, speculation, and the creation of complex financial instruments, so did an ever-increasing proportion of workers come to make their living from manipulating similar abstractions.

These days, it’s hard to recall the almost mystical aura with which the financial sector had surrounded itself in the years leading up to 2008. Financiers had managed to convince the public—and not just the public, but social theorists, too (I well remember this)—that with instruments such as collateralized debt obligations and high-speed trading algorithms so complex they could be understood only by astrophysicists, they had, like modern alchemists, learned ways to whisk value out of nothing by means that others dared not even try to understand. Then, of course, came the crash, and it turned out that most of the instruments were scams. Many weren’t even particularly sophisticated scams.

In a way, one could argue that the whole financial sector is a scam of sorts, since it represents itself as largely about directing investments toward profitable opportunities in commerce and industry, when, in fact, it does very little of that. The overwhelming bulk of its profits comes from colluding with government to create, and then to trade and manipulate, various forms of debt. All I am really arguing in this book is that just as much of what the financial sector does is basically smoke and mirrors, so are most of the information-sector jobs that accompanied its rise as well.

But here we return to the question already raised in the last chapter: If these are scams, who, exactly, is scamming whom?

a brief excursus on causality and the nature of sociological explanation

In this chapter, then, I want to address the rise of bullshit jobs and to suggest some reasons this may be happening.

Of course, in earlier chapters, particularly chapter 2, we looked at some of the more immediate causes for the creation of useless employment: managers whose prestige is caught up in the total number of their administrative assistants or underlings; weird corporate bureaucratic dynamics; bad management; poor information flow. These are important in understanding the overall phenomenon, but they don’t really explain it. We still have to ask, Why were such bad organizational dynamics more likely to occur in 2015 than they were in, say, 1915, or 1955? Has there been a change in organization culture, or is it something deeper: a change, perhaps, in our very conceptions of work?

We are faced here with a classic problem in social theory: the problem of levels of causality. In the case of any given real-world event, there are any number of different reasons why one can say it happened. These, in turn, can be sorted into different kinds of reason. If I fall into an open manhole, one might attribute this to absentmindedness. But if we discover there has been a sudden statistical increase in the number of people falling into manholes in a given city, one must seek a different sort of explanation—either one must understand why overall rates of absentmindedness are going up there, or, more likely, why more manholes are being left open. This is an intentionally whimsical example. Let’s consider a more serious one.

At the end of the last chapter, Meena noted that while many people who end up homeless have a history of addiction to alcohol or other drugs, or other personal foibles, many others are teenagers abandoned by their parents, veterans with PTSD, and women fleeing domestic violence. No doubt if you were to pick a random person sleeping on the streets or in a shelter and examine his or her life history, you would find a confluence of several such factors, usually combined with a great deal of just plain bad luck.

No one individual, then, could be said to be sleeping on the streets simply because he or she was morally reprobate; but even if everyone sleeping on the streets really was morally reprobate in some way, it would be unlikely to do much to explain the rise and fall of levels of homelessness in different decades, or why rates of homelessness vary from country to country at any given time. This is a crucial point. After all, consider the matter in reverse. There have been moralists throughout the ages who have argued that the poor are poor because of their moral turpitude: after all, we are often reminded, it’s easy to find examples of people born poor who became wealthy owing to sheer grit, determination, and entrepreneurial spirit. Clearly, then, the poor remain poor because they didn’t make an effort they could have made. This sounds convincing if you look just at individuals; it becomes much less so when one examines comparative statistics and realizes that rates of upward class mobility fluctuate dramatically over time. Did poor Americans just have less get-up-and-go during the 1930s than during previous decades? Or might it have had something to do with the Great Depression? It becomes harder still to hold to a purely moral approach when one also considers the fact that rates of mobility also vary sharply from country to country. A child born to parents of modest means in Sweden is much more likely to become wealthy than a similar child is in the United States. Must one conclude that Swedes overall have more grit and entrepreneurial spirit than Americans?

I doubt most contemporary conservative moralists would wish to argue this.

One must, then, seek a different sort of explanation: access to education, for example, or the fact that the poorest Swedish children aren’t nearly as poor as the poorest American ones.[117] This doesn’t mean that personal qualities do not help explain why some poor Swedish children succeed and others do not. But these are different kinds of questions and different levels of analysis. The question of why one player won a game rather than another is different from the question of how hard the game is to play.

---

Or why people are playing the game to begin with. That’s a third question. Similarly, in cases like these, where one is looking at a broad pattern of social change, such as the rise of bullshit jobs, I would propose we really need to look not at two but at three different levels of explanation: (1) the particular reasons any given individual ends up homeless; (2) the larger social and economic forces that lead to increased levels of homelessness (say, a rise in rents, or changes in the family structure); and, finally (3), the reasons why no one intervened. We might refer to this last as the political and cultural level. It’s also the easiest to overlook, since it often deals specifically with things people are not doing. I well remember the first time I discussed the phenomenon of homelessness in America with friends in Madagascar. They were flabbergasted to discover that in the wealthiest and most powerful country in the world, there were people sleeping on the streets. “But aren’t Americans ashamed?” one friend asked me. “They’re so rich! Doesn’t it bother them to know everyone else in the world will see it as a national embarrassment?”

I had to concede it was a good question. Why didn’t Americans see people sleeping on the streets as a national embarrassment? In certain periods of US history, they certainly would have. If large numbers of people were living on the streets in major cities in the 1820s, or even the 1940s, there would have been an outcry and some kind of action would have been taken. It might not have been very nice action. At some points, it would probably have meant rounding up vagrants and placing them in workhouses; at other times, it might have involved building public housing; but whatever it might have been, they would not have been left to languish in cardboard boxes on public thoroughfares. Since the 1980s, the same American was more likely to react not with outrage at how social conditions could have come to this pass, but by appeal to explanations of the first level—and conclude that homelessness was nothing more than the inevitable result of human weakness. Humans are fickle beings. They always have been. There’s nothing anyone can do to change this fact.[118]

This is why I emphasize that the third level is simultaneously political and cultural—it bears on basic assumptions about what people are, what can be expected of them, and what they can justifiably demand of one another. Those assumptions, in turn, have an enormous influence in determining what is considered to be a political issue and what is not. I don’t want to suggest that popular attitudes are the only factor here. Political authorities often ignore the popular will. Polls regularly find roughly two-thirds of Americans favor a national health care system but no major political party there has ever supported this. Polls also show most Britons favor reinstating the death penalty, but no major political party has taken this up either.[119] Still, the larger cultural climate is clearly a factor.

---

In the case of bullshit jobs, this means we can ask three questions:

1. On the individual level, why do people agree to do and put up with their own bullshit jobs?

2. On social and economic levels, what are the larger forces that have led to the proliferation of bullshit jobs?

3. On the cultural and political levels, why is the bullshitization of the economy not seen as a social problem, and why has no one done anything about it?[120]

Much of the confusion that surrounds debate about social issues in general can be traced back to the fact that people will regularly take these different explanations as alternatives rather than seeing them as factors that all operate at the same time. For example, people sometimes tell me that any attempt to explain bullshit jobs in political terms is wrongheaded; such jobs, they insist, exist because people need the money—as if this consideration had somehow never occurred to me before. Looking at the subjective motives of those who take such jobs is then treated as an alternative to asking why so many people find themselves in a position where the only way they can get money is by taking such jobs to begin with.

It’s even worse on the cultural-political level. There has come to be a tacit understanding in polite circles that you can ascribe motives to people only when speaking about the individual level. Therefore, any suggestion that powerful people ever do anything they don’t say they’re doing, or even do what they can be publicly observed to be doing for reasons other than what they say, is immediately denounced as a “paranoid conspiracy theory” to be rejected instantly. Thus, to suggest that some “law and order” politicians or social service providers might not feel it’s in their best interest to do much about the underlying causes of homelessness, is treated as equivalent to saying homelessness itself exists only because of the machinations of a secret cabal. Or that the banking system is run by lizards.

sundry notes on the role of government in creating and maintaining bullshit jobs

This is relevant because when, in the original 2013 essay about bullshit jobs, I suggested that while our current work regime was never designed consciously, one reason it might have been allowed to remain in place was because the effects are actually quite convenient politically to those in power; this was widely denounced as crazy talk. So another thing this chapter can do is clarify a few things in that regard.

Social engineering does happen. The regime of make-work jobs that existed in the Soviet Union or Communist China, for example, was created from above by a self-conscious government policy of full employment. To say this is in no sense controversial. Pretty much everyone accepts that it is the case. Still, it’s hardly as if anyone sitting in the Kremlin or the Great Hall of the People actually sent out a directive saying “I hereby order all officials to invent unnecessary jobs until unemployment is eliminated.”

The reason no such orders were sent out was because they didn’t have to be. The policy spoke for itself. As long as you don’t say “Aim for full employment, but do not create jobs unless they conform to the following standards”—and make it clear you will be very punctilious about ensuring those standards are met—then one can be sure of the results. Local officials will do what they have to do.

While no central directives of this kind were ever sent out under capitalist regimes, at least to my knowledge, it is nonetheless true that at least since World War II, all economic policy has been premised on an ideal of full employment. Now, there is every reason to believe that most policy makers don’t actually want to fully achieve this ideal, as genuine full employment would put too much “upward pressure on wages.” Marx appears to have been right when he argued that a “reserve army of the unemployed” has to exist in order for capitalism to work the way it’s supposed to.[121] But it remains true that “More Jobs” is the one political slogan that both Left and Right can always agree on.[122] They differ only about the most expedient means to produce the jobs. Banners held aloft at a union march calling for jobs never also specify that those jobs should serve some useful purpose. It’s just assumed that they will—which, of course, means that often they won’t. Similarly, when right-wing politicians call for tax cuts to put more money in the hands of “job creators,” they never specify whether those jobs will be good for anything; it’s simply assumed that if the market produced them, they will be. In this climate, one might say that political pressure is being placed on those managing the economy similar to the directives once coming out of the Kremlin; it’s just that the source is more diffuse, and much of it falls on the private sector.

Finally, as I’ve emphasized, there is the level of conscious public policy. A Soviet official issuing a planning document, or an American politician calling for job creation, might not be entirely aware of the likely effects of their action. Still, once a situation is created, even as an unintended side effect, politicians can be expected to size up the larger political implications of that situation when they make up their minds what—if anything—to do about it.

Does this mean that members of the political class might actually collude in the maintenance of useless employment? If that seems a daring claim, even conspiracy talk, consider the following quote, from an interview with then US president Barack Obama about some of the reasons why he bucked the preferences of the electorate and insisted on maintaining a private, for-profit health insurance system in America:

“I don’t think in ideological terms. I never have,” Obama said, continuing on the health care theme. “Everybody who supports single-payer health care says, ‘Look at all this money we would be saving from insurance and paperwork.’ That represents one million, two million, three million jobs [filled by] people who are working at Blue Cross Blue Shield or Kaiser or other places. What are we doing with them? Where are we employing them?”[123]

I would encourage the reader to reflect on this passage because it might be considered a smoking gun. What is the president saying here? He acknowledges that millions of jobs in medical insurance companies like Kaiser or Blue Cross are unnecessary. He even acknowledges that a socialized health system would be more efficient than the current market-based system, since it would reduce unnecessary paperwork and reduplication of effort by dozens of competing private firms. But he’s also saying it would be undesirable for that very reason. One motive, he insists, for maintaining the existing market-based system is precisely its inefficiency, since it is better to maintain those millions of basically useless office jobs than to cast about trying to find something else for the paper pushers to do.[124]

So here is the most powerful man in the world at the time publicly reflecting on his signature legislative achievement—and he is insisting that a major factor in the form that legislature took is the preservation of bullshit jobs.[125]

That a political culture where “job creation” is everything might produce such results should not be shocking (though for some reason, it is, in fact, treated as shocking); but it does not in itself explain the economic and social dynamics by which those jobs first come into being. In the remainder of this chapter, we will consider these dynamics and then return briefly to the role of government.

concerning some false explanations for the rise of bullshit jobs

Before mapping out what actually happened, it will first be necessary to dispose of certain very common, if ill-conceived, explanations for the rise of apparently pointless employment frequently proposed by market enthusiasts. Since libertarians, “anarcho-capitalists,” enthusiasts for Ayn Rand or Friedrich Hayek and the like are extremely common in pop economic forums, and since such market enthusiasts are committed to the assumption that a market economy could not, by definition, create jobs that serve no purpose,[126] one tends to hear these arguments quite a lot. So we might as well address them.[127]

Basically such arguments fall into two broad types. Proponents of each are happy to admit that at least some of those who believe they hold pointless jobs in the public sector are correct. However, the first group argues that those who harbor similar suspicions in the private sector are not correct. Since competing firms would never pay workers to do nothing, their jobs must be useful in some way that they simply do not understand.

The second group admits useless paper-pushing jobs do exist in the private sector, and even that they have proliferated. However, this group insists that private sector bullshit jobs must necessarily be a product of government interference.

A perfect example of the first kind of argument can be found in a piece in the Economist, published about a day and a half after the appearance of my original “bullshit jobs” essay in 2013.[128] It had all the trappings of a rush job,[129] but the very fact that this bastion of free market orthodoxy felt the need to respond almost instantly shows that the editors knew how to identify an ideological threat. They summed up their argument as follows:

Over the past century, the world economy has grown increasingly complex. The goods being provided are more complex; the supply chains used to build them are more complex; the systems to market, sell, and distribute them are more complex; the means to finance it all is more complex; and so on. This complexity is what makes us rich. But it is an enormous pain to manage. I’d say that one way to manage it all would be through teams of generalists—craftsman managers who mind the system from the design stage right through to the customer service calls—but there is no way such complexity would be economically workable in that world (just as cheap, ubiquitous automobiles would have been impossible in a world where teams of generalist mechanics produced cars one at a time).

No, the efficient way to do things is to break businesses up into many different kinds of tasks, allowing for a very high level of specialization. And so you end up with the clerical equivalent of repeatedly affixing Tab A to Frame B: shuffling papers, management of the minutiae of supply chains, and so on. Disaggregation may make it look meaningless, since many workers end up doing things incredibly far removed from the end points of the process; the days when the iron ore goes in one door and the car rolls out the other are over. But the idea is the same.

In other words, the author claims that when we speak of “bullshit jobs,”[130] we’re really just talking about the postindustrial equivalent of factory-line workers, those with the unenviable fate of having to carry out the repetitive, mind-numbingly boring but still very necessary tasks required to manage increasingly complicated processes of production. As robots replace the factory workers, these are increasingly the only jobs left. (This position is sometimes combined with a rather condescending argument about self-importance: if so many people feel their jobs are useless, it’s really because today’s educated workforce is full of philosophy or Renaissance literature majors who believe they are cut out for better things. They consider being a mere cog in administrative machinery beneath their dignity.)

I don’t think I really need to dwell too much on the second argument, since the reader is likely to have encountered variations of it a thousand times before. Anyone who truly believes in the magic of the marketplace will always insist that any problem, any injustice, any absurdity that might seem to be produced by the market is really caused by government interference with same. This must be true because the market is freedom, and freedom is always good. Putting it this way might sound like a caricature, but I have met libertarians willing to say exactly that, in almost exactly those words.[131] Of course, the problem with any such argument is that it’s circular; it can’t be disproved. Since all actually existing market systems are to some degree state regulated, it’s easy enough to insist that any results one likes (say, high levels of overall wealth) are the result of the workings of the market, and that any features one doesn’t like (say, high levels of overall poverty) are really due to government interference in the workings of the market—and then insist that the burden of proof is on anyone who would argue otherwise. No real evidence in favor of the position is required because it is basically a profession of faith.[132]

Now, this being said, I should hasten to point out I am not saying government regulation plays no role in the creation of bullshit jobs (particularly of the box-ticker variety). Clearly, it does. As we’ve already seen, whole industries, such as corporate compliance, would not exist at all were it not for government regulations. But the argument here is not that such regulations are one reason for the rise of bullshit jobs, it’s that they are the primary or, even, the only reason.

To sum up, then, we have two arguments: first, that globalization has rendered the process of production so complicated that we need ever more office workers to administer it, so these are not bullshit jobs; second, that while many of them are indeed bullshit jobs, they only exist because increases in government regulation have not only created an ever-burgeoning number of useless bureaucrats but also forced corporations to employ armies of box tickers to keep them at bay.

Both these arguments are wrong, and I think a single example can refute both of them. Let us consider the case of private universities in the United States. Here are two tables, both drawn from Benjamin Ginsberg’s book The Fall of the Faculty, about the administrative take-over of American universities, which give us pretty much all we need to know. The first shows the growth in the proportion of administrators and their staff in American universities overall. During the thirty years in question, a time during which tuition skyrocketed, the overall number of teachers per student remained largely constant (in fact, the period ended with slightly fewer teachers per student than before). At the same time, the number of administrators and, above all, administrative staff ballooned to an unprecedented degree (see figure 5).

Figure 5 Changes in the Supply of and Demand for Administrative Services, 1985–2005

Staff	+240%
Administrators	+85%
Student Enrollments	+56%
Faculty	+50%
No. of Degree-Granting Institutions	+50%
No. of BA Degrees Granted	+47%

Source: Calculated from NCES, “Digest,” 2006

Is this because the process of “production”—in this case, this would presumably mean teaching, reading, writing, and research—had become two or three times more complicated between 1985 and 2005, so that it now requires a small army of office staff to administer it?[133] Obviously not. Here I can speak from personal experience. Certainly, things have changed a bit since I was in college in the 1980s—lecturers are now expected to provide PowerPoint displays instead of writing on blackboards; there’s greater use of class blogs, Moodle pages, and the like. But all this is pretty minor stuff. It’s nothing even remotely comparable to, say, the containerization of shipping, Japanese-style “just in time” production regimes, or the globalization of supply chains. For the most part, teachers continue to do what they have always done: give lectures, lead seminars, meet students during office hours, and grade papers and exams.[134]

What about the heavy hand of government, then? Ginsberg provides us with a refutation to that claim, too, again in one easy table (see figure 6).

Figure 6 Administrative Growth at Public and Private Institutions, 1975–2005

	1975	1995	2005	change
Administrators and Managers at Public Colleges	60,733	82,396	101,011	+66%
Administrators and Managers at Private Colleges	40,530	65,049	65,049	+135%

Source: Calculated from NCES, “Digest,” 2006

In reality, the number of administrators and managers at private institutions increased at more than twice the rate as it did at public ones. It seems extremely unlikely that government regulation caused private sector administrative jobs to be created at twice the rate as it did within the government bureaucracy itself. In fact, the only reasonable interpretation of these numbers is precisely the opposite: public universities are ultimately answerable to the public, and hence, under constant political pressure to cut costs and not engage in wasteful expenditures. This may lead to some peculiar priorities (in most US states, the highest-paid public servant is a football or basketball coach at a state university), but it does tend to limit the degree to which a newly appointed dean can simply decide that, since he is obviously a very important person, it is only natural that he should have five or six additional administrative staff working under him—and only then begin trying to figure out what said staff are actually going to do. Administrators at private universities are answerable only to their board of trustees. Trustees are usually extremely rich. If they are not themselves creatures of the corporate world, they are at the very least used to moving in environments shaped by its mores and sensibilities—and as a result, they tend to view such a dean’s behavior as entirely normal and unobjectionable.

Ginsberg himself sees the increase in the numbers and power of university administrators as a simple power grab—one which, he says, has resulted in a profound shift in assumptions about the very nature of universities and the reasons for their existence. Back in the 1950s or 1960s, one could still say that universities were one of the few European institutions that had survived more or less intact from the Middle Ages. Crucially, they were still run on the old medieval principle that only those involved in a certain form of production—whether this be the production of stonework or leather gloves or mathematical equations—had the right to organize their own affairs; indeed that they were also the only people qualified to do so. Universities were basically craft guilds run for and by scholars, and their most important business was considered to be producing scholarship, their second-most, training new generations of scholars. True, since the nineteenth century, universities had maintained a kind of gentleman’s pact with government, that they would also train civil servants (and later, corporate bureaucrats) in exchange for otherwise being largely left alone. But since the eighties, Ginsberg argues, university administrators have effectively staged a coup. They wrested control of the university from the faculty and oriented the institution itself toward entirely different purposes. It is now commonplace for major universities to put out “strategic vision documents” that barely mention scholarship or teaching but go on at length about “the student experience,” “research excellence” (getting grants), collaboration with business or government, and so forth.

All this rings very true for anyone familiar with the university scene, but the question remains: If this was a coup, how did the administrators manage to get away with it? One has to assume that even in the 1880s, there were university administrators who would have been delighted to seize power in this way and each hire themselves a retinue of minions. What happened in the intervening century that put them in a position to actually do so? And whatever it was, how is it connected to the rise of the total proportion of managers, administrators, and meaningless paper pushers outside the academy that occurred during the same period of time?

Since this is the period that also saw the rise of finance capitalism, it might be best to return to the FIRE sector (finance, insurance, real estate) to seek insight into what overall dynamic in the economy sparked such changes. If those whom the Economist believes to be administering complex global supply chains are not, in fact, administering complex global supply chains, then what exactly are they doing? And does what is happening in those offices provide any sort of window on what is happening elsewhere?

why the financial industry might be considered a paradigm for bullshit job creation

• expedited frictionless convergences

• coordinated interactive market institutions

• contracted virtual clearinghouses

• directed margin adjustments [135]

On a superficial level, of course, the immediate mechanisms that create bullshit jobs in the FIRE sector are the same ones that produce them anywhere else. I listed some of these in chapter 2, when I described the five basic types of bullshit jobs and how they came about. Flunky positions are created because those in powerful positions in an organization see underlings as badges of prestige; goons are hired due to a dynamic of one-upmanship (if our rivals employ a top law firm, then so, too, must we); duct-taper positions are created because sometimes organizations find it more difficult to fix a problem than to deal with its consequences; box-ticker positions exist because, within large organizations, paperwork attesting to the fact that certain actions have been taken often comes to be seen as more important than the actions themselves; taskmasters exist largely as side effects of various forms of impersonal authority. If large organizations are conceived as a complex play of gravitational forces, pulling in many contradictory directions, one could say there will always be a certain pull in any of these five. Even so, one must ask: Why is there not a greater pressure pulling in the opposite direction? Why is this not seen as more of a problem? Firms like to represent themselves as lean and mean.

It seems to me that those creating, playing around with, and destroying large amounts of money in the FIRE sector provide the perfect place to begin to ask this question—in part because many who work in this sector are convinced that almost everything done in it is basically a scam.[136]

Elliot: So I did a job for a little while working for one of the “big four” accountancy firms. They had been contracted by a bank to provide compensation to customers that had been involved in the PPI scandal. The accountancy firm was paid by the case, and we were paid by the hour. As a result, they purposefully mis-trained and disorganized staff so that the jobs were repeatedly and consistently done wrong. The systems and practices were changed and modified all the time, to ensure no one could get used to the new practice and actually do the work correctly. This meant that cases had to be redone and contracts extended.

In case the reader is unaware, the PPI (payment protection insurance) scandal broke in the United Kingdom in 2006, when a large number of banks were found to have been unloading unwanted and often wildly disadvantageous account insurance policies on their clients. Courts ordered much of the money returned, and the result was an entire new industry organized around resolving PPI claims. As Elliot reported it, at least some of those hired to process these claims were intentionally dragging their feet to milk the contract for all they could.

Elliot: The senior management had to be aware of this, but it was never explicitly stated. In looser moments, some of the management said things like “We make money from dealing with a leaky pipe—do you fix the pipe, or do you let the pipe keep leaking?” (or words to that effect). There had been vast sums set aside by the bank to pay compensation for the PPI.

This is actually a fairly common story in the testimonies I received: I heard about similar things going on in law firms involved with asbestos compensation payments as well. Whenever a very large sum of money, in the hundreds of millions, is set aside to compensate an entire class of people, a bureaucracy must be set up to locate claimants, process claims, and portion out the money. This bureaucracy may often involve hundreds or even thousands of people. Since the money that pays their salaries is ultimately coming from the same pot, they have no particular incentive to distribute the spoils efficiently. That would be killing the goose that laid the golden egg! According to Elliot, this often led to “crazy, surreal stuff” like intentionally placing offices in different cities and forcing people to commute between them, or printing and destroying the same documents a half dozen times—all the while threatening legal action against anyone who revealed such practices to outsiders.[137] Clearly, the point was to siphon off as much of the money as possible before it got to the claimants; the longer the lower-level people took, the more the company would earn; but owing to the peculiar dynamic discussed in the last chapter, the very pointlessness of the exercise seemed to exacerbate levels of stress and abusive behavior.

Elliot: The cynicism involved was remarkable. I guess it works out to a form of parasitism. As it happens, the job was also extremely difficult and stressful: it appeared that part of their business model was placing impossible targets which would increase all the time so that turnover was high and more staff would regularly have to be brought in and mis-trained, so that, I imagine, the firm could plausibly ask their client that the contract be extended further.

This was demoralizing, of course. I’m now working as a cleaner, which is the least bullshit/alienated job I have ever had.

David: So this sounds like a whole new category: jobs intentionally done wrong! How common do you think that is?

Elliot: From what I’ve heard among other people in different companies, the PPI industry is basically built around this principle, on the basis that apparently it’s only large accountancy firms that really have the capacity to take on contracts like that.

David: Well, I see how one could make the argument that in any system where you are basically dealing with the distribution of spoils, it makes sense to create as many layers of parasites in between as possible. But who were they ultimately milking? Their clients? Or who?

Elliot: I’m not sure who was ultimately paying for this. The bank? An insurance company that insured the bank against losses on fraud activities in the first place? Of course, ultimately it would be the consumer and taxpayer who pay; all these companies need to know is how to milk it.

As long ago as 1852, Charles Dickens, in Bleak House, was already making fun of the legal profession with the case of Jarndyce and Jarndyce—in which two teams of barristers keep the battle over a huge estate alive for more than a lifetime, until they’ve devoured the whole thing, whereupon they simply declare the matter moot and move on. The moral of the story is that when a profit-seeking enterprise is in the business of distributing a very large sum of money, the most profitable thing for it to do is to be as inefficient as possible.

Of course, this is basically what the entire FIRE sector does: it creates money (by making loans) and then moves it around in often extremely complicated ways, extracting another small cut with every transaction. The results often leave bank employes feeling that the entire enterprise is just as pointless as the accountancy company’s intentionally mis-training employes to milk a cash cow. Surprising numbers of bank employes can’t even figure out what the real justification for their particular species of bank is supposed to be.

Bruce: I work as a fund accountant at a custodian bank. I’ve never really figured out what custodian banks do. I understand the concepts associated with custodian banks, but I always thought of them as just an unnecessary added layer of accounting. Custodian banks safeguard concepts such as stocks and bonds. How do they actually do that? Can Russian hackers steal these concepts? As far as I can see, the entire custodian bank industry is bullshit.

One reason for the confusion, perhaps, is that the level of general fear, stress, and paranoia appears to be much greater in banks than in most of the other enterprises we’ve been considering so far. Employes are under enormous pressure not to ask too many questions. One rebel banker, who described to me in detail the machinations by which the biggest banks would lobby the government to introduce regulations to their advantage and then expect everyone to play along with the pretense that the regulations had simply been imposed, told me he thought it’s almost as bad as coming out as gay would have been in the 1950s: “There are many people who have read ‘on the phenomenon of bullsh*t jobs’ and know of the reality of our industry, yet they (including myself) are consumed by fear of losing our jobs, so we don’t talk about or discuss these issues openly. We lie to ourselves, our colleagues, and our families.”

Such sentiments were commonplace. Almost all bank workers I corresponded with insisted on elaborate secrecy, effacing any detail that might possibly connect them to their employer. At the same time, many emphasized how cathartic it was to be able to finally express things that had been percolating through their minds for so many years. Here, for instance, is the testimony of Rupert, an economic refugee from Australia now working in the City of London, on bullshitization within the financial institution where he presently works:

Rupert: So in banking, obviously the entire sector adds no value and is therefore bullshit. But let’s leave that to the side for a minute and look at those within banking who literally do nothing. There actually are not all that many of these because banking is a weird mix. Overall we do nothing, yet within that nothing it’s efficient, meritocratic, and in general lean.

Still, the most obvious is the cheerleader Human Resources Department. At some point, banking realized that everyone hates them, and that their staff knows this, too, so they set about trying to make the staff feel better about it all. We have an intranet that HR was told to make into a kind of internal “community,” like Facebook. They set it up; nobody used it. So they then started to try and bully everyone into using it, which made us hate it even more. Then they tried to entice people in by having HR post a load of touchy-feely crap or people writing “internal blogs” that nobody cared about. Still nobody comes.

Three years they’ve been at this, the internal intranet Facebook page is just full of HR people saying something cheesy about the company and then other HR people saying “Great post! I really agree with this.” How they can stand this, I have no idea. It’s a monument to the total lack of cohesiveness in banking.

Another one is they have some big drive to do charity for a week. I refuse to participate as though I give to charity, I will not give through my bank, as for them it’s just a big advertising drive in an attempt to shore up morale internally and make it look like banking isn’t appropriating labor through usury. They put out a “target” of, say, ninety percent participation—all “voluntary”—and then for two months, they try to get people to sign up. If you don’t sign up, they note your name, and then people come and ask you why you haven’t signed up. In the last two weeks before the end of it, we get automated mails that look like they come from the CEO “encouraging” you to sign up. The last time, I was actually worried about losing my job over holding out. For me, this would have been bad, as I’m in a foreign country on a work visa with no right to remain. But hold on I did.

The number of man-hours spent chasing this “voluntary” charity work is amazing. “Voluntold” is, I believe the technical term.

The charity work itself is totally empty. Things like two hours of litter picking. Giving bad sandwiches to the homeless where someone else organizes all the sandwich packages, etc., and bank employes just turn up and hand them out then go home again in their nice cars. A lot of the charity work is driven by “best company to work for in X” awards that stipulate criteria like “charitable work.” The bank then has to hit that criteria to be considered, which will then help them with recruiting. They spend god knows how many hours every year trying to do this.

Okay, next: the time sheet guy…

After listing a few positions that could easily be automated away and seem to exist only to provide employment, Rupert ends with the most apparently useless position of all:

Rupert: Finally, middle management. The other day, I had to get an approval from someone at middle-management level. I clicked on a system to email out approval requests. Twenty-five middle managers were listed (only one needed to approve). I had only ever heard of one of them. What are these people doing all day long? Are they not worried about being found out and having to work at McDonald’s?

According to those middle managers who’ve contacted me, the answer to “What are these people doing all day long” would be, in many cases, at least, “Not much.” So in Rupert’s estimation, at least, in the lower echelons, competence and efficiency actually do seem to be the reigning values; the higher one goes up the ladder, the less true this appears to be.

Rupert’s account is fascinating from any number of perspectives. Take the theme of how artificial contests operate as a mechanism of bullshitization, one that cropped up in numerous other contexts as well. Many of the follies of local government in the UK, for instance, are driven by a similar desire to be named “best council” in a given region, or in the country as a whole. In every case, such contests set off a frenzy of box-ticking rituals, climaxing, in this case, in the ridiculous simulations of charity demanded of present employes so as to be able to tell potential future employes that their company has been voted one of the best places to work. Most of the other elements in Rupert’s testimony appear in other accounts from inside major financial institutions as well: the confused mix of frenetic, stressful, but almost magic efficiency in some sectors, the obvious bloat in others; all in a context where no one was quite sure what the bank really did or if it was even a legitimate enterprise; the fact that such questions could never be discussed.

Another common theme was the way many of those laboring in financial institutions—to a much larger degree than those in most large corporations—had little or no idea how their work contributed to the bank as a whole. Irene, for example, worked for several major investment banks in “Onboarding”—that is, monitoring whether the bank’s clients (in this case, various hedge funds and private equity funds) were in compliance with government regulations. In theory, every transaction the bank engaged in had to be assessed. The process was self-evidently corrupt, since the real work was outsourced to shady outfits in Bermuda, Mauritius, and or the Caiman Islands (“where bribes are cheap”), and they invariably found everything to be in order. Nonetheless, since a 100% percent approval rate would hardly do, an elaborate edifice had to be erected so as to make it look as if sometimes, they did indeed find problems sometimes. So Irene would report that the outsider reviewers had okayed the transaction, and a Quality Control board would review Irene’s paperwork and duly locate typos and other minor errors. Then the total number of “fails” in each department would be turned over to be tabulated by a metrics division, this allowing everyone involved to spend hours every week in meetings arguing over whether any particular “fail” was real.

Irene: There was an even higher caste of bullshit, propped atop the metrics bullshit, which were the data scientists. Their job was to collect the fail metrics and apply complex software to make pretty pictures out of the data. The bosses would then take these pretty pictures to their bosses, which helped ease the awkwardness inherent in the fact that they had no idea what they were talking about or what any of their teams actually did. At [Big Bank A], I had five bosses in two years. At [Big Bank B], I had three. The vast majority were installed, cherry-picked by higher-ups, and “gifted” these castles of shit. In many cases, sadly, it was how the companies met their minorities-in-management quota.

So once again, we have the same combination of fraud, pretense (no one was allowed to talk about the shady companies in the Caiman Islands), a system designed not to be understood, which was then pushed off on managers who had no idea what was going on below them, largely because it made no sense. It was all just a meaningless ritual. What’s entirely unclear is whether anyone on top of the food chain—the data crunchers, the just-passing-through executives, even the higher-ups who chose them—actually knew how pointless it all was.

Finally, on top of the usual artificially induced stress and tension and barking about deadlines, the usual sadomasochistic interpersonal relations, and the usual fearful silences (that is, all the things that typically happen when pointless projects are organized on top-down lines), there was the intense pressure on employes to take part in a different set of rituals designed to prove the institution really cared. In Irene’s case, these were not staged charity events, but New Agey seminars that often drove her to the point of tears:

Irene: On top of the metrics, there were the cruel, patronizing “flexibility” and “mindfulness” seminars. No, you can’t work fewer hours. No you can’t get paid more. No, you can’t choose which bullshit projects to decline. But you can sit through this seminar, where the bank tells you how much it values flexibility.

The mindfulness seminars were even worse. They attempted to reduce the unfathomable beauty and stupefying sadness of the human experience into the raw physicality of breathing, eating, and shitting. Breathe mindfully. Eat mindfully. Shit mindfully, and you can be successful in business.

All of this, presumably, to remind the employee that if one reduced life to pure physicality, the fact that some abstractions were more “real” than others, and that some office tasks seemed to serve a legal and moral or even economic purpose and others did not, was not really all that important. It’s as if they first forbid you to acknowledge you are engaging in empty ritual, then force you to attend seminars where hired gurus tell you, “In the final analysis, isn’t everything we do just empty ritual?”

What we’ve seen so far from Elliot, Rupert, and Irene are all partial, situated perspectives on very large and complicated organizations. None of them has an overall, panoptic view. But it’s not entirely clear if anyone else does, either. One has to assume the higher-ups in Irene’s story, who intentionally assign executives from minority backgrounds to the onboarding sector, are aware that most of what goes on in that part of the company is bullshit. Even they might not know precisely how and why. Nor would it be possible to create some kind of secret survey to determine what percentage of bank workers secretly believe their jobs to be bullshit and the divisions in which they tend to be concentrated. The closest I was able to find to general insight came from a certain Simon, who had been employed by a series of large international banks in risk management, which basically, he says, means to analyze and “find problems in their internal processes.”

Simon: I spent two years analyzing the critical payment and operations processes at one bank, with the sole aim to work out how a staff member might use the computer systems to commit fraud and theft, and thereby recommend solutions to prevent this. What I discovered by chance was that most people at the bank didn’t know why they were doing what they were doing. They would say that they are only supposed to log into this one system and select one menu option and type certain things in. They didn’t know why.

So Simon’s job was basically to be the all-seeing eye that determined how different parts of a bank’s many moving parts fit together and iron out any incoherences, vulnerabilities, or redundancies he might find. In other words, he’s about as qualified to answer the question as anyone could be. His conclusions?

Simon: In my conservative estimation, eighty percent of the bank’s sixty thousand staff were not needed. Their jobs could either completely be performed by a program or were not needed at all because the programs were designed to enable or replicate some bullshit process to begin with.

In other words, forty-eight thousand of the bank’s sixty thousand employes did nothing useful—or nothing that couldn’t easily be done by a machine. These were, Simon believed, de facto bullshit jobs, even if the bank workers themselves were deprived of the means to assess or collectively analyze the situation, and expected to keep any suspicions to themselves. But why didn’t the bank’s higher-ups figure this out and do something about it? Well, the easiest way to answer that question is to observe what happened when Simon did suggest reforms:

Simon: In one instance, I created a program that solved a critical security problem. I went to present it to an executive, who included all his consultants in the meeting. There were twenty-five of them in the boardroom. The hostility I faced during and after the meeting was severe, as I slowly realized that my program automated everything they were currently being paid to do by hand. It’s not as if they enjoyed it; it was tedious work, monotonous and boring. The cost of my program was five percent of what they were paying those twenty-five people. But they were adamant.

I found many similar problems and came up with solutions. But in all my time, not one of my recommendations was ever actioned. Because in every case, fixing these problems would have resulted in people losing their jobs, as those jobs served no purpose other than giving the executive they reported to a sense of power.

So even if these jobs didn’t originate as flunky jobs, which presumably most didn’t, they ended up being maintained as such. The threat of automation, of course, is an ongoing concern in any large enterprise—I’ve heard of companies where programmers will show up to work wearing T-shirts that say “Go Away or I Will Replace You with a Very Small Shell Script”—but in this case, and many like it, the concern went to the very top: to the very executives who (if, for instance, they are involved in private equity in any way) pride themselves on the ruthlessness with which they acquired other corporations and saddled them with enormous debts in the name of downsizing and efficiency. These very same executives prided themselves on their own bloated staffs. In fact, if Simon is also correct, they did so because that’s what a large bank really was: it was made up of a series of feudal retinues, each answerable to some lordly executive.[138]

on some ways in which the current form of managerial feudalism resembles classical feudalism, and other ways in which it does not

The upper quintile is growing in size and income because all the value created by actual productive workers in the lower quintiles gets extracted by those at the top. When the top classes rob everybody else, they need a lot more guard labor to keep their stolen loot secure.

—Kevin Carson

If we return to the example of the feudal overlord in chapter 2, this actually makes perfect sense. I was using feudal overlords and retainers as a metaphor at that point. But in the case of banks, at least, it’s not clear how much is metaphor and how much is literal truth. As I pointed out, feudalism is essentially a redistributive system. Peasants and craftsmen produce things, to a large extent autonomously; lords siphon off a share of what they produce, usually by dint of some complex set of legal rights and traditions (“direct juro-political extraction” is the technical phrase I learned in college),[139] and then go about portioning out shares of the loot to their own staff, flunkies, warriors, retainers—and to a lesser extent, by sponsoring feasts and festivals and by occasional gifts and favors, giving some of it back to the craftsmen and peasants once again. In such an arrangement, it makes little sense to speak of separate spheres of “politics” and “the economy” because the goods are extracted through political means and distributed for political purposes. In fact, it was only with the first stirrings of industrial capitalism that anyone started talking about “the economy” as an autonomous sphere of human activity in the first place.

Under capitalism, in the classic sense of the term, profits derive from the management of production: capitalists hire people to make or build or fix or maintain things, and they cannot take home a profit unless their total overhead—including the money they pay their workers and contractors—comes out less than the value of the income they receive from their clients or customers. Under classic capitalist conditions of this sort it does indeed make no sense to hire unnecessary workers. Maximizing profits means paying the least number of workers the least amount of money possible; in a very competitive market, those who hire unnecessary workers are not likely to survive. Of course, this is why doctrinaire libertarians, or, for that matter, orthodox Marxists, will always insist that our economy can’t really be riddled with bullshit jobs; that all this must be some sort of illusion. But by a feudal logic, where economic and political considerations overlap, the same behavior makes perfect sense. As with the PPI distributors, the whole point is to grab a pot of loot, either by stealing it from one’s enemies or extracting it from commoners by means of fees, tolls, rents, and levies, and then redistributing it. In the process, one creates an entourage of followers that is both the visible measure of one’s pomp and magnificence, and at the same time, a means of distributing political favor: for instance, by buying off potential malcontents, rewarding faithful allies (goons), or creating an elaborate hierarchy of honors and titles for lower-ranking nobles to squabble over.

If all of this very much resembles the inner workings of a large corporation, I would suggest that this is no coincidence: such corporations are less and less about making, building, fixing, or maintaining things and more and more about political processes of appropriating, distributing, and allocating money and resources. This means that, once again, it’s increasingly difficult to distinguish politics and economics, as we have seen with the advent of “too-big-to-fail” banks, whose lobbyists typically write the very laws by which government supposedly regulates them, but even more, by the fact that financial profits themselves are gathered largely through direct juro-political means. JPMorgan Chase & Co., for example, the largest bank in America, reported in 2006 that roughly two-thirds of its profits were derived from “fees and penalties,” and “finance” in general really refers to trading in other people’s debts—debts which, of course, are enforceable in courts of law.[140]

It’s almost impossible to get accurate figures about exactly what proportion of a typical family’s income in, say, America, or Denmark, or Japan, is extracted each month by the FIRE sector, but there is every reason to believe it is not only a very substantial chunk but also is now a distinctly greater chunk of total profits than those the corporate sector derives directly from making or selling goods and services in those same countries. Even those firms we see as the very heart of the old industrial order—General Motors and General Electric in America, for example—now derive all, or almost all, of their profits from their own financial divisions. GM, for example, makes its money not from selling cars but rather from interest collected on auto loans.

Still, there is one crucial difference between medieval feudalism and the current, financialized version. We’ve already mentioned it earlier in the chapter. Medieval feudalism was based on a principle of self-governance in the domain of production. Anyone whose work was based on some kind of specialized knowledge, whether lace makers, wheelwrights, merchants, legal scholars, was expected to collectively regulate their own affairs, or including who would be allowed to enter the profession and how they would be trained, with minimal supervision from anybody else. Guilds and similar organizations typically had elaborate hierarchies within (though not always so much as they do today: in many medieval universities, for instance, students elected their professors), but at the very least, a medieval sword smith or soap maker could go about his work in the confidence that he would never have anyone who was not himself a sword smith or a soap maker telling him he was not going about it correctly. Industrial capitalism obviously changed all that, and the rise of managerialism in the twentieth century drove the process even further; but rather than this in any sense reversing under financialized capitalism, the situation has actually worsened. “Efficiency” has come to mean vesting more and more power to managers, supervisors, and other presumed “efficiency experts,” so that actual producers have almost zero autonomy.[141] At the same time, the ranks and orders of managers seem to reproduce themselves endlessly.

---

If one wants a parable for what seems to have happened to capitalism over the last forty-odd years, perhaps the best example I know is the Elephant Tea factory outside Marseille, France, currently occupied by its employes. I visited the plant a few years ago, and one of the occupiers—who took me and some friends on a tour of the grounds—told us the story of what happened. Originally, it was a local enterprise, but during the age of mergers and acquisitions, the company was bought up by Unilever, owner of Lipton, the world’s largest tea producer. At first, the company left the organization of the plant more or less alone. The workers, however, were in the habit of tinkering with the machinery, and by the nineties, they had introduced a series of improvements that sped up production by more than 50 percent, thus markedly increasing profits.

Now, in the fifties, sixties, and seventies, there was a tacit understanding in much of the industrialized world that if productivity in a certain enterprise improved, a certain share of the increased profits would be redistributed to the workers in the form of improved wages and benefits. Since the eighties, this is no longer the case. So here.

“Did they give any of that money to us?” our guide asked. “No. Did they use it to hire more workers, or new machinery, to expand operations? No. They didn’t do that, either. So what did they do? They started hiring more and more white-collar workers. Originally, when I started working here, there were just two of them: the boss and the HR guy. It had been like that for years. Now suddenly there were three, four, five, seven guys in suits wandering around. The company made up different fancy titles for them, but basically all of them spent their time trying to think of something to do. They’d be walking up and down the catwalks every day, staring at us, scribbling notes while we worked. Then they’d have meetings and discuss it and write reports. But they still couldn’t figure out any real excuse for their existence. Then finally, one of them hit on a solution: ‘Why don’t we just shut down the whole plant, fire the workers, and move operations to Poland?’ ”

Generally speaking, extra managers are hired with the ostensible purpose of improving efficiency. But in this case, there was little to be improved; the workers themselves had boosted efficiency about as much as it was possible to do. But the managers were hired anyway. What this suggests is that what we are really dealing with here has nothing to do with efficiency but everything to do with changing understandings of the moral responsibilities of corporations. From roughly 1945 to 1975, there was what is sometimes referred to as a “Keynesian bargain” between workers, employers, and government—and part of the tacit understanding was that increases in worker productivity would indeed be matched by increases in worker compensation. A glance at the diagram on the next page confirms that this was exactly what happened. In the 1970s, the two began to part ways, with compensation remaining largely flat, and productivity taking off like a rocket (see figure 7).

These figures are for the United States, but similar trends can be observed in virtually all industrialized countries.

Where did the profits from this increased productivity go? Well, much of it, as we are often reminded, ended up swelling the fortunes of the wealthiest 1 percent: investors, executives, and the upper echelons of the professional-managerial classes. But if we take the Elephant Tea factory as a microcosm for the corporate world as a whole, it becomes obvious that wasn’t all that happened. Another considerable chunk of the benefits of increased productivity went to creating entirely new and basically pointless professional-managerial positions, usually—as we’ve seen in the case of universities—accompanied by small armies of equally pointless administrative staff. As we have seen so often, first the staff is allocated and then someone has to figure out what, if anything, they will actually do.