‘We simply live in the time we live in’, Pavao, a young worker in ITAS,¹ a Croatian metalworking company, told me. ‘It’s the 21st century: competition is strong … everyone knows how to work with metal. It’s not like we are unique in the world. Everyone has machines, much more modern than ours. We’re nothing special’. Pavao was frustrated that many ITAS workers, the majority of whom were older than him, were proud of their achievements in socialist Yugoslavia. ‘That’s all in the past’, he said. ‘The Chinese are the best now, Koreans as well; they are making machines. We are a handful of sorrow (šaka jada)’. He concluded, ‘It’s very hard. It’s hard to catch up’.

Pavao and other workers I spoke to did not describe their company’s predicament as creative destruction. In Croatia, the term creative destruction is used mostly by economists and right-wing libertarians. Although they invoke Schumpeter as a theorist who popularized the term, they don’t preserve his sophisticated theorization. Schumpeter famously conceptualized creative destruction as driven by entrepreneurial genius, but he also ascribed systemic quality to it. He described it as a process ‘that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction … is what capitalism consists in and what every capitalist concern has got to live in’ (Schumpeter, 1994: 83). The process revolutionized not just products offered in the market, but also in the production process itself. This was partially indebted to Marx’s insights about capitalism, who described it as characterized by ‘bitter contradictions’ that occasionally lead to ‘momentaneous suspension of labour and annihilation of a great portion of capital’ in order to allow the capital that remains to go on reproducing itself (Marx, 1993: 750).

The notion of creative destruction is useful to describe how enterprises are compelled to innovate. But a question for anthropologists is, how does creative destruction operate on the level of individual actors caught up in it? In other words, how do individuals understand the incentives, goals, and trade-offs they are facing?

ITAS is a machine-tool company in north-western Croatia. The workers’ ownership was recognized in 2007, after almost two decades of changing property relations, during which disinvestment and irregular maintenance had been the norm.Since then, ITAS has used its profits and bank loans to invest millions of euros in purchasing new machines and software necessary for high-precision metalworking. The cash-strapped company could only sporadically afford to purchase new machines; the average age of machines they used at the time of my ethnographic research was around 35 years.

ITAS was struggling to keep up with its competitors. Like other companies in the machine-tool production sector, ITAS was under tremendous pressure to invest in new machines (CECIMO 2011). Conversations about investment were, on the surface, about economic survival. At first, I had assumed that I would encounter a straightforward acceptance of the necessity to replace old machines to improve the productive process. What I found, instead, was a much more complicated set of ideas about, and practices of, production: metalworking technologies of different generations coexisted in a way that, in the workers’ view, was necessary for ITAS’s operations.

Old technologies in ITAS produced widespread frustration. A significant number of workers thought that it was necessary for the company’s survival to invest tens of millions of euros in production. Those workers thought that losing their ownership over the company would be worth it if a stronger company were to buy it up and invest in new technology. However, others were against that proposal and speculated that if ITAS were sold, many workers would lose their jobs. Economic studies show that the latter tended to be right: technology replacement in manufacturing usually displaces the workers who operate older technologies and replaces them with workers who operate newer ones (see Caballero, 2018). This dovetails with Marx’s old insight that the introduction (and replacement) of machinery displaces human labour; incidentally, Marx (1993: 775) hypothesised that it happened early in ‘the branches which are closest to being production of raw materials for industry … First of all in the production of metals, which are the chief raw material for the instruments of labour themselves’.

In principle, investment was supposed to help the company by increasing its productivity and improving the reliability of production. However, workers didn’t see recent technology as a silver bullet that could solve all problems in ITAS. In their view, new machines often end up being less helpful than the old ones. New machines are much faster when production is done in big series, but the majority of ITAS capacity is used for small-batch production. Since new machines require programming, which takes time and specialized knowledge, they typically take more time than manual machines in most cases. Furthermore, training young workers, who typically operated modern machines, took time and occasionally resulted in costly mistakes.

Although some workers occasionally left to try their luck elsewhere, many workers, especially old ones, remained in the company despite its problems. Since ITAS could not afford to completely overhaul its technology and production process, their knowledge and skill operating old, and often faulty, machines remained crucial for the company’s survival. As Bartol, an old worker, explained to me, ‘Many times, you need to make something with tolerance of one hundredth of a millimetre. And we manage to make it’. Bartol told me about the time when he was not at work and his supervisor operated Bartol’s machine, ‘He messed up the pieces. He didn’t know how much the machine was off, and it was over’. Relying on the knowledge and skill that were a living legacy of socialist industrialization in Yugoslavia these workers navigated the quirks and defects of old machines in order to produce high-quality products. These workers—who would potentially be replaced if ITAS completely replaced old machines—remained important in this company.

An old machine, which is no longer in use, was marked by workers with a hand-made sign that reads “R.I.P. 1985-2017: He who dies honorably lives forever!”

As anthropologists have noted, the process of creative destruction does not unfold uniformly (Dawdy 2010). Ethnography shines light on the unevenness of capitalism: how different spaces relate to the capitalist world system and the abstract power of capitalism. Analyses of capitalism on the societal or global level can be true on an abstract level, but they need not apply to lower-scale operations of capitalism.

Considering supralocal linkages provides some of the elements needed to understand the case of ITAS. The fact that it is located in the capitalist (semi-)periphery means that low wages allow these workers to be less productive than their counterparts in, say, Germany, and still remain viable. But to understand the particular ways in which old machines were made use of and why new machines were not seen as a panacea in this case, we need to take into account the agency of the workers to see how they produce ‘the heterogeneity of capitalist social formations’ (Kasmir and Gill, 2018: 355): how they shape social relationships, make meaning, and adapt practices within the field of power characterized by uneven relationships between labour, capital, and the state.

Left to its own devices, ITAS was attempting to pull itself up by its bootstraps and gradually replace machines. That process was unfolding in fits and starts, not only because the company was lacking liquidity, but also due to material properties of metalworking, as well as old workers’ knowledge, expertise, and experience of labour from socialist self-management to the present. Limited as their agency was by structural factors, ITAS workers shaped their future. Ethnography is instrumental for situating creative destruction with regard to such spatial linkages, working-class history, and materiality of the cases we study.

More broadly, what the ITAS case shows is that theorising creative destruction requires careful attention not only to the operations of capital, but also to the responses of workers who are affected by macro-scale transformations in capitalism. The stakes for understanding the process of creative destruction are high. It is global in its implications, rather than limited to capitalist peripheries. As recent years have shown, deindustrialization and shifts in the geography of manufacturing have affected millions of people in the developed world, resulting in profound socio-political transformations. How do these processes take place and what are their uneven effects? How do workers affect them and what are the limits of their agency? Who can adapt and who is left behind? Answers to these questions illuminate the material basis for everyday class politics and point to alternative possibilities: care instead of destruction and stronger social ties instead of alienation.

Endnotes

1. ITAS is the Croatian acronym of ‘Ivanec machine tool factory’. [↩]

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