Bosses talk recovery
Workers lose jobs
Published Apr 9, 2009 7:06 PM
While talk about signs of a possible economic recovery drove the stock market
up for four weeks in a row, beginning March 10, it is clear that the recovery
being talked about was a recovery of the bosses and bankers, not the
Three quarters of a million workers lost their jobs during those four weeks,
but the financiers and speculators were driving up the markets based upon
reports of increased profitability among the banks and a rise in activity in
the bond market.
On April 3, the day the Labor Department announced that 663,000 workers had
lost their jobs in the month of March, the Dow Jones Industrial Average of
stocks went up 49 points, capping a four-week rise. Then the market started
going down again, based on reports of a decline in corporate profitability.
This clearly shows differences in what a recovery means to Wall Street and what
it means to workers. Bosses want higher profits to roll in, while workers want
their jobs back, their homes back and their futures back. That is why the big
business media can talk about signs of recovery while unemployment is
True unemployment is 19.8 percent
In fact, real unemployment is completely underplayed in the big business media
in order to hide the extent of the crisis among the workers. According to the
headlines, unemployment has risen to an official 8.5 percent. Much less
publicity is given to the number 15.6 percent—the other official
number—which includes discouraged workers and those forced to work part
time although they need a full-time job.
Taking these percentages, the unemployed and underemployed amount to 24
million, not 13.2 million. But even this figure is a gross underestimation of
the true unemployment crisis.
A release by Martin Weiss, a financial consultant, reveals that the figures for
“discouraged workers” are a complete underestimate.
(moneyandmarkets.com, April 6) Weiss quotes a finding by John Williams of
ShadowStats.com: “During the Clinton administration, ‘discouraged
workers’—those who had given up looking for a job because there
were no jobs to be had—were redefined so as to be counted only if they
had been ‘discouraged’ for less than a year. This ... defined away
the bulk of the discouraged workers.”
In short, a worker who has been discouraged for more than a year disappears
from the unemployment statistics altogether. Based on this fact, Williams
estimates that actual unemployment is 19.8 percent, or close to 30 million.
The prospect for a capitalist recovery any time soon is highly unlikely, given
that manufacturing is plunging downward, not just in the U.S. but worldwide.
Even optimistic bourgeois experts expect economic decline and an increase in
the number of unemployed by at least half a million a month for the foreseeable
future. In fact, there is no economist who can point to a path out of the
At best, the hope is that the massive injection of government funds into the
banks, plus another stimulus package over and above the $787 billion package
already enacted, will be able to slow down the crisis and stabilize the system
within the next two years.
But an important point for the working class, the oppressed, and all
progressive and revolutionary forces to hold on to is the fact that even a
mild, artificially forced capitalist recovery based on government spending
would still leave the workers in crisis.
‘Mother of all jobless recoveries’
The working class is trapped in a capitalist system that is in a permanent
crisis. For example, a Wall Street Journal article on March 28 talked about
tentative signs that the bottom had been reached in the recession. The article
discussed various statements by bankers and indicators from government
statistics that could mark a turn toward “positive
growth”—meaning a capitalist business upturn with rising profits.
It went on to say:
“But a turn toward positive growth is not the same as a recovery,
particularly with the current 8.1 percent unemployment rate at a
quarter-century high and marching higher by the month. Nariman Behravesh, chief
economist at HIS Global Insight ... says unemployment could hit 10.5 percent by
late next year, even if the economy is growing at a 3 percent rate by that
“‘What comes next, I’m afraid, will be the mother of all
jobless recoveries,’ said Bernard Baumohl, chief global economist at the
Economic Outlook Group in Princeton, N.J. ‘While we may emerge from
recession from a statistical standpoint later this year, most Americans will be
hard pressed to tell the difference between a recession and recovery the next
Of course, capitalist experts cannot predict, and have never been able to
predict with any degree of certainty, the way their economy will perform over
the long run. Marxists, knowing the contradictions of capitalism, knowing that
consumption cannot keep up with production for profit under capitalism,
understand that overproduction and crisis is inevitable. This is the type of
crisis that is ravaging workers all over the world on the largest scale since
the Great Depression. So all talk of a recovery is highly premature.
For example, in the U.S. today the crucial automobile industry, which is
central to the economy, can sell at a profit only half the number of cars it
was built to produce. No sales mean no profits. No profits mean shut down
production. That means layoffs, destruction of factories, more poverty, less
sales and the crisis deepens.
The same is true of the housing industry. Millions of houses cannot be sold for
a profit even as tent cities of the homeless are multiplying around the
country. The housing industry, like the auto industry, ripples out into all
areas of the economy. The foreclosure crisis, in which millions are losing
their homes, means not only a rise in homelessness but a rise in unemployment
among all the workers affected by the collapse in housing construction.
Because capitalism has created a widespread, interconnected process of
producing everything, a truly global network of production, every layoff in a
central industry brings layoffs throughout the global network that those
industries depend on. Thus U.S. and world unemployment are both rising. The
World Bank estimates that up to 50 million workers could lose their jobs this
Workers can only recover by fighting back
None of this is a recipe for capitalist recovery—quite the opposite. The
working class cannot wait for the automatic processes of capitalism to revive,
save the situation, and wipe out unemployment, poverty and hunger.
Right now workers in Enfield, Britain, and Belfast, Ireland, have occupied
Visteon auto parts plants to demand severance pay and other rights. This
follows a similar occupation by the Waterford Crystal workers in Ireland, who
themselves were following the example of the Republic Windows and Doors workers
who seized their plant in Chicago in December.
The self-action of the working class, organizing from below to resist this vast
wave of layoffs, shift cuts, shortening of hours, as well as foreclosures and
evictions, is the only way forward.
The battle cry of “A Job Is a Right” must be raised everywhere and
the bosses must be stopped.
There must be mass mobilization and coordinated struggle by an alliance between
the oppressed and impoverished communities and the workers to stop the bosses
from shutting down, from picking up and leaving and destroying lives and
Every penny of the trillions of dollars for the banks should be turned over to
relieve the economic suffering of the people by creating real government jobs
programs with living wages and benefits—not just crumbs handed down after
the capitalists divide up the money from the stimulus package among themselves
and take their profits.
This is the only way to push the crisis back where it belongs, onto the backs
of the rich profiteers and off the backs of the working class and the
They created this crisis. They must pay. Bail out the people, not the
Goldstein is author of “Low-Wage Capitalism.” Information about
the book can be found at the Web site www.lowwagecapitalism.com.
Goldstein’s e-mail address is [email protected]
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