Capitalism is an inherently unstable economic system, subject to cyclical crises of overproduction. The term “overproduction” has nothing to do with more goods being produced than people need. People may have many, many unmet needs, from food and clothing to shelter and means of transportation. Overproduction refers only to more being produced than can be sold — at a profit.
Because capitalist economic activity is dependent on making profits rather than meeting human needs, it is a well-known fact that production and employment will oscillate up and down as markets rise and fall. When markets and profits fall, it’s called a recession. If they stay down for a long time, it’s a depression.
Since February of 2020, the U.S. has been in what economists are calling the COVID-19 Recession, with official unemployment hitting a peak of 14.8% in April 2020.
This was the highest level of unemployment in this country since 1938 and the Great Depression.
Not even covered in these unemployment figures are exploited workers in what is called the “gig economy.” They have little if any job protections and are not usually counted as unemployed when their jobs dry up.
This recession has affected many in the so-called “middle class” — the petty bourgeoisie — the self-employed or owners of small businesses doomed to be replaced by huge chains, but whose demise has been hastened by the virus.
The current recession, bordering on a depression, must be kept in mind when analyzing the violent right-wing movement that has mushroomed in support of Donald Trump. Such movements have historically looked to demagogues in periods of economic crisis.
In class terms, their base lies in the petty bourgeoisie, but they look to big-business figures like Trump as their saviors. In the U.S., they are especially prone to racist demagogy that blames their growing insecurity on the gains made by struggling people of color.
Racism provides them with a scapegoat, in the same way that anti-Semitism served the fascist movement in Germany during the Great Depression. Capitalism was so hated in Europe by that time that the Nazis had to disguise themselves as “national socialists,” while blaming Jewish people for all of capitalism’s crimes.
The camouflage of Hitler’s fake socialism didn’t confuse Germany’s big bourgeoisie, however. The Krupps and other wealthy capitalists made a deal with Hitler and made huge profits from his war machine.
There has always been a section of the U.S. ruling class that sympathizes with fascism as a weapon against the working class. In the South particularly, but not exclusively, it has taken the form of racism as the bosses’ main weapon to combat class solidarity among the workers.
The upsurge of this incipient fascist movement, as seen in their attack on Congress, and egged on by Trump, is a product of the capitalist economic crisis that has been worsened by the COVID-19 pandemic. It reflects all the worst features of this outmoded capitalist system.
While the incoming Biden administration will try to plaster over the cracks in the system, only a strong multinational, multi-gender workers’ movement can defeat the fascists and the capitalist system that spawns them.