Sacrifice. That is the watchword for the moment. After three years of slowing and now stagnant growth in the U.S. economy, Americans are asked by the economic lords and their media lapdogs to sacrifice for the common good.
This sounds like a noble and high-minded prescription. In times of duress, it is common to call for everyone to lower their expectations, accept some hardship, and struggle together for the benefit of all.
Certainly this is such a moment. Unemployment continues to rise, reaching a level of 11 percent by January when measured by the Bureau of Labor Statistics alternative measure of labor underutilization. In addition, the current economic crisis has exhibited a new feature. More than any earlier recession, the vast majority of layoffs are permanent. The odds of a worker being called back in the current crisis are 1 in 16.
Those lucky enough to have a job have seen incomes stagnate. Healthcare coverage has increased in cost or disappeared, and retirement benefits have been gutted by criminal management or bad investment of assets. Personal debt has increased to sustain consumer spending.
At a moment like this, sacrifice may well be necessary. But shouldn’t it at least be borne equally, if not more justly, from those most able to bear it? Should all of the burden fall upon the working class and the poor?
The capitalist press has reluctantly recorded some of the gross unfairness of the current economic ills. While management has demanded billions of dollars in sacrifice from workers in the airline industries, these same managers have secretly secured bonuses and protected pensions for themselves. This obscene hypocrisy has been repeated in other industries.
But by exposing these scandals, the media has attempted to hide the deeper, more systemic unfairness of the capitalist system. Like the Enron and WorldCom exposés, outrages are presented as exceptions to the rule.
The truth is that profits – the best measure of the health of the capitalist class – have been growing nicely while that class has been calling for further sacrifices on the part of workers. Business Week in the Feb. 10 issue estimated a 13 percent increase in corporate earnings for the last quarter of 2002. Earnings in the industrial sector rose by 13 percent while the service sector showed an explosion of 50 percent in earnings! Commerce Department figures confirm this: After-tax profits grew by 4.1 percent in the last quarter of 2002.
How did the capitalist class achieve these amazing results? They didn’t do it by increasing sales. Sales are relatively stagnant. They didn’t do it by investment. Investment also lags, not surprisingly, since the capitalists are barely using three-quarters of the available productive capacity. They did it by cost cutting!
Cost-cutting is the bourgeois economist’s euphemism for laying workers off or cutting their pay. In other words, profits are rising because capitalists have reduced the labor force and/or wages and benefits – the costs of labor.
But don’t forget the other side of the coin: when the same production is demanded of fewer workers, the remaining workers must work longer and harder.
They are exploited more than they were before the layoffs. This is what Marxists mean when they speak of increasing the rate of exploitation.
And with rising unemployment – a growing “excess” of labor – the capitalists extort even more concessions from the workers who fear that they may be the next asked to sacrifice.
Yes, the capitalists sacrifice: They sacrifice workers’ wages and jobs for the sake of profits.
The author can be reached at email@example.com