Fred Goldstein: "Workers, students, and you must fight for jobs, education"

Big business media finally admit
Mass unemployment is here to stay
Workers, students and you must fight for jobs, education
By Fred Goldstein
Published Feb 28, 2010 9:03 PM

The jobless recovery has been declared official by the New York Times, the newspaper of record for the U.S. ruling class. Its edition of Feb. 21 — the Sunday paper that is read in every capital, finance ministry, embassy, consulate, department of state, etc., in the capitalist world — carried the following two-column banner headline in bold: “Despite Signs of Recovery, Chronic Joblessness Rises — The Unemployed Face Years Without Jobs, Exhausting Savings and Benefits.”

The article that followed was a thinly veiled warning to Washington, to policy makers, and to pundits alike not to pay any heed to false optimism. The economy is in a new stage of crisis — economic recovery is rising alongside growing long-term unemployment. There is little to no prospect that the many millions of unemployed, many of whom are rapidly running out of unemployment benefits, will be rehired. Excerpts from the article give the sense of alarm intended.

It says there are “6.3 million Americans who have been unemployed for six months or longer, the largest number since the government began keeping track in 1948. That is more than double the toll in the next-worst period, in the early 1980s.”

A Times chart shows the racism of the long-term unemployment. Black men are 5.5 percent of the workforce but almost 13 percent of the unemployed. Latinos/as are also disproportionately represented among the long-term unemployed.

“Roughly 2.7 million jobless people will lose their unemployment check before the end of April unless Congress approves the Obama administration’s proposal to extend the payments, according to the Labor Department. ...

“Labor experts say the economy needs 100,000 new jobs a month just to absorb entrants to the labor force. With more than 15 million people officially jobless, even a vigorous recovery is likely to leave an enormous number out of work for years.

“Some labor experts note that severe economic downturns are generally followed by powerful expansions, suggesting that aggressive hiring will soon resume. But doubts remain about whether such hiring can last long enough to absorb anywhere close to the millions of unemployed.”

Of course, the Times minimizes unemployment. It does not refer to the millions of workers who, having dropped out of the labor force, are not considered part of the officially unemployed. Nor does it count the number of undocumented workers who were forced into the underground economy and are now laid off.

Youth suffer most from “jobless recovery” stage of capitalism

Above all, there has been no calculation of how many millions of youth cannot get into the labor force in the first place. Among those 16 to 24 years old who are counted, unemployment is in the 20 percent range. For African-American youth it is officially above 40 percent, but in reality is probably even higher.

For every available job, six people are looking for work. The connection between the economic crisis, the reduction in skills by technology and the loss of jobs in general falls hardest on youth, especially those who cannot afford to graduate from college because of unaffordable tuition and lack of financial support.

The Times knows that this jobless recovery did not come out of the blue.

“Large companies are increasingly owned by institutional investors who crave swift profits, a feat often achieved by cutting payroll. The declining influence of unions has made it easier for employers to shift work to part-time and temporary employees. Factory work and even white-collar jobs have moved in recent years to low-cost countries in Asia and Latin America. Automation has helped manufacturing cut 5.6 million jobs since 2000. ...

“‘American business is about maximizing shareholder value,’ said Allen Sinai, chief global economist at the research firm Decision Economics. ‘You basically don’t want workers. You hire less, and you try to find capital equipment to replace them.’

“During periods of American economic expansion in the 1950s, ‘60s and ‘70s, the number of private-sector jobs increased about 3.5 percent a year, according to an analysis of Labor Department data by Lakshman Achuthan, managing director of the Economic Cycle Research Institute, a research firm. During expansions in the 1980s and ‘90s, jobs grew just 2.4 percent annually. And during the last decade, job growth fell to 0.9 percent annually.

“‘The pace of job growth has been getting weaker in each expansion,’ Mr. Achuthan said. ‘There is no indication that this pattern is about to change.’

“Before 1990, it took an average of 21 months for the economy to regain the jobs shed during a recession, according to an analysis of Labor Department data by the National Employment Law Project and the Economic Policy Institute, a labor-oriented research group in Washington.

“After the recessions in 1990 and in 2001, 31 and 46 months passed before employment returned to its previous peaks. The economy was growing, but companies remained conservative in their hiring.”

In other words, the present jobless recovery, which is far worse than the last two, represents a sharp deepening of a profound trend in U.S. capitalism. But the Times and other “experts” can never admit that.

Marxists understand that this crisis is a natural outgrowth of the drive for profits. Profits are derived by the exploitation of workers. The use of technology is a fundamental way the bosses have of intensifying that exploitation. Technology takes the skills out of jobs, lowers wages, and makes workers produce more and more in less and less time.

For the last 30 years the bosses have engaged in a global restructuring of the capitalist system based upon the introduction of more and more modern technology. This leads to overproduction, because goods are produced faster and faster and workers are paid less and less.

In the present crisis, heads of the automobile industry and related industries claim they had to shrink their capacity and lay off hundreds of thousands of workers in order to stay profitable. The same is true of the housing industry, the aircraft industry and many others.

Thus there is a permanent reduction in the need to rehire the millions of workers who have been laid off — that is, so long as capitalist profits come before the needs of workers and the communities.

The basic contradictions of capitalism are at the bottom of this new stage of the jobless recovery. The capitalist system is not going to make some big comeback and rehire the workers. The only way the workers will get rehired is if they organize, mobilize and fight to override the profit motive and put workers’ needs first.

Someone reading the New York Times headline alone, and not knowing that the Times is the mouthpiece of big business, might think at first that the article was written out of concern and sympathy for the workers. Indeed, there is a long lead-in about a 57-year-old woman worker in southern California who has been unemployed for two years and whose husband is disabled. She is running out of unemployment benefits and the family is on the edge of homelessness.

But genuine concern for the working class is hardly the motive of the New York Times or its news editors, and certainly not of its owners. Millions have been suffering this fate for years now, but their trials have not made the lead story of the Sunday Times. The suffering of the workers, particularly in this crisis, is hardly late-breaking news.

The workers have been suffering throughout the last period while the government has handed over trillions of dollars to the banks, insurance companies, auto companies, etc. In all this time the capitalist class has been slashing jobs and wages, putting people out of their homes and bankrupting communities.

So why it this being raised now? It is to sound the alarm that two things are staring the capitalists in the face if the jobless recovery goes on. First, they will have to shell out more money to keep the workers from starving en masse. And second, they could face a social explosion, a working-class rebellion.

Yet in spite of all the warnings, neither the Times nor any other of the big business “experts” have any advice on how to solve their own contradictions. They have no way of resolving this crisis within the framework of capitalism and its profit-driven economy.

Only the workers can find the way out. As a first step, it is time to demand that the trillions of dollars held by the Treasury Department and the Federal Reserve Board, plus the bloated profits of the banks and the hundreds of billions of dollars handed over to the Pentagon for war and war preparation, be used to create a massive government jobs program.

This program must include reopening closed factories and stores, as well as creating new jobs so that every worker who needs a job gets one at a living wage. The money is there. But it will only be made available through the struggle of the mass of people in the streets.

The long-term solution is to get rid of the capitalist profit system itself and establish a system where the economy is socially owned and run on a planned basis for human need and not for profit — that is, on a socialist basis.

The writer is author of “Low-Wage Capitalism,” a Marxist analysis of the effect of globalization on the U.S. working class, which highlighted the jobless recovery in 2008 as the present crisis was first unfolding.


Articles copyright 1995-2010 Workers World. Verbatim copying and distribution of this entire article is permitted in any medium without royalty provided this notice is preserved.