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How Workers Can Win the Class War Being Waged Upon Them

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Organized labor led no mass opposition to Trump’s presidency or the December 2017 tax cut or the failed U.S. preparation for and management of COVID-19. Nor do we yet see a labor-led national protest against the worst mass firing since the 1930s Great Depression. All of these events, but especially the unemployment, mark an employers’ class war against employees. The U.S. government directs it, but the employers as a class inspire and benefit the most from it.

Before the 2020 crash, class war had been redistributing wealth for decades from middle-income people and the poor to the top 1 percent. That upward redistribution was U.S. employers’ response to the legacy of the New Deal. During the Great Depression and afterward, wealth had been redistributed downward. By the 1970s, that was reversed. The 2020 crash will accelerate upward wealth redistribution sharply.

With tens of millions now a “reserve army” of the unemployed, nearly every U.S. employer can cut wages, benefits, etc. Employees dissatisfied with these cuts are easily replaced. Vast numbers of unemployed, stressed by uncertain job prospects and unemployment benefits, disappearing savings, and rising household tensions, will take jobs despite reduced wages, benefits, and working conditions. As the unemployed return to work, most employees’ standards of consumption and living will drop.

Germany, France, and other European nations could not fire workers as the United States did. Strong labor movements and socialist parties with deep social influences preclude governments risking comparable mass unemployment; it would risk deposing them from office. Thus their antiviral lockdowns keep most at work with governments paying 70 percent or more of pre-virus wages and salaries.

Mass unemployment will bring the United States closer to less-developed economies. Very large regions of the poor will surround small enclaves of the rich. Narrow bands of “middle-income professionals,” etc., will separate rich from poor. Ever-more rigid social divisions enforced by strong police and military apparatuses are becoming the norm. Their outlines are already visible across the United States.

Only if workers understand and mobilize to fight this class war can the trends sketched above be stopped or reversed. U.S. workers did exactly that in the 1930s. They fought—in highly organized ways—the class war waged against them then. Millions joined labor unions, and many tens of thousands joined two socialist parties and one communist party. All four organizations worked together, in coalition, to mobilize and activate the U.S. working class.

Weekly, and sometimes daily, workers marched across the United States. They criticized President Franklin D. Roosevelt’s policies and capitalism itself by intermingling reformist and revolutionary demands. The coalition’s size and political reach forced politicians, including FDR, to listen and respond, often positively. An initially “centrist” FDR adapted to become a champion of Social Security, unemployment insurance, a minimum wage, and a huge federal jobs program. The coalition achieved those moderate socialist reforms—the New Deal—and paid for them by setting aside revolutionary change.

It proved to be a good deal, but only in the short run. Its benefits to workers included a downward redistribution of income and wealth (especially via homeownership), and thereby the emergence of a new “middle class.” Relatively well-paid employees were sufficient in number to sustain widespread notions of American exceptionalism, beliefs in ever-rising standards of working-class living across generations, and celebrations of capitalism as guaranteeing these social benefits. The reality was quite different. Not capitalists but rather their critics and victims had forced the New Deal against capitalists’ resistance. And those middle-class benefits bypassed most African Americans.

The good deal did not last because U.S. capitalists largely resented the New Deal and sought to undo it. With World War II’s end and FDR’s death in 1945, the undoing accelerated. An anti-Soviet Cold War plus anti-communist/socialist crusades at home gave patriotic cover for destroying the New Deal coalition. The 1947 Taft-Hartley Act targeted organized labor. Senate and House committees spearheaded a unified effort (government, mass media, and academia) to demonize, silence, and socially exclude communists, socialists, leftists, etc. For decades after 1945—and still now in parts of the United States—a sustained hysteria defined all left-wing thought, policy, or movement as always and necessarily the worst imaginable social evil.

Over time, the New Deal coalition was destroyed and left-wing thinking was labeled “disloyal.” Even barely left-of-center labor and political organizations repeatedly denounced and distanced themselves from any sort of anti-capitalist impulse, any connection to socialism. Many New Deal reforms were evaded, amended, or repealed. Some simply vanished from politicians’ knowledge and vocabulary and then journalists’ too. Having witnessed the purges of leftist colleagues from 1945 through the 1950s, a largely docile academic community celebrated capitalism in general and U.S. capitalism in particular. The good in U.S. society was capitalism’s gift. The rest resulted from government or foreign or ideological interferences in capitalism’s wonderful invisible hand. Any person or group excluded from this American Dream had only themselves to blame for inadequate ability, insufficient effort, or ideological deviancy.

In this context, U.S. capitalism strode confidently toward the 21st century. The Soviet threat had imploded. A divided Europe threatened no U.S. interests. Its individual nations competed for U.S. favor (especially the UK). China’s poverty blocked its becoming an economic competitor. U.S. military and technological supremacy seemed insurmountable.

Amid success, internal contradictions surfaced. U.S. capitalism crashed three times. The first happened early in 2000 (triggered by dot-com share-price inflation); next came the big crash of 2008 (triggered by defaulting subprime mortgages); and the hugest crash hit in 2020 (triggered by COVID-19). Unprepared economically, politically, and ideologically for any of them, the Federal Reserve responded by creating vast sums of new money that it threw at/lent to (at historically low interest rates) banks, large corporations, etc. Three successive exercises in trickle-down economic policy saw little trickle down. No underlying economic problems (inequality, excess systemic debts, cyclical instability, etc.) have been solved. On the contrary, all worsened. In other words, class war has been intensified.

What then is to be done? First, we need to recognize the class war that is underway and commit to fighting it. On that basis, we must organize a mass base to put real political force behind social democratic policies, parties, and politicians. We need something like the New Deal coalition. The pandemic, economic crash, and gross official policy failures (including violent official scapegoating) draw many toward classical social democracy. The successes of the Democratic Socialists of America show this.

Second, we must face a major obstacle. Since 1945, capitalists and their supporters developed arguments and institutions to undo the New Deal and its leftist legacies. They silenced, deflected, co-opted, and/or demonized criticisms of capitalism. Strategic decisions made by both the U.S. New Deal and European social democracy contributed to their defeats. Both always left and still leave employers exclusively in positions to (1) receive and dispense their enterprises’ profits and (2) decide and direct what, how, and where their enterprises produce. Those positions gave capitalists the financial resources and power—politically, economically, and culturally—repeatedly to outmaneuver and repress labor and the left.

Third, to newly organized versions of a New Deal coalition or of social democracy, we must add a new element. We cannot again leave capitalists in the exclusive positions to receive enterprise profits and make major enterprise decisions. The new element is thus the demand to change enterprises producing goods and services. From hierarchical, capitalist organizations (where owners, boards of directors, etc., occupy the employer position) we need to transition to the altogether different democratic, worker co-op organizations. In the latter, no employer/employee split occurs. All workers have equal voice in deciding what gets produced, how, and where and how any profits get used. The collective of all employees is their own employer. As such an employer, the employees will finally protect and thus secure the reforms associated with the New Deal and social democracy.

We could describe the transition from capitalist to worker co-op enterprise organizations as a revolution. That would resolve the old debate of reform versus revolution. Revolution becomes the only way finally to secure progressive reforms. Capitalism’s reforms were generated by the system’s impacts on people and their resulting demands for change. Capitalism’s resistances to those reforms—and undoing them after they happened—spawned the revolution needed to secure them. In that revolution, society moves beyond capitalism itself. So it was in the French Revolution: demands for reform within feudal society could only finally be realized by a social transition from feudalism to capitalism.

This article was produced by Economy for All, a project of the Independent Media Institute.

About the Author: Richard D. Wolff is professor of economics emeritus at the University of Massachusetts, Amherst, and a visiting professor in the Graduate Program in International Affairs of the New School University, in New York. Wolff’s weekly show, “Economic Update,” is syndicated by more than 100 radio stations and goes to 55 million TV receivers via Free Speech TV. His two recent books with Democracy at Work are Understanding Marxism and Understanding Socialism, both available at democracyatwork.info.


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Capitalism vs. Safety, Health: An Old Story Again

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The U.S. president recently ordered meatpacking employees back into workplaces plagued by coronavirus. He did not order the employers to make their slaughterhouses safe. GOP-proposed legislation exempts employers from lawsuits by employees sickened or killed by coronavirus infections at workplaces. The GOP is mostly silent about requiring employers to maintain safe or healthy workplaces. Employers across the country threaten workers who refuse to return to jobs they find unsafe. They demand that employees return or risk being fired. Job loss likely means loss of health insurance for employees’ families. Being fired risks also losing eligibility for unemployment insurance.

Employers are now going to extremes to evade the costs of safe and healthy workplaces. Recently, New Orleans’ authorities and their contractors fired their $10.25 per hour garbage collectors after a short strike. The strikers had demanded protective equipment against garbage possibly infected with the coronavirus and also $15 per hour “hazard” pay. New Orleans replaced the striking workers by contracting for nearby prison inmates paid $1.33 per hour and individuals from halfway houses. Capitalism’s iron fist hits the working class with this “choice”: unsafe job, or poverty, or slave labor with both.

Capitalism has always struggled to minimize outlays on workplace safety and health. Workers have protested this wherever capitalism became the prevailing economic system over the last three centuries. Upton Sinclair’s popular book, The Jungle, published over a century ago, exposed spectacularly unsafe and unhealthy conditions in Chicago’s meatpacking industry. The 1906 passages of the Meat Inspection Act and the Pure Food and Drug Act responded to public outrage over that industry’s working conditions. Coronavirus infection rates among employees of U.S. pork processing plants as high as 27 percent illustrate how employers forever “economize” on workplace health and safety.

The Occupational Safety and Health Administration (OSHA) within the U.S. Department of Labor was established in 1970. It sought to add more systematic federal government supervision and inspection to the regulations pressing employers to provide safe and healthy workplace conditions. Its mixed successes attest to the lengths employers will go to evade, weaken, or ignore efforts to enforce workers’ safety and health.

The profit-driven logic of capitalist enterprises incentivizes not spending capital on workplace safety and health conditions unless and until they deteriorate to the point of threatening profits. Capitalists and mainstream economics textbooks repeat endlessly that profit is every enterprise’s “bottom line.” Profitability measures each firm’s economic performance. Profits reward employers; losses punish them. Employers use capital to yield profits; that is their chief goal and priority. As objectives, workplace safety and health are secondary, tertiary or worse: obstacles to maximizing profits.

Capitalism has always sacrificed the safety and health of the employee majority to boost profits of its employer minority. That minority makes all the key enterprise decisions and excludes the employee majority from that decision-making. No wonder employers figure disproportionally among society’s rich, safe, and healthy, while employees figure disproportionally among the poor, unsafe, and unhealthy. Capitalism displays not only extreme inequalities of wealth and income, but also all their derivative inequalities: economic, political, and cultural. Pandemics expose and worsen them all.

In some times and places, capitalism’s iron fist wears velvet gloves. When profits are high and/or critics of capitalism ally strongly with its victims, employers may spend more on making workplaces less unsafe and less unhealthy. Otherwise, employers can and do spend less. If and when they fail to prevent government regulations mandating minimum health and safety standards, employers campaign to evade, weaken, and eventually repeal them. Employers usually repeat the same old arguments to block or undo regulations mandating safety and health standards. Such regulations, they insist, divert capital from productive uses (hiring workers) to “unproductive” uses (improving workers’ health and safety). Thus fewer workers will be hired, hurting the employee class. With such arguments employers have often succeeded and undermined workplace safety and health.

Capitalism’s long record of maintaining nearly constant unemployment—its “reserve army”—not only got workers to accept lower wages for fear of being replaced by more desperate unemployed. Unemployment also got employed workers to accept unsafe, unhealthy workplaces. Unemployment is a kind of torture by one class of another. It helps maintain lower wages and unsafe and unhealthy worksites. That is one reason why reduced labor needs are managed, in capitalism, not by keeping everyone employed but for fewer hours per week. That option is not generally chosen because firing a portion of the workforce—depriving those unfortunates of jobs—better disciplines workers to accept what they might otherwise reject.

In today’s situation, employers and the government, equally unprepared for the virus, did too little too late to prevent a dangerous pandemic. Sudden mass lockdowns led to mass unemployment. Expensive reconfiguring for social distancing, mass testing, cleaning and disinfection, etc., might have rendered jobsites safe and healthy. Instead, employers and their political spokespersons press employees back into unsafe, unhealthy workplaces. A “reopening the economy” is ordered. Employers get to impose unsafe and unhealthy workplaces by reframing the process as a patriotic return to a noble, national “work ethic.” Employers are counting on this sham drama now.

Consider this historic parallel: capitalists in the U.S. and elsewhere once regularly employed children as young as five years old. Their jobs’ safety and health conditions were mostly inadequate and often deplorable. Their pay fell well below that of adults. They suffered injury as well as physical, sexual, and emotional abuse. Schooling was neglected if not altogether absent. Yet capitalists insisted that economic well-being and prosperity required their access to child labor. Ending it would bring economic decline possibly “worse” than child labor. A reasonable “trade-off” was required. Employers argued that poor families needed and welcomed incomes from employed children. Employers also insisted, then as now, that they had spent all they could and all that was needed to provide adequately safe and healthy work conditions.

Working-class responses to child labor took time to develop the necessary understanding and political power. Once they did, child labor was doomed. Working-class parents confronted capitalists with a non-negotiable demand: overcome the horrors of child labor by ending it. Employers would have to find other ways to profit. Many did even as many others moved abroad where child labor is still allowed. They still do.

Today’s parallel non-negotiable demand: end unsafe and unhealthy workplaces. That requires differently organized workplaces. The majority, employees, must control their safety and health. It must be a higher priority than profit for the minority of owners, boards of directors, etc. Once again we meet society’s need for transition to a worker-coop based economy.

This article was produced by Economy for All, a project of the Independent Media Institute. Reprinted with permission.

About the Author: Richard D. Wolff is professor of economics emeritus at the University of Massachusetts, Amherst, and a visiting professor in the Graduate Program in International Affairs of the New School University, in New York. Wolff’s weekly show, “Economic Update,” is syndicated by more than 100 radio stations and goes to 55 million TV receivers via Free Speech TV. His two recent books with Democracy at Work are Understanding Marxism and Understanding Socialism, both available at democracyatwork.info.


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Capitalism Can’t Be Repaired—Coronavirus Shows Its Huge Weaknesses

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Consider this absurdity: The U.S. government’s policy in the face of the current capitalist crash is to “return the economy to the pre-coronavirus normal.” What? In that “normal” system, private capitalists maximized profits by not producing the tests, masks, ventilators, beds, etc., needed when coronavirus hit. Profit-driven capitalism proved extremely inefficient in its response to the virus. Wealth already lost from the coronavirus far exceeds what it would have cost to prepare properly. In capitalism, a small minority—employers—makes all the key decisions (what, how, where to produce and how to use the proceeds) governing production and distribution of most goods and services. The majority—employees and their families—must live with the results of employers’ decisions but are excluded from making them. Why return to such an undemocratic “normal”? Why fix capitalism yet again, given its structural disposition to cyclical crashes and repeated costly need to be fixed?

Look at this absurdity from another angle. When capitalist corporations fail, they often resort to declaring bankruptcy. That often means a court removes an existing leadership and turns the enterprise over to a different leadership team. Outside of legal bankruptcy, a failing capitalist enterprise may often experience its shareholders voting to oust one leadership team—one board of directors—and replacing it with another. While such steps recognize that capitalists do fail (and quite regularly), the solution they made into law changes only who are the employers. Bankruptcy neither questions nor changes the capitalist structure of the enterprise. But why maintain such a capitalist “normal?” Maybe the problem is the structure and not the particular executive team running the capitalist enterprise.

A staggering 20 million U.S. employees have lost their jobs and filed for unemployment benefits during the month before April 15. This is absurd. We the people, the public, will now pay a portion of the wages and salaries their employers no longer do. The unemployed will often blame themselves; many will lose connections to their skills, their former employer, and their fellow workers; many will worry about getting old jobs back; many will borrow (often too much); all will worry about mounting debts; etc. They would be far better off if they all got socially useful jobs as well as most of their former paychecks. The government could be such an employer of last resort: when private capitalists either cannot or will not hire because to do so is not profitable for them.

But capitalists almost always oppose public jobs. They fear the competition with private capitalists that state employment might entail. They worry that public employees will keep those jobs and not move back to private employment. To placate private capitalists, governments “fix” recessions and depressions—periods when capitalists fire workers—by sustaining the unemployed with cash for a while. Society loses as the public pays the workers’ wages and salaries but gets no production of public goods and services in return.

Congress’s recently passed law (CARES) plans to stimulate a crashed U.S. capitalism by giving major airlines some $25 billion to pay most of the wages and salaries of roughly 700,000 airline employees for the next six months. This is capitalist absurdity squared. Most of those employees will collect their paychecks but do no airline work because flying will remain too risky for too many over the next six months. One might expect airline employees to be required to do some sort of public service in return for their government paycheck. They might prepare safe workplaces to then produce the tests, masks, ventilators, gloves, etc., needed these days. They might be trained to test; to clean and disinfect workplaces, stores and athletic arenas; to teach using one-on-one social media tutorials; and so on. But no, in capitalist countries (with rare exceptions), private capitalists do not want and thus governments do not pass laws mandating that public sector jobs be required of the unemployed in exchange for their pay. Society loses, but capitalists are mollified.

Then, too, Boeing is getting a big bailout. That corporate leadership recently proved itself responsible for selling unsafe airplanes that killed hundreds, trying to hide its failures, and squeezing billions in public subsidies out of the state of Washington. Yet the government’s bailout leaves Boeing leaders (and other employers getting government bailouts) in their traditional positions of making all key enterprise decisions exclusively and privately.

Why “fix” capitalism in these ways? Why the irrationality of unemployment pay without socially useful work for the unemployed? Why reproduce a normal capitalism that so undemocratically organizes its enterprises—where an unaccountable employer minority dictates to an employee majority? Why replace one group of employer dictators with another, when a better alternative presents itself? In short, why reproduce the capitalist (i.e., employer-employee) system generating socially divisive levels of unequal income and wealth almost everywhere plus business cycles regularly intruding instability?

Are we experiencing capitalism’s historic decline? Is that the message as people increasingly find capitalism to be unnecessary at best and unbearable at worst? Worker cooperatives present themselves as a better alternative way to organize enterprises: factories, offices, and stores, private and public. As democratic economic institutions, worker coops are a better fit with and a much better support for democratic political institutions. For the 21st century, the most popular slogan on socialists’ banners will likely be “Democratize the Enterprise.”

In the 14th century, bubonic plague—the “Black Death”—exposed Europe’s feudalism as vastly underfed, exhausted, dispirited, divided, and diseased. The infecting fleas carried by the rats could thus kill off a third of a very vulnerable continent. European feudalism never recovered its pre-bubonic strengths; its peak was behind it. Renaissance, reformation, and then the great English, French and American revolutions followed. The system collapsed amid transition to a new and different system, capitalism. Might the interactions now among capitalism, coronavirus, and a new worker-coop-based socialism prove similar to those among feudalism, the Black Death and capitalism so long ago?

This article was produced by Economy for All, a project of the Independent Media Institute.

About the Author: Richard D. Wolff is professor of economics emeritus at the University of Massachusetts, Amherst, and a visiting professor in the Graduate Program in International Affairs of the New School University, in New York. Wolff’s weekly show, “Economic Update,” is syndicated by more than 100 radio stations and goes to 55 million TV receivers via Free Speech TV. His two recent books with Democracy at Work are Understanding Marxism and Understanding Socialism, both available at democracyatwork.info.


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