From the September-October 2021 issue of News & Letters
III. Economic contradictions
Both the pandemic and the climate and ecological crisis struck at a time when the world capitalist system had shown its inability to extricate itself from a prolonged economic slump. They deepened it. Despite the happy face that government and corporate economists keep trying to paint with statistics, the opposite story is told by what is happening economically in people’s lives:
- The staggering inequality, with billionaires not just jet-setting but rocketing to space, while even before the pandemic 40% of U.S. households had expenses bigger than income.
- As of July, 8.7 million people in the U.S. were officially counted as unemployed, 3.4 million of them longer than six months, plus 6.5 million more not counted although they want jobs and 4.5 million working part-time unwillingly. Black unemployment was 8.2%.
- Most people do not get paid a living wage, which varies by location. A living wage for two adults, both working, with two children in San Francisco would be $36.58/hour. Almost half of U.S. workers between ages 18 to 64 have low-wage jobs, and 19.2 % of Latinx workers are paid poverty-level wages, as are 14.3% of Black workers. Low-wage workers (the majority are women) were most likely to lose jobs during the pandemic, just as they were the bulk of those forced to work in unsafe conditions.
- Worldwide, 2 billion people, more than 61% of the world’s employed population, work in the informal economy, lacking most or all legally established rights.
- Life expectancy, which had risen steadily for decades until 2014, fell steeply last year by 1.5 years, but twice as much for Latinx and Black Americans.
- Rents keep going up, so that nearly half of U.S. workers cannot afford to rent a one-bedroom apartment on the income from one job. The Supreme Court just struck down the latest eviction moratorium, and 10 million renters are behind on rent.
Dominique Walker of Moms 4 Housing pointed out what should be obvious: “The true crime lies in this society we live in that can normalize people living in the street. Shelter is a human right.”
- 18% of the U.S. population are being harassed by collection agencies for $140 billion in medical debt—especially in Republican governed states that rejected Medicaid expansion.
- The pandemic has worsened global hunger, so that 270 million people may face life-threatening food shortages this year, especially in Africa, Central America, Afghanistan and North Korea, but the wealthy U.S. is not exempt, where one out of five Black families face food insecurity.
One measure of the U.S. economy is that its largest employers are Walmart, Amazon, and McDonald’s together with its franchises. Amazon has famously exploitative conditions, which is why it faced strikes during the pandemic and several union organizing drives going on now. It brags about paying a few dollars more than neighboring companies—still far short of a living wage—while it drives workers so hard that it breaks down their bodies and its turnover rate among hourly workers is about 150% a year.
Just as Amazon pushes workers to work at speeds and hours beyond their physical limits, long work hours are a global pandemic. In 2016, 488 million people had to work 55 or more hours a week, leading to 745,194 excess deaths and many shortened lives, according to a scientific study in Environment International.
At the same time an International Labor Organization report found that many workers, predominantly women, get short hours, “with a movement away from the standard workweek consisting of fixed working hours each day for a fixed number of days and towards various forms of ‘flexible’ working time arrangements…along with demands for extended and even 24/7 availability….[New technologies such as smartphones] have resulted in a blurring of the boundaries between paid working time and both the times and spaces that are normally reserved for personal life.”
These pressure-cooker conditions as well as low wages have sparked what may be the beginning of a strike wave. (See “Rideshare & truck drivers fight bosses,” Sept.-Oct. 2021 N&L, p. 3.)
All this at a time when capitalists are crying about a labor shortage and, rather than raising wages enough to attract workers, are extending hours and looking to hire prisoners and undocumented immigrants at sub-minimum wages, or making people work what Frito-Lay workers striking in July in Kansas called “suicide shifts”! A similar issue is involved in the Nabisco strike. (See “Nationwide walkout of Nabisco workers,” Sept.-Oct. 2021 N&L, p. 3.)
Yet another aspect of labor revolt is revealed by the bosses’ laments that the unemployed are not flocking back to jobs, especially low-wage service jobs. Akin to China’s “lying flat” movement (see “Chinese youth, labor and Marxism,” July-Aug. 2021 N&L), U.S. workers—white collar as well as blue and pink—are expressing discontent with the jobs and careers they had been putting up with before the pandemic and spurning the idea of returning to normal. (See “We Weren’t Happy Before the Pandemic, Either,” Aug. 21 The New York Times.)
Underlying the intensification of exploitation and unemployment is the long-term weakening of global capitalism’s economic foundations. There has been no full recovery of the rate of profit since the mid-1970s crisis. Since the 2008 crisis, stagnation has reigned, despite the spectacular mass of profits of the tech monopolies.
Those high-flying corporations have accumulated cash, but 15-20% of companies are “zombies” that make barely enough—or not enough—profit to cover their debt service. Productive capital investment remains at low rates.
The inflation of prices of assets like stocks is no reflection of economic strength but rather the diversion of money from productive investment to speculation. That is augmented by the Fed’s near-zero-interest and quantitative easing policies that help the rich and leave working people facing higher housing costs.
Internationally, U.S. hegemony was weakened by decrepit economic foundations. That was compounded by imperial overreach, especially in the wars in Iraq and Afghanistan, fueled by illusions after the fall of the USSR that overwhelming military capability would guarantee total domination. This weakness underlay Trump’s vacillating foreign policy, which was a symptom as well as accelerant of the disintegration of the previous regime of multilateral relations. The trend was most recently seen in the U.S. defeat in Afghanistan. (See “Taliban reconquest shakes alliances, challenges Left,” Sept.-Oct. 2021 N&L, p. 5.)