The Militant (logo)  

Vol. 80/No. 31      August 22, 2016

(front page)

Slow-burning capitalist depression wreaks havoc on working people

Labor force participation rate — percentage of population over 16 employed or actively seeking work. Shaded bars marks recessions. Despite claims by Hillary Clinton that economy is doing fine, the size of working class in U.S. has shrunk since 2009.
Democratic Party presidential nominee Hillary Clinton says the U.S. economy is doing just fine, pointing to the government’s latest jobs report that claims unemployment has fallen below 5 percent. She says this shows the economic policies of the Barack Obama administration are succeeding and she’ll give U.S. workers more of the same.

But this doesn’t square with the facts. The ongoing worldwide capitalist economic crisis, rooted in declining production, trade and employment, has wreaked havoc upon millions of working people in the U.S. and around the world.

“Economic growth in advanced nations has been weaker for longer than it has been in the lifetime of most people on earth,” the New York Times said Aug. 6.

The claim that unemployment has fallen simply reflects the fact that slow-burning depression conditions have shrunk the size of the working class in the U.S. with millions fewer workers in the labor force since 2009.

This is a crisis that no capitalist politician or the ruling class they represent have any solution for, except to try to force the working class to pay.

Millions more can’t get full-time jobs. They’re either forced to accept part-time hours, a figure that increased from the previous month, temp jobs or some spot in what the business press calls the “gig” economy.

The so-called labor force participation rate — the percentage of workers who are employed or on the unemployment rolls “actively” looking for work — has dropped since 2000 from more than 67 percent to below 63 percent, a 40-year low.

For men ages 25-54, the number with jobs dropped from 97.9 percent in the 1960s to 88.4 percent in July this year. And for those without any college classes the rate was 83 percent.

“While the number of people who are unemployed fell by about 7 million between June 2009 and today,” Investor’s Business Daily said Aug. 1, “the number who are no longer in the labor force — either because they’ve quit looking for work or retired — climbed an astonishing 14 million.”

Between 2009 and 2014 household incomes for workers in the bottom 20 percent declined by 8.4 percent. Over this same time frame 3.1 million people were added to government statistics as living in poverty.

This is the reality of what Clinton says is all good. Republican nominee Donald Trump, on the other hand, says workers do face problems. But his only answer is to promise that he alone can solve them. Everything else is demagoguery, or rightist threats against immigrants, Muslims and others.

Because their profit rates have been declining for decades, the capitalists have been holding back on investing in capacity-expanding plant and production. Instead, they’ve been speculating on stocks, bonds, derivatives and other forms of commercial paper, or hoarding their cash, and attacking the jobs, safety conditions and social and political rights of working people.

Workers employed in manufacturing are particularly hard hit. Durable goods orders in June declined 4 percent, its biggest drop in almost two years. Caterpillar Inc., which laid off thousands of workers in 2015, recently announced that additional job cuts are coming. Coal, oil and gas industry bosses have eliminated 220,000 jobs in the U.S. since September 2014.

Coal mining regions like Appalachia have been devastated as the coal bosses close mines and step up attacks on health care, working conditions and the United Mine Workers union.

Falling crop prices mean more and more farmers can’t meet the cost of production. In the Upper Midwest, farmers lost $58 per acre on corn and almost $3 per acre on soybeans last year. As farmers’ debts mount, banks are applying more pressure to pay up, with the threat of foreclosures.

While hunger and malnutrition continue to mark much of the world, the press says dairy farmers are overproducing and there is a “glut” of milk. From upstate New York to Wisconsin to Canada, Ireland and New Zealand, plummeting milk prices are forcing a deep crisis for these farmers, driving growing numbers off the land.

Plunging prices for raw materials have had their harshest impact on working people in semicolonial countries throughout Africa, Asia and Latin America. Oil prices have dropped from $100 per barrel in 2014 to about $40 today.

In Angola, where 45 percent of the gross domestic product comes from the oil and gas sector, the government has slashed funds for vital social needs.

“Thousands of people are dying of preventable illnesses and the nation’s hospitals are out of medicine,” reported the Washington Post Aug. 2. Last year the government “did not purchase a single dose of malaria medication,” the Post said. “In the first three months of 2016, Angola had roughly 1.3 million cases of the disease. At least 3,000 people have died, according to the World Health Organization.”  
Front page (for this issue) | Home | Text-version home