THE “MARKET,” “LABOR,” AUSTERITY AND DISEASE CONTROL (PART I)
THE “MARKET,” “LABOR,” AUSTERITY AND DISEASE CONTROL (PART I)
This morning I was informed that the Dow had dropped 264 points yesterday. I then perused a magazine which told me that the euro zone was at a standstill and that drug companies have known of Ebola for more than 30 years but haven’t bothered to come up with a treatment because as capitalists in assessing the market they spend their research dollars only on drugs for people who can afford to buy them. I was reminded by the news of the day of the old law of physics that “mass cannot occupy separate volumes simultaneously,” or, “you can’t get a quart of water out of a pint jar.”
I think these laws of physics, however expressed, may have some application to our current economic malaise both in this country and in Europe. For instance, with wage inequality and other capitalist-inspired suppression of labor, labor is the allegorical “pint jar,” and contrary to propaganda from Wall Street flacks and wrong-headed policy choices by government, you cannot get a quart of demand out of a pint jar. With less purchasing power due to such suppression, the capitalists’ “other market” (the real one where you and I live as opposed to the one in which they exchange paper as in the Dow) is long since stagnant. The paper exchangers on Wall Street, with global equilibrium in labor and other costs approaching (unless TPP is approved) and lack of domestic demand due to shrinking export markets, wage inequality, and other suppression of labor (right to work laws etc.), have created a monster (austerity) which is now biting the hand that feeds it. The Dow increasingly does not reflect reality.
It appears austerity as policy may have finally penetrated the dirt sheet propaganda of ballyhooed global exuberance to the real paper value of the investment class. If the TPP is approved by the Senate, which will give investors a reprieve with more years of slave labor that will reduce their costs and thus put more pressure on policymakers to further suppress domestic labor in our race to the bottom where foreign slave wages depress wages here, and if our current austerity policies remain in place, I predict more than a so-called “correction” in the investment market; I predict a selloff beyond the 1,000 point range, or even far worse, which will in turn give policymakers a new excuse to suppress labor which will cause an increase in domestic unemployment in our race to the bottom caused yet in turn by a new source of slave labor via approval of the TPP. Our downward economic spiral will thus be intensified.
Policymakers don’t seem to understand that people without money or enough of it cannot buy much, no matter how low-priced such slave-made goods are. They also don’t seem to understand that only aggregate demand creates new employment, and that Keynesian policies stimulate both employment and demand whereas austerity policies depress both. Policy that deepens malaise in order to finance continuing enrichment of the investment class may find its limits as the “rest of us” finally awaken to this continuing travesty and demand Keynesianism as policy before another Great Recession, or worse.
Thus with the euro zone in malaise (there goes our # 1 export market) and our domestic economy in malaise as well, and with dead-end austerity as policy which (along with wage inequality) further suppresses demand, I am not shocked at all by this precipitous drop in the Dow yesterday. Without a change in policy from austerity to Keynesianism that stimulates rather than suppresses demand, and without an end to wage inequality and true reform of our bankruptcy and internal revenue codes, it seems to me that recovery may well be beyond our reach. We may not have the tools; we may have destroyed the means of making recovery possible due to our propaganda-induced inattention and apathy, having ceded such policymaking to the caprice of the relatively few in the investment class.
We need to establish new “means” and proceed to execute on them post haste. We have inexcusably lost and are losing trillions of dollars and will (unless addressed) lose trillions more in economic underperformance due to a ruinous choice of policies, policies that enrich the few and impoverish most of the rest of us. History will (and should) judge us harshly for our apparent unconcern for our own and our families’ futures as well as that of our country, and why? Because there are alternatives. It doesn’t have to be this way; it is within our power to fix it. What in the world are we waiting for? Big Money approval? An O.K. from a dysfunctional Congress? Those can be fixed, too. It’s our country and economy, not theirs. Let’s have at it and remove those from Congress who are arranging the deck chairs on our Titanic. It’s lifeboat time.
Lest we misunderstand just what and who labor is, following are some definitions of terms. As prelude, Wall Street has done a good job in setting off class warfare within labor. It has equated “labor” with people who work on assembly lines, dig ditches etc., those whose social stature is regarded to be “beneath” that of professionals and those who work for the investment class and other such “white collar” designations as accountants, investment advisors et al., but the fact is that “labor” includes doctors, lawyers, engineers in Silicon Valley and many other perhaps highly paid professionals who work for wages, salaries, commissions and/or fees. As properly defined, prior to retirement I was a lawyer working for myself on a fee basis, and as such I was in the laboring class. I was “working” for my clients and their interests.
Wage inequality is therefore not just a matter of depressing wages of blue collar workers; it is designed to depress compensation for all of us who labor, whether blue or white collared. Even CEOs (with their outlandish salaries and bonuses) are working for someone else and are to such extent within the labor designation. Only the investment class (aka known to Piketty as rentiers) does not work and is not labor, instead drawing its rents and profits off of its property and the labor of the rest of us.
The “rest of us” are working for” them” under current lopsided rules of economic engagement that desperately need reinvention, and those of us who are not in one way or another working for “them,” even if “working for ourselves,” are still working for compensation for services rendered or goods produced and are still “labor.” We must therefore be mindful of this broadened definition of “labor” when resisting Wall Street propagandists and their (successful so far) attempts to divide us into manipulative units. White collar and blue collar workers have common interests and should band together to resist the expressed wishes of those who would divide us for their own selfish ends.
I will write more of the market and the economics of disease control in Part II of this diverse undertaking of topics for discussion. Stay tuned. GERALD E
