Please read the short essay, or just click the answers to these simple questions. You may need to *enable popups.
1. How is the "official" rate of unemployment calculated?
a. They count the people drawing unemployment benefits
d. They divide the state reports of unemployment expenditures by the average individual benefit
2. What is wrong with the "official" rate?
a. It doesn't show how long people have been unemployed and how much they are suffering
b. It doesn't count "discouraged" workers
c. It doesn't count people who didn't look for jobs because their kids were sick
d. It's just a survey, not an actual count
3. Everybody says they hate unemployment, but do they really?
a. Yes, because it causes suffering
b. Yes, because sooner or later it may hit our own family
c No, because some people benefit from unemployment
d. No, because it helps with natural selection
4. Who is actually to blame for unemployment?
b. American workers who have grown complacent and no longer work as hard as people in other lands
c. Unions who demand too much money for too little work
d. Our shrinking world and global economy
5. Can a capitalist government supply jobs?
a. Yes, though they may be reluctant to do it
b. Yes, and they do their absolute best to overcome unemployment
d. No, because it would overextend our national debt
6. Why hasn't increasing American productivity commensurately benefited American workers?
a. Rising productivity is just a vague statistic, and doesn't mean that more wealth is being created
b. Productivity changes are too small to make much difference
c. Capitalists rake in most of the benefits
d. It did! All Americans benefited equally!
7. Why haven't U.S. working hours been cut since 1938?
a. People prefer working longer hours
b. Capitalists prefer longer hours for workers
c. It wouldn't make any difference
d. America has always had a labor shortage
*If popups don't work when you click on the answers, you will probably get a yellow line across the top of your screen. Click on it and choose "temporarily enable popups."
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Unemployment Is Built Into Capitalism |
"When more and more people are thrown out of work, unemployment results."
--President Calvin Coolidge
As the quote above shows, capitalists put very little effort into explaining unemployment. They expend even less in trying to remedy it. They like unemployment because it helps them drive down our wages and benefits. They use our jobless brothers and sisters against the rest of us as what Marx called an "army of unemployed."
Capitalists under-report it
What usually appears in news reports as the unemployment rate is based on a survey. Jobless people are asked "Did you apply for a new job in the last period?" If they reply "yes" then they are reported as "unemployed." If they say "no" then they aren't unemployed, even though they may not have a job but did not seek one for any number of reasons. If, for example, they were lying in a gutter suffering from starvation because of long-term unemployment, but could not rise to seek a job, they aren't unemployed, according to the survey.
Actual unemployment would have to include jobless people who were unable to seek work. It would have to include people who had become too discouraged to seek work. It would also have to include people who have taken ragtag temporary or part-time jobs out of desperation, and thus did not have time to look for other jobs. From time to time, statisticians calculate the actual unemployment rate, and it generally comes out more than twice the "official rate."
Capitalists blame it on downturns
Within capitalist economics, unemployment is usually blamed on the periodic downturns in economic activity. They infer that the economy will "pick up" and unemployment will return to "natural" levels.
Capitalists blame it on workers changing jobs
The "natural" level, or "structural unemployment" is defined as the percentage of people who voluntarily gave up their jobs and have not yet selected new ones. The U.S. used to define it as 4% unemployment, but President Reagan did his best to re-define it as 6% as the "official" unemployment rate grew because of deliberate government policies.
Unions blame it on outsourcing and automation
After the Clinton Administration brought the North American Free Trade Agreement (NAFTA) into law, American unions blamed increasing unemployment on outsourcing. With government encouragement, American corporations move more and more of their work to nations with fewer labor and environmental restrictions. In the "race to the bottom," they built manufacturing facilities in Mexico, then Central America, then in Asia as they sought the least restrictive environmental laws and the cheapest labor. They disguised this abandonment with talk of a "global society" and an "information economy" in America, but they were doing what capitalists must do, driving down production costs in hopes of raising their profits.
In the 1950s and 1960s, unions and knowledgeable economists often blamed unemployment on automation, or the replacement of human labor with machinery. The 1947 invention of computers, and subsequent improvements, greatly accelerated job losses. A romantic-comedy film, Desk Set, in 1957, gave a whimsical treatment to the replacement of a female library staff by a handsome computer analyst.
Even in Marx's day, long before computers were invented, it was entirely clear that capitalists tended to force more and more production from fewer and fewer workers. Not only is machinery used, as explained in our more technical lesson, but more sophisticated divisions of labor enabled capitalists to lay off workers. The best example of improved divisions of labor might be attributed to Henry Ford and the modern assembly line.
Capitalism itself is to blame
Whether jobs are lost because of improved methods of production, automation, outsourcing, changing jobs, or economic downturns, capitalism is the culprit and capitalists are the perpetrators of unemployment. If "our" economy were a rational economy seeking to bring the most benefit to all of society, there would be no unemployment. But capitalism is not rational, and it does not seek to benefit all of society. It isn't "ours" either. It benefits capitalists, and they don't care much about unemployment!
What's the answer?
If we oppose the outsourcing of jobs, we are called isolationists. If we oppose losing jobs to automation, we are called luddites. If we oppose fiscal and monetary policies that accommodate unemployment during capitalist downturns, we are called idealistic dreamers. If we demand jobs at all, we are called selfish. The answer is to disregard what they call us and organize ourselves to win what the capitalists don't want us to have.
Even a capitalist government can supply jobs
The U.S. government has never faltered in financing its imperialist wars. It does not hesitate to cover the losses of greedy bankers and unscrupulous schemers, but serious government action to help the jobless has not happened since the Great Depression. Under President Roosevelt, a great many workers were able to support their families through jobs created directly by the federal government. Many of the parks, buildings, and bridges that they created are in use in the 21st century. The books written by the Works Progress Administration Writing Project are still being read. The songs that Woody Guthrie wrote while in government employ are still being sung.
The jobs crisis of 2010, its causes and remedies, were described beautifully by a report of the Economics Commission at the CPUSA convention in May, 2010. It is available as a short video.
Cut the hours of work
In a rational society, workers would receive full benefit of their labor. Improvements in methods of production and/or new machinery would be welcomed, but the benefits would pass to the workers and not to a handful of greedy capitalists.
Consider just the productivity figures released each year by the U.S. Bureau of Labor Statistics. They are simple measures of the amount of wealth produced by a single American worker in a given time period. They are usually reported as a single-figure percentage change from one period to the next, and are usually dismissed as insignificant, because the changes aren't usually large. For example, productivity increased 2.8% from 1947 to 1948. One American worker, working one hour, created 2.8% more commodities than he/she produced in the previous year.
But what if those small annual figures were accumulated, like compound interest, for a longer period? The results are astounding! The chart below shows the cumulative increase in productivity from 1947 to 2009, with 1947 arbitrarily set to 100%. The 2009 figure is 400%!
| Year | annual% change | increment | new base |
| 1947 | 100 | ||
| 1948 | 2.8 | 2.8 | 102.8 |
| 1949 | 3.3 | 3.3924 | 106.1924 |
| 1950 | 6.7 | 7.114891 | 113.3073 |
| 1951 | 2.7 | 3.059297 | 116.3666 |
| 1952 | 1.8 | 2.094599 | 118.4612 |
| 1953 | 2.3 | 2.724607 | 121.1858 |
| 1954 | 1.9 | 2.30253 | 123.4883 |
| 1955 | 4.2 | 5.18651 | 128.6748 |
| 1956 | -0.7 | -0.90072 | 127.7741 |
| 1957 | 2.6 | 3.322127 | 131.0962 |
| 1958 | 2.2 | 2.884117 | 133.9804 |
| 1959 | 3.8 | 5.091253 | 139.0716 |
| 1960 | 1.2 | 1.668859 | 140.7405 |
| 1961 | 3.1 | 4.362954 | 145.1034 |
| 1962 | 4.5 | 6.529654 | 151.6331 |
| 1963 | 3.5 | 5.307158 | 156.9402 |
| 1964 | 2.9 | 4.551267 | 161.4915 |
| 1965 | 3.1 | 5.006236 | 166.4977 |
| 1966 | 3.6 | 5.993918 | 172.4917 |
| 1967 | 1.7 | 2.932358 | 175.424 |
| 1968 | 3.4 | 5.964416 | 181.3884 |
| 1969 | 0.2 | 0.362777 | 181.7512 |
| 1970 | 1.5 | 2.726268 | 184.4775 |
| 1971 | 4 | 7.379099 | 191.8566 |
| 1972 | 3.3 | 6.331267 | 198.1878 |
| 1973 | 3.1 | 6.143823 | 204.3317 |
| 1974 | -1.6 | -3.26931 | 201.0624 |
| 1975 | 2.8 | 5.629746 | 206.6921 |
| 1976 | 3.3 | 6.820839 | 213.5129 |
| 1977 | 1.6 | 3.416207 | 216.9291 |
| 1978 | 1.3 | 2.820079 | 219.7492 |
| 1979 | -0.4 | -0.879 | 218.8702 |
| 1980 | -0.3 | -0.65661 | 218.2136 |
| 1981 | 1.4 | 3.054991 | 221.2686 |
| 1982 | -1.1 | -2.43395 | 218.8347 |
| 1983 | 4.4 | 9.628725 | 228.4634 |
| 1984 | 2 | 4.569268 | 233.0326 |
| 1985 | 1.6 | 3.728522 | 236.7612 |
| 1986 | 3.1 | 7.339596 | 244.1008 |
| 1987 | 0.3 | 0.732302 | 244.8331 |
| 1988 | 1.6 | 3.917329 | 248.7504 |
| 1989 | 0.8 | 1.990003 | 250.7404 |
| 1990 | 1.8 | 4.513327 | 255.2537 |
| 1991 | 1.5 | 3.828806 | 259.0825 |
| 1992 | 4 | 10.3633 | 269.4458 |
| 1993 | 0.6 | 1.616675 | 271.0625 |
| 1994 | 1 | 2.710625 | 273.7731 |
| 1995 | 0.4 | 1.095093 | 274.8682 |
| 1996 | 2.6 | 7.146574 | 282.0148 |
| 1997 | 1.5 | 4.230222 | 286.245 |
| 1998 | 2.9 | 8.301106 | 294.5461 |
| 1999 | 3.3 | 9.720022 | 304.2662 |
| 2000 | 3.4 | 10.34505 | 314.6112 |
| 2001 | 2.9 | 9.123725 | 323.7349 |
| 2002 | 4.6 | 14.89181 | 338.6267 |
| 2003 | 3.7 | 12.52919 | 351.1559 |
| 2004 | 2.8 | 9.832366 | 360.9883 |
| 2005 | 1.7 | 6.136801 | 367.1251 |
| 2006 | 1 | 3.671251 | 370.7963 |
| 2007 | 1.8 | 6.674334 | 377.4707 |
| 2008 | 2 | 7.549413 | 385.0201 |
| 2009 | 3.8 | 14.63076 | 399.6508 |
In other words, if an American worker made enough commodities to feed his/her family in 1947, he/she made four times as much stuff in 2009! If they made a living in 1947 with a 40-hour workweek, then they could be living at the same level in 2009 while working only a 10-hours!
Actually, even these irrefutable numbers understate the case, because the proportion of our population in the workforce was much smaller in 1947, before most wives were forced to compete for jobs.
Would we still have unemployment? No, because we could adjust working hours to "spread the work" to everyone available. The Fair Labor Standards Act, which forced companies to pay time-and-a-half overtime pay for hours over 40 per week, went in the direction of resolving the awful unemployment of the Great Depression. A few companies, most notably Post Cereals, have actually tried "spreading the work" but they cut the pay, too.
During the union upsurge of 1937-1947, American workers understood that cutting working hours is the only way to completely stop unemployment. They regularly demanded "30 for 40 with no cut in pay" to get work-week reductions without losing any job benefits.
We could end unemployment now and forever
The catch is, if we were to get that 10-hour workweek, we'd have to be living in a rational society.
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"As long as one American seeks employment, the hours of labor are too long."
--American Federation of Labor President Samuel Gompers
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