Social Economics

Monopoly Capitalism in the 21st Century: Neoliberalism, Monetarism, and the Pervasion of Finance

By Colin Jenkins

The following is the third part of a multi-part series, "Applying Poulantzas," which analyzes the work of Greek Marxist political sociologist, Nicos Poulantzas, and applies it to the unique political and economic structures found under neoliberalism and post-industrial capitalism.


With industrial or "competitive capitalism," it was the "separation and dispossession of the direct producers (the working class) from their means of production" which created this multi-layered, class-based societal structure. [1] Globalization has resulted in a massive shift of national economies. Former industrialized nations are now considered "post-industrial" due to the ability of large production-based manufacturers to move their operations into "cheaper" labor markets. International and regional trade agreements have facilitated this shift. With post-industrial capitalism and the widespread destruction of "productive labor," or labor that produces a tangible product and is thus exploited through the creation of surplus value, it is the complete reliance on a service economy which produces no tangible value that allows for strict control through wage manipulation. The ways in which the working class interacts with the owning class has changed significantly, if only in regards to their physical worlds. In the US, financialization has replaced industrialization as the main economic driver. Alongside this shift, monopoly capitalism has effectively replaced "competitive capitalism," and globalization has ushered in the neoliberal era. These developments have rearranged the superstructure and forced capitalist states to develop new methods in maintaining a societal equilibrium that is constantly being pushed to the brink of unrest at the hands of a capitalist system that breeds concentrations in wealth and power, while simultaneously driving the working-class majority towards a state of functional serfdom.

The emergence of monopoly capitalism was inevitable. "The battle of competition is fought by cheapening of commodities," explained Marx. "The cheapness of commodities depends, ceteris paribus, on the productiveness of labor, and this again on the scale of production. Therefore the larger capitals beat the smaller."[2] Whether we are referring to technology and automation, the relation of finance and the varying degrees of access to capital, or merely the all-encompassing process of "cheapening commodities" which Marx refers to above, it all works in tandem to create a funneling effect whereas capital becomes concentrated. And with this concentration of capital comes the concentration of wealth, which in turn inevitably breeds concentrations of other forms of power, i.e. political. In this sense, what many have come to refer to as "corporatism" is more correctly viewed as a mature stage of capitalism, rather than a differentiation from capitalism. The "marriage of corporation and state" that Benito Mussolini once referred to is merely a byproduct of capitalist advancement - the natural consequence of concentrated interests relying on the state apparatus to both facilitate its progression and protect its assets.

The consequent development of financialization could also be seen as an inevitable late stage of capitalism. As Paul Sweezy explains, while paraphrasing Marx, "Further, the credit system which 'begins as a modest helper of accumulation' soon 'becomes a new and formidable weapon in the competition in the competitive struggle, and finally it transforms itself into an immense social mechanism for the centralization of capitals.'"[3]

In the US, the creation of the Federal Reserve and the use of government-approved, macroeconomic policy-making has been a crucial tool in maintaining the equilibrium that is a central theme of Poulantzas' work. It has, in a sense, represented a Captain's wheel on a chaotic ship rolling over rough seas. The Keynesian model that dominated the American landscape from the late-1930s until the late-1970s relied on fiscal policy to supplement private sector instability, mainly by stimulating and supplementing this sector through infusions of money.

A shift to monetarism in the late-1970s paralleled the arrival of the neoliberal era, an intensification of privatization, and deregulation. While the all-encompassing policy-direction found under neoliberalism extended into the geopolitical realm to include "free trade" agreements and far-reaching international policies directed by the IMF and World Bank, it was this newfound reliance on monetary policy that created more ground between the standard operations of capitalist economy and the development of a " corporate-fascistic model." In other words, it allowed for greater returns on corporate profit in spite of wage stagnation, an overall degeneration of employment, increased poverty, and a consequent decline in expendable (consumer) income from within the working class. With regards to the equilibrium, direct manipulation of the money supply has allowed for a tightly-controlled mechanism that safeguards this extension and intensification of systemic inequities. Neoliberal economist Milton Friedman echoed the call for monetarism through his analysis of the Great Depression:

"The Fed was largely responsible for converting what might have been a garden-variety recession, although perhaps a fairly severe one, into a major catastrophe. Instead of using its powers to offset the depression, it presided over a decline in the quantity of money by one-third from 1929 to 1933 ... Far from the depression being a failure of the free-enterprise system; it was a tragic failure of government." [4]

Friedman's assessment wasn't critical of the existence of the Fed, or even of the Fed's ability to manipulate the money supply, but rather quite the opposite; it was critical of the Fed's failure to increase the money supply in times of crisis. In this sense, Monetarists did not oppose the Keynesian approach of intervention, but rather the nature of that intervention -fiscal policy (government spending) versus monetary policy (Quantity Theory of Money). The former provides money to the government, which in turn creates public programs and/or increases public spending that directly affects the population. The latter provides money to the financial industry and/or government, which in turn provides money to "power players" (corporate interests, big business, bank bailouts, etc...) in the hopes that such money will make its way through the population, hence "trickle down." Modern monetarism (Post-2008 financial crisis) has intensified through multiple bouts of QE (Quantitative Easing), which has reaped tremendous growth for the financial industry and big business (see the Dow Jones Industrial Average) while having no positive effect on the population, which continues to struggle through stagnation, chronic unemployment, and impoverishment.

It is no surprise that financialization found a perfect bedfellow in neoliberalism . "The neo-liberal bias towards de-regulation, which widened the space for financialization, was more often linked to an institutional fix that relied (and still relies) on 'unusual deals with political authority', predatory capitalism, and reckless speculation - all of which have fuelled the global financial crisis," explains Bob Jessop. "As the limits to 'more market, less state' emerged, there was growing resort to flanking and supporting measures to keep the neo-liberal show on the road. This was reflected in the discourse and policies of the ' Third Way ', which maintained the course of neo-liberalization in new circumstances, and is linked to the North Atlantic Financial Crisis (witness its eruption under 'New Labour' in Britain as well as the Bush Administration in the USA)." [5]

While conducted and carried out on different spheres, and for different reasons, financialization and expansionary monetary policy have emerged in parallel to one another. Because of this, they have maintained a loose relationship in the era of neoliberalism, with one (financialization) creating massive rifts and chaotic patterns of accumulation, and the other (monetary policy) attempting to manage the aftermath of this chaos. This has added yet another element to what Poulantzas saw as the inevitable rise of the authoritarian nature of State Monopoly Capitalism (SMC), whereas the capitalist state is forced to become more and more involved in maintaining equilibrium. In the economic realm, this amounts to monetary policy; in the political realm, this amounts to steadying the superstructure (balancing austerity measures with the welfare state); and in the social realm, this amounts to increased militarization of domestic police forces and a gradual erosion of civil liberties, features that become necessary when society's equilibrium is pushed toward a breaking point (civil unrest).

In the era of finance-dominated accumulation, and especially following periodic, systemic crises, governments have extended their reach to deal with unprecedented volatility. This was seen following the financial crisis of 2008-09, as capitalist states the world over scrambled to right their ships which had been steered into a perfect storm of financialized accumulation (many guided by illegal schemes; see the mortgage-backed securities scandal). Since then, it has become commonplace for governments, through monetary policy, to "intervene periodically to underwrite the solvency of banks, to provide extraordinary liquidity and to guarantee the deposits of the public with banks." [6] This is not to suggest that government intervention in the capitalist system is a new phenomenon; only that its methods have changed as capitalism has changed. Poulantzas explains:

"In the competitive capitalist stage, the capitalist state (the liberal state) always played an economic role; the image of the liberal state being simply the gendarme or night watchman of a capitalism that 'worked by itself' is a complete myth… From taxation through to factory legislation, from customs duties to the construction of economic infrastructure such as railways, the liberal state always performed significant economic functions..." [7]

With monopoly capitalism and the onset of financialization, the tendency toward extreme developments in both accumulations of the dominant classes and dispossession of the dominated classes requires higher degrees of state intervention. These interventions inevitably extend far beyond the economic base. Poulantzas contrasts this development with its former stage of 'competitive capitalism':

"If it is possible to speak of a specific non-intervention of this state into the economy, this is only in order to contrast it with the role of the state in the stage of monopoly capitalism, the 'interventionist state' which Lenin already had in mind in his analysis of imperialism. The difference between this and the state of competitive capitalism is not, as we shall see, a mere quantitative one. In the stage of monopoly capitalism, the role of the state in its decisive intervention into the economy is not restricted essentially to the reproduction of what Engels termed the 'general conditions' of the production of surplus-value; the state is also involved in the actual process of the extended reproduction of capital as a social relation." [8]

The emergence of expansionary monetary policy, most notably in the US Federal Reserve's use of Quantitative Easing, has become the go-to method of addressing the chaotic effects of financialization. This has become a necessary component for embedded capitalist interests that have taken advantage of a system that privatizes gains and publicizes losses. For the working classes, the reliance on consumer credit for not only luxury goods but necessities has illustrated how financialization has penetrated everyday life. To the former industrialized working classes (like that in the US), this is due to the emergence of both globalization and neoliberalism, which "favour exchange- over use-value" and "treat workers as disposable and substitutable factors of production," and "the wage (including the social wage) as a cost of (international) production." [9]

The permeation of this trifecta (Globalization, Neoliberalism, and Financialization) is not lost on the working classes. "Neoliberalism tends to promote financialization, both as a strategic objective and as an inevitable outcome," Jessop writes. "As this process expands and penetrates deeper into the social and natural world, it transforms the micro-, meso- and macro-dynamics of capitalist economies." [10] For the economic base and its power players, the state's use of expansionary monetary policy becomes a lifeboat, providing eternal life to corporate accumulation. For the working-class majority, whose existence is more and more precarious due to declining wages, consumer credit (often predatory) becomes a necessity to satisfy basic needs. Jessop concludes:

"The primary aspect of the wage is its treatment as a cost of (global) production rather than as a source of (domestic) demand; this is linked to re-commodification of social welfare in housing, pensions, higher education, health insurance, and so on. This leads to growing flexibility of wage labour (especially increasing precarization), downward pressure on wages and working conditions, and cuts in the residual social wage. A further result is the financialization of everyday life as the labour force turns to credit (and usury) to maintain its standard of living and to provide for its daily, life-course, and intergenerational reproduction. Combined with the increased returns to profit-producing and interest-bearing capital, this also intensifies income and wealth inequalities in the economies subject to finance-dominated accumulation, which now match or exceed their levels in just before the 1929 Crash (Elsner 2012; Saez 2013)." [11]

Monopoly capitalism in the 21st century has become ever more reliant on capitalist states to serve as facilitators, protectors, and a damage control mechanism. Former industrialized nations have shifted the remnants of "competitive capitalism" to global labor markets (which are also state-supplemented) and replaced them with service-sector economies based in finance schemes that seek to reproduce "fictitious capital" at alarming rates. Capitalist states, in adjusting to this shift, have embraced expansionary monetary policy as a means to address the ensuing chaos by supplementing and protecting financial institutions (the dominant classes in the age of neoliberalism/financialization). Will the volatility created by this shift finally bring capitalism to its breaking point? Will the prospect of automation force governments to develop radically new welfare states that include basic income guarantees? Will highly-exploited, global labor markets radicalize and collectivize, and bring the neoliberal era to its knees? The future brings many questions.



Notes

[1] Poulantzas. Classes in Contemporary Capitalism. Verso, 1978, pp. 97-98.
[2] Marx, Karl. Capital, Volume 3. Moscow: Progress Publishers, 1894.
[3] Sweezy, Paul M. "Monopoly Capital." Monthly Review, Volume 56, Issue 5. October 2004.
[4] Friedman, Milton & Friedman, Rose. Two Lucky People: Memoirs, University of Chicago Press, 1998.
[5] 'Finance-dominated accumulation and post-democratic capitalism', in S. Fadda and P. Tridico, eds, Institutions and Economic Development after the Financial Crisis, London: Routledge, 83-105, 2013.
[6] Lapavitsas, C. (2013) Profiting without Producing: How Finance Exploits All, London: Verso.
[7] 
Classes in Contemporary Capitalism, p. 100.
[8] Ibid. p. 100.
[9] Bob Jessop. (April 1, 2014) "Finance-Dominated Accumulation and Post-Democratic Capitalism."
http://bobjessop.org/2014/04/01/finance-dominated-accumulation-and-post-democratic-capitalism/
[10] Jessop, 2014.
[11] Jessop, 2014.


Works Cited

Elsner, W. (2012) 'Financial capitalism - at odds with democracy: The trap of an "impossible" profit rate', Real-World Economics Review, 62: 132-159. http://www.paecon.net/PAEReview/issue62/Elsner62.pdf

Saez, E. (2013) 'Striking it richer: The evolution of top incomes in the United States (Updated with 2011 estimates)', at http://elsa.berkeley.edu/~saez/.

Zombie Apocalypse and the Politics of Artificial Scarcity

By Colin Jenkins

Dystopian narratives have long been an alluring and thought-provoking form of entertainment, especially for those who take an interest in studying social and political structures. From classics like Nineteen Eighty-Four and Brave New World to the current hit, The Hunger Games, these stories play on our fears while simultaneously serving as warning signs for the future.

Their attractiveness within American society is not surprising. Our lives are driven by fear. Fear leads us to spend and consume; fear leads us to withdraw from our communities; and fear leads us to apathy regarding our own social and political processes. This fear is conditioned as much as it is natural. The ruling-class handbook, Machiavelli's The Prince, made it clear: "Since love and fear can hardly exist together, if we must choose between them, it is far safer to be feared than loved."

The idea of apocalypse is a central tenet of human society. We've been taught about Armageddon, Kali Yuga, Judgement Day, Yawm ad-Dīn, nuclear holocaust, the end times, the four horsemen, and the Sermon of the Seven Suns. Hierarchical societal arrangements leave us feeling powerless. Exploitative systems like capitalism leave us feeling hopeless. And the widespread deployment of fear ultimately keeps us in our place, and out of the business of those who own our worlds.

The last half-century has brought us the zombie apocalypse - a fictional world where the human race has largely been transformed into a brainless, subhuman horde of flesh-eaters, with only a few random survivors left to carve out any semblance of life they can find in a barren landscape. The emergence and immense popularity of the TV show The Walking Dead is the latest, and perhaps most influential, piece in a long line of narratives centered within themes of survival, human interaction, and scarcity.


Human Nature and Interaction

Behind all political battles, social critiques, and theoretical inquiries lies the most fundamental question: when left to our own accord, how will we interact with one another? How one answers this question usually goes a long way to how one perceives the world, and how issues are viewed and opinions are formed. To our dismay, potential answers are typically presented in dualities. Are we good or evil? Competitive or cooperative? Generous or greedy? Violent or peaceful?

A common theme among religion has been that human beings are "born into sin" and heavily influenced by "evil forces" to do harmful things. One who embraces this theme will tend to have less faith in humanity than one who does not. For, if we really are engaging in a daily struggle to resist the powers of evil, it is reasonable to assume that evil will take hold of many. How can we trust anyone who, at a moment's notice, could potentially lose the ability to act on their own conscience? The common theme of our dominant economic system - capitalism - is that human beings are inherently competitive and self-centered. When combined, it is easy to see how such ideologies may create intensely authoritative and hierarchical systems. After all, people who are influenced by strong and evil metaphysical forces while also being drawn toward callous, self-interest certainly cannot be trusted with free will.

This lesson is drilled deep into our psyches with each episode of The Walking Dead, where the potential threat of flesh-eating zombie hordes become an afterthought to the clear and present danger of "evil" humans who are out to get one another. Whether it's a sadistic governor charming an entire town with violent gladiator events, an outlaw gang with the obligatory pedophile, or a pack of hipster cannibals salivating at the thought of eating their next visitor, the intended theme is clear - human beings are not capable of co-existing, even in a world where they rarely interact.

But is this idea accurate? Are we really drawn toward conflict? Must we compete with one another to survive? Is it appropriate to apply Darwin's evolutionary theories in a social sense where the "fit" are meant to gain wealth and power over the "weak"? Or are we, as Peter Kropotkin theorized in his classic Mutual Aid, more inclined to mimic most other species on Earth, which have been observed over the course of centuries to exhibit "Mutual Aid and Mutual Support carried on to an extent which made me suspect in it a feature of the greatest importance for the maintenance of life, the preservation of each species, and its further evolution?"

There is ample evidence that we are drawn to cooperation. "Caring about others is part of our mammalian heritage, and humans take this ability to a high level," explains neuroscientist Sandra Aamodt. "Helping other people seems to be our default approach, in the sense that we're more likely to do it when we don't have time to think a situation through before acting. After a conflict, we and other primates-including our famously aggressive relatives, the chimpanzees-have many ways to reconcile and repair relationships." Studies have shown that in the first year of life, infants exhibit empathy toward others in distress. Evolutionary Anthropologist Michael Tomasello has put "the concept of cooperation as an evolutionary imperative to the test with very young children, to see if it holds for our nature and not just our nurture. Drop something in front of a two-year-old, he finds, and she is likely to pick it up for you. This is not just learned behavior, he argues. Young children are naturally cooperative."

So, if we are truly inclined to cooperate with one another, why is there so much division and turmoil in the world? The answer to this question may be found by assessing not only the mechanisms of capitalism, but more importantly in the creation of artificial scarcity as a means to maintain hierarchies.


Capitalism and Artificial Scarcity

It is no secret that capitalism thrives off exploitation. It needs a large majority of people to be completely reliant on their labor power. It needs private property to be accessible to only a few, so that they may utilize it as a social relationship where the rented majority can labor and create value. It needs capital to be accessible to only a few, so that they may regenerate and reinvest said capital in a perpetual manner. And it needs a considerable population of the impoverished and unemployed - "a reserve army of labor," as Marx put it - in order to create a "demand" for labor and thus make such exploitative positions "competitive" to those who need to partake in them to merely survive. It needs these things in order to stay intact - something that is desirable to the 85 richest people in the world who own more than half of the world's entire population (3.6 billion people).

But wealth accumulation through alienation and exploitation is not enough in itself. The system also needs to create scarcity where it does not already exist. Even Marx admitted that capitalism has given us the productive capacity to provide all that is needed for the global population. In other words, capitalism has proven that scarcity does not exist. And, over the years, technology has confirmed this. But, in order for capitalism to survive, scarcity must exist, even if through artificial means. This is a necessary component on multiple fronts, including the pricing of commodities, the enhancement of wealth, and the need to inject a high degree of competition among people (who are naturally inclined to cooperation).

Since capitalism is based in the buying and selling of commodities, its lifeblood is production. And since production in a capitalist system is not based on need, but rather on demand, it has the tendency to produce more than it can sell. This is called overproduction. Michael Roberts explains:

Overproduction is when capitalists produce too much compared to the demand for things or services. Suddenly capitalists build up stocks of things they cannot sell, they have factories with too much capacity compared to demand and they have too many workers than they need. So they close down plant, slash the workforce and even just liquidate the whole business. That is a capitalist crisis.

When overproduction occurs, it must be addressed. There are multiple ways to do this. Marx addressed three options: "On the one hand by enforced destruction of a mass of productive forces; on the other, by the conquest of new markets, and by the more thorough exploitation of the old ones." Another is through the destruction of excess capital and commodities. Whichever measure is taken, it is paramount that the economy must emerge from a starting point that is different from the ending point where the crisis began. This is accomplished through creating scarcity, whether in regards to labor, production capacity, or commodities and basic needs.

Maintaining scarcity is also necessary for wealth enhancement. It is not enough that accumulation flows to a very small section of the population, but more so that a considerable portion of the population is faced with the inherent struggles related to inaccessibility. For example, if millions of people are unable to access basic needs such as food, clothing, shelter, and healthcare, the commodification of those needs becomes all the more effective. On the flip side, the mere presence of accessibility - or wealth - which is enjoyed by the elite becomes all the more valuable because it is highly sought after.

In this sense, it is not the accumulation of personal wealth that creates advantageous positions on the socioeconomic ladder; it's the impoverishment of the majority. Allowing human beings access to basic necessities would essentially destroy the allure (and thus, power) of wealth and the coercive nature of forced participation. This effect is maintained through artificial scarcity - the coordinated withholding of basic needs from the majority. These measures also seek to create a predatory landscape - something akin to a post-apocalyptic, zombie-filled world where manufactured scarcity pits poor against poor and worker against worker, all the while pulling attention away from the zombie threat.


Control through Commodification

A crucial part of this process is commodification - the "transformation of goods and services, as well as ideas or other entities that normally may not be considered goods, into commodities" that can be bought, sold, used and discarded. The most important transformation is that of the working-class majority who, without the means to sustain on their own, are left with a choice between (1) laboring to create wealth for a small minority and accepting whatever "wages" are provided, or (2) starving.

In The Socioeconomic Guardians of Scarcity, Philip Richlin tells us that:

"When society deprives any community or individual of the necessities of life, there is a form of violence happening. When society commodifies the bare necessities of life, they are commodifying human beings, whose labor can be bought and sold. Underneath the pseudo-philosophical rationalizations for capitalism is a defense of wage slavery. For, if your labor is for sale, then you are for sale."

We are for sale, and we sell ourselves everyday - in the hopes of acquiring a wage that allows us to eat, sleep, and feed our families. In the United States, the 46 million people living in poverty haven't been so lucky. The 2.5 million who have defaulted on their student loans have been discarded. The 49 million who suffer from food insecurity have lost hope. The 3.5 million homeless are mocked by 18.6 million vacant homes. And the 22 million who are unemployed or underemployed have been deemed "unfit commodities" and relegated to the reserve army of labor.

The control aspect of the commodification of labor comes in its dehumanizing effect - an effect that was commonly recognized among 18th and 19th century thinkers. One of those thinkers, Wilhelm Von Humboldt, when referring to the role of a wage laborer, explained "as whatever does not spring from a man's free choice, or is only the result of instruction and guidance, does not enter into his very nature; he does not perform it with truly human energies, but merely with mechanical exactness, suggesting that "we may admire what he (the laborer) does, but we despise what he is," because he is essentially not human.

The worker, in her or his role in the capital-labor relationship, exists in a position of constant degeneration. This is especially true with the onset of mass production lines and the division of labor - both of which are inevitable elements within this system. "As the division of labor increases, labor is simplified," Marx tells us. "The special skill of the worker becomes worthless. He becomes transformed into a simple, monotonous productive force that does not have to use intense bodily or intellectual faculties. His labor becomes a labor that anyone can perform." As automation and technology progress, such specialized task-mastering even seeps into what was once considered "skilled" labor, thus broadening its reach.

In this role, workers are firmly placed into positions of control within a highly authoritative and hierarchical system.


A World beyond Profit

Dystopian narratives are no longer fiction. From birth, we are corralled into a system that scoffs at free will, stymies our creative and productive capacities, and leaves us little room to carve our own paths. The constructs directed from above are designed to strip us of our inclination to care and cooperate, and make us accept the need to step over one another to get ahead. This is not our nature. Whether we're talking about Kropotkin's studies in "the wild" or Tomasello's experience with children, observable evidence tells us we've been duped.

Another world is not just possible; it is inevitable if we are to exist in the long-term. In Post-Scarcity Anarchism, Murray Bookchin offers a glimpse into this world not constructed on labor, profit, and artificial scarcity:

"It is easy to foresee a time, by no means remote, when a rationally organized economy could automatically manufacture small "packaged" factories without human labor; parts could be produced with so little effort that most maintenance tasks would be reduced to the simple act of removing a defective unit from a machine and replacing it by another-a job no more difficult than pulling out and putting in a tray. Machines would make and repair most of the machines required to maintain such a highly industrialized economy. Such a technology, oriented entirely toward human needs and freed from all consideration of profit and loss, would eliminate the pain of want and toil-the penalty, inflicted in the form of denial, suffering and inhumanity, exacted by a society based on scarcity and labor."

The barren landscape for which we've been placed has a future beyond Hershel's overrun farm, the confines of a prison, the Governor's creepy town of Woodbury, and the trap known as Terminus. It has a future beyond the artificial constructs of capitalism and hierarchy. Human nature is talking to us… and we're starting to listen.

The Great Recession, Six Years Later: Uneven Recovery, Flawed Indicators, and a Struggling Working Class

By Colin Jenkins

In July of this year, Barack Obama boasted of an impressive recovery the US has undertaken since the Great Recession of 2008, proclaiming, "We've recovered faster and come farther than almost any other advanced country on Earth." To support this claim, the White House released a report showing that, out of 12 countries identified as "advanced" (France, Germany, Greece, Iceland, Ireland, Italy, Netherlands, Portugal, Spain, Ukraine, United Kingdom and United States), the United States is "one of only two (the other being Germany) that experienced systemic financial crises in 2007 and 2008 but have seen real (gross domestic product) per working-age person return to pre-crisis levels."

Reports such as these have become commonplace in 2014, not only from those in the White House, but also from multiple media sources. Within mainstream circles, the recovery has generally been lauded by the Democratic wing of the media (MSNBC, Huffington Post, and of course reports from the White House) and questioned by the Republican wing (Fox News, the Wall Street Journal). Since the reports stemming from these sources are almost always politically-charged, they have a tendency to be misleading in at least some manner. In the rare instance where genuine information or analysis leaks from the mainstream, it is usually the unintended result of a media spin.

Ultimately, the intended purpose of these reports are reduced to either showing Barack Obama and the Democratic Party in a good light (by focusing on seemingly positive statistics) or showing Obama and the Democrats in a bad light (by focusing on seemingly negative statistics). Often times, the same statistics may be used; however, spun differently. Neither side is interested in formulating meaningful analysis, but rather in swaying voters one way or the other. Still, in this media tug-o-war, facts are sometimes used to support political arguments, and thus may be useful from time to time if one is able to pick them out of the fray. But, even when we catch a glimpse of fairly reliable statistics, how do we cut through the politically-charged spins to give them meaning?

Take Obama's July statement for instance. It suggests that the US has experienced a strong recovery since the 2008 economic crisis, right? Well, not necessarily. What it says is that the US has experienced a better recovery than 11 out of 12 of its "advanced" counterparts that "experienced systemic crises," which (it's important to note) were handpicked by the White House. According to the International Monetary Fund, there are actually 36 countries that are considered to have "advanced economies." And considering the global nature of the economy, it's difficult to claim that 67% of them avoided systemic crisis. When compared to the 36, the US ranks 12th in GDP growth and 9th in unemployment rate recovery. Not necessarily bad, but certainly not as good as suggested.

Which brings us to some other questions: How accurate are GDP and unemployment rates when assessing the overall economic well-being of a country? Why are such macroeconomic indicators used so frequently in mainstream analyses? Do they accurately represent the well-being of the working-class majority, or do they simply represent convenient fodder used to supplement political spins? Let's take a look.


Gross Domestic Product and the Dow Jones Industrial Average

Two major indicators used to determine the overall health of the economy are the Gross Domestic Product (GDP) and the Dow Jones Industrial Average (DJIA).

US GDP growth rates over the past six years suggest a strong recovery. Since falling more than 16 percent during the Great Recession of 2008-09, the GDP has experienced growth in 19 out of 21 financial quarters.

rec1.jpg

2013 was especially successful in terms of GDP growth, averaging over 3 percent for the first time since the recession. 2014 started out slow, dropping a little over 2% in the first quarter (Q1 2014); however, this was written off as an irregularity by analysts, including PNC Senior Economist Gus Faucher, who attributed the drop to " bad weather " that "was a significant drag on the economy, disrupting production, construction, and shipments, and deterring home and auto sales." Since that time, the GDP has been growing at a rate of 4.1% over the past six months.

The DJIA has shown even bigger signs of recovery. After being cut in half between September 2007 (15,865) and February 2009 (7,923), the DJIA has experienced an almost unfathomable boom.

It hit its highest point ever in November 2013, nearly five years after the recession, at 16,429, and has been breaking records ever since. Heading into November of 2014, it stands at 17, 390 - the highest point in its 128-year history.


Corporate Profits

Not surprisingly, the cumulative amount of corporate profits in the United States have paralleled the success of the stock market. American Enterprise Institute economist Mark J. Perry has illustrated a sharp correlation between the S & P 500 Index and after-tax corporate profits in the chart below:

rec2.jpg

Perry explains this phenomenon:

"Starting about 2009, a one-to-one relationship between stock prices and after-tax corporate profits has once again re-emerged, and both the S&P 500 and corporate profits have increased by the exact same 119% at the end of 2013 from their cyclical, recessionary lows. The all-time record highs for the S&P 500 Index in 2013 were being driven by record-high corporate profits as the chart shows, and it's almost certain that the ongoing bull market rally in 2014 continues to be supported by record-high corporate profits."

The corporate landscape has rarely been as conducive to generating profit as it is right now. As a result, the post-recession years have been dubbed "a golden age of corporate profits" by those in both mainstream and alternate media. Specifically, "corporate earnings have risen at an annualized rate of 20.1 percent since the end of 2008." As a percentage of national income, "corporate profits stood at 14.2 percent in the third quarter of 2012, the largest share at any time since 1950."

To put the significance of this growth in perspective, at the end of 2008, during the peak of the recession, US corporate after-tax profits totaled $671.40 Billion. At the end of June 2014, that total has nearly tripled to $1.842 Trillion.


Unemployment Rate and Job Growth

Another major indicator used to gauge the state of the economy is the unemployment rate. In October of 2009, after the residual effects of the recession had settled, the US unemployment rate officially hit 10% for only the second time since 1940 (10.8% in 1982). After hovering around 9% through 2011, the rate has steadily decreased over the past few years, dropping below 6% in September of 2014 - a level untouched since July of 2008.

This new 6-year low in the rate includes 1.9 million people dropping from the ranks of the unemployed, and the number of "long-term unemployed" falling 1.2 million over the past year.

According to the US Department of Labor, "employers added 248,000 jobs in September (2014)" and "payrolls have expanded an average 227,000 a month this year, putting 2014 on track to be the strongest year of job growth since the late 1990s." The job growth rate in 2014 included a 300,000+ jump in April. And much of this expansion has been fueled by the private sector, which "has now added 10.3 million jobs over 55 straight months of growth" since the recession.


Flawed Indicators

Based on assessments which focus on macroeconomic indicators like the GDP, DJIA, and Unemployment Rate, one could reasonably come to the conclusion that not only has the US fully recovered from the "Great Recession," but it has actually surpassed pre-recession levels in economic well-being. However, this begs the question: whose well-being? And a closer examination uncovers plenty of contradictions.

The contradictions that arise from such assessments are largely due to the inherent flaws of these indicators. According to the New Economy Working Group, "Gross Domestic Product (GDP) has many deficiencies as a measure of economic well-being. Most often noted is the fact that it can only add, which means it makes no distinction between beneficial and harmful economic activity." Also, GDP analyses focus solely on total growth, and do not attempt to assess levels of wealth distribution:

"There could be complete income equality with everyone's purchasing power growing equally. Or the society may be divided between a small minority of the extremely affluent and a majority of the extremely destitute - or anything in between. GDP gives no clue one way or the other. Growth in the incomes of a few billionaires can produce impressive growth in GDP even as a majority of people starve."

In fact, during the past half-century, the DJIA has lost almost all of its credibility as a reliable indicator of economic well-being. And since the rise of globalization in the late-1990s, it has become increasingly irrelevant to economic activity on a national level. "The Dow's biggest flaw, perhaps, is that it doesn't help us to make sense of an increasingly interconnected global economy - one in which what's good for GM isn't always good for the country," explains Adam Davidson. "GE, IBM and Intel, for example, all make more than half their profits in other countries. And while this may be great for their shareholders, it means little for most Americans."

The ever-increasing gap between corporate profit and workers income has also served as a death knell to the DJIA indicator. "In the postwar boom of the 1950s, the economy was growing so fast, and the benefits were so widely shared (throughout the socioeconomic ladder), that following 30 large American companies was a solid measure of most everyone's personal economy," Davidson adds. Back then, "what was good for GM really was good for the country." In a modern economic environment that rewards CEOs 331 times more than the average worker, and 774 times more than minimum wage workers, this is no longer the case. (In 1983, this ratio was 46 to 1)

Historically, the unemployment rate has been considered a fairly weak indicator of economic well-being, and for good reason. Its two major flaws lie in its failure to gauge levels of income, and its inability to consider things like "underemployment" and "hidden unemployment."

These lost categories include "people who have given up looking for jobs or work part time because they can't find full-time position." In 2014, as unemployment statistics suggest a vast improvement in labor participation, "more than 9 million Americans still fit into these categories, about 60 percent - or 3.5 million - above prerecession levels, according to the Labor Department."

Evan Horowitz explains:

"Let's say there are 100 people either working or looking for work. If 94 of those people have jobs, and six are seeking jobs, then the unemployment rate is 6 percent.

Notice that a lot hinges on people 'working or looking for work.' Say you want to work, but the job market is bad and you decide to put off the search until conditions get better. You're still unemployed, just not counted as unemployed by the government.

To return to the example, if three of those six people looking for work get discouraged and give up, the unemployment rate would fall to about 3 percent."

Furthermore, the unemployment rate completely ignores income. In other words, even rates that are considered to represent "full employment" (4-5%) essentially mean nothing if a considerable number of jobs pay poverty wages.


State of the Working Class

Because macro-indicators like the DJIA, GDP, and unemployment rates are severely flawed in their ability to reflect standards of living and economic well-being for a population, it is important to evaluate how the majority is fairing in this so-called recovery.

Since the US population throughout is largely driven by consumerism, a telling statistic is the market-based core personal consumption expenditures (PCE) price index, a measurement used to determine the amount of expendable income the average consumer possesses at a given time. According to Josh Bivens of the Economic Policy Institute, "the market-based price index for core PCE (i.e., excluding food and energy) rose just 1.3% over the past year, well below the Fed's 2% inflation target." This supports further evidence that impressive gains in GDP and corporate profits are simply not reaching (or trickling down to) a majority of Americans.

Despite recent and steady job growth, there are still 1.4 million fewer full-time jobs in the US today than there was in 2008. A recent survey conducted at Rutgers University reports that more than 20 percent of all workers that have been laid off in the past five years still have not found a new job.

When considering workers who have given up on job searches, the unemployment rate is estimated at more than 12 percent.

A more accurate indicator than the unemployment rate may be the actual employment rate. When looking at this, we see that roughly 80 percent of " prime-age workers " (those between 25 and 54) had jobs in 2007. "That bottomed out at around 75 percent during the worst of the downturn, but has risen to only 76.7 percent since."

Despite steady job growth, new jobs simply do not stack up to the jobs that were lost. In sectors that experienced severe job losses due to the recession, workers are earning 23% less today. The average annual salary in the manufacturing and construction sectors - a particularly hard hit area - was $61,637 in 2008. It has now plummeted to $47,171 in 2014. Similar adjustments to income levels imply that $93 billion in lower wage income has been created during the recovery - meaning workers, across the board, are receiving a much smaller share than they were before 2009.

A report by the United States Conference of Mayors (USCM) also showed that "the majority of metro areas - 73 percent - had households earning salaries of less than $35,000 a year," hardly a living wage for families facing ever-rising commodity prices.

Despite increased productivity and corporate profits, most workers' wages have actually fallen. Biven reports, "From the first half of 2013 to the first half of 2014, real hourly wages fell for all deciles, except for a miniscule two-cent increase at the 10th percentile. Underlying this exception to the general trend at the 10th percentile is a set of state-level minimum-wage increases in the first half of 2014 in states where 40 percent of U.S. workers reside."

"As a percentage of national income, corporate profits stood at 14.2 percent in the third quarter of 2012, the largest share at any time since 1950, while the portion of income that went to employees was 61.7 percent, near its lowest point since 1966,"reported Nelson Schwartz in 2013. Dean Maki, chief US economist at Barclay's reports that "corporate earnings have risen at an annualized rate of 20.1 percent since the end of 2008, but disposable income inched ahead by 1.4 percent annually over the same period, after adjusting for inflation," adding that "there hasn't been a period in the last 50 years where these trends have been so pronounced."

In the midst of impressive GDP growth, the US working class is experiencing a legitimate hunger crisis that does not seem to slowing down. "As of 2012,49 million Americans suffer from food insecurity, defined by the U.S. Department of Agriculture (USDA) as lack of access to 'enough food for an active, healthy life.' Nearly one-third of the afflicted are children. And millions of them don't even have access to food stamps, according to a new report from the anti-hunger organization Feeding America."

In May of 2014, there were 46.2 million Americans on food stamps, a slight decrease from a record 47.8 million in December 2012. According to the US Department of Agriculture, 14.8% of the US population is currently on the Supplemental Nutrition Assistance Program (SNAP). Prior to the recession, the percentage of the population requiring such assistance hovered between 8 and 11 percent.

According to the US Census Bureau, "in 2013, there were 45.3 million people living in poverty" and "for the third consecutive year, the number of people in poverty at the national level was not statistically different from the previous year's estimate." The official poverty rate is at 14.5 percent.


Conclusion

Between 2008 and 2013, the number of US households with a net worth of $1 million or more increased dramatically, from 6.7 million to 9.6 million. Households with a net worth of $5 million and $25 million respectively also increased. "There were 1.24 million households with a net worth of $5 million or more last year, up from 840,000 in 2008. Those with $25 million and above climbed to 132,000 in 2013, up from 84,000 in 2008."

The US government, or more specifically, the Federal Reserve, has been instrumental in this uneven recovery that has been characterized by massive corporate profits and booming millionaires on one side (a small minority), and falling wages, increased poverty, and frequent reliance on food stamps on the other side (a large majority).

According to a September 2014 study by the Harvard Business School, the widening gap between America's wealthiest and its middle and lower classes is "unsustainable," and "is unlikely to improve any time soon." The study points the finger at "shortsighted executives" who are "satisfied with an American economy whose firms win in global markets without lifting US living standards" for American workers, and therefore create an extremely polarized population where a majority of workers are disenfrachised from the business world.

The practice of quantitative easing (QE) - "An unconventional monetary policy in which a central bank purchases government securities or other securities from the market in order to lower interest rates and increase the money supply" - has become common during the recovery. Essentially, this practice "increases the money supply by flooding financial institutions with capital in an effort to promote increased lending and liquidity." After three bouts of QE, all occurring since the recession, the Federal Reserve has acquired $4.5 trillion in assets , while adding at least $2.3 trillion of additional currency into the economy.

Robert D. Auerbach - an economist with the U.S. House of Representatives Financial Services Committee for eleven years, assisting with oversight of the Federal Reserve, and now Professor of Public Affairs at the Lyndon B. Johnson School of Public Affairs at the University of Texas at Austin - estimates that 81.5% of this money has not been used to "stimulate the economy," but rather " sits idle as excess reserve in private banks."

Others have reported that, rather than sitting idle as Auerbach suggests, the money has actually funneled through to major corporate players, creating massive personal wealth for a select few. CNBC's Robert Frank reported just last week that "the world's billionaires are holding an average of $600 million in cash each - greater than the gross domestic product of Dominica," which "marks a jump of $60 million from a year ago and translates into billionaires' holding an average of 19 percent of their net worth in cash."

When considering the top-heavy recovery numbers, and increased misery for the working class, this comes as no surprise. And it certainly comes as no surprise to political economist Doug Henwood, who reported such trends back in 2012:

"Despite the strong recovery in cash flow, to record-breaking levels, firms are investing at levels typically seen at cyclical lows, not highs. Some cash flow is going abroad, in the form of direct investment, but still you'd think returns like these would encourage investment. Instead, they've been shipping out gobs to shareholder. Here's a graph of what I call shareholder transfers (dividends plus stock buybacks plus proceeds of mergers and acquisitions) over time:

rec3.jpg

Though not at the preposterously elevated levels of the late 1990s and mid-2000s, transfers are at the high end of their historical range. Instead of serving the textbook role of raising capital for productive investment, the stock market has become a conduit for shoveling money out of the 'real' sector and into the pockets of shareholders, who besides buying other securities, pay themselves nice bonuses they transform into Jaguars and houses in Southampton."

The Great Recession - like the 2001 recession before it, the 1990-91 recession before that, the 1981-82 recession before that, the 1973-75 recession before that, and so on - was the result of deeper systemic deficiencies. While the emergence of financialization opened the door for manipulative and predatory finance tricks (credit default swaps, mortgage-backed securities, NINJA loans, etc...) and helped to construct an impressively profitable house of cards, it is only part of the story. Ultimately, it is the boom & bust, cyclical nature of capitalism, along with its perpetually falling rates of profit (not cumulative profit), that are truly responsible, though almost always ignored.

The nature of this latest recovery suggests that the final nail in the working-class coffin, whose construction has been underway since the birth of neoliberalism, has been secured into place. Despite desperate measures used to pump massive amounts of currency into the economy through QE, virtually none has trickled down to the 99%. It's like déjà vu, all over again. And again… And again…

Calibrating the Capitalist State in the Neoliberal Era: Equilibrium, Superstructure, and the Pull Towards a Corporate-Fascistic Model

By Colin Jenkins

The following is Part one of a multi-part series, "Applying Poulantzas," which analyzes the work of Greek Marxist political sociologist, Nicos Poulantzas, and applies it to the unique political and economic structures found under neoliberalism and post-industrial capitalism.



Since the capitalist formation of relations between what is perceived as the 'public sector' and the 'private sector,' traditional nation-states and their governing bodies have played a major role as facilitators of the economic system at-large. This became a necessary supplemental component as localized economies, which were dominated by agrarian/plantation life, gave way to industrialization and subsequent mass migration into urban centers, thus introducing new industrial economies based in the manufacturing/production process. With the advent of wage labor came predictable outcomes of capital accumulation and a perpetually increasing polarization between the owning class and working class. And with this growing inequality came the notions of worker collectivization and unionism which, absent any equalizing measures taken by the State, were the only sources of hope for workers who quickly found themselves, their livelihood, and their family's well-being at the mercy of a rapidly fluctuating and exploitative labor market. Work was often hard to come by and, when it was available, the wages "earned" were barely enough to cover basic necessities like food, clothing and shelter - provisions which had long been commodified to create expanding avenues of profit for the owning class.

The inherent instabilities created by this economic system — a system that exists for the sole purpose of creating or maintaining individual/personal wealth (as opposed to preserving collective/societal wealth) — require components that act solely as stabilizers. Despite its shunning, the existence of society — or "the aggregate of people living together in a more or less ordered community" — not only remains, but actually serves as the casing for which this system must rely on, or more aptly, capitalize from within. And because of this reliance, the instabilities and contradictions that simultaneously represent natural byproducts and threats become common growths as the result of a counterintuitive and inhumane arrangement, and must be kept in check through a delicate (though not necessarily intricate) balancing act.

In order to "balance" competing interests - in this case the "dominant" and "dominated" classes - the political sphere, a major element of the State apparatus, assumes a vital role. As such, Nicos Poulantzas, building upon earlier theoretical contributions from the likes of Antonio Gramsci, details the dynamic process whereas the state serves as a facilitator to the unstable equilibrium that is produced by the internally antagonistic capitalist system. Ultimately, through this act of facilitating, the state (by deploying its political power) negotiates a perpetual series of "compromises" in the form of economic "sacrifices" which are accepted as a necessity by the dominant classes; and which are precisely aimed at creating a limited equilibrium that ensures a minimal degree of social stability (maintained by the political superstructure) atop the inherently asymmetrical economic base.

Poulantzas explains:

"…political power is thus apparently founded on an unstable equilibrium of compromise. These terms should be understood as follows: 1) Compromise: in the sense that this power corresponds to a hegemonic class domination and can take into account the economic interests of certain dominated classes even where those could be contrary to the short-term economic interests of the dominant classes, without this affecting the configuration of political interests; 2) Equilibrium: in the sense that while these economic 'sacrifices' are real and so provide the ground for an equilibrium, they do not as such challenge the political power which sets precise limits to this equilibrium; and 3) Unstable: in the sense that these limits of the equilibrium are set by the political conjuncture." [1]

Gramsci tells us, "The life of the state is conceived of as a continuous process of formation and superseding of unstable equilibria… between the interests of the fundamental group and those of the subordinate groups - equilibria in which the interests of the dominant group prevail, but only up to a certain point, i.e. stopping short of narrowly corporate interest."[2] In other words, as the capitalist system naturally bends toward a corporate-fascistic state of being through the simultaneous developments of capital accumulation and mass alienation - thus forming structures of domination that extend from the economic base and into the political, social, and cultural realms - there develops a need to stabilize the fragile nature (in the sense that such imbalance is a constant threat to the societal structure at-large) of this system.

The need to maintain this equilibrium exists as long as a wholly functioning society is requisite for capitalist expansion - or, as long as worker-consumers represent viable targets of exploitation. In Political Powers and Social Classes, Poulantzas identifies certain measures that represent embedded concessions on the part of the owning class, carried out by the state apparatus through a systematic process that is relatively fluid and effortless (though, as Poulantzas points out, competing interests exist even within this elite bureaucracy). In recognizing the function of the state and its role atop the capitalist formation of relations, Poulantzas explains, "The notion of the general interest of the 'people', an ideological notion covering an institutional operation of the capitalist state, expresses a real fact: namely that this state, by its very structure, gives to the economic interests of certain dominated classes guarantees which may even be contrary to the short-term economic interests of the dominant classes, but which are compatible with their political interests and their hegemonic domination."[3]

Political systems based on grand "democratic" narratives like "representative democracy" and "republicanism," as well as Rousseau's "social contract," are ideal enablers for this societal arrangement. This is the very reason why liberalism and the modern adaptation of the "liberal politician" play such a crucial role in their opposition to the proto-fascist nature of "conservatism." Their superficially adversarial relationship represents the ultimate stabilizer as its reach is limited to the confines of the political superstructure. And, because it deals primarily with "social issues" (including passive measures of economic redistribution), it is ultimately relegated to directing the aforementioned "compromises" of the dominant class. It does not and can not transform the economic base (the capitalist hierarchy) as these compromises, while representing "real economic sacrifices" that are necessary to provide the ground for equilibrium, "do not as such challenge the political power which sets precise limits to this equilibrium."

"Democratic" systems which involve periodic elections of "representatives" to "public" office accomplish two important tasks in this regard. First, they create a façade of civil empowerment - a form of political compromise which gives the dominated classes the appearance of choice vis-a-vis universal suffrage. Second, they create a political sphere that, while completely fused with the long-term interests of the dominant classes (through its sole purpose as a facilitator), operates as a separate entity existing outside the economic base - a separation that is, as Poulantzas explains, both an exclusive and necessary element to the capitalist system. It reminds us of John Dewey's claim that, "As long as politics is the shadow cast on society by big business, the attenuation of the shadow will not change the substance." In the US, the two-party political system has proven extremely effective in this regard. Aside from differences on social issues like abortion and gay marriage, as well as socioeconomic issues like unemployment insurance and public assistance, both parties ultimately embrace capitalist/corporatist interests in that they both serve as facilitators for the dominant classes: The Republican Party in its role as forerunner, pushing the limits of the capitalist model to the brink of fascism; and the Democratic Party in its role as governor, providing intermittent degrees of slack and pull against this inevitable move towards a "corporate-fascistic state of being."

The distinction made between 'the political' and 'the economic' is important to consider, though these boundaries have seemingly blurred in the age of neoliberalism and the intensification of the merger between "public" and "private." And while Poulantzas insists this separation is inherent and theoretically unbreakable, he (along with Gramsci) may have underestimated the extent to which compromises may be reined in without destabilizing the equilibrium beyond repair. During the neoliberal era, there have been many developments which have pushed this long-standing balance to the verge of "narrow corporatism" and beyond, including factors related to technology and government surviellance, growth in the banking industry, the development of corporate media and intricate propaganda, financialization's role in supplementing monopoly capitalism, and the maturation of the international economic system and all of its mediating components, to name a few; but that discussion is for another place and time.

For the purpose of this analysis, we are focused on national electoral politics and political parties, and the specific role they play in maintaining the status quo - in this case, not only the capitalist hierarchy, but also the stage of monopoly capitalism which has come to fruition over the past few decades. The distinction between base and superstructure allows us to see how the political apparatus, through the actions of political parties, exists solely as a tool for the "power bloc." Furthermore, it allows us to divert from reductionist theories which attempt to highlight a singular cause, and move towards a more nuanced critique of the capitalist state, especially in the "pluralist" form that we see in the US and other "western democracies."

"As far as the terrain of political domination is concerned, this is also occupied not by one single class or class fraction, but by several dominant classes and fractions," explains Poulantzas. "These classes and fractions form a specific alliance on this terrain, the power bloc, generally functioning under the leadership of one of the dominant classes or fractions, the hegemonic class or fraction."[4] In this instance, even with a government that includes separate branches - legislative, executive, and judicial - and represents several interests, as in Robert A. Dahl's "polyarchy," the state still exists and operates on the foundation of a capitalist system that creates its own hierarchy. The members of this "political terrain" are not necessarily synchronized with one another when it comes to geography, special interests, localized interests, and priorities when maintaining the equilibrium, and they don't have to be. Despite these various pieces which make up the power bloc, in its own formation the base forces the political "superstructure" to adjust accordingly. This is why modern practices like "blanket financing" of political campaigns, which consists of corporations or private interests providing monetary support to opposing candidates and political parties in a particular election, have become so prevalent. Politicians, despite what their personal beliefs or aspirations may be, are put into power by the very hierarchy that depends on the economic base. Their positions of power cater to and are reliant on not only the power bloc which put them there, but the maintenance of the very system that allows them to stay there. Therefore, while they may possess some leeway in terms of pushing superficial agendas, their ability to do so is granted by the hierarchy extending from the economic base. Ultimately, in order to maintain its own existence, the political apparatus must protect the base - and is essentially designed (or is ever-evolving) to do so despite its "relative autonomy" which is "inscribed in the very structure of the capitalist state."

According to Poulantzas, by recognizing both the autonomy of the "state machine" as well as the existence of a "power bloc" which mimics society's pluralist form, it will "enable us to establish theoretically, and to examine concretely, the way in which the relative autonomy of the capitalist state develops and functions with respect to the particular economic-corporate interests of this or that fraction of the power bloc, in such a way that the state always guards the general political interests of this bloc - which certainly does not occur merely as a result of the state's and the bureaucracy's own rationalizing will."[5] This understanding includes "firmly grasping the fact than an institution (the state) that is destined to reproduce class divisions cannot really be a monolithic, fissureless bloc, but is itself, by virtue of its very structure (the state is a relation), divided."[6] Poulantzas continues:

The various organs and branches of the state (ministries and government offices, executive and parliament, central administration and local and regional authorities, army, judiciary, etc.) reveal major contradictions among themselves, each of them frequently constituting the seat and the representative - in short, the crystallization - of this or that fraction of the power bloc, this or that specific and competing interest. In this context, the process by whereby the general political interest of the power bloc is established, and whereby the state intervenes to ensure the reproduction of the overall system, may well, at a certain level, appear chaotic and contradictory, as a 'resultant' of these inter-organ and inter-branch contradictions.[7]

This "division," and these "contradictions," were never more evident than with President Dwight Eisenhower's 1961 farewell address and sobering warning against the rising "military industrial complex," which publicly displayed a major fission within the power bloc. According to Poulantzas, this splitting is irrelevant in the capitalist scheme of things because it remains, by design, autonomous from the base; and, therefore, will naturally work itself out to accommodate that base, whether through conscious coordination or through inherent process. In the age of neoliberalism and monopoly capitalism, the state has become highly concentrated out of necessity. In this sense, C. Wright Mills' assessment rings true:

As each of these domains becomes enlarged and centralized, the consequences of its activities become greater, and its traffic with the others increases. The decisions of a handful of corporations bear upon military and political as well as upon economic developments around the world. The decisions of the military establishment rest upon and grievously affect political life as well as the very level of economic activity. The decisions made within the political domain determine economic activities and military programs. There is no longer, on the one hand, an economy, and, on the other hand, a political order containing a military establishment unimportant to politics and to money-making. There is a political economy linked, in a thousand ways, with military institutions and decisions. [8]

This intertwined political economy exists within the superstructure. It's increased centralization, coordination, and synchronization over the past half-century has undoubtedly pushed the US government to the brink of a "corporate-fascistic state of being." In this development, the equilibrium has never been more delicate and fragile. The two-party system, thriving from the pluralist nature of both the electorate and power bloc, has proven efficient in carrying out trivial "concessions" that give "the economic interests of certain dominated classes guarantees which may even be contrary to the short-term economic interests of the dominant classes, but which are compatible with their political interests and their hegemonic domination."[9] The expansion of domestic militarization and the intensification of "austerity measures" have introduced a degree of "corporate-fascistic" torque unseen before from within a mature capitalist state. How far these embedded "compromises may be reined in without destabilizing the equilibrium beyond repair" remains to be seen.



References

[1] Poulantzas, Nicos (Timothy O'Hagan translating). Political Power and Social Classes. Verso, 1975, p. 192.

[2] Gramsci, Antonio. Prison Notebooks, p. 182.

[3] Poulantzas, Political Power and Social Classes, p. 191.

[4] Poulantzas, Nicos. Classes in Contemporary Capitalism (Translated from French version by David Fernbach). Verso, 1978, p. 93.

[5] The Poulantzas Reader: Marxism, Law and the State. Verso Books: London/New York, 2008, p. 284.

[6] Ibid, p. 285.

[7] Ibid, p. 285.

[8] C. Wright Mills. The Power Elite, New Edition. Oxford University Press: 2000, p. 76.

[9] Poulantzas, Political Power and Social Classes, p. 191

On the Front Lines of Class War: Why the Fight for a Livable Wage is Everyone's Fight

By Colin Jenkins

"There's class warfare, all right, but it's my class - the rich class - that's making war, and we're winning."

- Warren Buffett (2006)



In the spring of 2004, amid the thaw of a frigid New York City winter, a brave group of Starbucks baristas began organizing. Like most service-sector employees in the United States, they were faced with the daunting task of trying to live on less-than-livable wages. Inconsistent hours, inadequate or non-existent health insurance, and less-than-dignified working conditions paled in comparison to their inability to obtain the most basic necessities. Apartment meetings, backroom discussions, and after-hours pep talks - all fueled by a collective angst - culminated into a sense of solidarity, the natural bond that occurs when workers take the time to realize their commonalities and shared struggle. On May 17, 2004, they officially announced their affiliation with the Industrial Workers of the World, an all-encompassing union with an impressive history of labor activity in the US. A petition for unionization followed suit. Their demands were simple: Guaranteed hours with the option for fulltime status, an end to understaffing, a healthier and safer workplace, and increased pay and raises.


"Solidarity Unionism," Grassroots Organizing, and the Formation of a New Front

It is only fitting that such a daring endeavor would fall under the banner of the IWW. Proudly asserting itself as "One Big Union" and "A Union for All Workers," the "Wobblies" shun hierarchical and highly-bureaucratic union models that have dominated the American labor scene for much of the past half-century, instead promoting and utilizing direct action that is member-run and member-driven. Deploying what they refer to as "solidarity unionism," as opposed to "business unionism," the preamble to the IWW's constitution echoes an old-school, militant, trade-union tone, boldly (and correctly) proclaiming, "The working class and the employing class have nothing in common. There can be no peace so long as hunger and want are found among millions of the working people" - a far cry from the timid and capitulating modus operandi of the modern adaptation. However, it is not just a much-needed infusion of labor militancy that makes the IWW attractive, it is its grassroots approach to labor organizing. In a post-industrial landscape that is overrun with underemployment, the IWW's model represents accessibility and a sense of empowerment for disconnected workers who find themselves on virtual islands - outside the potentially radical confines of a traditional shop floor. And when considering that wages have either dropped or remained stagnant in the midst of ever-growing costs of living over the past 30 years, it is no surprise that American workers are reaching their collective breaking point and seeking refuge in the form of a shared struggle.

After decades of a disastrous neoliberal agenda that has placed the American working class in an all-out sprint to the bottom, the growing needs of low-wage workers coupled with the "wobbly way" to create a perfect storm. As such, the Starbucks Union captured a vibe and sparked a movement. 2007 saw the arrival of Brandworkers, "a non-profit organization bringing local food production workers together for good jobs and a sustainable food system." Following a similar grassroots blueprint, the NYC-based organization was founded "by retail and food employees who identified a need for an organization dedicated to protecting and advancing their rights," and stands on "a simple principle: that working people themselves, equipped with powerful social change tools, were uniquely positioned to make positive change on the job and in society." Their direct-action, "Focus on the Food Chain (FOFC)" initiative specifically targets "the rapid proliferation of sweatshops among the food processing factories and distribution warehouses that supply the City's (NYC) grocery stores and restaurants" and that of which "increasingly relies on the exploitation of recent immigrants of color, mostly from Latin America and China." In an unprecedented effort, FOFC "creates space for the immigrant workers of NYC's industrial food sector to build unity with each other, gain proficiency in the use of powerful social change tools, and carry out member-led workplace justice campaigns to transform the industry." Ultimately, "Focus members and their allies are using organizing, grassroots advocacy, and legal actions to build a food system that provides high-quality local food and good local jobs."

Groups like the Starbucks Workers Union and Brandworkers created momentum. In 2010, six years after baristas came together in Manhattan, a band of sandwich makers gathered 1,200 miles westward, in Minneapolis, Minnesota. Thus, the next wave of grassroots, low-wage labor activity - this time stemming from the fast-food industry and, more specifically, the corporate brand of Jimmy John's sandwiches - took hold. Sporting T-shirts that read, "Wages So Low You'll Freak" - a mockery of JJ's corporate slogan, "Subs So Fast You'll Freak" - JJ workers, also under the direction of the IWW, embarked on the first ever unionization drive for fast-food workers. Emily Przybylski, a bike delivery worker at the restaurant chain, captured the spirit of the moment. "A union in fast food is an idea whose time has come," she told reporters. "There are millions of workers in this industry living in poverty, with no consistent scheduling, no job security and no respect. It's time for change." As Labor Day 2010 approached, JJ workers at one Minneapolis store filed for a union election, and actions such as leafleting and picketing were coordinated at stores in 32 states, "from Clovis, California to Miami, Florida."

The embryo created by baristas in NYC, and nurtured over the better part of a decade by the likes of the Brandworkers and Jimmy John's workers in Minneapolis, came to a head in 2012. On Thursday, October 4th, 2012, the spread of low-wage discontent struck the epicenter of corporate exploitation, as "more than 70 Los Angeles Wal-Mart workers from nine stores walked off the job." These walkouts accompanied over "20 charges of unfair labor practices" filed with the National Labor Relation Board. A week later, Wal-Mart workers across 28 stores in 12 states, staged labor protests in the form of strikes and walk-outs. The first workers' strike in the company's 50-year history spread to stores in Los Angeles, San Francisco, Seattle, Chicago, Dallas, Miami, Washington, D.C., and Orlando. This movement, much like its predecessors, was largely formed out of grassroots organizing efforts that were over a year in the making. In June 2011, "OUR Walmart," a workers advocacy organization supported by and coordinated with store associates from across the country, dispatched "nearly 100 Associates representing thousands of OUR Walmart members from across the United States to the Walmart Home Office in Bentonville, Ark., and presented a Declaration of Respect to Walmart executive management." The Declaration included a list of requests: Listen to us, the Associates; Have respect for the individual; Recognize freedom of association and freedom of speech; Fix the Open Door policy; Pay a minimum of $13/hour and make full-time jobs available for Associates who want them; Create dependable, predictable work schedules; Provide affordable healthcare; Provide every Associate with a policy manual, ensure equal enforcement of policy and no discrimination, and give every Associate equal opportunity to succeed and advance in his or her career; and provide wages and benefits that ensure that no Associate has to rely on government assistance.

In November of 2012, merely weeks after Wal-Mart workers took a courageous stand, fast-food workers from McDonald's, Wendy's, Burger King, Taco Bell and KFC staged protests in various locations around New York City, "demanding $15 an hour in pay and the right to form a union." A few months later, in the spring of 2013, fast food strikes gained momentum with numerous walk-outs across the country. In April, NYC workers - backed by labor, community and religious groups - staged protests at more than five dozen restaurants. Over the course of the next month, similar actions were carried out in Pennsylvania and Chicago. In Chicago, the actions spread from the fast-food industry to retail, with low-wage workers from Macy's, Sears, and Victoria's Secret also participating. On Friday, May 10th, "400 workers at more than 60 fast-food restaurants in the Detroit metro area walked off the job" in what may have been "the largest fast food strike in American history." The Detroit event was significantly effective as it "shut down multiple restaurants entirely, including multiple McDonald's outlets, a Long John Silver's, a Burger King, two Popeye's restaurants, and a KFC." "One McDonald's worker, Jay Robinson, told reporters that when he started at McDonald's over two years ago, he was paid $7.40 an hour,"writes Aaron Petkov for Socialistworker.org. "Robinson has gotten raises since then - and now makes $7.48 an hour." In his efforts to care for himself and a 2-year-old daughter, "It's a day-to-day struggle," he told reporters. "And the owners make millions." At another McDonald's restaurant, "management attempted to avert a shutdown by bringing in replacement workers, but those replacement workers (in a moment of incredible solidarity) then promptly joined the strike." This wave of low-wage labor militancy continued through the summer. On Thursday, August 29th, workers at numerous fast-food chains participated in coordinated strikes in nearly 60 cities nationwide. Citing poverty wages and the need for more rights in the workplace, "a dozen workers didn't show up for their shift at a McDonald's on 8 Mile Road (in Detroit), forcing the closure of the dining room." In Raleigh, N.C., about 30 workers picketed outside a Little Caesars location. One employee, Julio Wilson, expressed the discontent of his peers, saying the $9-an-hour he was paid was not nearly enough to support himself and his 5-year-old daughter. "I know I'm risking my job, but it's my right to fight for what I deserve," Wilson said. "Nine dollars an hour is not enough to make ends meet nowadays." In Indianapolis, "several employees walked off the job from a McDonald's outlet at 16th and Meridian streets." "Most people here have a family to support, and most people here barely make enough to make ends meet,'" employee Dwight Murray said. "We're here today because we feel like McDonald's is a $6 billion entity and it's not unfeasible for them to pay $15 an hour.


Corporate Greed, Propaganda, and Union-Busting

Despite the obvious needs for livable wages, there is much opposition. Union-busting has become a staple of employee orientations throughout the corporate landscape, with retail giants like Target and Wal-Mart regularly unleashing "aggressive anti-union push (es), and distributing pamphlets and other propaganda to employees." Corporations like Target have become notorious for making employees watch dramatized "training videos" on the so-called "dangers" of unionization in an attempt to convince workers that higher wages, more benefits, and an overall sense of dignity at the workplace would somehow not be good for them. This concerted effort to maintain a grip on poverty wages has led to the formation of intricate networks of union-busting firms that employ corporate lawyers and "anti-union strategists" to offer "continuing education" for business owners and executives. "At these seminars," writes Kim Phillips-Fein, "lawyers and labor relations consultants from the nation's top union-busting law firms come to speak to rapt, intimate groups of executives, advising them on how to beat union election drives, do end runs around the National Labor Relations Board (NLRB), and decertify unions, all the while hawking their own firms' services." Of course, "union members are expressly banned." To complement this behind-the-scenes movement, corporate mouthpieces like Fox News have taken up the propaganda charge against unions by referring to them as "monopolies" that prevent non-union workers from securing jobs, coining terms like "union thugs" as a fear tactic, displaying video snippets of supposed "union violence," utilizing doublespeak like "right to work" to suggest that accepting low wages is somehow a right that should be fought for, and airing modern-day snake oil salesmen to convince its working class viewers that unions are given extra benefits at their expense. In addition to ideological propaganda, special interest groups, wealthy donors, and Super PACs fueled by the Supreme Court's infamous Citizens United decision - such as Koch Industries PAC - have placed virtual ATMs in Governor's mansions and Congressional offices to ensure political opposition to workers' needs while remaining corporate (and thus profit)-friendly.

Starbucks' corporate response to the organizing efforts made by those fateful NYC workers in 2004 was fierce. "Faced with the first serious effort in decades to unionize one of its stores, Starbucks launched what a former worker called 'a scorched-earth campaign' against pro-union employees," reported Josh Harkinson. "The union busting has just been absolutely relentless," says the worker, Daniel Gross, who was fired in 2006 due to his involvement in the initial organizing efforts at the Manhattan store where he worked. The Minneapolis Jimmy John's workers were met with similar tactics, which included bizarre personal attacks from store owners and management through social media. On March 22, 2011, after lobbying for sick days from the restaurant chain, six workers - all of whom were "key figures" in the union organizing efforts - were fired for "defaming the brand and disloyalty to the company." Shortly thereafter, another "pro-union" employee was berated and humiliated on social media by owners and managers, some of whom went as far as posting the employee's personal telephone number on a public Facebook page and asking people to text the employee to "let him know how they feel." An Assistant Manager then posted disparaging personal comments about the pro-union employee, making fun of his appearance and including a picture of the employee for all to see. In addition to these reactive measures deployed by some companies, corporate behemoths like Wal-Mart have relied on proactive union-busting programs for years. In 2007, Washington-based Human Rights Watch released an extensive report accusing the retail giant of "routinely flouting its workers' human rights through a sophisticated strategy of harassing union organizers, discriminating against long-term staff, and indoctrinating employees with misleading propaganda." The report includes examples of "workers forced into unpaid overtime and an alleged strategy of squeezing out long-serving staff who are more costly than low-wage, temporary, younger workers," highlights "elaborate tactics to stop staff from coming together to fight for better conditions," and even describes detailed measures such as "focusing security cameras on areas where staff congregate and shifting around loyal workers in 'unit packing' tactics to ensure votes for union recognition are defeated." The report also found that each store manager, as a part of their training, receives a "manager's toolbox" manual which instructs them on "how to remain free in the event union organizers choose your facility as their next target," and that managers are also given access to and instructed to call a 'union hotline' if they suspect staff are discussing unionization - an action that would deploy corporate specialists from the company's headquarters to "address the situation."

The reasons for such opposition are clear. Corporate profits remain at an all-time high because companies are able to pay poverty wages to their employees and rely on government welfare programs to cover the rest (ironically, while also enjoying historically low corporate tax rates ). Additionally, the economic storm that has lingered over the heads of the American working class for the past five years has equaled a virtual paradise for corporate America. Three simple facts highlight this current economic landscape:

  • Corporate profit margins just hit another all-time high as companies are making more per dollar of sales than they ever have before.

  • Wages as a percent of the economy just hit another all-time low as companies are paying employees less than they ever have as a share of GDP.

  • Fewer Americans are working than at any time in the past three decades as companies don't employ as many workers as they used to. As a result, the employment-to-population ratio has collapsed.

Maintaining this environment has become a top priority for wealthy investors, the corporations themselves, and the politicians who are funded by both. By gutting the middle class through the destruction of unions (as of 2011, only 11.9% of the American workforce was unionized - a 70-year low) over the past three decades, corporations have enjoyed a relatively clear path towards establishing these beneficial conditions of today - where 20% of the population owns 89% of all "privately held wealth;" and where the top 1% of the population owns 42.1% of all "financial wealth (total net worth minus the value of one's home)." In addition to corporate-friendly policies that became commonplace starting with the Reagan years and continuing through both Bush', Clinton, and now Obama, the emergence of globalization has allowed for the replacement of American workers through the process of offshoring and the subsequent exploitation of extremely impoverished populations of workers abroad. Therefore, this latest surfacing of labor militancy from within the ranks of the domestic, low-wage, service-sector workforce represents the biggest threat - not only in its tangible fight for economic justice in the form of a livable wage, but also in its potentially revolutionary orientation which identifies with the modern working class and, most notably, the working poor - that corporate hegemony has faced within the geographic confines of the U.S. in decades. "If these guys are seen to succeed, it could really light a fire, because the dissatisfaction is unquestionable," labor historian Peter Rachleff explains. "The corporation knows that, and they have a lot of resources [and] plenty of lawyers" to combat these working class movements.


Workers' Victories and Building Momentum

Despite a well-funded and highly-coordinated opposition, there have been many victories and positive developments along the way. The mere emergence of a new labor resistance - let alone the fact that it has developed from within the low-wage service-sector and from one of the most disenfranchised demographics of the working class - is very encouraging. While some have questioned the roots of the movement and the extent of the involvement of more traditional, hierarchical unions like SEIU (Service Employees International), there is no denying the politicization and sense of empowerment that is being internalized by the involved workers themselves. Considering the near-death of working class consciousness in the U.S., this development simply cannot and should not be underestimated. The infusion of a direct-action model that insists on a worker-controlled approach to labor battles (i.e. the IWW) is certainly a leap forward. And this method has proven effective in more ways than one. On Tuesday, December 28, 2008, NYC Starbucks baristas were vindicated by National Labor Relations Board judge, Mindy E. Landow, when she ruled that Starbucks had "illegally fired three workers and otherwise violated federal labor laws in seeking to beat back unionization efforts at several of its Manhattan cafes" and ordered Starbucks "to pledge to end what she said was discriminatory treatment toward workers who supported the union at four of its Manhattan shops: 200 Madison Avenue at 36th Street, 145 Second Avenue at 9th Street, 15 Union Square East and 116 East 57th Street." Two years later, the IWW Starbucks Workers Union, following a "determined campaign of grassroots actions in Starbucks stores and communities all over the country," secured another victory when the company's corporate office gave in to demands for workers to receive time-and-one-half pay for working on Martin Luther King, Jr. Day. "We're deeply moved to have been able in our modest way to increase respect for Dr. King's legacy while ensuring that Starbucks employees who work on his holiday are fairly compensated," said Anja Witek, a Starbucks barista and SWU member in Minnesota. "This is a great example of what baristas and all low-wage workers can achieve by getting organized and taking direct action in support of workplace justice issues." In February of 2012, after a long and drawn-out battle with Jimmy John's, a federal judge ruled the company illegally fired the six employees who had campaigned for sick time, and ordered the company to "reinstate the workers with back pay within 14 days." In a spirited testimony, Erik Forman, one of the fired employees, remarked:

"It has already been over a year since we were illegally fired for telling the truth. For all the hard work and dedication of the NLRB's civil servants, employers like Jimmy John's prefer to break the law and drag cases through the courts for years rather than let workers exercise their right to win fair pay, sick days, and respect through union organization. The dysfunctional U.S. labor law system gives Mike and Rob Mulligan (JJ franchise owners) and their cronies in the 1% carte blanche to trample on workers' rights. Jimmy John's workers, and the rest of the 99%, will only be able to win a better life by taking our fight from the courtroom back to the shop floors and the streets."

The latest low-wage workers strike, which took place on December 5th across "100 cities through the day," signified, according to the Guardian's U.S. affiliate, "a growing clamour for more action on income inequality." In front of a Walgreen's in downtown Chicago, nearly 200 protestors chanted, "We can't survive on eight-twenty-five…Walgreen's, Walgreen's, you can't hide. We can see your greedy side!" In Washington, D.C., dozens of workers carrying signs singing loudly, "Jingle bells, jingle bells, jingle all the way, it's no fun, to survive, on low low low low pay." "In New York City, about 100 protesters blew whistles and beat drums as they marched into a McDonald's chanting "We can't survive on $7.25." This collective outrage has empowered workers while also placing the problem of income inequality back on the public agenda. Major media sources that had barely uttered a word about such inequality in recent decades have now begun to showcase it. The Catholic Church's latest Pope, Francis, has made waves during a near-month-long tirade exposing the flaws of capitalism, recently asking, "How can it be that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market drops 2 points?" and referring to the "widening gap between those who have more and those who must be content with the crumbs." And calls for a federal minimum wage increase have gained steam with U.S. Labor Secretary, Thomas Perez, writing on his blog, "To reward work, to grow the middle class and strengthen the economy, to give millions of Americans the respect they deserve - it's time to raise the minimum wage." Though, of course, the Democratic Party's proposal to raise the current rate from $7.25 to $9.00, or even $10.10 in other proposed legislation, would hardly equal a significant change for tens of millions of working poor. Still, despite reformist-based rhetoric from politicians, the agenda is being shaped by the brave workers who have risked all to take a stand.

The battle cry "Fight for $15" has stuck. Numerous small and localized labor organization like Detroit 15 - a group of fast-food and retail workers from the Detroit area fighting "for fair wages and the right to form a union without interference" - and Fast Food Forward - a movement of NYC fast-food workers coming together to "build community engagement, hold corporations and their CEOs accountable, and to raise wages so that all Americans can prosper" - have sprung up amidst the movement-at-large, helping to form collaborative efforts with community and religious organizations which possess built-up social capital to be used, and to make the collective decision-making process more accessible to the workers themselves. Socialist candidate, Kshama Sawant, who made the "Fight for $15" cause a key part of her election campaign, made history by winning a seat on the Seattle City Council in November. Sawant's victory was significant not only for working class interests that have been in dire need of a true "left wing" for decades, but also for the fact that her platform was able to pull local Democrats toward a more authentic (though still reformist), left-wing, working-class agenda. As Seattle Times columnist, Danny Westneat, reported:

"You can't look at the stagnant pay, declining benefits and third-world levels of income disparity in recent years and conclude this system is working. For Millennials as a group, it has been a disaster. Out of the wreckage, left-wing or socialist economic ideas, such as the 'livable wage' movement in which government would seek to mandate a form of economic security, are flowering."


The Future of the American Working Class

If you're reading this article, chances are you are a member of the working class - not because the article specifically pertains to your interests but because, by definition, a large majority of us are compelled to work for a wage or salary to survive. The Occupy slogan which may seem a bit hyperbolic on the surface - breaking society into two camps: the 99% and the 1% - is actually not far off. The 99% essentially refers to the working class - those of us who are underemployed, unemployed, making minimum wage, making an hourly wage, working multiple jobs, earning a salary, working as "salaried professionals," working "under-the-table," etc.. In other words, if you weren't born with enough privilege and generational wealth to carry you through life, you are likely working for a wage in some form or another, or would be compelled to do so if left to your own means.

Jay Robinson, Julio Wilson, Dwight Murray, and their fellow employees are correct in their estimation: Multi-billion dollar corporations can and should pay their workers a livable wage. Considering how far removed we are from the age-old concept of workers "enjoying the fruits of their labor," a seemingly minimal expectation of earning a livable wage for fulltime work has become a revolutionary notion. But it shouldn't be. This issue is not just a low-wage problem - it's a working class problem. It's a middle class problem. It's a societal problem that destroys living standards for everyone outside of elite circles. And, while it is nowhere near the end-all, be-all of solutions to a toxic system, the premise of "a chain being only as strong as its weakest link" is certainly an improvement over the neoliberal, "greed is good" mantra which has dominated monetary and governmental policy over the past thirty years. For low-wage workers themselves, besides allowing the dignity of "earning a living," a livable wage infuses more expendable income into the economy while allowing for the opportunity to live without a chronic reliance on public assistance. "If you earn your money through wages (unlike many of the 1 percent, who earn through things like investments and a tax system biased in favor of capital gains over income) then a higher wage, minimum or otherwise, would mean that you'd spend the additional dollars, creating jobs for other workers," explains market analyst Marshall Auerback. "You'd pay down your mortgages and car loans, getting yourself out of debt. You'd pay more taxes - on sales and property, mostly - thereby relieving the fiscal crises of states and localities. More teachers, police and firefighters would keep their jobs. America would get a virtuous cycle toward higher employment and, more importantly, the cycle would be based on a policy which creates higher incomes, not higher debt via credit expansion." Furthermore, the establishment of livable wages eases the burden placed on the rest of the working class, which has contributed approximately $7 billion per year to fund public assistance programs that serve as a form of subsidization for Fortune 500s. That figure, from an October 2013 report by UC Berkeley's Labor Center, includes four major social benefits programs that low-wage workers are forced to use in order to provide basic necessities for themselves and their families. Specifically, the amount is broken down to Medicaid and the Children's Health Insurance Program ($3.9 billion), the Earned Income Tax Credit ($1.9 billion), food stamps ($1 billion), and Temporary Aid for Needy Families ($200,000), and doesn't include other publicly funded programs like child care assistance, WIC, or section 8 housing, among others.

For those who see low-wage workers protesting for higher pay and think, "why don't they just get a better job" or "why don't they go to college, like I did, and earn a degree?" - think again. In 2012, nearly 300,000 Americans with college degrees were working minimum wage jobs. Furthermore, nearly one-half of all recent college graduates with jobs are underemployed. "Of 41.7 million working college graduates in 2010, about 48 percent of the class of 2010 work jobs that require less than a bachelor's degree, and 38 percent of those polled didn't even need high school diplomas." Even worse yet, 40% of recent college graduates are unemployed. In other words, the idea that earning a degree guarantees a livable wage is exactly that - an idea, no longer based in reality. For those who see low-wage workers striking for a livable wage and think, "what do they expect, they're working at McDonald's" or "these aren't careers we're talking about" - think again. Fact is, since the arrival of globalization, American manufacturing companies - the traditional suppliers of a livable wage - have jumped ship, moving their operations overseas to exploit impoverished workforces that are compelled to labor for next-to-nothing. Since this shift, America's working class has become largely reliant on the service industry. In other words, low-wage, service sector jobs are now careers - not by choice, but by necessity. The 2008 economic crisis and subsequent "recovery" only intensified this shift as "mid-wage occupations ($13.84 to $21.13 per hour) constituted 60 percent" of job losses during the 2008 recession, but only 22 percent of the job gains during the recovery. In contrast, "low-wage occupations ($7.69 to $13.83 per hour) constituted 21 percent" of job losses during the recession, while representing 58 percent of new jobs created during the aftermath. This is a staggering displacement that has seen once-livable employment virtually replaced by now-unlivable wages. As a result, the "characteristics of minimum wage workers" are changing, as 75 percent of them are now adults, many of whom have dependents to care for, and 70 percent of who have at least a high school degree.

The American working class has found itself in a breakneck "race to the bottom" during the corporatist era. However, recent developments stemming from "solidarity unionism," low-wage worker revolts, and a backlash against neoliberal policies and the extreme income inequality which they have bred have shown that American workers are, in fact, beginning to "rise like lions after slumber." If the thundering wave of low-wage labor militancy that has swept the country is any indication, the slumber is officially over. And if the "dramatic actions by and on behalf of workers" in places likes Seattle the past few months - including a "defeat of concessions at major grocery chains, Boeing workers' big 'no' vote on concessions, a $15 minimum wage voted in for airport workers, and election of a socialist (a candidate who made a city-wide $15 minimum wage the centerpiece of her campaign) to city council" -represent a microcosm of things to come, the proverbial race to the bottom - whether it has struck bedrock or not - is over. Because of their emergence as a viable sector of embedded labor, courageous, low-wage workers in the service industry now represent the front lines of an ongoing class war. They represent, as Dave Frieboth notes, "a general uprising of young, displaced workers trapped in low-wage jobs;" people who "looked at the wage disparities and saw that, as a simple matter of fact, the system isn't working." The further they can be kept down in terms of wages, benefits, and overall standards of living, the more effectively their lowly presence may be used as leverage to drive all working Americans' standards down. Thus, their status affects the status of the working class as a whole. They are not only fighting for themselves - they are fighting for all of us. In this sense, "an injury to one" truly is "an injury to all." Their fight is everyone's fight.



References

Sylvia Allegretto, Marc Doussard, Dave Graham-Squire, Ken Jacobs, Dan Thompson and Jeremy Thompson. "FAST FOOD, POVERTY WAGES: THE PUBLIC COST OF LOW-WAGE JOBS IN THE FAST-FOOD INDUSTRY." A report by UC Berkely's Labor Center. October 15, 2013. http://laborcenter.berkeley.edu/publiccosts/fastfoodpovertywages.shtml

Arnade, Chris. "Pope Francis is a whistleblower for the poor. Thank you Time for recognising it." The Guardian, December 11, 2013. http://www.theguardian.com/commentisfree/2013/dec/11/time-pope-francis-whistleblower-poor-right-choice

Auerback, Marshall. "Why Low Minimum Wages Kill Jobs and Crush Living Standards for Everyone." AlterNet, April 24, 2012. http://www.alternet.org/story/155132/why_low_minimum_wages_kill_jobs_and_crush_living_standards_for_everyone?page=0%2C1

Bacon, John. "Fast-food workers strike, protest for higher pay." USA Today, December 5, 2013. http://www.usatoday.com/story/money/business/2013/12/05/fast-food-strike-wages/3877023/

Bigman, Paul. "How'd Seattle Do It?" Labor Notes, December 16, 2016. http://labornotes.org/2013/12/howd-seattle-do-it

Blodget, Henry. "Profits Just Hit Another All-Time High, Wages Just Hit Another All-Time Low." Business Insider, April 11, 2013. http://www.businessinsider.com/profits-at-high-wages-at-low-2013-4

Brandworkers: Good Jobs, Local Food. http://www.brandworkers.org/our-mission

Brandworkers campaigns: Focus on the Food Chain. http://www.brandworkers.org/campaigns

Callahan, David . "The Global Context of Wal-Mart's Illegal Union Busting Tactics." Demos, September 6, 2013. www.demos.org/.../global-context-walmarts-illegal- union-busting-tactics ‎

Casselman, Ben. "College Grads May Be Stuck in Low-Skill Jobs." The Wall Street Journal, March 26, 2013. http://online.wsj.com/news/articles/SB10001424127887323466204578382753004333838

Characteristics of Minimum Wage Workers: 2011. US Department of Labor Bureau of Labor Statistics report. March 2, 2012. http://www.bls.gov/cps/minwage2011.htm

Noam Chomsky interviewed by Tom Morello. "On Democracy." Summer 1996. http://www.chomsky.info/interviews/1996summer.htm

Clark, Andrew. "Security cameras and HQ squads: Wal-Mart's union-busting tactics." The Guardian, April 30, 2007. http://www.theguardian.com/business/2007/may/01/usnews.supermarkets

Cooper, Michael. "Lost in Recession, Toll on Underemployed and Underpaid." The New York Times, June 18, 2012. http://www.nytimes.com/2012/06/19/us/many-american-workers-are-underemployed-and-underpaid.html

Dimaggio, Dan. "Union-Busting: Six Fired After Demanding Sick Days for Fast-Food Workers." AlterNet, March 25, 2011. http://www.alternet.org/story/150375/union-busting%3A_six_fired_after_demanding_sick_days_for_fast-food_workers

Discounting Rights: Wal-Mart's Violation of US Workers' Right to Freedom of Association. Human Rights Watch, May 2007. http://www.hrw.org/sites/default/files/reports/us0507webwcover.pdf

Dolan, Ed. "US Corporate Profits at All-Time High as GDP Growth Holds at 2.5 Percent." EconoMonitor, September 26, 2013. http://www.economonitor.com/dolanecon/2013/09/26/us-corporate-profits-at-all-time-high-as-gdp-growth-holds-at-2-5-percent/

Domhoff, G. William. "Wealth, Income, and Power." Who Rules America? UC Santa Cruz Sociology Department. http://www2.ucsc.edu/whorulesamerica/power/wealth.html

Eidelson, Josh. "Fast Food Strike Wave Spreads to Detroit." The Nation, May 10, 2013. http://www.thenation.com/blog/174270/fast-food-strike-wave-spreads-detroit#

Eidelson, Josh. "McDonald's Guest Workers Stage a Surprise Strike." The Nation, March 6, 2013. http://www.thenation.com/blog/173217/mcdonalds-guest-workers-stage-surprise-strike#

Fast Food Forward: Higher Pay for a Stronger New York. http://fastfoodforward.org/

Fast Food, Poverty Wages: The Public Cost of Low-Wage Jobs in the Fast-Food Industry. Report by the UC Berkely Labor Center. http://laborcenter.berkeley.edu/publiccosts/fast_food_poverty_wages.pdf

Gabbatt, Adam. "US fast-food workers strike over low wages in nationwide protests." The Guardian, December 5, 2013. http://www.theguardian.com/world/2013/dec/05/fast-food-workers-strike-minimum-wage

Greenhouse, Steven. "Starbucks Loses Round in Battle over Union." The New York Times, December 23, 2008. http://www.nytimes.com/2008/12/24/nyregion/24starbucks.html?_r=0

Greenhouse, Steven. "Union Membership in U.S. Fell to a 70-Year Low Last Year." The New York Times, January 21, 2011. http://www.nytimes.com/2011/01/22/business/22union.html?_r=0

IWW Starbucks Workers Union homepage. http://www.iww.org/unions/dept600/iu660/starbucks

IWW Campaigns: Current and Historic. http://www.iww.org/history/campaigns

Jenkins, Colin. "Corporatism 2.0: Wal-Mart and the Modern Corporate Business Structure." The Hampton Institute, May 24, 2013. http://www.hamptoninstitution.org/corporatism2.0.html

Jimmy John's Workers Union homepage. http://www.jimmyjohnsworkers.org/

Kroll, Andy. "Wisconsin Governor Scott Walker: Funded by the Koch Bros." Mother Jones, February 18, 2011. http://www.motherjones.com/mojo/2011/02/wisconsin-scott-walker-koch-brothers

Lott, John. "Why Unions are Harmful to Workers." Fox News, March 17, 2011. http://www.foxnews.com/opinion/2011/03/17/unions-harmful-workers/

Lydersen, Kari. "Jimmy John's Workers Hope Management 'Freaks Out' Over Union Drive." In These Times, September 10, 2010. http://inthesetimes.com/working/entry/6422/jimmy_johns_workers_hope_management_freak_out_over_union_drive/

McGuinness, William. "Half Of Recent College Grads Work Jobs That Don't Require A Degree: Report." Huffington Post, January 29, 2013. http://www.huffingtonpost.com/2013/01/29/underemployed-overeducated_n_2568203.html

Miles, Kathleen. "Walmart Strike: Dozens Of LA Workers Walk Off The Job In First-Ever Strike Against Retailer." Huffington Post, October 4, 2012. http://www.huffingtonpost.com/2012/10/04/walmart-strike-la-workers-walk-off-first-ever_n_1940710.html

Mobley, Chris. "Election breakthrough for a Seattle socialist." Socialistworker.org, November 14, 2013. http://socialistworker.org/2013/11/14/election-breakthrough-in-seattle

OUR Wal-Mart: Organization United for Respect at Wal-Mart. http://forrespect.org/

Petkov, Aaron. "We'd Like a Living Wage with that Order." Socialistworker.org, May 20, 2013. http://socialistworker.org/print/2013/05/20/wed-like-a-living-wage

Phillips-Fein, Kim. "A More Perfect Union Buster." Mother Jones, September/October 2008. http://www.motherjones.com/politics/1998/09/more-perfect-union-buster

Powell, Michael Orion. "The Hunt for Red November: Third-Party, Working-Class Politics Get a Boost with Socialist Victory." The Hampton Institute, November 20, 2013. http://www.hamptoninstitution.org/rednovember.html

Pullella, Philip. "Pope Francis in Peace Message Attacks Mega-Salaries With 'Crumbs' For Poor." Huffington Post, December 12, 2013. http://www.huffingtonpost.com/2013/12/12/pope-attacks-mega-salarie_n_4431701.html

Resnikoff, Ned. "Hundreds of Service Workers Strike in Chicago." MSNBC, April 24, 2013. http://www.msnbc.com/all-in/hundreds-service-workers-strike-in-chicago

Resnikoff, Ned. "Largest fast food strike yet as workers walk out in Michigan." MSNBC, May 10, 2013.http://www.msnbc.com/all-in/largest-fast-food-strike-yet-workers-walk

Sands, David. "Detroit Fast Food Strike Employees Gather At Protest to Demand Unions And A $15 Per Hour Wage." Huffington Post, May 10, 2013. http://www.huffingtonpost.com/2013/05/10/detroit-fast-food-strike-15-hour_n_3254861.html

Sands, David. "Fast Food Strike: Detroit Walkouts, Protests Continue National Movement For Higher Wages, Union." Huffington Post, May 10, 2013. http://www.huffingtonpost.com/2013/05/10/fast-food-strike-detroit-protests-living-wage_n_3252944.html?utm_hp_ref=detroit

Semuels, Alana. "Fast-food workers walk out in N.Y. amid rising U.S. labor unrest." Los Angeles Times, November 29, 2012. http://articles.latimes.com/2012/nov/29/business/la-fi-mo-fast-food-strike-20121129

Shapiro, Lila. "American Labor's Next Target." Huffington Post, June 16, 2011. http://www.huffingtonpost.com/2011/06/16/target-union-labor-movement_n_877741.html

Strauss, Gary. "Fast Food Workers Strike for Higher Pay." USA Today, August 30, 2013. http://www.usatoday.com/story/news/nation/2013/08/29/fast-food-workers-strike-for-higher-pay-in-nearly-60-cities/2726815/

Thompson, Derek. If Corporate Profits Are at an All-Time High, Why Are Corporate Taxes Near a 60-Year Low?" The Atlantic, May 23, 2013. http://www.theatlantic.com/business/archive/2013/05/if-corporate-profits-are-at-an-all-time-high-why-are-corporate-taxes-near-a-60-year-low/276164/

Townsend, Allie. "First Fast-Food Workers Union Planned." TIME Newsfeed, October 5, 2010. http://newsfeed.time.com/2010/10/05/first-fast-food-workers-union-planned/

Tracking the Recovery after the Great Recession. A report by the National Employment Law Project. http://www.nelp.org/index.php/content/content_about_us/tracking_the_recovery_after_the_great_recession

Zweifel, Dave. "There is a Class War, and Rich are Winning." The Capital Times (Wisconsin), October 6, 2010. https://www.commondreams.org/headline/2010/10/06-5

"284,000 College Graduates Had Minimum-Wage Jobs Last Year." Huffington Post, March 13, 2013. http://www.huffingtonpost.com/2013/03/31/college-graduates-minimum-wage-jobs_n_2989540.html

"The $7-billion dollar problem of low-wage, fast-food jobs." NASDAQ "Minyanville" blog. http://www.nasdaq.com/article/the-7-billion-problem-of-lowwage-fastfood-jobs-cm288226

"Historic First in Nation's Fast Food Industry, 200 Jimmy John's Workers to Vote in NLRB Union Election on October 22." Jimmy John's Workers Union homepage, September 28, 2010. http://www.jimmyjohnsworkers.org/news/201009/labor-day-jimmy-johns-faces-coast-coast-actions-support-nations-first-ever-fast-food-uni%20http://www.workdayminnesota.org/index.php?news_6_4609

"NYC's fast-food workers expected to strike in bid for higher wages." NBC News - Reuters, April 4, 2013. http://www.nbcnews.com/business/nycs-fast-food-workers-expected-strike-bid-higher-wages-1C9212578

"Wal-Mart Workers in 12 States Stage Historic Strikes, Protests Against Workplace Retaliation." Democracy Now online, October 10, 2012. http://www.democracynow.org/2012/10/10/walmart_workers_in_12_states_stage

"Hourly wages of entry-level workers by education, 1973-2011." Report by the Economic Policy Institute. http://www.epi.org/chart/ib-327-table-1-hourly-wages-entry-level-2/

Supremacy: A Social Order of Division, Control, and Enslavement

By Kali Ma

"It seemed like Mrs. Elliott was taking our best friends away from us."

These are the words of a third-grader from Riceville, Iowa. Her schoolteacher, Jane Elliott, had just put her class through an exercise that showcased the viciousness and injustice of white supremacy in the late 1960s. Jane Elliott has since replicated this exercise countless times, but her original lesson remains a groundbreaking insight into the mechanisms of supremacy as depicted in the documentary A Class Divided. By labeling the blue-eyed students in her class smarter and better, and giving them more privileges than the brown-eyed students, Jane Elliott instantly creates division and hostility between the two groups. She constantly reinforces the superiority of her blue-eyed students who suddenly feel more confident and perform better at tasks than their now demoralized and dejected brown-eyed classmates. This division creates conflict between the students, which greatly upsets them and even leads to physical fights. Jane Elliott is stunned by the results of her exercise, saying: "I watched what had been marvelous, cooperative, wonderful, thoughtful children turn into nasty, vicious, discriminating little third-graders in a space of fifteen minutes."

Jane Elliott's exercise clearly illustrates how simple it is to ignite conflict between people once a group of individuals is elevated above another. It also demonstrates how supremacy creates powerlessness in the "inferior" group and that the loss of personal power eventually leads to hostility and violence. This is the system we live under today - a hierarchy that ranks people based on their "worth" and socio-economic status.


Hierarchy - A Tool of Supremacy

To varying degrees, most socio-economic systems in the world today are hierarchical.[1] In a system of hierarchy, individuals occupy social ranks based on their levels of income and wealth, which significantly affect their access to vital resources such as food, shelter, healthcare, and education. In all hierarchies there is a ruling class on top that holds significant social, political, and economic power and whose interests are in direct opposition to those of the masses. A hierarchical structure is, in essence, about power - the ability to control and shape outcomes that further the interests of the ruling class. Since money is the way to greater freedom, most people intend to move up the hierarchy and buy their way into a new reality. After all, those at the top have the freedom to act in ways most people cannot: they make the rules and break them with impunity; they have access to resources, people and capital that allows them to easily perpetuate their wealth; and their occupations often include those of "socialite," "philanthropist," and some even get paid to party.

As an economic system, a hierarchical structure is inefficient and creates unnecessary scarcity because it allows the ruling class to hoard wealth and resources while the majority fights it out over "leftovers." Additionally, because its structure grants disproportionate power and privilege to those on top, it creates a system that is only beneficial to a wealthy minority. Economic inequality is particularly insidious in a hierarchical social order in which wealth determines social status. Such systems create extreme inequality where the gap between the rich and poor is great and social mobility is particularly difficult.

Supremacy is the hallmark of hierarchy where being a "winner" depends on someone else being a "loser" and where wealth is created at the expense of other people and the environment without concern for the collective good. Hierarchies are inherently coercive because they grant dominant groups the authority to impose their rules and ideology on those below them. It is thus a system of dominance, commanding its full power, authority and coercive nature against "weaker" subjects (i.e. the "have-nots" or "inferiors"). However, it is by no means a "natural" arrangement or, as many would say, "just the way things are." A hierarchical social system is closely linked to the systemic subjugation of women under patriarchy, which emerged as a dominant structure in the last 5,000 years of modern human history and helped spur on the agricultural revolution. [2] In effect, humans have lived in hierarchical systems for a fraction of our existence; yet during this new time period we have exhausted much of the world's resources and are quickly heading for a collision course with nature itself.

The purpose of hierarchy in a socio-economic system is not to create opportunities but to protect the supremacy of the ruling elite by controlling people's autonomy and dividing the working class amongst one another through social and economic stratification.


'Divide and Conquer'

While a hierarchical structure places the ruling class on top, it also divides the working people into various "levels" of socio-economic status, with money determining the place in the pecking order. Because there are various "levels" of social status with millions of people competing for the few spots on top, solidarity and cooperation between the people becomes virtually impossible. As a result of this stratification, the lower classes compete against each other and become divided along social, political, and economic lines. In other words, a hierarchical structure breeds competition, division, and outright hostility amongst the various members in society.


Social Conflict within the Working Class

In addition to fostering general class conflict and powerlessness in "inferior" groups, supremacy also creates a hierarchy of worthiness that is directly linked to how closely each of us resembles the '"supreme" image. This "supreme" ideal has traditionally been white, wealthy and male. If we do not meet that profile, then we can at least strive to behave and speak like them, think and believe as they do, or shape our personas in countless ways to appear acceptable to them or as close to the "supreme" image as possible. Economic worth and, in turn our ranking in the hierarchy, are directly linked to how closely we resemble the "supreme" image of white, male privilege. Those who least reflect this "supreme" ideal are deemed "inferior" and labeled as the "other." Because we internalize the "supreme" image early on in our lives, we grow up judging ourselves and others based on that standard. We are effectively pit against one another and through our judgments dehumanize, disrespect, marginalize, and deem unworthy individuals who do not meet the "supreme" standard and who occupy a lower rung on the hierarchy. This dehumanization and "otherness" of individuals who are different from the "supreme" standard is inherent in a hierarchical structure and is at the root of sexism (male supremacy), racism (white supremacy), classism (class supremacy), homophobia (heterosexual supremacy), ethnocentrism (cultural supremacy) and all other social and political divisions under the sun. Victim-blaming and general hostility towards those who are "different" or "inferior" becomes a staple of hierarchical society.

Of course there are exceptions and a privileged upbringing can cancel out many "inferior" traits. However, exceptions are just that: rare occurrences that do not reflect the rule and the reality that happens every day, all day, everywhere. In fact, exceptions are often used to distract us and falsely convince us that society has overcome classism, racism, sexism, or homophobia. In reality, society has gotten much better at hiding its inequities by commercializing, fetishizing, and pop- culturulizing the lives of individuals who are subject to real, everyday discrimination. It is privilege and supremacy we must challenge in all their forms, which are still deeply rooted in white, male, privilege and power.


Economic Conflict within the Working Class

The hierarchy of worthiness also plays out in our economic system. In a hierarchical economic structure, the lower classes are the foundation upon which the successes of others are built. For instance, professionals such as doctors and engineers occupy higher socio-economic standings than Wal-Mart cashiers who ring up their groceries or janitors who clean and maintain their offices. Of course, not everyone possesses the skills and talents to be a doctor or engineer, or for that matter, a cashier or janitor. But when more privileged individuals blame others for being poor, "unaccomplished," "unsuccessful," or unemployed, they do not take into account that the reason they are in a superior position is because someone else is in an inferior, lower position. This is how hierarchy works - someone has to rank at the bottom in order for those on top to be recognized as the "winners." Without such ranking, everyone would be equal. Moreover, society absolutely depends on workers to clean, maintain, repair and service various sectors of society, including private property and public commons. These individuals provide an extremely valuable service that allows society to function yet the system gives them no credit and, in fact, looks down on them and blames them for being in that position. Just imagine a society without sanitation workers to haul off your waste and keep the streets clean, or maintenance workers to keep your buildings running and the AC flowing when it's 100 degrees outside, or grocery clerks who stock your food and water so you can conveniently pick it up and feed your family. Without them, doctors, lawyers, engineers and other members of the professional class could not go about their business. But society has little respect for these individuals who are often paid minimum wage with no benefits; yet they are the very people who make society function.

The "winner" in this unequal arrangement is always the wealthy ruling class who owns the factories, corporations, businesses, and most other institutions and profits from the labor of the working class. The "owners" of society, essentially, sit back and watch their profits soar while the working class slaves over increasingly lower wages and deteriorating working conditions imposed on them by the same people their labor enriches. Individuals of privilege occupy "leadership" positions in all areas of society, from corporations, government and non-profit organizations to the medical, legal, and academic fields. The privileged play both villain and superhero, terrorizing and rescuing the lower classes who are simply pawns in the ruling elite's game of interest and intrigue. The supremacy of the ruling class is legitimized by the meritocracy myth that the most intelligent individuals in society naturally succeeded. The truth, however, is that the wealthy and privileged always end up on top in a system that is created by them to protect their own interests and power.

The meritocratic rationalization for why the wealthy have so much wealth - namely that they are smart and worked hard - is simply ridiculous. Janitors, secretaries, sanitation workers, and plenty of other people are smart and work hard - sometimes at 2 or 3 different jobs - yet their incomes can be as much as 1,795 times lower than that of the "owners." The excuse that elites are smarter is equally absurd seen as how the education system is set up to favor individuals of privilege and serves to protect the power of the ruling class. But for the sake of argument, if indeed they are rewarded by wealth because of their hard work and intelligence, when does the time of rewards come to hard-working lower class people? Shouldn't they be rewarded for their invaluable work that keeps society and the world functioning? And what about the fact that the "superior" ruling elite has completely failed at leading society on all levels, pretty much driving us off the cliff into global suicide? The truth, of course, is that in a system based on domination, the few on top who make the rules can do no wrong regardless of their incompetence. All that matters is the supremacy of their position, which is attained through wealth that has, for the most part, been passed down through generations.


Controlling our Bodies

Slavery is the ultimate control of people's bodies for economic exploitation. A slave has no autonomy, because his actions depend on the permission of another who "owns" him. Within our society today, slavery is not as obvious as it used to be when blacks were "owned" by white slave masters. Today, the control of our bodies takes on many different forms: the use of our bodies and labor as economic goods to be traded on the market in exchange for security in the form of monetary compensation; the steady supply of mostly poor minorities into the private prison system whose bodies are used as slave labor for the benefit of corporations; the control of women's bodies through legislation under the guise of "protecting" the woman and the "unborn" which deprives women of their fundamental choice to make decisions about their bodies; regulation of homosexual conduct and relationships which deprives consenting adults of making decisions about how to use their bodies in a sexual way; the vindication of the George Zimmermans of the world who - with the full backing of a systemic and cultural ideology of white supremacy that views black bodies as worth less - internalize these poisonous values and believe in their inherent right to decide the fates of innocent black people and deprive them of their right to exist as dignified human beings without being stalked, marked, harassed, and murdered with impunity. And even those of us who are victims of oppression in some other way, nonetheless, often become agents of the system, internalizing its values and beliefs and turning on those below us in the hierarchy who are deemed "inferior" or "less than." In this way, hierarchy not only controls our bodies, but also our minds.


Working Toward a New Paradigm

A hierarchical system that facilitates social and economic relationships is extremely harmful because it creates relationships of power that are based on coercion in which freedom cannot exist. Power and freedom are essentially opposites: power seeks to control and dominate while freedom is about autonomy and self-determination that yearns to determine its own path of expression. While there are varying degrees of freedom that can be bought by moving up the system of hierarchy, no one is truly free - not even the ruling class because its supremacy solely depends on the subjugation of the masses.

Our goal then is not to move up the hierarchy because this only legitimizes and perpetuates a dysfunctional system of inequality and oppression; the goal is to completely abolish hierarchy, which only the people can do. We cannot look to those in power who depend on the system for their privilege to make things better for the majority of people. Logically, the ruling class will not threaten its own interests and power. Our immediate short-term goal must be to stop further inequality by building mass movements of solidarity with one another. It is important to note, however, that not every person must get out into the streets to protest; rather, each person can contribute to this movement in different ways, even if it means just standing up for truth instead of "going along to get along." Awareness is key, but we also need to take action. What that action is, each person must determine for themselves.

A violent uprising against the most technologically sophisticated military in history is certain to fail and will do little to improve relations between various social groups. Because the system of supremacy has - through its divisive nature - literally "taken our best friends away from us" and discriminated against many of them, we must confront our own shadows and acknowledge all the ways we personally perpetuate the system's ideology and judge ourselves and others based on its oppressive values. As a result of the division, there is much distrust between various social groups and if we wish to move forward in solidarity, we must work to repair those social bonds. Likewise, we must also confront the internalized fear and desire for acceptance that pushes us to sacrifice truth in favor of comfort and privilege. In other words, we have to reach into the depths of our souls and take our individual power back. A power that is not dependent on the approval of the system, but rooted in self-acceptance and self-awareness. It is truly a radical process that seeks to transform human consciousness by bringing about a revolution from the inside out. We certainly have our work cut out for us; but, at this point, evolving into a new consciousness is our only hope.



Notes

[1] The system we live under is often described as capitalism, oligarchy, corporatocracy, or plutocracy. Regardless of the label, all of these structures are extremely hierarchical where most benefits flow to the ruling class at the top at the expense of the majority of people. While hierarchies occur in all systems - even socialism and communism - in those structures inequality between the different classes is much less pronounced and resources are much more evenly distributed.

[2] Gerda Lerner, The Creation of Patriarchy, (Oxford University Press: 1987)

 

Corporatism 2.0: Wal-Mart and the Modern Corporate Business Structure

By Colin Jenkins

Quick... answer this question: Who pays Wal-Mart's workforce the money necessary for them to sustain? Independent franchisees? No. Wal-Mart's board of directors? Nope. Wal-Mart's shareholders? Not even close. The answer is us. You and I. In fact, on average, American taxpayers pay a staggering $2.66 billion dollars a year to Wal-Mart workers. [1] Why? Simply put, because they must eat. And, so Wal-Mart executives can keep more of the company's "profit" to themselves and their shareholders. How much profit? How about $16.4 billion in 2011 alone. [2]

Hence, the modern corporate business structure is upon us. As much nonsense as we must endure from right-wing politicians, outspoken Randian "libertarians," and hired financial guns about the powers of the "free market" and the rewards of "business savvy," the fact of the matter is that without a supportive State structure to prop them up, corporations like Wal-Mart would be in trouble. Well, not necessarily in "trouble." But, if these monstrosities were unable to rely on the "Welfare State" to supplement their workforce, they would most certainly be forced to pay a livable wage. And if so, in Wal-Mart's case, that $16.4 billion in shareholders' profit would probably look more like $4 billion. Not too shabby, especially for a family that currently owns $100 billion in accumulative wealth, which is more than 130,000,000 (yes, that's 130 million) Americans - roughly half of the entire country - combined can say for themselves. [3]

Of course, big business using the government as a tool for creating large amounts of profit is nothing new. The original robber barons, namely rail and banking tycoons at the turn of the 20th century, notoriously used the federal coffers to fatten their own pockets in the name of "public interest" and "investment projects." However, today's retail giants like Wal-Mart have unveiled a new brand of corporatism - one that goes beyond the in-your-face style of the government "contracts" of old. The arrival of Reagan's "Conservative Revolution" of the 1980s ushered in a new, sophisticated and sleek style of corporate entitlements. This neoliberal blueprint, which cries for "laissez faire" and "free markets" while secretly co-opting government - and which champions and "legitimizes" corporate power and privilege - has created nothing more than a Gilded Gomorrah; a landscape that places corporate entities on a pedestal, relieves them of any and all social responsibility, creates too-big-to-fail businesses and banks, and has cemented the seemingly absurd notion of "corporate personhood."

Corporatism 2.0, like any updated version, borrows the structure set by its predecessor, repairs and improves prior shortcomings, and adds new features that are designed to enhance experience and effectiveness. Building on a centuries-old foundation set by plantation tyrants, patroonships, feudal lords and industrial barons; modern-day corporations, despite their anti-government and anti-tax rhetoric, ultimately depend on the state to protect their private interests. Much like the privileged landowner of the past, who was "ardently individualistic in that he demanded, and was accorded, the unimpaired right to get land in any way he legally could, hold a monopoly of as much of it as he pleased, and dispose of it as he willed," [4] the corporate man of this era rests easily under the blanket of state power. And just as the old plantation lord asserted this "individualism," "calling upon Society, through its machinery of Government, for the enactment of particular laws, to guarantee him the sole possession of his (vast amounts of) land and uphold his claims and rights by force if necessary," so too does the modern corporate entity seek and receive unrestrained power. They "yoke society as a partner" as long as "society" allows them the power to accumulate as much as they wish. [5]

Despite the new trends that have accompanied these "upgrades," old-fashioned direct subsidies are still in play. For example, Wal-Mart has received public funds (taxpayers' money) "to build retail stores and a network of nearly 100 distribution centers to facilitate its expansion." In fact, "over 90% of the company's distribution centers have been subsidized by local, state and federal government." [6] A recent study conducted by Good Jobs First found "244 Wal-Mart subsidy deals with a total value of $1.008 billion;" and reported that "taxpayer dollars have helped individual stores and distribution centers with everything from free or cut-price land to general grants." One example provided in the report focused on Sharon Springs, N.Y., where "a distribution center made a deal with an industrial development agency for the agency to hold the legal title to the facility so Wal-Mart could evade property taxes - a deal which will ultimately save Wal-Mart about $46 million over the life of this one agreement." [7]

While the ideology of corporatism - and the many practices that accompany it - hasn't changed, the techniques have. Today's corporate structure relies heavily on covert activities, government legislation, and "activist judges" to carry out its agenda. The formation of "Super PACs" - legitimized by the Supreme Court's Citizens United decision - has joined "union busting," price gouging, and perhaps the newest trick in their bag - workforce supplementation via government welfare programs - to allow corporations like Wal-Mart to use the state in some ways, and to supersede it in others. The most recent update to this system of "socializing costs and privatizing gains" has been the introduction of "backdoor subsidies" which amount to indirect avenues of public subsidization. Like many corporations seeking to maximize their bottom line, Wal-Mart's executives convene regularly to discuss "business plans" and "strategic maneuvering." Since profit equals total revenue minus total cost (In the most basic economic sense), there are two elementary means to maximizing said profit: (1) increase revenue, and/or (2) decrease costs. And since a good chunk of a company's "costs" come in the form of paying its workforce - the less a company pays its workers, the more profit goes to its executives and shareholders.* Hence, the formation of a "business plan" that seeks to use the government "safety net" and "welfare" programs to offset the company's costs.

This "business plan" includes a concerted effort by Wal-Mart's executive headquarters and management to educate and refer their workforce to public assistance programs. A January 2012 Wal-Mart Associate Benefits book provides a directory so associates can locate their local Medicaid office. [8] "Instead of providing affordable health insurance, Wal-Mart encourages its employees to sign up for publicly funded programs, dodging its health care costs and passing them on to taxpayers," Jenna Wright explains. "The company is the poster child for a problem outlined in a 2003 AFL-CIO report on Wal-Mart's role in the healthcare crisis: "federal, state and local governments" - American taxpayers - must pick up the multi-billion-dollar tab for employees and dependents, especially children, of large and profitable employers who are forced to rely on public hospitals and other public health programs for care and treatment they need but cannot obtain under their employers' health plans." [9]

In order to maintain excessive rates of executive pay (Wal-Mart'sCEO, Mike Duke, gets paid 1,034 times morethan the median Wal-Mart worker, according to a new analysis by PayScale), and to avoid paying its workers' a livable wage (Half of Wal-Mart workers made less than $22,400 in 2012, according to PayScale, which is below poverty level for a family of four), the company relies on programs such as food stamps, Medicaid, HEAP and Section 8 rental assistance. [10] Because of this, "reliance by Wal-Mart workers on public assistance programs in California alone comes at a cost to the taxpayers of an estimated $86 million annually; this is comprised of $32 million in health related expenses and $54 million in other assistance." [11] On average, a single Wal-Mart location requires "$420,750 in tax dollars for employee assistance a year, working out to $2,103 per worker," to operate. Broken down, this includes: $36,000 a year for free or reduced school lunches (assuming that 50 families of employees qualify); $42,000 a year for Section 8 rental assistance (assuming that 3% of the store employees qualify); $125,000 a year for federal tax credits and deductions for low-income families (assuming that 50 employees are heads of households with a child, and 50 employees are married with two children); $108,000 a year for the additional federal contribution to state children's health insurance programs (assuming that 30 employees with an average of two children qualify); $100,000 a year for additional Title I expenses (assuming 50 families with two children qualify); and $9,750 a year for the additional costs of low-income energy assistance. [12] On a national scale, these "backdoor subsidies" amount to $2.66 billion annually in Food Stamps and other taxpayer assistance, and over $1.02 billion a year in healthcare costs. [13]

During a time when the working class has essentially become the "working poor," we, as a society, are confronted with only a few options. We can either demand that corporations like Wal-Mart, who are enjoying record-breaking profit margins year after year, start paying a livable wage to their workers,or we must pay Wal-Mart's workforce for them. As the stock market continues to rise to unprecedented levels - a reflection of the immense success being enjoyed at the very top of the socio-economic ladder - and considering that Wal-Mart's CEO, executive team and shareholders are major benefactors of this "success," the latter choice really shouldn't be an option. Like the majority of us who must participate in a system that compels us to sell ourselves for wages in order to sustain, Wal-Mart's workforce deserves, at the very least, the dignity of earning a living. And we, as taxpayers, owe it to ourselves to demand that Wal-Mart starts paying livable wages and stops forcing their operational costs onto us. If you accept the status quo, you've already been taken. And after your next trip to Wal-Mart, as you walk out staring at your receipt in admiration, keep in mind that you've already paid for those "savings."


Notes

* It's important to tackle the misconception that labor costs have a direct effect on the prices of goods - in other words, higher wages will automatically equal higher prices on goods - a notion that is simply not true, especially considering the retail scale and profit margin of a company like Wal-Mart, where there is a substantial pool of top-tier profits that come into play long before consumer prices should.

[1] [Arindrajit Dube, Phd, and Ken Jacobs. Hidden Cost of Wal-mart Jobs: Use of Safety Net Programs by Wal-Mart workers in California. UC Berkeley Labor Center, August 2, 2004.

[2] Ibid

[3] Reagan's "Welfare Queen" FOUND! Monday, 03 December 2012. By Thom Hartmann and Sam Sacks The Daily Take

[4] Myers, Vol 1, pp. 104-105

[5] Ibid

[6] Shopping for Subsidies: How Wal-Mart uses Taxpayers money to fund its never-ending growth. Philip Mattera and Anna Purinton, Good Jobs First, May 2004.

[7] Ibid

[8] Why Wal-Mart Loves Welfare, California Progress Report. Bobbi Murray, 3/14/12

[9] Wal-Mart Welfare: How taxpayers subsidize the world's largest retailer. Jenna Wright, Dollars and Sense magazine, January/February 2005.

[10] Walmart's CEO Paid 1,034 Times More Than The Median Walmart Worker: PayScale The Huffington Post | By Bonnie Kavoussi Posted: 03/29/2013 1:18 pm EDT

[11] Arindrajit Dube, Phd, and Ken Jacobs, 2004.

[12] Everyday Low Wages: The Hidden Price we all Pay for Wal-Mart
A Report by the democratic staff of the Committee on Education and the workforce -
US House of Representatives, February 16, 2004.

[13] How Does That Make Any Sense? Jill Klausen. The Winning Words Project, 2012.

Invisible Chains: Consumerism, Debt, and Consciousness

By Colin Jenkins

Critical analyses regarding the effects of "consumerism" have been a staple of Leftist theory for the past century. The Situationist International, appearing in the 1950s as an extension of Lukacs' unique brand of social analysis from the 20s, famously ridiculed the "western lifestyle" as a "fake reality which masks the capitalist degradation of human life."[1] The Situationists viewed the "spectacle" as the process for which people's desires are shaped and molded towards consumerist tendencies through mass media, marketing and advertising, and advanced techniques like "recuperation." This counter-cultural examination quickly became synonymous with a Left that had already come to terms with the "economic injustice" which characterized "the predatory phase of human development."[2] In opposition to this "rigged game," a determined and conscious working class countered with radical unionism and activism, direct action, stacks of polemics, studies on socio-economics, and avant-garde artistic techniques that fell under the banner of "culture jamming." "Detournement" turned the act of recuperation upside down by attempting to radicalize and politicize the corporate slogans and logos that flooded the "spectacle," leading to modern alternative media outlets such as Adbusters, the unsung catalysts of Occupy Wall Street and Rolling Jubilee, and street artists like Banksy, who combines detournement techniques with urban graffiti to send powerful counter-cultural messages via concrete canvass.

Naturally, any opposition to consumerism, especially from within those societies historically classified as "western" or "industrialized," is counter-hegemonic and proto-revolutionary. After all, the cultures derived from them have come to be dominated by ideals rooted in capitalism and market economies, naturally leading to intense daily routines that consist of celebrity worship at the altar of reality television and a multi-billion dollar "gossip industry." And when considering the dominant culture is one of superficiality, where our identities are based on what we own, wear and drive - in other words, consumerism - any stance in opposition to this is naturally "against the grain." The current counter-culture is one that not only recognizes the inherent dangers of a society where meaningful human concerns like impoverishment, homelessness, ever-increasing militarism, racism and misogyny take a backseat to Reality Housewives, American Idol and Jersey Shore; but also one that dares to make conscious lifestyle decisions which run contrary to this domination, while also working to break the collective trance that derives from such. Despite the obvious legitimacies found in this stance, and assuming we haven't conceded to nothingness, it's important to consider (1) how this opposition affects the Left's ability to function as a real alternative to the embedded socio-political hegemony, and (2) how it affects the Left's relationship with a working class that has embraced much of this culture as its own. The inherent risks of elitist-like diatribes against what have essentially become "cultural norms" beg for a re-evaluation which must recognize the need to accommodate both scathing cultural critiques and working-class political means. And while this seemingly half-assed approach to addressing such reactionary psychology may be debatable, the dangerous effects and continued escalation of consumerism clearly represent a powerful barrier to reaching any semblance of a collective working class consciousness. Its roots are not always as clear.

In 1901, following the conquest of Madagascar, French General Joseph Simon Gallieni immediately introduced a franc-based currency in order to impose an "educational tax" on the native population. This move had three implied purposes: "To teach the natives the value of work;" to create an immediate and effective monetary form of debt; and to instill consumerist tendencies within the population. While the first "function" followed the typical blueprint of colonialism by creating cheap forms of "human resources" to exploit, the latter two incorporated tangible debts to "legitimize" servitude (a tactic that would soon take hold in the "modern international financial system") and a culture of consumerism as the psychological means to establish and maintain what Antonio Gramsci once referred to as "cultural hegemony." As David Graeber explains, "The colonial (French) government was quite explicit about the need to make sure that (indigenous) peasants had at least some money of their own left over, and to ensure that they became accustomed to the minor luxuries - parasols, lipstick, cookies - available at the shops."[3] Understanding the connection between alienation, debt and consumerism - and how each may be used as a form of control - goes beyond the "inferiority complex" that Fanon once attributed to colonized populations which are "physically and symbolically destroyed, and in their place the colonizer produces a people who deserve only to be ruled."[4] Essentially, these are tools that transcend international and inherently racist relations between the "core" and "periphery" - making class analyses absolutely vital in regards to the "forced dependency" created by the architects of the dominant culture, not only from the perspective of an indigenous population, but also from that of the domestic working classes. "It was crucial that they (the colonized) develop new tastes, habits and expectations; that they lay the foundation of a consumer demand that would endure long after the conquerors had left, and keep Madagascar forever tied to France."[5]

Establishing a "cultural hegemony" runs analogous to principles that drive the market business model, which relies solely on individual "desires" to sell products. Since most of these desires do not constitute basic needs in the Maslovian sense, advertising and marketing must convince consumers that they need big screen televisions, new clothes, technological gadgets, and so forth. With such a task at hand, the business community had to look no further than the colonizers' experience in establishing control over its subject population. In a 1955 edition of The Journal of Retailing, Economist and Marketing Consultant, Victor Lebow, urged business "leaders" and marketers to cultivate and exploit this consumerist mentality with full force:

(Our economy) demands that we make consumption our way of life, that we convert the buying and use of goods into rituals, that we seek our spiritual satisfactions, our ego satisfactions, in consumption. The measure of social status, of social acceptance, of prestige, is now to be found in our consumptive patterns. The very meaning and significance of our lives today expressed in consumptive terms. The greater the pressures upon the individual to conform to safe and accepted social standards, the more does he tend to express his aspirations and his individuality in terms of what he wears, drives, eats- his home, his car, his pattern of food serving, his hobbies.... We require not only "forced draft" consumption, but "expensive" consumption as well. We need things consumed, burned up, worn out, replaced, and discarded at an ever increasing pace. We need to have people eat, drink, dress, ride, live, with ever more complicated and, therefore, constantly more expensive consumption.[6]

To them, the ultimate challenge was not merely establishing a monetary system which allows for widespread consumer spending (fiat-based, supply-side economics) - a task that is handled in conjunction by the "financial wizards" of the hegemonic class - but rather creating the psychological desire to drive such spending. Essentially, as Lebow implied, this may only be accomplished by deflating the "meaning" out of life and replacing it with artificial "spiritual and ego satisfactions" that are achieved through false consciousness and "forced draft consumption." In a scene from the movie Fight Club, Tyler Durden famously rails against the effects of this conditioned psychology on the working classes:

I see all this potential, and I see squandering. God damn it, an entire generation pumping gas, waiting tables - slaves with white collars. Advertising has us chasing cars and clothes, working jobs we hate so we can buy shit that we don't need. We're the middle children of history, man. No purpose of place. We have no Great War. No Great Depression. Our Great War's a spiritual war; our Great Depression is our lives.

While Durden's underground sermon accurately characterized the nihilistic decadence of America's Generation X - a generation born at the pinnacle of this consumerist assault - he was merely echoing the theoretical basis of "commodity fetishism" espoused by Marx nearly a century and a half prior:

(With the spread of markets) there will come a time when everything that people consider as inalienable will become an object of exchange, of traffic, and can be alienated. This is the time when the very things which till then had been communicated, but never exchanged, given, but never sold, acquired but never bought - virtue, love, conviction, knowledge, conscience - when everything, in short, passed into commerce. It is the time of general corruption, of universal venality. It has left remaining no other nexus between man and man other than naked self-interest and callous cash payment. [7]

As predicted, this commodity-consumer paradigm has dominated life for much of the past century. Just as workers are commodified and alienated by their role within the labor-capital relationship, they are doubly commodified and exploited in the consumer-capital relationship. Marx recognized this; western imperialists recognized this; and the corporate business community recognizes this. Hence, the appearance of an extensive "propaganda model" that is carried out in the form of a multi-billion-dollar marketing and advertising industry - which is controlled to a large extent by "a relatively concentrated network of major corporations, conglomerates and investment firms."[8] And while there are certainly examples of acute organization within this corporate community (i.e. The Business Roundtable, Chamber of Commerce, etc…), the maintenance of its hegemony ultimately falls on a loosely connected arrangement of entities that share one powerful commonality: the search for profit. It is this very dynamism that makes it such a formidable foe for the Left in its attempt to deploy class-conscious politics.

Long before the onset of industrialization, capitalism, and even market economies, there were many examples of cultures partaking in the act of accumulation for reasons other than need. Therefore, it seems such "gathering" is likely inherent in our DNA. So what's the problem? Well, first of all, it's important to differentiate between a superficial condemnation that borders on envy, and an analytical assessment that attempts to identify and deconstruct mindless, narcissistic and reactionary societal tendencies. By doing so, it brings much needed legitimacy to the latter purpose, while avoiding further alienation from folks who find natural enjoyment in the acquisition of things. In other words, it's not the act of "wanting" that's inherently bad, it's the totality of a "consumerist" society that intensifies the process of degradation and dehumanization which has already been established within the realms of capital, labor and property relations. And while the battle against exploitation via labor and property is complex, multi-layered and formidable, especially when considering its collective nature and the multitude of external factors involved, the battle against anti-consciousness perpetuated by consumerism can be won on an individual basis, from within. Ultimately, it is this compounding "superstructure" which houses many aspects of superfluous want, where the transition from a civil society to a "surface society" has been made complete; and ironically, where the reversal of such may begin. Therefore, juxtaposing "superficial condemnation" and "analytical analysis" is absolutely vital when breaking down this inherently destructive process. Secondly, it is important to identify such characteristics of a "surface society," with the most dangerous of those coming in the form of personal identity, whether internally through the self or externally through the perception of others. Historically, this process of "self-worth through accumulation" and its reciprocal effect on public perception has blurred the lines between consummation for personal enjoyment and "conspicuous consumerism" as a means of establishing human value. Thorstein Veblen's observations of more than a century ago, though somewhat obvious, still ring true:

Since the consumption of these more excellent goods is an evidence of wealth, it becomes honorific; and conversely, the failure to consume in due quantity and quality becomes a mark of inferiority and demerit."[9]

As if the illegitimacy and consequences of personal fortune and unequal distribution are not enough, the cultural norms that are created through consumption and public display serve to compound and further entrench such inequity on a social scale. As such, the "cultural hegemony" becomes a self-sustaining phenomenon that persists without the need for direct manipulation. "This principle has had the force of a conventional law," explains Veblen. "It has served as the norm to which consumption has tended to conform, and any appreciable departure from it is to be regarded as an aberrant form, sure to be eliminated sooner or later in the further course of development."

A civil society is one that recognizes the collective nature which exists within a community and realizes the inherent connection between a common good and the individual "pursuit of happiness." The essence of civility was captured by Peter Kropotkin in his historical work, Mutual Aid: A Factor of Evolution:

The mutual-aid tendency in man has so remote an origin, and is so deeply interwoven with all the past evolution of the human race, that it has been maintained by mankind up to the present time, notwithstanding all vicissitudes of history. It was chiefly evolved during periods of peace and prosperity; but when even the greatest calamities befell men --when whole countries were laid waste by wars, and whole populations were decimated by misery, or groaned under the yoke of tyranny --the same tendency continued to live in the villages and among the poorer classes in the towns; it still kept them together, and in the long run it reacted even upon those ruling, fighting, and devastating minorities which dismissed it as sentimental nonsense. And whenever mankind had to work out a new social organization, adapted to a new phase of development, its constructive genius always drew the elements and the inspiration for the new departure from that same ever-living tendency.[10]

A "surface society" is one that ignores this commonality and replaces it with narcissistic tendencies that are centered within a false sense of identity - one that constantly pursues wealth or, at the very least, the appearance of such. In Prosperity without Growth, Tim Jackson writes, "The profit motive stimulates a continual search for newer, better or cheaper products and services. Our own relentless search for novelty and social status locks us into an iron cage of consumerism. Affluence itself has betrayed us."[11] This society, in sharp contrast to its civil counterpart, has been intensified by the maturation and successive mutations of capitalism, a system that has far outlived the spotty improvements it once offered to its ancestral systems of feudalism and mercantalism.

The development of a "surface society" is as much intentional as it is incidental. On one hand, it represents a regression to what Kant once referred to as "man's self-imposed infancy." On the other hand, it represents a product of invention - the intended result of a social and economic system that is manipulated and shaped through intensely concentrated power structures and profit-seeking motives. The latter brings us back to the French subjugation of Madagascar, where a noted "strategy" used to gain control of the indigenous population was to mold them into consumers who become "accustomed to the minor luxuries available at the shops." Thus, by doing so, they are not only assimilated into the "western mindset," but also dependent on the perceived need for otherwise worthless commodities. Post-industrialized societies are marked by similar dynamics, some of which are natural byproducts of the corporatized market system, and others which are products of design through hierarchical decision-making and political and monetary policy. Ultimately, if the interests of the "ruling-class" (the super minority) not only differs from that of the "working-class" (the super majority), but actually runs adversarial to such, then the need to "manipulate a culturally diverse society so that the ruling-class worldview becomes the worldview that is imposed and accepted as the cultural norm," like Gramsci once suggested, is logical on face value.

As we embark well into the 21st century, debt has officially replaced "labor surplus value" as the fundamental tool used by "the rich to extract wealth from the rest of us."[12] However, below its tangible use for "extracting" and funneling wealth to the top lies a crucial weapon in the battle for consciousness and working-class servitude. One of the most notable instances of "assimilation through policy" is reflected within America's love affair with home ownership, which has been intensely subsidized by the federal government for the past century. Interestingly enough, the push for home ownership was rooted in two essential motives: to quell the radical working-class uprisings of the early 1900s, and to serve as a subtle avenue for transferring public funds to private finance. Federal support of home ownership "began as an extension of anti-communist efforts in the wake of the Bolshevik Revolution in Russia; as on organization of realtors put it at the time, "socialism and communism do not take root in the ranks of those who have their feet firmly embedded in the soil of America through homeownership."[13] The working-class angst that had begun to surface, both internationally with the events in Tsarist Russia and nationally with the groundswell of union activity and workers' strikes, presented the need to ramp up capitalist intervention in domestic policy. What followed were the federally-backed "Own Your Own Home" campaign, the Home Owners' Loan Corporation (HOLC), the Federal Housing Administration (FHA) and the Federal National Mortgage Association (better known as "Fannie Mae."). The consensus among the "owning-class" was that indebted homeowners do not go on strike. The subsidization of private home ownership through tax incentives (where the federal government actually pays homeowners a portion of their expenses at the end of the year) allowed for the manipulation of working-class interests, and were eventually fortified by modern advents of the same, such as consumer debt (rampant through the 1980s and 90s) and student loan debt (dominant from the 1990s to present). It is no surprise that this "control by debt" mantra has intensified during an historical macroeconomic transition from tangible production economies to highly abstract "financial" economies. In contrast to the potentially negative perception of debt, the introduction of seemingly positive forms of class connections have been deployed in the form of "privatized" retirement plans, company "profit sharing," 401Ks and "deferred compensation" plans - all of which urge workers to give portions of their earnings to Wall St. in the promise of long-term returns. Yet another artificial creation of vested (in the form of a direct monetary medium), though contradictory, interest in the owning-class' well-being. The result: A working-class that cheers on the Dow, Nasdaq and S & P 500 under the false impression of inclusion and mutual interest, all the while being fleeced.

Naturally, as "financialization" has sprung up as the dominant paradigm, so has the near-complete fusion of what C. Wright Mills once referred to as "The Power Elite." Graeber writes:

Financialization is not just the manipulation of money. Ultimately, it's the ability to manipulate state power to extract a portion of other people's incomes. Wall Street and Washington, in other words, have become one. Financialization, securitization and militarization are all different aspects of the same process. And the endless multiplication, in cities across America, of gleaming bank offices- 
 spotless stores selling nothing while armed security guards stand by-is just the most immediate and visceral symbol for what we, as a nation, have become.[14]

So, where does consumerism fit into this bleak reality? It's rather simple. Without a constant effort to ensure people remain "accustomed to the minor luxuries - parasols, lipstick, cookies- available at the shops," the potential reach of debt is limited. Of course, basic necessities like housing, health care, food, clothing, and even water can and have been commodified in this fashion - but this isn't enough. Without creating and maintaining an insatiable "need" for luxuries, immense avenues of profit (on one side) and debt (on the other side) are essentially shut down. Furthermore, beyond the basic pursuit of monetary gain (profit) and wealth extraction (debt) lies the foundation of the status quo: the struggle for consciousness. A working class that remains ignorant to its role in this struggle; that remains indignant towards members of its own class through artificial divisions (race, gender, nationality) or false consciousness (by foolishly blaming the poor, homeless, welfare recipients, etc..); that buys into the Weltanschauung established by the "owning-class," is one that stands idle in the face of its own collective disenfranchisement. It allows "the norms of gender, class, and culturally circumscribed behavior, the requirements of work, the pressures of seeking status through consumption, and, in the absence of viable social alternatives, the need to find almost all enjoyment from private commodities" to dictate human life.[15] In this sense, consumerism is the enemy of solidarity; and solidarity is the catalyst of social awareness. Because if and when genuine class consciousness takes flight, society runs the risk of offering a meaningful human existence - an inevitable death to the status quo and the collective realization that "you're not your fuckin khakis."



Notes

[1] Guy Debord. The Society of the Spectacle.

[2] Albert Einstein. Why Socialism? Monthly Review: May 1949. (Paraphrasing Thorstein Veblen)

[3] David Graeber. Debt: The First 5,000 Years (New York: Melville House, 2011)

[4] Franz Fanon. Black Skin, White Masks (New York: Grove Press, 1967)

[5] Graeber, Debt.

[6] Karl Marx. The Poverty of Philosophy, 1847.

[7] Victor Lebow. Journal of Retailing, Spring of 1955.

[8] Edward Herman and Noam Chomsky. Manufacturing Consent: The Political Economy of the Mass Media (New York: Pantheon, 1988)

[9] Thorstein Veblen. The Theory of the Leisure Class: An Economic Study of Institutions (New York: Macmillan, 1902), pp. 68-101

[10] Kropotkin, Peter. Mutual Aid: A Factor of Evolution. 1902

[11] Is rampant consumerism ruining our lives? The Guardian, March 17, 2011.

[12] "Can Debt Spark a Revolution?" David Graeber. The Nation, September 5, 2012.

[13] Vincent Cannato, A Home of One's Own, National Affairs, Spring 2010.

[14] The Nation.

[15] Michael Albert. Parecon: Life After Capitalism (New York: Verso, 2003), p. 205.