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Socialism and exploitation

from David Ruccio

If you listened to or read the text of President Trump’s State of the Union speech Tuesday night, you might have been surprised by the explicit mention of socialism.

Here, in the United States, we are alarmed by new calls to adopt socialism in our country. America was founded on liberty and independence — not government coercion, domination, and control. We are born free, and we will stay free.

Or maybe not—since just last year the Council of Economic Advisers apparently found it necessary to issue a report, on the cusp of the midterm elections, to push back against the fact that “socialism is making a comeback in American political discourse.” And Fox News is engaged in its own campaign against socialism, since “support for Karl Marx’s collectivist ideas is steadily increasing.”

The irony, of course, is that Trump and his principal media outlet are in part responsible for the growth of support for socialism and for policies that are often associated with socialism (such as raising taxes on the income and wealth of the rich).* Claiming that “our country is vibrant and our economy is thriving like never before” and then scapegoating immigrants in “organized caravans [that] are on the march to the United States,” while ignoring the effects of the largest tax break for large corporations in U.S. history—which, while boosting economic growth, executive salaries, and the stock market, leaves American workers further and further behind—makes the case for socialism even more compelling.

But interest in socialism was growing even before Trump took office, especially among millennials. The question is, why? 

millennialsocialists_E8nBRzp

As I’ve noted before, the members of Generation Y are generation screwed, with lower earnings, fewer jobs, more part-time employment, and a higher unemployment rate than any other generation in the postwar period. As a result, they’re more likely than their elders to think of themselves as working-class and less likely to identify as middle-class.

For Malcolm Harris, the problem is exploitation:

This is a fundamentally capitalist story. Workers have always been exploited, but that rate of exploitation. . .is increasing exponentially for millennials.

What Harris is referring to is the growing gap between productivity and workers’ wages. And it really doesn’t matter how that gap is measured.

153034-19227

Harris refers to the numbers produced by the Economic Policy Institute, according to which”net productivity” has grown 6.2 times “hourly compensation” since 1973.

fredgraph

Alternatively, we can look at the gap between real output per person in the nonfarm business sector and real weekly earnings, which has increased by a factor of almost 10 since 1980.

Both measures point to increasing exploitation—to a growing gap between what workers produce and what they receive back as their pay. And it’s that exploitation—which neither Trump nor, for that matter, “conventional American economists” want to talk about—that is generating interest in socialism today.

Workers, especially young workers, are suffering the consequences of increased exploitation and beginning to look beyond capitalism, to different ways of organizing the U.S. economy and society. Socialism, since at least the end of the eighteenth century, has been the name for those alternatives.

Why is there growing interest in socialism in the United States today? The answer is clear. It’s capitalist exploitation, stupid!

 

*Such policies now include abolishing billionaires. However, Farhad Manjoo, who tried to sort out good from bad billionaires, never asks where those billions come from.  If he did, he’d discover the ways an increasingly unequal and unjust distribution of income is tied to—as both condition and consequence—a fundamentally unequal and unjust structure of production.

  1. culturalanalysis.net
    February 7, 2019 at 11:49 pm

    The central tenet of socialism is “abolishing of private property”, at least in so far as it can be used in trade and commerce. It is important not to conflate social policy with socialism, a category mistake.

    The comparison of productivity vs hourly wage is nearly meaningless without accounting for the standard of living on that wage. The problem of capitalism is of a different kind. Excessive accumulation of capital in few hands is anticompetitive, and this in turn is one of the fundamental tenets of capitalism, so, in essence, the problem is not ‘too much’ capitalism but ‘not enough’ of it, or bastardisation of capitalism by the elites wh are now actively trying to destroy capitalism in order to accomplish absolute power for themselves. Socialism is a convenient springboard for such a change, as socialism for the masses, all equal in their destitution, and absolute power for the Central Comittee of the elites.

    Curiously, after the fall of socialist order in Poland, the communist elites and military brass, provided they did not commit serious crimes (other than exploitation) become the leaders of the new Poland, presidents of leading institutions, various authorities (including the Central Bank).

    I am nonetheless optimistic about capitalism, because its problem can be narrowed down to one property which can be hypothetically fixed: credit. In order to fix capitalism we only need to nationalise bank credit, and the system is bound to become more equitable while profits from credit (interest) would provide a huge revenue boost to the public purse, equivalent to a 20% tax rate on income.

  2. February 8, 2019 at 5:00 pm

    Socialism and scientific incompetence
    Comment on David Ruccio on ‘Socialism and exploitation’

    There is no such thing as economics. There are TWO fundamentally different types of economics: political economics and theoretical economics. The main differences are: (i) The goal of political economics is to successfully push an agenda, the goal of theoretical economics is to successfully explain how the actual economy works. (ii) In political economics anything goes; in theoretical economics, the scientific standards of material and formal consistency are observed.

    For non-economists, the most important thing is to realize is that theoretical economics (= science) had been hijacked from the very beginning by political economists (= agenda pushers). Political economics has produced NOTHING of scientific value in the last 200+ years. Economics is a failed science. The four main approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent, and all got the foundational concept of the subject matter ― profit ― wrong.

    As a result, since Adam Smith/Karl Marx economic policy guidance NEVER had sound scientific foundations. Economists of all colors sell proto-scientific garbage in the bluff package of science.

    This, of course, holds also for Marxianism:
    • Marx’s profit theory is provably false.#1
    • By consequence, the concepts of exploitation and classes are false. Marx lacks the concept of cross-over exploitation.#2, #3
    • Because the foundational concepts are false, Marx’s whole analytical superstructure is false.
    • Because the theory is defective, Marxian economic policy guidance was bound to fail from the very beginning.#4, #5
    • After-Marxians have not spotted Marx’s foundational blunder to this day.#6, #7
    • Marxians are scientifically incompetent just like non-Marxians and all together are only employable as useful political idiots.

    Because both Capitalism and Socialism have no sound scientific foundations, their respective economic policies are not much more than blind political agenda pushing. Never forget that both left-wing and right-wing economists do NOT know what profit is and how the actual monetary economy works.

    David Ruccio concludes: “Workers, especially young workers, are suffering the consequences of increased exploitation and beginning to look beyond capitalism, to different ways of organizing the U.S. economy and society.” If so, what is their winning formula? Go for it but do NOT think that economists have any solutions for you or that they are of any help. Forget this Capitalism/Socialism thing. Since 200+ years, economists are incompetent blatherers who are too stupid for the elementary mathematics that underlies macroeconomics. Independent of their political color, economists have always been a real hazard to their fellow citizens.#8

    Egmont Kakarot-Handtke

    #1 Profit for Marxists
    https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2414301

    #2 Capitalism, poverty, exploitation, and cross-over exploitation
    https://axecorg.blogspot.com/2018/04/capitalism-poverty-exploitation-and.html

    #3 If we only had classes
    https://axecorg.blogspot.com/2018/10/if-we-only-had-classes.html

    #4 Ricardo, too, got profit theory wrong. Sad!
    https://axecorg.blogspot.com/2018/02/ricardo-too-got-profit-theory-wrong-sad.html

    #5 Ricardo and the invention of class war
    https://axecorg.blogspot.com/2018/02/ricardo-and-invention-of-class-war.html

    #6 MMT and Marxism ― blather as immunizing stratagem
    https://axecorg.blogspot.com/2019/02/mmt-and-marxism-blather-as-immunizing.html

    #7 MMT ― backstop or advanced life support for the Oligarchy?
    https://axecorg.blogspot.com/2019/02/mmt-backstop-or-advanced-life-support.html

    #8 Econogenics in action
    https://axecorg.blogspot.com/2019/01/econogenics-in-action.html

  3. Ken Zimmerman
    February 17, 2019 at 1:03 pm

    Terms like socialism have a lot of emotional baggage attached, particularly in a society like the US founded in part by Puritans and other religious fanatics, and by free-boosters whose only aim was wealth by any means necessary. So, let’s remove the term from our discussion. The real issue here is democratic control. As liberals once understood, maintaining democratic control in the US is never ending work. Some group, cult, class, etc. was always attempting to undermine democratic control to their own benefit. The anti-democratic faction that most worried many of the signers of the Constitution is the “monied-class.” They worried this faction could use their ownership of factories, rations, natural resources, etc. to threaten the economic wellbeing of ordinary Americans and thereby force Americans to betray democracy. Take the American population hostage, in other words. American radicals later came up with a name for this process, wage slavery. Upton Sinclair summed up the problem in these words, “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” Guess what, these early Americans were correct. We’re now living in the hostage society predicted by them.

    How do we fix this? We need to rebuild a strong democratic government and then push it to restore democratic control. In terms of history it is social movements that have generally carried out this pushing. Social movements created a nation while the American Revolution was under way, made the abolition of slavery a national issue before the American Civil War, forced prohibition on the nation, led America into both World War I and World War II, forced the American government to abandon the War in Vietnam, led the way in forcing changes for American laborers, etc. And now we need social movements in the US to force government back within the bounds of the Constitution, including taking strong measures to control the increase of economic and political inequality within the nation. The citizens of the US began this process after the election of Donald Trump and continue to increase the pressure on Trump and his followers to behave properly or be forced from office or even American citizenship. American citizenship is not a right. Citizens forfeit it by abuse.

    • Rob
      November 9, 2019 at 1:08 am

      The citizens of the US began this process after the election of Donald Trump and continue to increase the pressure on Trump and his followers to behave properly or be forced from office or even American citizenship. American citizenship is not a right. Citizens forfeit it by abuse. ~ Ken Zimmerman on stripping US citizens of their American citizenship a bridge to far into fanaticism

      .
      Trump and many of his sycophantic minions in the GOP were born in the US, which raises the question, where would they be sent back to once they lost their American citizenship? It is against international law to make someone nationless, and I cannot see how flaunting and violating international law furthers world peace and the spread of the rule of law. While I concur with much of what Ken says above about the need for democratic social movements using peaceful and democratic means to hold the anti-democratic factions accountable, nevertheless he reveals his penchant to slip from reason to fanaticism in his comment, “be forced from office or even American citizenship.” His reason surrenders to his angry emotions in this case seems.

      • Ken Zimmerman
        November 11, 2019 at 10:34 am

        Rob, not at all. What I’m seeking, as are many others is accountability. Each member of Congress, SCOTUS, and the President take an oath to defend the Constitution (and thus the nation) from all enemies, foreign and domestic. Is there a penalty for violating this oath? I believe there is – loss of American citizenship. Or at least loss of American residency. This is the story of Phillip Nolan a young American Navy Lieutenant who in 1807 while attempting to defend Aaron Burr from the charge of treason, in court bitterly renounces his nation, angrily shouting, “I wish I may never hear of the United States again!” When Nolan is found guilty along with Burr the judge gives him his wish. Nolan is to spend the rest of his life aboard United States Navy warships, in exile, with no right ever again to set foot on U.S. soil, and with explicit orders that no one shall ever mention his country to him again. The sentence is carried out to the letter. For the rest of his life, Nolan is transported from ship to ship, living out his life as a prisoner on the high seas, never once allowed back in a home port. Though he is treated according to his former rank, nothing of his country is ever mentioned to him. Nolan dies on the American ship Levant in December 1863, having not seen or heard of the US for nearly 50 years.

        This is one option. How practical this punishment is today I can’t say. But for some crimes it remains appropriate.

  4. Meta Capitalism
    November 11, 2019 at 10:44 am

    Accountability is making sure they are not above the law. What you propose is a violation of not only domestic but international law. You reveal you empty values and hollow self-righteous justification for your own fanaticism. Something is wrong in your mind, get help for your PTSD.

    • Ken Zimmerman
      November 11, 2019 at 12:43 pm

      Wow. This is amazing considering I made no such proposals. None of the ones I made violate any laws.

  5. Rob
    November 11, 2019 at 1:43 pm

    To be specific, what the millennials want is democratic socialism like we find in the more progressive societies like Norway, Denmark, Nederlands, Sweden, etc. We raised two millennials (or one Gen-X, hell, I can’t keep track of the labels!) and they know the difference between the different incarnations of socialism. Our family has lived in Japan, the US, and the Nederland. They know the benefits of greater equality and have seen the public benefits that social consciousness brings even in our neighbor Canada’s infrastructure and education. That is what they want. Think The Nobel Factor and you get a good idea. They are not going to put up with predatory capitalisms much longer. And if the next round of elections don’t put the US on the right track we are doing to do everything in our power to help the emigrate to wiser and more sustainable democratic country that understands that “social” and “social awareness” and “social consciousness” and democratic socialism are not some bogyman word called “socialism” but real alternatives to the dog-eat-dog Social Darwinism of modern mainstream capitalism.

  6. Ken Zimmerman
    November 12, 2019 at 12:14 pm

    Rob. “From each according to their ability, to each according to their need.” Lenin’s definition of socialism and what he wanted to establish in the USSR. It did not work out as Lenin planned. The USSR became first a brutal totalitarian nation under Stalin, and then a bureaucratic socialism under Khrushchev, etc. The belief in the Russian version of socialism never died out. But between the Kafkaish bureaucratic government and the pressures of an arms race with the US, the USSR finally collapsed. And returned to the worst of possibilities. A criminal crony capitalism combined with digitized totalitarianism. But there’s a valuable lesson here for the US. Socialism has many of the same industrial and ideological roots as capitalism. But in reverse, as Lenin’s definition shows us. Instead of a brutal competition where some gain wealth and well-being, socialism provides both to everyone, and asks in return each person make their maximum contribution to the welfare of the society. Because of the many racial, ethnic, class, gender, etc. divisions by which Americans have chosen to rank themselves (often not voluntarily) for access to wealth, well-being, and status, the struggle for survival has been part of American culture since the nation’s start. But also because of these same divisions socialism has been part of American culture from the nation’s start. American communities organized for common defense, common public safety, common education, common health care, etc. Sometimes these efforts were limited to Americans of a specific race, class, ethnicity, religion, etc. But over time, they came to cover communities of mixed genders, races, ethnicities, classes, etc. This 250-year movement is under attack today by capitalists. Capitalists seek revenues from which they can take profits for themselves. Enterprises such as health care, fire protection, police protection, care of the aged, etc. which since the 1930s have been funded by large portions of taxes paid by Americans are a tempting target for capitalists, particularly “fake” capitalists. Donald Trump’s entire business model has always been earning profits from tax money. Some capitalists may even believe for-profit companies can provide these services better and more cheaply. That is not borne out by history. It’s estimated that had the polio vaccine developed by Jonas Salk been patented the patent would have returned over $7 billion to it owners by today. That would have made the vaccine beyond the reach, economically for nearly half the American population and polio would not have been eradicated in the US, without massive new government subsidies to provide this profit. Capitalism works for some things, but not for the important ones involving human survival, well-being, and health. For those socialism is superior, as Lenin knew. But this means socialism reduces the opportunity for profits on things humans yearn for to protect their lives and health. Many are direct matters of life or death. Millennials recognize these problems and, in their view, see socialism as the answer to them. As do the generations coming after the Millennials. They want more than just surface changes in economic relationships, however. They want to re-define relations among people. That’s cultural changes beyond the comfort zone of many Americans born prior to 1950. The Millennials will win, of course, since they will simply outlive their opponents.

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