Apr 1, 2013
Wall Street is booming. The Dow index is at an all-time high, and so are corporate profits. Supposedly, the economy is getting better too.
We are told the employment situation is also improving. The official unemployment rate dropped to 7.7 percent in February. But the official rate lies. When you factor in discouraged workers who have dropped out of the labor force and those part-time workers who want full-time work, the unemployment rate is really 14.3 percent.
And there are many part-time workers who want full-time work. Supposedly, the economy added 170,000 jobs in February, but the economy actually lost 276,000 full-time jobs. Only because it gained 446,000 part-time jobs, could the politicians claim a net gain of 170,000 jobs. Not exactly the solid, secure jobs people need!
In fact, this shift to part-time jobs has been happening for years. Since 2007, 5.8 million fewer Americans are working full-time, while 2.8 million more are working part-time.
Nonetheless, the economy IS getting better – for some: with their record corporate profits and record cash holdings, companies are paying out more in dividends to their stockholders than ever before. Stockholders are to get upwards of 300 billion dollars in 2013, up from 282 billion in 2012. At the same time, companies are buying back more shares of their own stocks – almost 118 billion dollars worth in February alone. This amounts to another gift to shareholders, since these companies are buying back their stocks when those stocks are selling at an all-time high. Instead of creating jobs, they’re taking their mounds of accumulated cash and handing it over to their shareholders. As one financial advisor put it, “They’re saying ‘I don’t know what to do with this. You take it.’”
The rest of us are told to be patient, to expect that our situation will slowly get better because of the unimaginable wealth being accumulated at the top.
But the worsening situation for working people is the REASON for that accumulation of wealth! They are making their profits BECAUSE they continue to take so much from us. The wealth isn’t trickling down – it’s gushing upward.
Since the early 2000s, the profit share of business income has been rising, and is now at a record 25.6 percent. At the same time, the labor share – that part going to wages and benefits – has dropped five percent.
As one writer put it, “We now have an economy built to assure high corporate profitability even when it’s operating far below capacity and when most families and workers are faring poorly.”
This IS the “better economy” they promise us!
This better economy will never provide us with the jobs or the decent, comfortable life we need. And that is an outrage – because there is plenty of work to be done: roads and bridges that desperately need to be fixed, lighting to be upgraded and turned back on, housing and schools to be built. If we put everyone to work doing all the work that needs to be done to give people the decent life they deserve – we would have zero unemployment! More than that – wages would go up. Those of us forced to work overtime to make ends meet could have a reasonable work week.
The work is there. The wealth is there. And the need for jobs is certainly there. But capitalism will never bring all these together to provide us the life we need and deserve.
If anything shows us why the working class should fight to get rid of capitalism, that’s it!