We may be ready for this discussion as a nation, especially if Biden were to stop eschewing the socialist label and proudly embrace his goal of an economy designed to meet need rather than just produce profit.
A Pandemic Nurse’s Diary, by Nurse T with Timothy Sheard. New York: Hardball Press, 2020. 143 pp.
Reading A Pandemic Nurse’s Diary, particularly against prevalent media representations of healthcare workers’ experiences during this pandemic, brought to mind for me the opening words of the sketch by the U.S. radical writer Jesús Colón, “Something to Read,” from his collection A Puerto Rican in New York, in which he describes “a piece of working class literature, a pamphlet, a progressive book or pamphlet” as “precious things.”
Donald Trump has repeatedly expressed an impatience to send Americans back to work and re-open all the businesses currently closed.
“We can’t let the cure be worse than the problem,” he has said repeatedly.
With this new favorite mantra of his, he is pitting saving people’s lives against saving the economy, coming down in favor of the latter. He argues that an economic depression will in the end destroy more lives than the virus. His opponents argue that saving the economy is contingent on saving lives and stemming the pandemic.
Either way, both sides are interested in saving “the” economy, which makes the choice a false one.
To understand why the choice is a false one, we have to stop saying “the economy,” as if there’s only one kind of economy we can create, and refer specifically to the U.S. capitalist economy.
The question then is, do we really want to save the U.S. capitalist economy?
Both present conditions and American history powerfully indicate that capitalism is hostile to human life, such that saving capitalism is not the way to save lives. If we want to save lives, we need to transform U.S. capitalism.
Just take these few examples of how capitalist behavior has hampered rather than aided the COVID-19 response save lives:
*As New York Governor Andrew Cuomo has stressed, private hospitals, geared toward making profits, are unprepared to treat the many stricken with the coronavirus because, operating according to capitalist models of business efficiency, they do not allow for excess beds—or “excess capacity’—because that eats into profit. https://www.politicususa.com/2020/03/21/opinion-coronavirus-highlights-inhumanity-and-inefficiency-of-for-profit-economy.html
*Also, following capitalism’s preferred “just-in-time” inventory management process, hospitals do not stockpile the equipment—masks, gloves, ventilators—necessary to handle the volume of patients such a crisis brings to them. The private sector cannot handle the nation’s public health needs, as they are designed to produce profit, not meet human need. And the global supply chain, operating on capitalism’s push for lean production, cannot now mobilize to meet need given that workers all over are impacted by the virus.
*Companies that do produce the necessary equipment are stalling in distributing these goods needed to immediately save lives, holding out for the highest bidder as state and federal governments compete against one another. The capitalist “ethos” of competition doesn’t make us better; it costs lives in the name of the producing profit.
And some other key historical moments also arguably demonstrate the hostility of capitalism to human life.
Take the Great Depression.
First, let’s recognize that what caused this economic crisis was overproduction. We didn’t have too little as a country; we had too much! Thus, with markets glutted with more products than people needed or could afford to buy beyond need, prices plummeted in accordance with the capitalist laws of supply and demand, and factories and industries laid people off. Consequently, people didn’t have money to buy the basic necessities. Hence, the masses, starving as they were, hit the breadlines, as we all know from the familiar images of the Depression passed down to us.
So, to put the absurdity of this situation into relief, at this moment in history, the logic of the capitalist system created a scenario in which the mass of American citizens was starving and in need amidst conditions of material abundance.
The sane mind might find this description of a crisis a bit off kilter. Should having abundant resources available to us really constitute a crisis? It seems we need to question the efficacy of a system that transforms conditions of material abundance into human want and misery.
How did the capitalist imagination seek to resolve the crisis? Well, in order to restore pricing and create conditions to make more production necessary, the task was to eliminate abundance by burning crops, pouring milk down sewers, slaughtering livestock, and so forth. In short, the answer was to get the capitalist economy-whose internal dynamics inevitably generated the crisis to begin with-up and running again, leaving us to wait for the next inevitable cyclical crisis, such as our most recent Great Recession.
As an example of what I’m talking about, take the foreclosure crisis that largely caused our latest Great Recession. Our leaders, our great minds, imprisoned by the limitations of the capitalist imagination, sought to solve the problem and save the system from total collapse by bailing out the banks from the toxic mortgages they issued which were leaving them high and dry because borrowers could not repay them.
But while the banks were bailed out, the “homeowners” were still foreclosed upon and evicted. Homes were left empty. An abundance of houses flooded the market, driving down property values for those still in their home. Millions more Americans thus found themselves underwater in their mortgages, witnessing their chief investment and wealth asset disappear. Gazillions in wealth were lost, destroying the housing market and eroding the financial wherewithal of the consumer (whose prowess accounts for more than 2/3 of the economy). But the banks were saved. The system was saved.
How might the problem have been approached the problem differently? Putting human need first and envisioning an economy that served people as opposed to one in which people serve the economy-would have sought first to keep people housed.
Imagine if instead of prioritizing the banks, our leaders had sought to save the system by bailing out homeowners? If the trillions of dollars had been dispensed to those with unpaid mortgages instead of the banks? To those people could have paid off their mortgages, made good on the “toxic loans,” and arguably have bailed out the banks while staying in their homes? It would have prevented the destruction of the housing market and the death spiral of the overall economy.
Capitalism won’t save people. They need to be saved from it.
We need to approach the governing and the crafting of economic policy with a clearer vision of what the objective of a government and a political economy should be. And that is to serve the people and organize the production and distribution of resources to most efficiently serve human need, first and foremost.
To perhaps an unprecedented degree in the United States, we are witnessing an increasingly serious debate playing out about the relative merits of capitalism and socialism.
Trump’s recent rants against General Motors and the United Auto Workers for the closing of the Lordstown, Ohio plant where the Chevy Cruze was assembled reveal that Trump indeed has his own version of capitalism, one rooted in an understanding of economics that has little to no resemblance to capitalism.
Celebrants of the recent tax bill have claimed, echoing Trump’s top economic advisors, that the massive corporate tax cut will indeed trickle down or, to mix metaphors, serve as the proverbial rising tide that will lift all boats.
CNBC’s Patti Domm was quick to validate this exuberant claim, pointing to announcements from Wells Fargo and Fifth Third bank that they will be raising their minimum wage to fifteen dollars per hour and from AT&T and Comcast that they will be showering their employees with bonuses. Other reporting on CNBC suggest it’s too early to tell, as many companies Fred Imbert and others reached out to hoping to forecast the impact of the corporate tax cut were more reticent about how this tax windfall will trickle down to employees, adopting a wait-and-see attitude.
Before we get too exuberant, let’s keep in mind not just recent history but also the longer arc of history in terms of the relationship between corporate profits and wages as well as the most basic dynamics of capitalism. The bottom line of capitalist dynamics is that higher corporate profits do not translate into higher wages. Indeed, higher profits have typically been achieved through lowering workers’ wages and benefits.
First, recent history: Remember when Trump lavishly offered up seven million dollars of taxpayer money to the Carrier corporation in order, supposedly, to persuade Carrier not to re-locate factories and jobs to Mexico? Trump generated a self-aggrandizing headline, but Carrier ended up still moving jobs to Mexico and eliminating over 600 jobs from the Indiana workforce.
That’s one reason not to get prematurely rapturous about corporate trickle down.
Another reason to be skeptical about corporate windfalls translating into rising wages is that since the 1950s we have seen corporations fare better and better while worker wages, including the minimum wage, have stagnated. Indeed, last March, well before the passage of this tax cut, The Economist reported, as part of its cover story, that corporate profits in the United States were in fact enjoying record performance.
So, given this record corporate performance in terms of profit generation, we should have already seen corporations raising wages, expending monies in capital and infrastructure investment, and showering generous bonuses on its employees.
If this scenario happened, I guess I missed it. Unfortunately, I didn’t miss it. It just didn’t happen.
And it likely won’t.
Indeed, at a meeting of the Wall Street Journal’s CEO council in early November, Gary Cohn asked CEO’s to raise their hands if the GOP tax cut proposed at the time would spur their companies to invest more and raise wages. In a moment Business Insider termed “awkward,” few CEO’s raised their hands, reinforcing the reporting of CNBC’s Fred Imbert.
These are not left-wing anti-capitalist ideologues doing this reporting. These are business journalists.
And these business journalists are just reporting the facts validated by the history of capitalism’s dynamics. The end game of corporate behavior is to increase profits, not to give money away charitably because they have it. In fact, corporations often push to lower wages and benefits to increase profits. They aren’t looking for any reason to raise wages.
Are we really supposed to be buying this bill of goods capitalist President Trump and the corporate bedfellows with which he has staffed his cabinet and advisors are trying to sell us?
They know full well how capitalism works. And corporations raising wages because profits and income increase ain’t how it works, and it never has been.
Take Trump himself. Recently Trump’s Mar-a-Lago resort requested and was awarded 70 H-2B visas to hire foreign workers. According to Trump, John Bowden at The Hill reported, “It’s very, very hard to get people. Other hotels do the exact same thing.”
Really? Is that why Bowden also cited CareerSource spokesmen Tom Veenstra as highlighting, “We currently have 5,136 qualified candidates in Palm Beach County for various hospitality positions listed in the Employ Florida state jobs database.”
Free-market advocates typically oppose minimum-wage legislation, believing that the market should determine wages. Capitalists understand that corporate profits don’t determine wages but rather the dynamics of labor supply and demand do.
In the case of Mar-a-Lago’s hiring practices, Trump’s resort is deliberately trying to undermine the forces that raise worker wages by bringing in foreign workers—because that’s how capitalism works. Corporations, like Carrier and Trump’s businesses, seek to pay the lowest wages possible.
So, if history is any indicator, as it typically is, the dynamics of capitalism won’t change, such that we cannot expect increased corporate profits and income to translate to better treatment and higher pay for workers.
Such a scenario would defy the logic of capitalism, as Carrier and Mar-a-Lago demonstrate. And our capitalist President, his cronies, and the Republican Congress are simply lying about this reality of which they in their wealth are well-aware.
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