Why capitalism can't sort out the worlds problems

wsm.ie: Why capitalism can't sort out the worlds problems
(a-infos-en@ainfos.ca)

He list of jobs to be done in Ireland is endless. Houses need to be built, roads need to 
be repaired, hospitals and schools need to be adequately staffed. At the same time large 
number of pople are looking for work but unabkle to find it. Why can't these jobs be given 
to those who want them? ---- Is it because we have a right wing government and all we need 
is a more 'caring' one? Or is there a more fundamental reason, one specific to capitalism? 
In this article we explain how long unemployment lines are part and parcel of the 
capitalist system. And we explain why "booms" and "recessions" and millions of people 
dying of hunger are something that leftist or "socialist" politicians in government can't 
do anything about. ---- First, a brief economics lesson. Picture a typical business with 
workers and owners. In a small business the owner will also be the boss. But in big 
corporations and multinationals the owner would be the majority shareholder who may never 
meet you. The following still applies whether there are 10, 100 or 100,000 employed in the 
business, and whether the owner/boss is the local shopkeeper or a cigar smoking Texan 
billionaire.

What we will look at in this business is the way the finances are arranged. And in 
particular, who controls them. The workers who do not own anything do the majority of the 
work and get paid by the owner/boss. Also paid by the owner is a relatively fixed sum for 
maintenance of machinery, electricity and gas bills, rents, taxes, etc.

The bosses who own everything and do at most a small fraction of the work reward 
themselves out of what is left over. This means that they get more for themselves if they 
pay out less in other expenses. The main expense that the owners can lessen is the wages 
and working conditions of the workers, so these are attacked most.

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THE CLASS STRUGGLE

This is what is meant by the class struggle. The capitalist system creates two main 
classes, owners/bosses (or ruling class) and workers (or working class). The more the 
working class wins (through strikes and militant action), the less the ruling class has.

The ruling class is a tiny minority and so must defend its "property" (i.e. the ownership 
of factories, businesses and land) from the majority by use of repression. This involves 
using a wide spectrum of tools, from the propaganda of the education system and Church to 
the State courts, police and army. The working class will be constantly forced to fight to 
win and protect gains from this class. And as long as the capitalist system exists these 
two classes will be pitted against each other.

But how does this lead to unemployment? Why not employ everyone, including developing the 
regions of the world left under developed?. Surely this would mean more workers, more 
profits and so more money for the ruling class. The reason why is competition.

CAPITALIST COMPETITION

Different companies have to compete with each other to sell more, in order to make higher 
profits and increase the money in the bosses' pockets. To protect their present sales and 
hopefully increase them, the ruling class must invest in more research and development, 
more modern machinery, advertising and marketing. This costs money.

The bosses are faced with the problem of trying to recover this money. They can produce 
more of the product in the hope of selling more and they can try to lower workers wages.

RECESSION

The recession starts when more goods are produced than people can afford to buy. Sales and 
therefore profits drop as shops start filling up with unsold goods. Then the ruling class 
resorts to the second method of keeping their profits up. They start imposing wage freezes 
and wage cuts.

Sometimes workers were even given the choice to accept wage cuts or lose their jobs! This 
accentuates a downward spiral. As people have their wages cut they buy less; prices are 
put up and wages put down.

Finally the owners start sacking people and closing down factories. Small companies drop 
like flies. The situation is the same elsewhere in the world.

A point about the recession is that profits have not vanished, they have just gone down 
low enough for large parts of the ruling class to make more by earning interest from 
government funds, stocks and speculation rather than by direct investment in business.

Meanwhile it is the working class who suffer. Unemployment soars, wages are slashed. 
Working class confidence dives. Women are most effected by cuts in public services: 
housing, hospitals, schools and transport.

THE SO-CALLED 'BOOM'

The recession ends as it began - when the economic conditions are right for the ruling 
class. That is, when they can make high enough profits by investing in production instead 
of speculating on the stock market.

In the absence of a large fighting movement, workers will be forced to work for less and 
accept worse conditions. The unemployed are used by the bosses to threaten the security of 
workers' jobs. For the same reason strikes and militant action will be at a minimum. And 
with less money being spent on wages, health, education and housing the owners will take a 
larger chunk of the profits for themselves.

As the economy pulls out of a recession only one thing is sure - it is going to collapse 
again. Not that a "boom" is any way brilliant. It just means that a large amount of bosses 
are making an extraordinarily large amount of money. Any increase in living standards won 
by the working class is only a fraction of that which is gained by the ruling class as the 
last "mini-boom" showed.

The ruling class will never invest in lower than average profit making businesses simply 
because they don't need to. And it is in their interests to keep people unemployed and 
hungry. The only sizable gains that are made for the workers are when they fight for them 
and win them against the ruling classes' wishes.

ONE SOLUTION - REVOLUTION

Therefore capitalism can only offer to the worker a continuous struggle, against the 
ruling class, for the necessities of life. We can never be as rich as the ruling class, 
because we can never own what they own.

The only way to achieve long term riches for all is by a complete elimination of the class 
system. It will have to be replaced with ownership of the means of production by the 
working class. And that means everybody having a fair say in how things are run, not just 
a ruling "political party" clique who would be no more than the replacement of one set of 
rulers by another.

Text is based on an article originally published as Why the bosses system can't sort it 
out in Workers Solidarity No 33, Winter 1991 The specific examples that date the text have 
been removed for this publication

http://www.wsm.ie/c/capitalist-system-crisis-unemployment-services