Austerity: the aim is not to reduce budget deficit, it is to increase unemployment, thus recreating a reserve army of labor

45  2013-03-13 by [deleted]

Capitalism is based on consumption. Reducing budget deficit in the middle of a crisis only reduces the ability of the masses to consume. Reducing the consumption, small and medium (local) business, who do not have the funds to withstand the shock, fail, while big ones just fire a hell lot of individuals until the crisis pass.

It is then created a huge pool of desperate individuals who now must accept to work for less. It also becomes politically viable to pass laws that would be frowned upon by the working class (reducing benefits, increasing work hours, taking labor rights away, the usual) in normal times. Profits from big players are increased by reducing the wages, increasing the work hours, etc.

Also, it is a little bit difficult to make competitive products in developed countries when you can hire slaves to do the same in China.

Why I think this is not just incompetence? This measure was successfully applied in UK during baroness Thatcher government. Never have capitalists made so much profit before, while the labor force was weakened. They now seek to do the same in other "developed" countries, where wages are too high to maintain profits.

In essence, it is a desirable crisis, moved by the following factors, among others (redacted from wiki because I am lazy):

1-) Full employment profit squeeze: capital accumulation can pull up the demand for labor power, raising wages. If wages rise "too high," it hurts the rate of profit;

2-) The tendency of the rate of profit to fall: the accumulation of capital, the general advancement of techniques and scale of production, and the inexorable trend to oligopoly by the victors of capitalist market competition, all involve a general tendency for the degree of capital intensity, i.e., the "organic composition of capital" of production to rise. All else constant, this leads to a fall in the rate of profit;

You can expect corporate merges, wages and labor rights being undermined, high unemployment for some time and record profits. It is a textbook move.

14 comments

I agree. I once heard the Republican Party called the "cheap labor"party. It's almost as though they purposely want this to be a third world country. Austerity creates a new level of wage slaves... A former Vice President once wrote an essay about what fascism would look like if it came to America and it was eery. I would say that we are pretty damn close with our corporate takeover.

I was thinking recently about the the demise of the G.I. Bill. So no more new recruits will be going into the armed forces for 4 years just to earn enough for college will probably diminish the ranks. My initial thoughts were that they have all they need at the moment and my wife initially thought they'll go for the draft. But maybe a higher amount of unemployment will force young people to join the armed forces instead of looking for jobs.

[deleted]

Indeed, it actually fits: more unemployment, more free workers. I am amazed on how well it actually works for those above, yet the population can't see the obviousness of their actions.

But how can you do that with Republicans being so against anything that resembles The New Deal?

You want New Deals Con-Men?

Lincoln - Civil War - Conscription

Wilson - 1st World War - Conscription

FDR - 2nd World War - Conscription (LaRouches Husbands)

Truman - 2nd World War, Korea - Conscription

Kennedy - Vietnam War - Conscription (Kennedy Husbands)

LBJ - Vietnam War + - Conscription

White Men = Terrorists

The U.S. needs to keep a close watch on the growing threat of home-grown extremist groups.

There are, in increasingly frightening numbers, cells of angry men in the United States preparing for combat with the U.S. government. They are usually heavily armed, blinded by an intractable hatred, often motivated by religious zeal.

They're not jihadists. They are white, right-wing Americans, nearly all with an obsessive attachment to guns, who may represent a greater danger to the lives of American civilians than international terrorists.

...

These groups should be closely monitored, with resources adequate to the task, even if it means shifting some homeland security money from the hunt for foreign terrorists.

Obama bringing in National Service?

Raving Fruiting Nutcake Webstar Tarpley Having been laughed at Hysterically for His Attempts to associate Himself With Everything He Can That Others Initiated In Order To Get People Under Control Of Lyndon LaRouche Now Turns 180 And Encouraging Obama to A Post 9/11 War Against Americans For His Muricans - Migrants.

It's a fact that all capitalist nations need to have a percentage of the population unemployed, and to try to maintain a perceived scarcity of jobs. This ensures wages of the masses can be kept at a reasonable level. Full employment (less than 1% unemployment) sees wage rises, as can currently be seen in countries like Thailand). However austerity goes much further. You introduce austerity to put the whole lot at risk. Many large organisations will be squeezed so hard that they too 'go to the wall'. It is an aggressive tactic that wipes out middle to large organisations, yet supports small and massive organisations. The only conclusion for having such measures must be to either force the elimination of minimum wages, or to force a new industry onto the masses.

The consumer age is slowing down quite naturally, we don't need as much stuff anymore and people have grown tired of it all. Maybe austerity will force the thinkers amongst us to think that bit harder and come up with a solution. The USA and Europe don't want manufacturing to return, those jobs are soul destroying, we now live in the Information Age and service age, let the Chinese sit there for 16 hours a day doing the same monotonous task day in day out, year in, year out for a miserable pittance. We already spent 200 years doing it, we don't want those days back!

Capitalism is not based on consumption, it is based on capital, as the name implies. Capital is investment.

Capitalism, among other things, is based on profit from private ownership. When I said is based on consumption, I meant that without consumption, you have a recession/depression/economical catastrophe, as lack of consumption reduces profit, which in turn requires people to get fired to maintain the profits or not enter in debts.

If lack consumption reduces profit, where does the money come from for investment?

Just because Greece is not consuming, doesn't mean Germany, Austria, Sweden, United States, Brazil, China, India and the rest of the world are not. Siemens and Bosch can survive to some economical stress in Greece, just to reap greater profit when they come back with all that cheap labor available.

Oh so OP supports the deportation of migrants and so called immigrants then - like all cultural marxists do /s?

Anyone using class identities is just enforcing a capitalist view of identity and throwing financial 'promise' of a few breadcrumbs to people in exchange for their destroying all the things that make them wealthy (non-financial wealth).

The only people enraged at anyone who isn't poor and gushing at the politics of the elite are economaniacalists and their 'humanity'. Poor people and their racism despise being labelled working class.

[deleted]

Economaniacal sneering.

When I say capitalists, I am talking about board directors and CEOs of companies like Siemens, Alcoa, Accenture, Exxon, Total SA, JP Morgan, Barclays, etc., making money through financial investments. White collar professionals (managers, certain technical positions) are still "labor". I mean class identity in that sense. Indeed, anyone that uses non-financial wealth to achieve and maintain material wealth could be said to be part of "labor".

EDIT: beggars are not labor, neither are incapacitated individuals, neither old retired people, neither "lazy" people, etc..

Well yes wealth if it's minorities, gender groups etc and that's theoretically 'fine' for the, roughly, 20 - 25 odd% that cultural marxist types think this applies to but for the rest who are in their entirety hated by them it's 'not'.

94 million Americans for example didn't vote in the Presidential election compared to 61 million for Obama and 58 million for Romney = Romney and no votes with 152 million and Obama with 61 million.

Just because Greece is not consuming, doesn't mean Germany, Austria, Sweden, United States, Brazil, China, India and the rest of the world are not. Siemens and Bosch can survive to some economical stress in Greece, just to reap greater profit when they come back with all that cheap labor available.

You want New Deals Con-Men?

Lincoln - Civil War - Conscription

Wilson - 1st World War - Conscription

FDR - 2nd World War - Conscription (LaRouches Husbands)

Truman - 2nd World War, Korea - Conscription

Kennedy - Vietnam War - Conscription (Kennedy Husbands)

LBJ - Vietnam War + - Conscription

White Men = Terrorists

The U.S. needs to keep a close watch on the growing threat of home-grown extremist groups.

There are, in increasingly frightening numbers, cells of angry men in the United States preparing for combat with the U.S. government. They are usually heavily armed, blinded by an intractable hatred, often motivated by religious zeal.

They're not jihadists. They are white, right-wing Americans, nearly all with an obsessive attachment to guns, who may represent a greater danger to the lives of American civilians than international terrorists.

...

These groups should be closely monitored, with resources adequate to the task, even if it means shifting some homeland security money from the hunt for foreign terrorists.

Obama bringing in National Service?

Raving Fruiting Nutcake Webstar Tarpley Having been laughed at Hysterically for His Attempts to associate Himself With Everything He Can That Others Initiated In Order To Get People Under Control Of Lyndon LaRouche Now Turns 180 And Encouraging Obama to A Post 9/11 War Against Americans For His Muricans - Migrants.