The bourgeois press greeted the New Year with the usual celebratory narcissism. The carefully crafted rhetoric of the supposed “economic recovery” was continually punctuated by the tacit reminder that hard times are still ahead. The bourgeoisie’s calls for sacrifice are heard more thoroughly and the recent mid-term elections have potentially provided the bourgeoisie with the political pieces necessary to institute a harsher round of austerity. The incoming House majority leader, Mr. Boehner, has referred to the period ahead as an “adult” time for political leaders. Only time will tell whether or not the “freshmen” coming into office can pass the first major test of being responsible bourgeois managers of the US economy. Will they vote to raise the debt limit of the United States again (as is tradition) or will they act in accordance with the lunatic ideology they’ve espoused in the run-up to the election? The pressures upon the Republican Party from the right are analyzed deeper in another article within this issue of Internationalism that deals specifically with these elections. Instead, this article will turn its attention more pointedly towards the elements of austerity that the working class are faced with today and try to present these elements within a historical framework of global capitalism’s permanent crisis.
The Necessity of Historical Perspective
There are layers of mystification whenever the bourgeoisie attempt to analyze and represent the crisis to the working class. One of the first layers is through (mis)-classification. Case-in-point, the crisis as a “financial” crisis that has its roots in the 2008 bursting of the housing bubble and the meltdown of some of the largest financial institutions. This is a necessary layer of deception for the bourgeoisie, whose principle assault on revolutionary consciousness is the stripping away of any historical framework for analyzing the capitalist system. With a degree of calculation characteristic of the Machiavellian class, the reframing of the crisis as a financial one is directly in line with this tactic of isolating historical crises within a-historical frameworks. For revolutionaries, it is therefore necessary to establish and reiterate the historic nature of this crisis before diving into the austerity that the bourgeoisie find compelled to enact.
Make no mistake about it: the “financial” crisis is a material crisis. It is a physical crisis whose roots lie in the limitations of capitalist accumulation as a global system. The crisis can be further understood in the disparate impacts on society. The working class, as always, bears the full brunt of the crisis. One indicator of this truth is the exponential rise of foreclosures. Millions of people have already lost their homes with the onset of this latest deepening of the crisis, and the latest statistics from November 2010 indicates that more than 100,000 people lost their homes that month alone! Furthermore, layoffs continue unabated. The Bureau of Labor Statistics has even formed a program entitled “Mass Layoffs Summary,” whose most recent report begins with the line: “Employers took 1,586 mass layoff actions in November involving 152,816
Of course, this only measures those newly added workers filing for unemployment insurance—excluding the droves of proletariat classified as “long-term discouraged workers” who no longer fall into the convenient methodological categories of bourgeois economists. Meanwhile, the bourgeoisie are effectively insulated from the most direct material effects of the crisis. As the New York Times reported, “the truth is that there have been surprisingly few career fatalities among New York developers, even though they have lost billions of investor dollars on overpriced real estate and have littered the city with unfinished apartment buildings. While a homeowner who lost a house to foreclosure would find it difficult to borrow for years, developers who defaulted on enormous loans have still been able to attract money.”
Presented with this reality, the frantic calls by the bourgeois ideologists of the Friedman ilk fall on deaf ears and reveal their true message: the sacrifices must be made by the working class, while the bourgeoisie enjoy all the protections under the law. In this sense, the illustrated image of sacrifice in the face of the crisis would be a capitalist pig settled upon the mounded corpses of the working class. Ironic that the loathsome Bernie Madoff was criticized so strongly for his pyramid schemes—the entire capitalist system is necessarily pyramidal! However, we must avoid a certain simplification of the crisis that states that the bourgeoisie are completely outside of the material impacts of the crisis. This analysis suggests that the bourgeoisie are completely protected, yet this cannot be further from the truth and a historic framework for understanding the crisis exposes the very real dangers this period of capitalism pose not just for the working class but humanity.
The latest deepening of the crisis is the culmination of decades of desperate measures taken by the bourgeoisie to offset the unraveling of their economic system. The restructuring of the international monetary system arising out of the Bretton Woods conferences, the institutionalization of outsourcing, the extensions of personal consumer debt and the financial gymnastics representative in the mysterious “derivative” instruments—all illustrate the increasingly extreme and abstract actions taken by the bourgeoisie to stave off the crisis. These actions, however, can’t overcome capitalism’s fundamental contradictions, which came to the fore once more in 2008 with frightening clarity. The bourgeoisie have been wrestling with this crisis for a long time, and they are running out of options.
The terrifying impact of social decomposition also weighs heavily on the bourgeoisie’s ability to rule. Segments of the ruling class seem to have gone completely insane and are losing their ability to govern the state and orient it towards the interests of national capital. In decadent capitalism, the state is a vital institution in maintaining capitalist rule in the face of ever sharpening economic contradictions and internal ruling class squabbles. There seem to be insurgent elements of the ruling class that seek to “abolish the state” (while saving capitalism!); all in some highly ideological nostalgia for a period of capitalism that has never existed. For the working class its historical challenge is socialism or barbarism not the abolition of or the limitation of the powers of the state. With the rise of lunatic factions of the bourgeoisie and the gripping terror representative within social decomposition, the importance of this question cannot be emphasized enough.
Who is to be the judge, jury and executioner?
Nationally, the bourgeoisie certainly have appeared quite clumsy in their priorities and capability with regards to enacting austerity. The proposed healthcare plan by President Obama, which from the very beginning was a tool in offsetting the costs from US manufacturers domestically and maintaining US imperialism abroad, was met with vicious and often terrifying populist backlash. This is despite the fact that the healthcare reform proposals certainly were in the interests of national capital, for the mentioned reasons. However, Obama has appointed a bi-partisan ‘National Commission on Fiscal Responsibility and Reform’, known as the ‘deficit commission’, which is taking a sober look at the state’s finances. The commission’s initial report, entitled The Moment of Truth, clearly put the cards on the table: “We cannot play games or put off hard choices any longer... Our challenge is clear and inescapable: America cannot be great if we go broke. Our businesses will not be able to grow and create jobs, and our workers will not be able to compete successfully for the jobs of the future without a plan to get this crushing debt burden off our backs... Together, we have reached these unavoidable conclusions: The problem is real. The solution will be painful. There is no easy way out... If the U.S. does not put its house in order, the reckoning will be sure and the devastation severe… The national interest, not special interests, must prevail.”
Although the plan did not win enough votes among the members of the commission to be pass along to Congress officially, its austerity proposals for dealing with the budget deficit will like be part of any future plan for addressing the mounting national debt.
Whatever the obstacles the bourgeoisie finds itself ensnared with, these have certainly not slowed down the slew of austerity proposals. The privatization of social security, the proposed extension of the retirement age to 69, are all necessary in the face of the crisis but there is no reason to suspect that these will pass easily. In the face of all of these measures, the working class finds itself again being called upon as the savior of a system that cannot ever operate for anyone except the minority class that the state serves as defender of.
For all the difficulties the bourgeoisie find at the national level in enacting the necessary austerity measures, they have had nothing but comparatively stellar success at the local and state levels. Austerity measures have been brutally instituted across the nation as the individual states seek to reduce their budget deficits in order to continue operating. The venomous assault on the working class coming out of New Jersey Republican governor Chris Christie is a principal example of such effective wielding of power. Among the first targets in periods of austerity is education, and Christie delivered the goods when he cut over $1 billion dollars from the state’s education funding laying off teachers and privatized a slew of public sector jobs in the year he’s been in office.
All of this in spite of resistance from Democrats with regards to the severity with which he has instituted the cuts. Regardless of the forces that may find disfavor with Christie’s style of enacting the measures, there is little in the way of significant power being mobilized by other politicians to slow Christie’s crusade to “walk the talk.” In fact, there is little which Christie has done which hasn’t been achieved or attempted by Democratic politicians as well. The selective memory displayed by New Jersey Senate Majority Leader Barbara Bruno when she toothlessly criticized Christie for sacrificing jobs and gutting the social safety net is appalling, when nearly a year ago President Obama hailed the laying off of Rhode Island teachers as a necessary part of his education ‘reform’.
New Jersey isn’t the only state in which the bourgeoisie has been able to push through austerity measures with seeming impunity and a complete disregard for human life. Starting in October 2010, Arizona—a state that certainly hasn’t shied away from increasingly bizarre expressions of bourgeois brutality—began reversing approvals on life saving organ transplants through the state’s Medicaid program. This left patients without coverage for pending transplants and if they couldn’t cough up the cash, often exceeding $100,000, then they would be denied a transplant and will die.
These two states provide some of the most compelling and drastic examples of how austerity has been viciously enacted at the regional level. These examples show us what may be in store with the recent massive Republican victories across the spectrum, although it must be recalled that the successful campaigns of Jerry Brown and Gavin Newsome as the Governor and Lieutenant Governor of California, despite being Democrats, does not suggest anything remotely more positive. Jerry Brown, who militarized the Oakland police force, and Gavin Newsome, who gutted the public sector workers in San Francisco over the last two years, certainly have the credentials required by capitalism to enact the brutal austerity in this time of added strife and strain.
The bourgeoisie only speaks in lies
The bourgeoisie is very careful to enact austerity filtered through a system of propaganda which justifies the measures. As the crisis deepens, the capacity of previous lies to carry the same water weakens and new lies are necessary so that the latest assault against the working class can continue unhindered. At the root, there is no filter greater than that of the much cherished bourgeois ideology of “democracy.” The variations of this theme are many, as both major parties are able to twist the rhetoric to suit their aims, but they are still illustrative as they expose the bourgeoisie’s capacity to distort even its own scandals into bludgeons with which to further batter the working class.
In California, the scandal around the tiny city of Bell erupted when it was discovered that the three top city employees—the police chief, a city council member, and an assistant city manager—each earned over $300,000 a year and combined their salaries exceeded $1.2 million! This revelation was revealed by the Los Angeles Times in 2010 and resulted in these three individuals resigning from their posts. The weeks following the scandal saw the story twisted from a story about top city employees (managers) earning too much to a story about “public workers of Bell” getting paid more than they deserve. The actual story was one of corruption; a part-and-parcel element of decadent capitalism, but no opportunity to deflect public outrage and further divide the working class will be lost by the managers of the capitalist economy.
Bourgeois ideologists quickly began clamoring for “transparency” with regards to public sector jobs. This steady drumbeat culminated in the City of Los Angeles publishing, through the LA Times, the salaries of all of its city employees (exempting only the power and water workers) under the guise of “transparency.” By this time, the LA Times had led the charge in rechristening the Bell scandal as a “salary scandal” and quoted Los Angeles City Controller Wendy Gruel’s justification for the publication: “The public’s trust has been broken as a result of the recent scandal in Bell. This is an important step to provide greater transparency and openness in how taxpayer dollars are spent.”
The public’s trust was broken by the exposure of the ruling class’ depravity in allotting for themselves the goods of a system that invariably leads to economic insecurity, crisis and war? Corrupt as it was, the combined salary of $1.2 million between three people pales in comparison to the salaries being meted out to Wall Street insiders and corporate leaders.
These are the necessary elements of capitalism’s historic crisis. It’s no wonder the story had to be redirected to further ensure that the working class is divided. Other cities have followed suit, and not only in California — Philadelphia has similarly “opened up” under the guise of democratic principles. The race to the bottom has always fed calls for austerity, everyone must be dragged down to ever further levels of inhuman, humiliating treatment—everyone, except those who rule.
There is no freedom in bourgeois democracy
There can be no doubt that capitalism’s historic crisis is deepening with a seeming disregard for the bourgeoisie’s various attempts to buy time. Even where austerity has been viciously enacted, there’s no indication that the crisis is being alleviated. Job cuts lead to more jobs being cut; human life is degraded at a terrifyingly exponential rate. This is a global trend, which even affects the economic “miracles” which the capitalist ideologists love to point to so much—the income disparity, the impact on the environment, the wonton disregard for human life is just as real in the periphery of the advanced capitalist nations as in California—one of the largest economies in the world!
The only alternative for revolutionary minorities and our class is class struggle. The task of the future freedom of mankind is not in some bourgeois notion of “democracy,” but in the working class’ revolutionary consciousness and the struggle it wages to create a society where production is oriented along the principle of: from each according his ability and to each according to his need. This inability—in the end—to provide for human needs must be seen as the fundamental failing of capitalism.
.- Real Estate Developers Prosper Despite Defaults, New York Times, January 1, 2011.
.-The Moment of Truth, p. 6, NCFRR, December 2010.
.-‘L.A. city employee salaries posted online’, LA Times, August 6, 2010.