The working class in America is a mixture of industrial and service workers who work for a wage. Although most people in America would assign themselves the economic class of 'middle class,' for purposes of this discussion, the working class will be defined as all workers who do not own capital and who work for a wage. Auto workers, secretaries, custodians, retail workers, and even middle management fall into this category. This group, as defined, consists of people with very different economic means: from low-wage earners living paycheck to paycheck, to salaried middle executives of business firms. Although superficially there may appear to be no connection between low-wage earners and middle management, they can both be viewed in terms of poverty and oppression. While poverty has historically been the perennial plague of low-wage workers, middle executives and management have become vulnerable in recent years to the oppression of a capitalistic economy.
Poverty as oppression in America is a direct result of the economic mandates and tendencies of capitalism. A capitalistic economy is inherently impersonal and concerned exclusively with profit. In the ubiquitous drive for profit, oppression becomes the relationship between workers and employers as employers try to maximize profits by minimizing wages. Thus the primary cause for poverty amidst the working class is oppression. Not only does capitalism require a marginal labor force of the unemployed to depress wages, but recently it has shown its need to eliminate employees and produce internationally to reduce costs. Thus the working class finds itself in periodic poverty due to oppression for three main reasons: unemployment, layoffs, and subcontracting.
Competitive capitalism demands a definite level of unemployment to reduce wages. A base level of unemployed workers increases the demand for lower level jobs. This lowers the acceptable wages as workers are forced to choose: either no work or whatever work they are offered, regardless of how low the wages are. The irony is very interesting. Capitalism as an economic force took away the worker's pre-industrial ownership of the means of production. The advent of industrial capitalism ended the system of craftsmanship and divorced the worker from the means of production. This left workers with only one asset to sell - their labor power.
Now that workers are forced to sell their ability to do work, capitalism has managed to devalue that capacity by producing an artificial excess of workers and an artificial shortage of work. This assertion is true, not simply leftist dogma. There is plenty of work to be done in American society, but not all of that work is profitable. And when too many people are employed and wages rise as a result, capitalistic enterprises become less profitable. At a certain point all profit would be lost to wages. Long before this point is reached, however, an employer must 'unemploy' some of its workers in order to remain profitable. Thus capitalism has the mechanism which creates unemployment built into its very fundamental principles. Full employment cannot be attained in a competitive capitalistic economy, and workers are thus oppressed into poverty by the economic system itself.
Layoffs are another form of capitalistic oppression. Traditionally, layoffs have been a way in which businesses have coped with an economic depression. The typical layoffs were largely industrial and blue-collar workers. According to a New York Times poll, a third of all American households have experienced a layoff in the last 15 years. Department of Labor figures show that only about 35 percent of those laid-off full-time workers end up in a equally paid or better-paying job.
From 1981 to 1983, the median pay for a worker who lost a full-time job and later was rehired fell $62 per week in 1994 dollars. From 1991 to 1993, the median pay drop had grown to $85 per week. Decent paying jobs in America have been replaced by jobs with lower wages, fewer benefits, and more hours. Many full-time jobs are being permanently lost as businesses increase their proportion of part-time workers. This replacement of full-time with part-time jobs creates a permanent tendency toward lower paying jobs without benefits.
While layoffs have been a part of every recession, now they are occurring in larger numbers during an economic recovery. Lately this trend has gained media attention as it has broadened from a low-wage-earner phenomenon to a trend which affects middle management and white-collar workers as well. In a reversal from the early 1980's, white-collar workers with some college education make up the majority of layoffs. This is because layoffs are not simply a compensation for an economic depression. Layoffs are a tool of oppression of the capitalistic system, which, in its drive for ever increasing profits must drive more and more workers, both blue and white-collar, closer and closer to poverty. The education and skills of these workers has in no way changed. There is no economic depression or negative market forces. The only justification for the current trend of increasing lay-offs is the oppression of workers to increase profit.
American workers are also oppressed into poverty by the international subcontracting of capitalism. Although America has too much poverty, it in no way compares to the poverty of the third world. Work in the third world is often so difficult to find that businesses find it profitable to shut down American plants and reopen them in third world countries or to subcontract partial or complete products from foreign countries. By oppressing people in third world countries more than workers in America can be oppressed, businesses again increase their profitability. In addition to oppressing the inhabitants of the third world however, this tendency also oppresses American workers. Area poverty is often a result of the flight of U.S. capital overseas.
The tendency to shut down industries and reopen them in third world countries is epitomized by Nike, the shoe and sports accessories manufacturer. They went from an American based company paying an average $10 per hour to a Korean company paying mere dollars per day to an Indonesian company which two years ago paid its workers a mere $0.26 per day, several cents below the subsistence wage. China has received massive amounts of outsourcing form American companies. Cheap Chinese labor and the forced prison camps, the laogai, enable China to produce pliers which cost on the order of $0.99 while an American company, such as Stanley, must charge up to $3.99 simply to compensate for the higher wages of American workers. This outsourcing and capital flight hurts American workers by taking away jobs and forcing American companies into competition with extremely low cost third world companies. Again, poverty is the result of institutionalized capitalistic oppression.
Poverty of the working class is very accurately described by oppression. All of the aspects of the capitalist economy which drive the working class into poverty or near poverty are simply efforts to increase profit at the expense of workers. Regardless of the state of the economy, of the skills or education of the workers, or of the type of job performed, capitalism consistently oppresses workers to increase profit. This oppression through unemployment, lay-offs, and subcontracting is a direct cause of poverty for working folks.
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