Capitalism requires at all times – during the period of economic expansion or during the bad times of economic recession – that a certain part of the working population be unemployed or maintained in what Marx called the “reserve army of the unemployed.”
If everyone in a capitalist economy had a job then the competition between workers would essentially end. The working class would be fully empowered to demand from each employer that their wages be increased which would mean that the profits for the employers would be reduced. That’s good for workers but very bad for the capitalists.
The phenomenon of unemployment is a profound crisis for each jobless individual and a source of fear for almost all employed workers but it is an opportunity for the capitalists to have unemployed workers compete with each other for jobs.
Under this system capitalists can hire some part of the unemployed when it’s best for their profit margins and fire large numbers of them when it’s best for their profit margins. The only basis for the decision is what is best for the accumulation of profits. The worker is like the machine, useful at times but also expendable and replaceable.
WalMart just opened new stores in Washington D.C. for the first time. They advertised that they would hire 800 people. Nearly 24,000 showed up to apply for these jobs that guarantee a wage that will leave the new worker in poverty. The Walton family that owns WalMart has the equivalent wealth of 41 percent of the population of the United States.
Until 1935, when workers lost their jobs because they were fired or laid off by capitalist employers or because they were told old to keep working, they would be forced to completely fend for themselves. During the 1930s during the economic Depression caused by capitalism millions of people were plunged into widespread hunger and homeless and tens of thousands died from hunger and cold.
In 1935, in the face of growing working class resistance and the rapid growth of communist and socialist influence among the oppressed class the Roosevelt Administration pushed through the Social Security Act that provided the basis for unemployment insurance benefits for the laid off workers and retirement benefits for older workers.
Even with these important reforms most of the unemployed do not receive unemployment insurance and the number that do is going down.
Today, December 28, 2013, 1.3 million workers who have been unemployed for more than six months will lose all their unemployment benefits as a result of the compromise budget agreement worked out between the Democrats and Republicans who wanted to leave Washington D.C. to begin their next vacation. President Obama left with his family for Hawaii after the deal was reached.
By the end of 2013 the percentage of unemployed workers who receive benefits will drop to 26 percent, a record low, according to the National Employment Law Project.
Capitalist political parties want people to think that unemployment is unavoidable – It’s not!
Some members of the capitalist class are politically liberal and others are conservative. Some are Democrats and some are Republicans. The corporations and banks they own give huge amounts of money to both of the ruling class parties. They donate to each as an investment so the outcome won’t matter much.
The ruling class has inculcated the idea that the working class should identify with the Democratic Party or the Republican Party. The last thing they want is for workers to become class conscious enough that they would create their own party which would insist on the creation of a full employment economy where every individual would be guaranteed a job or an income in the case of disability or illness.
The scourge of unemployment is not naturally caused. It is a byproduct of a social and economic order that legalizes the “right” of one very small class in society to become enriched by their employment of working people. The rights of capitalist private property are paramount. The government and courts defend those rights and provide guarantees that particular form of property as sacrosanct.
The working class has no such guarantee. Even their job, the very thing necessary to generate income and sustain the life of the individual workers and their children does not belong to them. Even their job is considered a property right of the capitalist owners.
The first step of a socialist economy is turning this formula upside down. The rights of working people are re-defined. A socialist economy guarantees the right to a job and the right to an income for those who cannot work because of health, disability or age.