This is a topic I've harped on repeatedly for years, and it's time for another post on the deliberate engineering of unemployment for the benefit, comfort and convenience of the Ruling Class.
Throughout the current economic catastrophe, there has been no let up on the pressure being applied to the working class to force lowered living standards, impoverishment and destitution. This is not a popular topic in most of the blogosphere, and often when it does come up, it is couched in many of the same circumlocutions and euphemisms that are typical of the propaganda media.
Unemployment rates, for example, are almost always given as the Bureau of Labor Statistics' undercount in the U3 monthly release, not the more encompassing, but still not necessarily revealing U6 statistics. Thus, the "Unemployment Rate" constantly hovers around 9.5%, sometimes up, sometimes down, but never really improving or getting all that worse. But this is not the rate of unemployed workers; this is the rate at which unemployment is reported as such according to official guidelines. The actual rate of unemployment -- which is to say, the difference between the number of workers and the number of jobs filled (not "jobs available" -- which is a whole other matter) is probably double the official rate of unemployment, but it's hard to find out any accurate statistics. The U6 figure which comes closest includes people who report they have dropped out of the labor pool due to discouragement and those who report they are underemployed and would like more hours, but they cannot find full-time work.
But U6 is almost never reported, even in the blogosphere -- which reports it far more often than the Big Media does.
Whatever the case, whether using the official unemployment rate or the much higher U6 rate or working up your own numbers, the unemployment situation is calamitous for workers and the working class, and it is so by design.
And that's something else that's not reported extensively if at all.
Tens of millions of Americans are unemployed or underemployed by design. The point is to forced down wages and benefits for workers who can manage to get and keep jobs, and to ensure there is always a willing pool of workers who will do the job for less than the current workforce will. This has been obvious for years, as not only have millions upon millions of workers been let go, but the pressure to reduce the income and benefits of the remaining workers -- while getting more work out of them -- has increased constantly. In the current economic calamity, for example, many workers have taken pay cuts, up to 50% in some cases, just to ensure they can continue to work at all.
The unemployed who qualify for benefits -- and remember half or more of the workers let go in this economic catastrophe don't qualify for UI benefits and never did -- also get a cut income of at least 50% and often much more. While their UI benefits are subject to income tax, they are not subject to payroll tax, so there is the added burden for them of paying no FICA taxes while they are unemployed and that will have a serious repercussion on the amount they can claim from Social Security when they retire.
Those workers who still have jobs, albeit at reduced wages, hours, and benefits, pay into Social Security, but at a reduced rate commensurate with their reduced income, so their benefits will also get a haircut when the time comes to retire.
Many older workers find it completely impossible to find any work at all. Age discrimination is rampant (as are other forms of employment discrimination I'll get to eventually) and employers get away with it scot free. Older workers are opting to collect Social Security early if they are close enough to age 62, and that means that their benefits are lower for the remainder of their lives than they would have been if they remained working.
So all this frenzy to cut Social Security retirement payments is sort of silly: Social Security is being cut by the simple expedient of making sure that lots of people can't contribute and so can't collect full benefits in any case. Beauty.
During the height of the layoffs, there were 6 unemployed workers available for each position. Now it's closer to 5 workers per position. But that doesn't really state the case. Many of the positions "available" are not really available at all for a variety of reasons. The most common reason is that the position has already been filled in house, and it is being advertised pro-forma to present the illusion of a fair competition or being open to outsiders. This is typical of many government and corporate positions. So the job isn't really available; it's the illusion of an opening that counts.
Many advertised positions are "phantom openings" in that the position may technically be available, but the employer has no intention of filling it. In other cases, the advertisement is for a job that doesn't exist and never did, but the ad is used as a recruitment tool for other kinds of work, for which there may or may not be current openings.
There are many other recruitment subterfuges and scams perpetrated by HR departments in all kinds of fields, and it has been going on essentially forever. The fact of the matter is that at any given time, there are far fewer actual jobs available than appearances would suggest given the number of positions advertised or statistically "available".
We are constantly propagandized to believe it is "small business" that drives employment in this country. And when that propaganda fails, we are propagandized to believe it is corporations that drive employment in this country. As it happens, both are still shrinking employment, though not at the breathtaking pace we saw in 2008 and 2009.
Small business is shrinking employment for two main reasons: 1) they have no customers; 2) they cannot get operating financing. The absence of customers is due to the fact that so many people are unemployed, impoverished or destitute. They have no money, so they can't buy anything. The absence of operating financing is due to the fact that the banks are hoarding their cash, much of which has been given to them by the government to "encourage lending." Well, that didn't work out so well. Business loans are still very hard to get. Predatory capitalists have found the pickings among desperate small businesses very good indeed, and they are happily scooping up failed and failing small businesses for pennies on the dollar, while their former proprietors wind up among the unemployed, impoverished, and destitute.
May the circle be unbroken.
Corporate hiring -- in this country -- continues to slide downward. Corporations are not hiring in this country and are reducing operations at home while they shift their economic and financial interest abroad, particularly to China, where an enormous potential for the development of a consumer economy grows by the day. Jobs have been moving to China, India, Vietnam and elsewhere for many years; now much corporate focus is on these Asian markets, for that is where they see the Future, not here in the United States.
What happens here doesn't matter when there is money to be made abroad.
We might want to reflect on the condition of the British working class during the heyday of The Empire. Read your Dickens for a glimpse. Tired of that? Ponder how the British behaved toward their next door colony of Ireland during the Famine. Mm. Yes. Pity.
Need more? Check out American history during the Gilded Age. How the Other Half Lives may seem shocking to modern eyes and sensibilities, but let me tell you: in parts of California that I became very familiar with during the heights of the recent booms, many people lived no better, and arguably in some areas were living in worse conditions that Jacob Riis documented more than a century ago in the tenements of New York. People were living in the open or in their cars because there was no housing available at all in some areas to people at their income level; people were crammed 8, 10, 12, 16 to a small apartment for which they were charged indecent rent by exploitative landlords, because there was no other housing available to people at their income level. All these people were working, and working hard I might add, to make other people's lives as comfortable as they wished, to ensure there was abundant food and cheap wine on other people's tables, and to clean up the messes that other people made.
This was the underclass of America during the height of the recent booms, and it is becoming the normalized condition for many, many Americans year in and year out as this Endless Recession continues and the languid indifference of Our Rulers remains undisturbed.
Just review your Steinbeck. He was loathed and despised in Salinas and the Central Valley of California because he told the truth. Watch this series of videos from the Guardian UK on conditions along Route 66 in today's Endless Recession. And it only tells a portion of the story.
All this misery and more is coming around again, and most Americans remain oblivious -- or worse, they know what is going on and self-righteously blame the victims.
There are some gobsmackingly simple solutions that have been known and advocated since the beginning of this economic nightmare, but Our Rulers adamantly refuse to consider them let alone implement them. bobswern, over at dKos (where he and Meteor Blades are among the very few posters who will consistently grapple with the issue of unemployment and the continuing efforts to force down wages and benefits) put together a very simple statement about what to do the other day:
So, let's talk about five simple things that could be done, immediately, to fix our economy that would make a major difference for Democrats in November, and for our entire country, right now and going forward...
1.) Give money to the poor.
"Just Give Money To Poor People, A Surpisingly Effective Solution to Poverty," Melinda Burns at Miller-McCune.com, 7/4/10
2.) Bypass the Wall Street bailout recipients, entirely, and have the Federal Reserve lend money directly to Main Street, without the Wall Street status quo middlemen taking their tithes.
"The Scope of Monetary Policy Actions Authorized Under The Federal Reserve Act," Federal Reserve white paper by David H. Small and James A. Clouse, 7/19/04
3.) Drastically expand highly effective jobs programs, immediately, that have proven themselves to be worthy of massive expansion.
"A Jobs Program That Works," Bob Herbert at the NY Times, 7/3/10
4.) Have the Treasury Department and/or Federal Reserve lend money to the states to enable them to provide a backdoor bailout to Main Street, immediately.
"Let Treasury Rescue the States," Chris Edley, NY Times, 7/8/10
5.) Either before or after we do "number 4," immediately above--and to pay for items 1 through 4, above--we then provide all of the resources necessary for the states' attorneys general to sue the crap out of Wall Street.
From Kossack and Democratic Party candidate for Texas Attorney General Barbara Ann Radnofsky, an elegantly simple way to not get mad, but to get even: "Suing Wall Street: 'Brilliant, Simple and Clear'," Barbara Ann Radnofsky, Daily Kos, 6/28/10
More on this from Zero Hedge: "Texas AG Candidate Sues Goldman et al For Causing "Recession, Unemployment" And Everything Else That's Bad, Zero Hedge, 7/4/10"
# # #
See, wasn't that easy? And completely self-funded, too! Our economic problems resolved!
Indeed, any solution at all -- not just the glaringly simple ones -- are ignored by Our Rulers, who continue, with utter indifference, to insist that 1)"nothing can be done," and 2) it's the lazy unemployed worker's fault anyway.
And yet still, there are no pitchforks, no torches, and the guillotines remain rusting in storage along with the Democrats' supply of dry powder.
I'm not a Doomblogger, and I don't believe the People are innately stupid. The insight from Orwell was that the Proles had the power to change things
They needed only to rise up and shake themselves like a horse shaking off flies.
... if they only knew they could, but they were kept in darkness and ignorance, by design, exploited by design.
It was not desirable that the proles should have strong political feelings. All that was required of them was a primitive patriotism which could be appealed to whenever it was necessary to make them accept longer working-hours or shorter rations. And even when they became discontented, as they sometimes did, their discontent led nowhere, because being without general ideas, they could only focus in on petty specific grievances. The larger evils invariably escaped their notice. He [Winston Smith] wrote:
Until they become conscious they will never rebel,
and until after they have rebelled they cannot become conscious.
And that, quite simply, is where we -- Proles -- are stuck today. I hate to say it, but it is a prime condition for the rise of a rightist/fascist demagogue to fashion that unformed and unfocused discontent into a furious, murderous, and further calamitous "movement."
The unfortunate thing is the Democratic Socialism that Orwell advocated and that I and many other Americans favor, has nearly always required a stable and relatively prosperous society in which to voluntarily be adopted, or contrariwise (cf: Post WWII Germany) utter defeat and near annihilation in order to be imposed from without.
Fascist demagogues? They're a dime a dozen, almost always internal developments of peoples' unfocused rage at deteriorating conditions they believe they can do nothing about. Weimar anyone?