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September 26, 2007

America in Crisis, Parts I and II


No one can know when the next struggle will erupt or what its outcome will be. Only one thing is certain. The needs of the capitalist class will continue to clash with the needs of humanity. If we can organize ourselves in sufficient numbers to end the war and win universal health care, we need not stop there. We could proceed to build a very different world based on peace and security for all.


Thomas Paine's Corner 

Part I: Class Conflict



AMERICA IS DEEPLY DIVIDED. For one thing, most Americans want an end to the war against Iraq and some form of universal health care, while the ruling class is committed to the war and to sacrificing social services to pay for it.

This conflict between the rulers and the ruled reflects a deeper, structural rift. In a series of three articles (Z Magazine, February, April, May, 2007), Jack Rasmus documents how,

“From the early 1980s on, income inequality widened, deepened, and accelerated until today well over $1 trillion in income is being transferred every year from the roughly 90 million working class families in the U.S. to corporations and the wealthiest non-working class households.”

Thirty-five years of pro-business social policies have hurtled class inequality back to the level of the 1920s. One percent of Americans now owns half the nation’s wealth. In 2005, the total wealth of all U.S. millionaires was $30 trillion, more than the annual wealth produced in China, Japan, Brazil, Russia and the European Union combined!

The extent of inequality has angered the working class and alarmed sections of the establishment. Inequality in “the land of opportunity” is usually blamed on the victim for lacking the skills and determination to succeed. Now that the majority has been left behind, this excuse has lost credibility. Consider this editorial comment from the New York Times (August 29, 2007),

“The median household income last year was still about $1,000 less than in 2000, before the onset of the last recession… [W]hen household incomes rose, it was because more members of the household went to work, not because anybody got a bigger paycheck…The earnings of men and women working full time actually fell more than 1 percent last year…[T]he spoils of the nation’s economic growth have flowed almost exclusively to the wealthy and the extremely wealthy, leaving little for everybody else.”

Americans are seething with discontent over falling living standards, the environmental crisis, the war and the abysmal state of the medical system. In the spring of 2006, this anger exploded in the largest demonstrations in the nation’s history. Protesting anti-immigrant policies and chanting “We are America,” the working class rose up and punched the capitalist class in the face. That fall, the Republican majority was swept from office by voters who were sick of government lies, incompetence and corruption.

Reform or revolution

The powers-that-be are concerned that popular discontent could coalesce into a generalized rebellion against the system. This happened after World War I, during the 1930s, and in the 1960s.

There are only two solutions to such crises: reform from above to restore confidence in the system or revolution from below to replace it. Let’s examine the first option.

Both the Democratic and Republican Parties are committed to victory in Iraq. To counter widespread anti-war sentiment, Washington has repackaged the war as military support for the Iraqi government, with Iraqi incompetence being blamed for “delaying” troop withdrawal. Regular announcements of “signs of progress” imply that the war is winding down when it is actually escalating. This stalling tactic seems to be working, for now.

Reducing class inequality presents a greater challenge. The New York Times concludes, “What are needed are policies to help spread benefits broadly — be it more progressive taxation, or policies to strengthen public education and increase access to affordable health care.”

The elite immediately cry “socialism!” at the suggestion that any portion of the social pie should be returned to the working class. Capitalists want a State that enacts policies just for them and rescues only them. And that’s what they get. In countless ways, capitalism functions as a kind of socialism for the rich.

America’s tax laws free the largest corporations from paying any tax whatsoever. Federal judges have allowed ailing industries to abandon billions of dollars in “burdensome” pension obligations. The multi-billion-dollar federal bailout of mortgage lenders has not been matched by any money for working-class home owners facing foreclosure. And while the Bush administration has allowed Medicare-funded insurance companies to keep millions of dollars that should have been returned to beneficiaries, it vigorously pursues beneficiaries to recover money that it says is owed to insurance companies.

The New York Times doesn’t actually want socialism. It wants a lesser-evil capitalism directed by the Democratic Party.

Liberals and liberal institutions condemn the worst aspects of capitalism in order to preserve the system as a whole.

Most Americans want more investment in the nation’s infrastructure. They want universal healthcare and more funding for schools. They want New Orleans rebuilt and their bridges secure. Liberals know that, unless the system can deliver on some level, the majority will eventually reject that system.

Wiser capitalists remember the French Revolution. Those who take too much can lose their heads. Billionaires like Bill Gates and Warren Buffett prefer to return a small piece of the pie than forfeit the entire bakery.

Gates criticizes the “inequality gap” and devotes a tiny portion of his fortune to charity. Buffett says it’s unfair that he pays less than 18 per cent of his income in taxes, when his secretary pays 30 per cent of hers. Gates and Buffett aren’t socialists. Like the robber-baron philanthropists of the last century, they understand that their class must appear generous to preserve its system of organized thievery.

President Roosevelt faced a similar choice when he fought for the New Deal despite opposition from business interests. In A People’s History of the United States, Howard Zinn explains,

“The Roosevelt reforms…had to meet two pressing needs: to reorganize capitalism in such a way as to overcome the crisis and stabilize the system; also to head off the alarming growth of spontaneous rebellion…— organization of tenants and the unemployed, movements of self-help and general strikes in several cities.”

Reining in a 35-year wealth-grabbing binge won’t be easy. Despite liberal demands that Democrats in Congress develop a spine, the Democratic Party serves the business class. Returning any wealth to the working class would undermine Corporate America’s ability to dominate the global economy.

Unless it is forced to use the carrot to quell discontent, the ruling class prefers to use the stick.

The war on terror, with its attack on civil liberties, is the capitalists’ response to inequality and injustice. They seize the wealth; they do not share it. They crush their victims; they do not rescue them. And they don’t feel threatened by a labor movement that is currently too weak to mount a sustained rebellion. At the same time, their confidence has been shaken by their failures to win the war, create a workable immigration policy and resolve the health-care crisis.

Part II: The Liberal Challenge and the Prospects for Socialism

Part I (September 17) discussed the deepening conflict between the rulers and the ruled and the disagreements within the elite on how to address the nation’s problems. Part II (below) compares liberal efforts to preserve the system with socialist efforts to replace it.

Containing discontent

The capitalist class is a tiny minority that needs majority consent to rule. That consent could be lost if social problems are allowed to deepen. Arguing that an ounce of prevention is worth a pound of cure, liberals align with social discontent in order to contain it.

When the President defended insurance industry profits over the needs of sick children, the New York Times shared the nation’s outrage. In “An Immoral Philosophy” (August 1, 2007), Paul Krugman writes,

“What kind of philosophy says that it’s O.K. to subsidize insurance companies, but not to provide health care to children?…9 in 10 Americans – including 83 percent of self-identified Republicans – support an expansion of the children’s health insurance program…There is, it seems, more basic decency in the hearts of Americans than is dreamt of in Mr. Bush’s philosophy.”

The liberal media are running to get ahead of a growing number of dissidents, like Naomi Klein and Michael Moore, who are fueling discontent. Klein’s best-selling book, The Shock Doctrine: The Rise of Disaster Capitalism, has joined Moore’s documentary film, SiCKO, to punch holes in the lies that prop up the system. When Oprah and Moore agree on national television that America needs some form of socialized medicine, the wind is definitely shifting.

Suddenly, “socialism” is not such a dirty word. In “A Socialist Plot” (August 27, 2007), Krugman writes, “The truth is that there’s no difference in principle between saying that every American child is entitled to an education and saying that every American child is entitled to adequate health care.”

Liberals must convince the capitalist class that a lesser-evil-capitalism, even when it calls itself socialism, is preferable to the threat of real socialism. However, conservatives argue that granting reforms will be the start of a slippery slope. If Americans think they have a right to health care, what else will they think they deserve?

Conservatives remember the 1960s, when Americans gained the confidence to demand racial equality, women’s liberation, aboriginal rights, gay liberation, more social support, higher wages, safer working conditions, more affordable housing, better schools and more access to medical care. There was organized opposition to the arms race, nuclear power, the death penalty, American foreign policy and the Vietnam War. It took a concerted effort and many years to beat back that rebellion.

Is America ready for socialism?

The social crisis and the conflict at the top have opened a space to discuss genuine socialism, a worker-run democracy where ordinary people take collective control of the economy and direct it to meet human needs. The material conditions already exist for such a society.

Because socialism is based on sharing, there must be more than enough to go around. That is no longer a problem.

If the yearly production of American workers was transformed into dollars and equally shared among the population, it would provide $45,000 for every man, woman and child in the nation, or $180,000 for every family of four. This sum would be many times larger if everyone who wanted to work was employed and if the wealth produced in previous years was included.

The same is true on a world scale. Between 1800 and 2000, the amount of wealth produced grew eight times faster than the global population. Only a few have benefited. By 2001, 497 billionaires enjoyed assets of $1.54 trillion, more than the combined incomes of half of humanity.

The second criterion for socialism is a matter of choice. Human beings create the societies in which they live and they can choose to change them.

Most Americans do not choose socialism, because they are bamboozled into thinking that it would not be in their interest. Our rulers insist that there is no alternative to capitalism, as they intensify their barbaric tactics of blame-the-victim and divide-and-rule. By dazzling us with their power, they hope that we will not discover our own, much greater power.

Capitalism isn’t threatened by talk of cooperation and sharing. However, it cannot tolerate demands for a society based on these principles. That’s why the elite have made “socialism” a dirty word. If people knew they could meet their needs and solve their problems without a ruling class, they would have no need for capitalism.

Socialist organizations bring ordinary people together to discover and use their collective power. Where capitalism divides and fragments, socialists link individuals, causes, past events and future dreams into a unified struggle for human survival.

The battle for ideas is critical. To isolate workers and re-enforce their feelings of powerlessness, the capitalist class infects them with fear and pessimism. In contrast, socialists connect workers’ experience of individual suffering with their collective power to eliminate that suffering.

Most important, socialists believe in the working class even when it does not believe in itself.

The anti-globalization movement of the late 1990s raised the hope of change. So did the massive anti-war demonstrations that preceded America’s invasion of the Middle East. When the U.S. began bombing Baghdad, many became discouraged and retreated from activism.

Today, rising discontent is not matched by a corresponding rise in struggle. While millions of Americans are enraged by the deterioration of their lives and society, decades of defeat have deepened the belief that real change is not possible. But beliefs change.

The working class is obedient, not stupid. It has rejected the war despite a steady stream of pro-war propaganda. Workers are also exceedingly patient, but there is a limit to how much unfairness they will tolerate.

With the economy sliding into recession, the New York Times warns, “It seems that ordinary working families are going to have to wait — at the very minimum — until the next cycle to make up the losses they suffered in this one. There’s no guarantee they will.”

No one can know when the next struggle will erupt or what its outcome will be. Only one thing is certain. The needs of the capitalist class will continue to clash with the needs of humanity. If we can organize ourselves in sufficient numbers to end the war and win universal health care, we need not stop there. We could proceed to build a very different world based on peace and security for all.

Dr. Susan Rosenthal has been practicing medicine for more than 30 years and has written many articles on the relationship between health and human relationships. She is also the author of Striking Flint: Genora (Johnson) Dollinger Remembers the 1936-1937 General Motors Sit-Down Strike (1996) and Market Madness and Mental Illness: The Crisis in Mental Health Care (1999) and Power and Powerlessness. She is a member of the National Writers Union, UAW Local 1981. She can be reached through her web site or by

Submitter: Jason Miller

Submitters Bio:
Jason Miller, Senior Editor and Founder of TPC, is a tenacious forty something vegan straight edge activist who lives in Kansas and who has a boundless passion for animal liberation and anti-capitalism. Addicted to reading and learning, he is mostly an autodidact, but he studied liberal arts and philosophy at the University of Missouri Kansas City. In early 2005, he founded the radical blog Thomas Paine's Corner. An accomplished and prolific essayist on social and political issues, his writings have appeared on hundreds of alternative media websites over the last few years. He is also a press officer for the North American Animal Liberation Press Office and the founder of Bite Club of KC, a grassroots animal rights activist group. You can reach him at