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why the rich love high unemployment

May 26, 2011

This article reads like Marxism 101, albeit through a liberal/social democratic lens. Capitalism, by its very nature, requires what Marx termed the “reserve army of labour” (i.e., the unemployed), which is one of the tools it uses to create and increase the profit it extracts from the labourer and the commodities their labour produces. What the article calls “labor-market flexibility” is the capitalists wet dream, i.e., an insecure labour pool that can be hired and fired at will, at whatever wage the employer deigns to give. And as the article points out, the mechanisms that the ruling class use to help ‘fix’ the economy ultimately end up benefiting big capital and the wealthy, not the workers (who make up the majority of the population). Which is, of course, counterproductive when you have a consumer-based economy and very few of the consumers can afford much beyond their basic means of subsistence. However, in the context of a global, capitalist economy, capital can invest elsewhere (whether abroad in foreign markets or in stocks and bonds) and still increase their profits and those of their shareholders, while the average worker is left struggling. The whole thing leaves a bad taste in my mouth. How anyone can find such a system moral, or simply preferable to something which is less exploitative, is beyond me. /rant


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