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Recession: A System In Crisis

By VVAW

We are in a recession. President Ford, in his State of the Union speech before Congress, finally came out and admitted it long after we already knew what was happening. After raising the hue and cry that the number one enemy was inflation, Ford pulled a complete reversal and is now saying that recession is number one.

The economists are coming up with all kinds of theories on what has gone wrong and how to fix it. With all the gobbledygook these "experts" are saying, it's almost impossible to understand what they're talking about. However, what comes across clear as a bell is their conclusion: things are bad; they are going to get worse; and the American people should be willing to sacrifice to keep the system afloat with inflation, unemployment and speedup!

We live under the system of imperialism and certain basic facts about that system clearly reveal what the real problem is. Who creates the wealth? Workers. Workers create everything in society. It is the labor or working people that makes the cars, the machines, the clothes, the schools. Workers make crude oil into gasoline and construct the skyscrapers; workers also build the shabby building that they must live in. There is hardly a thing people need and use that is not made by workers.

On the other hand, what do the imperialists do? Virtually nothing, yet they own just about everything. All the things produced by workers are owned by that small strata at the top; the Rockefellers, Mellons, DuPonts, Gettys -- the people who own all large industry. Anyone who works knows that they produce in one day thousands of dollars worth of products, yet their wages do not equal the value of what they have produced. What the owners get is the difference between what they pay the workers (and what they pay for overhead) and what they sell the product for, and that difference is their profit -- the extra sweat wrung from the workers. They didn't do anything to get it, so it is virtually stolen.

The owners know that the less they have to pay worker, the more profit they will make. The harder and faster they can make people work, the more profit they get. So wages are kept down and "productivity" is kept up with speedups and new machines. But there is a catch to keeping wages down -- it is working people who have to buy what is produced. And if wages are pushed too far down (either directly or by inflation) then it is impossible to buy those products. Therein lies one of the key reasons for the current (and just about every) crisis of imperialism -- over-production. Goods pile up because people cannot afford to buy them.. So, the imperialists start laying off workers to cut back on production. That means that even less can be purchased and that means more cutbacks and more layoffs. It does not mean that there are so many products that they can't all be used. It means that there are more than people can afford to buy, even though everyone sure could use what's been produced.

Every ten years or so this rip-off system goes through a crisis. During those times, millions of people have been thrown out of work and many left to starve. The last major crisis, the Great Depression, didn't end until the star of WWII. With that war came huge government spending on defense, thus pumping up the economy and avoiding the continuing spiral downwards of the depression. Since WWII, the U.S. has printed a lot of paper money to finance all that government spending. That is one of the main causes of inflation. But because of this country's enormous wealth and military power, imperialism has always been able to export inflation. What this has meant is that the main effects of inflation were not felt here. It was forced onto the weaker nations who had to trade with the U.S. at inflated prices. The precious foreign aid money that the U.S. sent these countries had to be used just to pay for all those inflated goods. So, while these underdeveloped countries faced skyrocketing prices and unstable economies, our economy stayed relatively stable.

However, those days are gone. The weaker countries did not let this setup continue where they got pushed around and had their resources plundered at will by huge U. S. companies. They are fighting back to gain control of their own resources and destinies, fighting U.S. imperialism tooth and nail. U.S. markets abroad are not secure anymore. With the great defeat handed U.S. imperialism by the Indochinese people, all the contradictions that are inherent in this system started coming out again -- this time, full blown.

Prices started to rise. The government reacted with wage controls but prices kept going up. Freezing the wages at a time when prices kept going up exposed the "theory" that it is wage increases that make prices go up. Now the imperialists are really in a bind. Overproduction has led to recession. As shown by President Ford's economic proposals, you can't fight inflation and recession at the same time. It's one or the other without really solving either. They couldn't avoid this crisis anyway, because it is the very nature of imperialism itself that these crises happen. So they must continue to throw people out into the streets to try and save their system -- a system which doesn't serve the interest of poor and working people.

But that's not the answer working people have. Our answer is to fight these layoffs and cutbacks. VVAW/WSO has joined the fight against the attacks that the imperialist have launched on our living and working standards. As part of that fight, we are raising the demand: JOBS OR INCOME FOR ALL! This system is not run in our interest, so it is not in our interest to save it. We must join together, employed and unemployed, veteran and non-veteran, to fight for our jobs or be given adequate income when our jobs no longer exist. And only by fighting back can we hope to end this rotten system once and for all!