Monday, November 16, 2009

The economic model and its victims. . . .

This morning on the CBC they were talking about a steel-workers’ strike. Not surprisingly the strike centered on the restructuring of pensions, an issue that has been inciting labour unrest all over the world in recent years. What struck me in particular was an interview with people around the community of the strike many of whom took the position, summed up by one interviewee, that “there is a new business model and people need to adjust to it, and if that means reductions in, or even elimination of, their pensions, that is just how it goes.” This position, though apparently widely held, strikes me as not only naïve but profoundly dangerous. It is naïve because it fails to recognize that business has always tried to undermine the power, the conditions, and the prosperity of workers. It was not that long ago in Western history that children worked in factories and mines and some workers were literally chained to their machines. And any effort to improve the wages or conditions of these workers, or to legislate the use of child labour, was met with terrifying predictions by business of economic disaster. These terrible conditions still prevail in many countries in the world and anyone who does not understand that business everywhere would be glad to bring back the bad old days is deeply naïve. Even where some people in business would find such regressive moves distasteful, they are structurally compelled to move whenever possible in this direction. What many people fail to understand is that what workers are actively pursuing are not just better conditions for themselves. Workers struggles are for all of us. Today we have rights to decent wages and working conditions because generations of union activists have struggled for these things. And every generation has been derided and cursed by many in the community while their victories have been enjoyed by all people in the labour force.

The prevailing opinion is dangerous because it fails to understand that it is not the people are not there to serve the economy, rather the economy is there to serve people. If we have an economic model that cannot provide adequate wages and decent pensions then it is the model that is wrong not the people. The simple fact is that the vast majority of wealth in every country and all over the world is in the hands of a very small group of people and there is plenty of wealth in the world for everyone to live a decent life and if someone claims that the model is changing in such a way that will not always, say, good wages, pensions, and a safe work environment, then the model must be changed. It is as simple as that. In the days when children worked in factories wealthy business people assured us that if we tried to change the business model it would just end in disaster. But here is the simple fact; the regions of the world which have seen the greatest number of regulations of such things as workers’ safety, environmental standards, and workers’ rights, as well as the strongest efforts at redistribution have seen the highest standards of living. The economics of this, and an idea that many would not like us to understand is that workers rights, high wages, and pensions, instead of being a drag on an economy are overall a impetuous to innovation. This has always been central to the development of capitalism. In fact capitalism grew in part out of the ravages of the black-death which made labour scarcer and more expensive, forcing innovations throughout the productive economy. When labour is expensive capitalists have been forced to innovate which has beneficial side effects for all of us. One of Marx’s most important insights was that the capitalist economy tends toward reification; that is the illusion that the economy is a set of relations between things and not between people. Capitalists will, of course, tell us that any efforts at changing the economic model will be disastrous. But the fact is that the economic model that exists today did not happen spontaneously, it was a creation of individuals acting quite consciously in particular ways. This is evident in the fact that we do not have a ‘free-market’ economy but a highly regulated economy the processes of which have been consciously designed to function in certain ways. The problem today is made more complex by the process of globalization. But it is still essentially the same problem and until people understand that we can make the economy serve the interests of everyone if we choose and as long as we let people promote the myth that the economic model is a force of its own then we will continue to be victims of the brutal self-interest of a small minority of wealthy and powerful people. It is a story as old as civilization which is rehashed for each generation but the struggle will and must continue. 

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