'Reaganomics' and the American Worker

Adopted by the 34th National Convention of the Socialist Labor Party of America, University of Wisconsin, Milwaukee, Wisconsin, June 5-10, 1981

Again, working people are being victimized by an array of absurd contradictions. Basic needs like housing remain unmet while a fourth of the nation’s industrial capacity and millions of working people remain idle. Commodities that could satisfy these needs sit in warehouses or storage lots, inaccessible to the working people who need but can’t buy them. Billions of dollars are being spent on arms while school programs, mass transit systems and other social services are being curtailed or eliminated for “lack of funds.”

What has caused this situation? What is its solution?

The Reagan administration, speaking on behalf of the capitalist class, is offering workers one set of answers to these crucial questions. Reduced to their essentials, the administration’s answers are that workers have been asking for, and getting, too much, especially from government. Workers have demanded too much improvement in air quality, too much job safety, too much retirement protection, too much health care, too much racial equality, too much housing, too much pay, etc. Discarding the empty promises advanced in the past that capitalism could provide “more,” the administration is thus promising workers less in every respect.

The position being taken by the Reagan administration here is no accident of history or merely a bad policy decision. It reflects a marked change in the approach being taken by those who rule to the disastrous state of the economy. Gone are the days of expansive government spending in the areas of social services and job creation. Economic contraction is, instead, the order of the day.

More for Capitalists

It isn’t hard to understand why the Reagan administration, and politicians generally, are advancing this point of view. Though current economic policies are being couched in nonpartisan terms, it has already become abundantly clear that such policies serve the interests of the small capitalist minority that Reagan represents. Less pay for workers, less spending for job safety, less investment for pollution control mean more profits for the capitalist owners of industry. Less spending for education, mass transit, and social services generally means more funding for the arms that protect capitalist investments around the world.

These economic policies serve the capitalist class in other ways as well. Like every ruling-class “explanation” advanced in the past for the economic problems faced by workers, the current one diverts attention from the underlying causes. Those causes are profit-motivated production and private ownership of the economy. Moreover, current policies are fostering increased competition among workers for the limited number of jobs and social services capitalism has to offer. In this way, the ability of workers to mount a unified defense against enforced austerity is crippled.

Even when a capitalist economy is relatively healthy, the needs of workers are never met. This is so because the capitalist economy does not operate to meet workers’ needs. It operates for capitalist profit. That profit is generated through the exploitation of working people—that is, by paying workers wages that amount to only a fraction of the wealth they collectively produce. The resulting limited purchasing power of workers accounts in large measure for the economic stagnation and unemployment that periodically plague capitalism.

“Reaganomics” will neither correct this situation nor alleviate the suffering it is causing. In fact, to the extent that the administration’s policies are implemented, the problems working people face will only be aggravated. These policies seek only to increase profits for the capitalist minority through tax breaks for business and the wealthy, cuts in public services and schemes to increase productivity—that is, to increase the exploitation of workers. In short, the aim of Reagan’s policies is to shift the burden of the prevailing economic crisis onto the shoulders of the working class.

The Socialist Solution

In a socialist economy based on collective ownership of industry, the workers’ condition would be the reverse of what it is today. Production would be for social use instead of for private profit. Through representatives elected by workers where they work, they would democratically administer the industries and make all economic decisions. Resources would be allocated and production would be carried out on the basis of social needs and wants. A socialist economy would thereby free society of the limitations now imposed by capitalism.

Such a society will not, of course, come into existence by itself. Nor will it come about if workers seek alternatives to the Reagan administration’s antilabor policies by turning to the Democrats, who also represent capitalist-class interests. If the working-class majority is to become master of the nation’s economic forces, rather than its victims, workers must organize to wrest control from the capitalist class and to lay the foundation for a socialist society.

Specifically, working people must break with the political parties of the capitalist class and organize politically around their common class interests. Workers must also organize where they work into classwide unions that, unlike existing unions, acknowledge the irrepressible struggle between those who own the industries and those who run them. The ultimate goal of these unions will be the transformation of the present economy into a socialist economy run by, and in the interests of, working people.

Socialist Labor Party of America, P.O. Box 218, Mountain View, CA 94042-0218 • www.slp.org • socialists@slp.org

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