During the last Great Recession, which started after the 2007/08 global financial crisis, countless workers lost their jobs and homes as the rich and big corporations were protected and bailed out. While many of us still live with the impact of this a decade later, we now face a similar threat in the economic wake of the COVID-19 pandemic.
One of the ways the continued impact of the Great Recession can be seen is in the reduced purchasing power of the working class. Wage growth has been incredibly slow and inflation has continued—particularly for the costs of housing, healthcare, and education. The jobs that were regained since the last recession were largely low wage and part-time, leaving many workers in an incredibly vulnerable position. This has only increased the wealth gap between workers and bosses in the decade since the recession. Every year, in every crisis, the rich have gotten richer, while the working class struggles to keep its head above water. Capitalism entails booms and busts where workers rarely benefit from the booms and are always hurt by the busts. As entire sections of the workforce either lost their jobs or have been unable to work due to COVID-19, the inevitable economic crash has come to a head once again—with this recession promising to be much more severe than the last.
In the U.S. alone, there have been more than 4 million cases of COVID-19. Hundreds of thousands are now without a source of income—though bills continue to pile up. Half of American adults are currently out of work while as of May 15th, 44% of unemployment applicants were either denied or still waiting for their benefit checks. By June 20th, the number of people on unemployment rose to 19.3 million people. The additional COVID-19 unemployment relief money, a measly $600 per week, is coming to an end on July 31st. Without a strong social safety net, workers are forced to bear the brunt of this burden. While some have been able to benefit from the one-time stimulus payment and other relief programmes, it is nowhere near enough money to sustain families! The capitalist state doesn’t care that we don’t have food and can’t pay our bills. By prematurely ending these surface-level reforms, the capitalist class and their politicians show that they care more about money than human lives.
As the economy is pre-emptively re-opened, workers are being forced off of unemployment and back into work—solely to push more money into the pockets of the bosses. Although workers are suffering and even dying, the bosses continue to profit. This leaves many workers— especially those in the gig and service industries—making next to nothing compared to their pre-crisis wages. For example, though some restaurants have opened for dine-in services and thus pulled staff in to work, they have limited capacity, and often have very few tables. This leaves servers—who typically receive much lower than minimum wage and rely on tips to make ends meet—with a drastic reduction in pay. The ruling class paraded re-opening the economy as something that would help working families, but it is instead sending them under. Now, they’ve been forced off of unemployment, make very little money at work, and are being exposed to COVID-19 to do it.
This has opened the door to a housing crisis. Rents and mortgage payments have continued to rise over the years, even as wages stagnated. Although many people are no longer working, landlords are continuing to demand rent. While some protections, such as eviction moratoriums, have been put into place, they are quickly being lifted or expiring, leaving millions at risk of eviction. Even as moratoriums are extended in some states, the criteria are drastically tightened. In New York, the moratorium will soon only apply to those who are still eligible for unemployment. This leaves some of the most vulnerable members of the working class—such as undocumented workers and those in the gig economy—with absolutely no protections. These circumstances lay bare the class lines that cut through our society. The removal of these protections benefits only the ruling class—to them, housing is a source of profit, not a human right. The capitalist response to this crisis has been to protect and support the ruling class as much as possible by putting the true cost of the pandemic onto the workers. Mass layoffs, continued demand for rent and mortgage payments, corporate bailouts, prematurely re-opening the economy, and more has only funnelled money to the capitalists. Meanwhile, workers are paying for this with their health and livelihoods.
In particular, the government has spent trillions bailing out corporations, including in the stock market bailouts at the start of the crisis and in subsequent bills. Similar to 2008, the government has backed ruling class CEO’s over workers—giving money to the exact same corporations who have laid-off workers to protect their bottom line. While using taxpayer money to do this may serve as a means of “stabilizing” the economy for the ruling class, this will have disastrous impacts on workers. The government will jump at implementing severe austerity to offset the trillions of dollars it’s spent to help corporations weather the economic slowdown. If the public debt jumps to new highs, heightened attacks on education, healthcare, public transport, and much more will follow.
Corporations have also protected their profits by pushing the idea that “we’re all in this together.” They have forced workers to take pay cuts and pay freezes (including hospital staff!) or switch from full time to part time, attacked unions, instituted hiring freezes, and more. Obviously, we are not all in this together; they are doing just fine while the rest of us are struggling. This system of protecting those at the top and leaving workers to all but fend for themselves has disastrous consequences—for the economy and public health. States that have removed the most protections to open up the economy are seeing drastically increasing numbers of cases, with Arizona, Texas, and Florida having their highest infection rates yet.
Billionaires benefit from bailout
This bailout has seen billionaires massively profit while the working class spirals further and further down. Over the last three months, as over 45 million workers have lost their jobs, billionaires have grown almost $600 billion richer. This crisis has unveiled the true nature of capitalism—that the ruling class exponentially profits from the labor, exploitation, and death of the working class. While workers are without income, evicted, exposed to COVID-19, lacking personal protective equipment (PPE) in hospitals, and more, the two corporate parties have done little but write in protections for the capitalists. By doing this, the ruling class continues to siphon away money that is desperately needed to address the needs of the working class to survive this crisis.
The policies put in place by the two corporate parties aren’t working for the working class. We need to take action that protects us and addresses the actual issues of the pandemic, rather than lining the pockets of the billionaires. The cyclical nature of capitalism’s response to the crisis will inevitably pave the way for more, larger crises down the road. This is not the first nor the last global disaster that we will face, especially with the growing threat of the climate crisis.
Rather than individually refusing to shop at companies mistreating workers and receiving government funds, we need to organize against the system as a whole. By engaging in organized labor struggles and linking up with the Black Lives Matter movement, we can push these companies and the government to adhere to our demands—be it further stimulus payments for the working class, a liveable wage, or an eviction moratorium—on a mass scale.
Support and protest workers
We need to support and protect workers navigating the crisis with hazard pay and effective PPE. This needs to be in conjunction with an overall increase in pay to a liveable wage for all workers, continuing after the pandemic. We should establish safety committees within our workplaces, with democratically elected members. These workplace safety committees would be able to evaluate and call for measures to be taken to protect workers. In conjunction with organized labor, strikes should be called if safety standards are not met. The hundreds of job protest actions taken by a broad variety of workers in the early months of the pandemic were a good start, but they need to be expanded in scope and taken up by the unions as well. By continuing to strengthen the power of the working class—through workplace committees and active and engaged unions, for example—we can fight back and prevent similar exploitation of the working class in future crises.
This pandemic doesn’t need to be a death sentence for the working class. We’ve already seen action against the atrocities of the pandemic, and capitalism as a whole. From nurses striking against staffing cuts and PPE shortages to the massive anti-racist, anti-police brutality protests, the working class is beginning to see that when we fight, we win. We need to organize to defend the existing emergency measures and push for more.
The Independent Socialist Group demands:
No cuts to jobs, pay, or hours during or after the pandemic. Workers should not pay for this crisis with our livelihoods. Workers did not cause the health or economic catastrophe and we should not be held responsible for capitalism’s failure to plan for or cope with the pandemic.
Workers cannot be evicted during a pandemic! We need to not only continue the moratorium on evictions but put in place a 3-year rent freeze to fight the constant raising of rents and displacement of low-income workers.
Tax the rich and big corporations in order to create and fully fund public services—like public affordable housing, expanded emergency housing for the homeless, and universal free healthcare—that could have lessened the impact of this pandemic. In doing this, we can begin to redistribute the massive wealth that has been hoarded by the rich during this crisis.
For a workers bailout, not a bailout of Wall Street! The federal government should not only continue the support payments to unemployed and furloughed workers but expand it to $750 a week for all people unable to work due to job loss, closed universities, cut hours, child or elder care, retirement, sick leave, disability or increased COVID-19 risk!
For an independent workers’ party that can genuinely fight for the working-class and the youth with a socialist program. The Democrats and Republicans have proven time and time again that they serve corporations, not working people. We must break with the two parties of big business and build a new party that can represent the working class and builds towards a workers’ government.
For a massive restructuring of major industry, taken under democratic public control, to produce what we need to manage this pandemic and prevent the next. Workers should democratically decide what needs to be produced and when. For example, factories could produce ventilators and PPE during the pandemic (as GE workers demanded they do) and pharmaceutical workers could cooperate, not compete, around the world to develop a COVID-19 vaccine.
For a socialist world, in which power is held firmly in the hands of the working-class who actually produce the wealth, not the rich few who profit off of our labor. For international solidarity and cooperation against the violence and inequality of capitalism and imperialism.
For more on the Coronavirus economic crisis, see: COVID-19 Triggers Long Anticipated Economic Crash.