Standing in the Way of Progress

June 3, 2003

by Bill Foster

Reading the business page and studying reports on the state of the economy always reminds me of just how insane and anti-human the capitalist system is.

- Item: government economists and business executives fear that the U.S. economy is heading into a sustained period of deflation (i.e. a persist fall in the prices of goods and services). Businesses have more than $1.1 trillion dollars of unsold goods on hand.

- Item: U.S. factories are operating at less than 75% of capacity, the lowest rate in 20 years, even while nearly 9 million workers are unemployed.

What is going on here?

Falling prices mean that food, clothing, housing and other necessities will be cheaper. Isn't this a good thing for the vast majority of people? Shouldn't we be happy that falling prices will help the plight of tens of million of Americans who are living in poverty and going without many necessities?

Yet more, if factory utilization is at a 20-year low, and, at the same time, millions of workers are unemployed and looking for jobs, why don't we simply increase production and provide even more goods and services? Why can't we put this unused economic capacity to work to build houses and schools, to feed the 2 out of every 5 urban children who lack sufficient nutrition, to solve the health care crisis, etc.?

The common sense answers to such questions are obvious. But common sense has no place in capitalism. This economic system does not operate with the aim of meeting the needs of the people but solely in order to maximize profits for a few.

Thus the capitalist owners fear falling prices and will use practically any means to prevent it because, even though cheaper goods may make life better for the people, it means less profits for the capitalists.

Thus the capitalists will not set in motion the vast economic capacity of our country, but would rather leave factories idle and workers unemployed because more production, while increasing the well-being of society as a whole, would mean even a greater glut of commodities and less profits for the capitalists.

This insanity, the inhumanity, of poverty and deprivation in a country with a glut of goods and excess economic capacity -- reflects the fundamental contradiction of the capitalist system.

Our country's advanced, modern economy, created by the social cooperation of some 250 million people, is set in motion with the sole aim of maximizing profit for a few capitalists who have usurped the ownership of the collective wealth and productive resources of society. The social character of our economy is suppressed and negated by the private ownership of a few. As a result U.S. capitalism is in a permanent and unresolvable crisis of overproduction: the economy is capable of producing more than enough to meet the needs of all, but the capitalists refuse to produce unless guaranteed maximum profit. Factories stand idle, goods remain stockpiled or are even destroyed, workers go without jobs -- all because the capitalists can't make a profit.

In other words the capitalist system stands condemned -- incapable of setting in motion the vast economic power of our country, incapable of meeting the needs of the people.

The profit-motive cannot be the guiding line of economic life; the fate of the country and the very lives of people cannot remain at the mercy of a handful of capitalist owners.

We need an economy of, by and for the people. We need to replace the profit-motive with an economic plan that is based on meeting the needs of the people.

As a starting point, we must orient the economy so as to guarantee the basic economic rights of every member of society, including the right food, clothing and shelter, to a secure, stable livelihood, to health care, to the best available education, to income secure in retirement or loss of ability to work, etc.

Only such an economy can be considered truly modern and humane.