Re: The welfare state and a note about rally against privatisation

[HANLY@xxxxxxxxxxx]

Recently Zeyned Tufekcioglu wrote:
Now, the crucial issue is "the law of falling profits", a crisis generating
tendency of capitalism. After the boom of 1950-1973, the crises tendency
became stronger, (diminishing return on investment, less areas to invest
in). Triggered by the OPEC crises of 73, (not a cause, but an important
turning point), the world capitalism entered again into a long period of
crises, with smaller ups and downs until since.

During that era, capitalism did provide many benefits to workers of advanced
countries, and many third-world "third-path" regimes did yearn for a
"welfare state" of some sort.

Economically, it is not possible any more (save for either another war, or
an technological innovation on the scope of the internal combustion engine
-computers don't count really, because in spite of many changes computers do
not involve an across the board destruction and renewal of technology-). So,
the only way to increase profits is through more worker exploitation (both
absolute and relative, return to sweatshops in many countries, and flexible
work methods, which means the workers are flexed around as demand oscillates).

This is a long economic discussion, the point of the matter is, the welfare
state was the product of a *unique* historical period, which is now over for
the foreseeable future.

That is what we try to tell the workers. Times are tough, not because your
particular capitalist has decided to get meaner, but capitalism as a whole
is going through this period which will get worse. Life-time employment is
over because it is not possible for capitalism to sustain it when it is in
crises, and since politically it is very strong and does not neet to make
concessions.
      COMMENT: While I agree generally with this post I would make a couple of
more points. Barriers to capital flows have decreased with GATT and various
regional free trade agreements such as NAFTA and the common market in Europe.
This means that many developed countries are competing with developing
countries where there are few worker rights and little welfare. Many countries
also have various enterprise zones which have even less control on capital and
offer incentives for capital investment (China, Mexico) . Countries with
extensive welfare states and/or relatively well paid workers may lose out in
global competition. There will be pressure then to dismantle welfare
programmes, and this is especially true where government expenditures have
created substantial debt loads. (NOTE: I think these features of the situation
are deliberately exagerrated by those arguing for the dismantling of the
welfare state by they are real pressures.)
    I don't think that the welfare state will disappear or be dismantled
completely. THere is already a significant resistance and growth in civil
strife over cutbacks. In Canada at least some provinces are slowing cutbacks in
some areas, stopping, or even spending more. For example in B.C. the New
Democratic Government ( a social democratic party) is preparing for an election
and is promising MORE not less social spending. Even in Alberta, home of an
eminently right wing slash and burn premier called Klein cutbacks in medicare
have virtually ceased after a wildcat strike that generated all sorts of
support.
   A recent general strike of civil servants in Ontario caused the government
to mitigate some of the worst aspects of their slash and burn budget.
   Even in New Zealand where the welfare state has been badly hit there is
still a medicare system that any American worker would envy I should think.
There are user fees and privatizations of various sorts, but the basic
socialised health care system still exists. This is even more true in Canada.
There have been  nibbles at the edges and continual propoganda about cost--
even though we spend much less than the US, but to dismantle our medicare
system would cause too much civic furour.
   As for capitalism not being able to afford full time jobs, I think that this
is only partly true. The Japanese miracle was in part (but only in part) a
result of providing workers more security than was or is common in most
advanced capitalist countries.  If the firm
doesn't give a shit about you why give a shit about the firm. THere is a limit
to which capitalism can shed workers without reducing profits rather than
raising them.This is particularly true of highly skilled workers. Even
contracting out and privatization has limits. Contracting out involves problems
of monitoring that may be extremely costly as doing things in house. In fact
there have been cases where privatisation has been reversed by cities because
of problems with monitoring and quality.
   A certain measure of welfare will pay for itself in reduction in the costs
of class war.
   Cheers, Ken Hanly



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