Re: Response to Henning and Mitchell

[Doug Henwood <dhenwood@xxxxxxxxx>]

Is Doug Henning on PKT? Clever magician must be using a very good disguise.

For all but about 20 years of modern capitalist history, a plentiful
reserve army has been the norm. Are we to assume that the capitalists
don't know their own interests?

I find it very interesting to read that the Unions are the ones who put
an end to the Golden Age, and that they were led by Marxists! I'm
conjuring up a mental image right now of George Meany reading the
Grundrisse. Do you know anything about American unions, Paul Davidson?
And why, now that they are on the verge of disappearance, is not the
Golden Age returning?

Doug

Doug Henwood [dhenwood@xxxxxxxxx]
Left Business Observer
212-874-4020 (voice)
212-874-3137 (fax)


On Thu, 14 Apr 1994, Paul Davidson wrote [edited for length]

>      When Mitchell wears his Marxist hat, on the other hand, he and
> Doug Henning seem to suggest that the capital system believes full
> employment is the error, and the industrial reserve army is the
> error correction mechanism! Thus in his second message, Mitchell
> (and Doug) imply that Marx is their Turing machine
>      Finally what about class conflict in the existing system. The
> statistics I cited earlier from 1947 to 1972 indicated that
> capitalists did not need an industrial reserve army to get richer.
> The problem occurred for an number of reasons -- but one that I
> should mention is that Unions become dissatisfied with gaining on
> the capitalists only as much as a larger after-tax share of the
> incremental GNP. They began to want no only the entire growth in
> GNP for labor but also an absolute reduction in the nonwage share.
> In other words, with prosperity and full employment apparently
> guaranteed by governmental policies, labor (and later landowner of
> oil producing properties) wanted to exploit the capitalists,
> rentiers, and even other workers domestically and around the
> global. The union threat of wanting such a large increase in income
> shares, led to planned recessions as the only way to reduce the
> militant power of the unions. Clearly, a more civilized policy
> would have been an Incomes Policy such as Weintraub's TIP!
>      In other words, not only are rentiers and capitalists greedy -
> - but in periods approaching full employment, strategically placed
> workers and their leaders are just as greed (maybe more so if lead
> by Marxists who tell they are being exploited.) That's why I said
> rich people are just like poor people except they have money. A
> civilized solution to the fight over income shares is a
> democratically agreed upon incomes policy. (When Gene Smolensky and
> I read a joint paper on "The Popular Appeal of 5 PerCent
> Unemployment" in 1960 to a labor organized conference, explaining
> the need for an incomes policy if political forces were not to be
> nurtured which would make a high (for the times) unemployment
> policy popular. WE were almost tarred and feathered by the
> audiences as apologists for the capitalists! (I note with interest
> that Doug and Bill tend to think of Keynes as an apologist.
>      No Doug it does not take "Marxist revolutionaries" to get
> "rentiers to ever agree to this compromise". A laissez-faire system
> when it breaks down -- not only destroys real wages but real
> profits and real interest as well. The experience of a Great
> Depression was sufficient to encourage rentiers around the global
> (outside of the Iron curtain) to enter into a Bretton Woods --
> active Keynesian demand management system with enormous social
> welfare schemes. They found they even enjoyed the fruits of such
> a system until prosperity encouraged some workers and oil producers
> to try to "exploit" everyone else. Then the reverted to the old
> game rules which does keep workers in their place and makes the
> world so impoverished that even the OPEC nations can't collect
> their huge economic rents anymore.