[Translated from GegenStandpunkt 4–05]
In his inaugural speech, the President of the United States communicates how the working class is doing in its material position in the USA. He promises his fellow citizens the following:
"America has need of idealism and courage, because we have essential work at home – the unfinished work of American freedom. … In America's ideal of freedom, citizens find the dignity and security of economic independence, instead of laboring on the edge of subsistence…. We will widen the ownership of homes and businesses, retirement savings and health insurance – preparing our people for the challenges of life in a free society." (GW Bush, Inaugural Address; 1.21.05)[2]
An enlightening diagnosis. A 200-year old capitalist success story has made the United States not only the richest and most powerful nation in the world, and at the same time an ever-growing number of American citizens lack the basic necessities of life – from an affordable roof over their heads to security against the costs of illness and old age. And the definitive trustee of the nation openly admits this state of affairs: he explains the securing of such necessities of life to be the ideal ambition of state policy, which can only be approached with “courage” and a lot of “idealism.”
Bush is not by any means the first president to announce this: whether under the title “war on poverty” or now the Bush variant, an aspired-to “ownership society”: every American President still declares it to be a decisive component of his program to want to just take care of the living conditions of that section of its citizens who are never able to support their own maintenance themselves. However, the prayer-like repetition of this message is never meant as possibly an acknowledgement of failure on this front, even as national self-criticism. Poverty is simply the indestructible downside of American wealth: if despite all the state's efforts the growing wealth is accompanied by a tendency for the poor to become ever poorer, then that's just a fact which the state power sees itself confronted by; a “challenge” to which it rises and for which it must always seek new and suitable “answers.”
In the case of the Bush administration, the answer is: people who lack the means to “self-responsible management” of their lives should be helped to it with the encouragement of state power. With this promise, the state acknowledges the reasons that first ensure that the people become and remain absolutely destitute: on this basis it wants to do its bit so that people get by in spite of this. These reasons are willed and set into effect by the state: one is poor in the United States – just like in other countries – because one has the misfortune of belonging to the class of wage laborers. This type of person works in the USA just as little as in Europe, Japan and elsewhere for their own subsistence: their work serves the increase of the property of American owners of capital; they abet the wealth and power of the American state. With its force, it therefore ensures that the people have to live on whatever their labor power is worth to capital; the wage that secures the growth of capital is the livelihood that the working masses are entitled to. An American President can only approve of this benefit of American work for American wealth; particularly as the working masses, through their work and the wages that they receive, quite adequately participate in the advancement of this wealth, from his perspective.
If the unfortunate fact remains that this wage is chronically not enough for quite a lot of people in quite a lot of proletarian living conditions – this is something that the state mostly does not deny – then a decent American proletarian has to see how he copes with this situation in all freedom. If and insofar as he does this, the state power takes him under the arm with one or another support program: always strictly according to the criteria that the compensatory funds, which are lacking in the proletarian finances, has to serve the higher aim of making destitute people into self-responsible managers of their own distress. In Bush’s words: the state support for proletarian poverty should enable the wage-earning worker to position himself for the “challenges of life in a free society.” Whatever burdens this always holds ready for them: this then is their participation in the “American dream.”
The first sociopolitical act of the American welfare state consists of giving every citizen, across classes and without regard to person or race, a social security number. With this identification number the state registers its citizens in all categories of rights and duties that they get involved in over the course of their working and family lives. What the rights and duties then are, how they are organized according to what state criteria – that all completely depends. The comprehensive responsibility that the state exercises in social matters for its citizens is not to be confused with a comprehensive endowment of benefits. A good Yank has to work hard in the truest sense of the word, if not with his own private property, then in service to the property of others. How good one proves in the process decides what one has from the supplementary arrangements in social matters with which the state accompanies the efforts of its less-wealthy citizens who are pummeled with wage labor throughout their lives. In any case, the American state does its best so that private initiative can unfold its beneficial effects in this “sector” and is hindered as little as possible by state intervention.
A) “Social Security”: The state imposes a fund for the poverty of old age
In the USA, there is a state-organized pension fund with the informative name “Social Security.” And in fact the pension is the only social benefit that is “secure” for the American citizen, i.e.: the only social sector in which the state has established a share-financed compulsory payment system on the European model. This neither means that every Yank gets a pension, nor that it is enough to finance a living in old age for those who get one; again similar to the European model. It is “secure” first in that one is inside it as a contributor to the compulsory fund as soon as and as long as one works; the US state takes the contributions with which the fund finances itself from the income of the wage laborers as well as the self-employed.[3] It is secondly secure in that both the time that one must have worked in order to get the benefit payments, as well as the amount, are decided by the organizer of the levy according to its funding situation. And thirdly it is secure that one depends as a retiree on receiving the state-ordered payments: for two-thirds of average retirees, the Social Security check represents almost their exclusive income in retirement.[4]
The procedure that the American state uses in this social department is well-known in other countries: based on the verdict that the wages that one earns in a proletarian working life is not enough to finance life after work, it makes, through compulsory contributions and a reallocation procedure, the whole of its working population responsible for ensuring that their class brothers still have an income in old age – or at least most of them a little. Who, when and how much, the state sets in all freedom: it sets the retirement age at 67 years, ties the eligibility for benefits of pensioners at 10 years payment of contributions and at the same time (according to a complex calculating procedure) limits the pension payments to a maximum of 40% of the average wage earned in the entire “working life time.” The state ensures that only those people who have proven their willingness to work verifiably long and continuously get something; and only because of old age, it also guarantees that one does not withdraw from out of competition because of a lack of willingness to work. In the state pension fund the state acknowledges the willingness of the proles to earn the wealth of the nation, and this recognition is meted out to them so that at the end of all the troubles of a long life of work this willingness is materially honored by the acquisition of “entitlements.” [5] So it combines the principle of collective responsibility with the much-praised “spirit of self-responsibility”: thus with an order to the persons concerned to view the state pension as an incentive to find private insurance for themselves. And indeed in two ways: they must make sure that they get and remain “in work“; and they must concern themselves in a private way with the fact that the pension will never be enough anyhow.
B) The company pension: Social security as a subject of contract between capital and labor and a bubbling source of finance capital
How hard one is hit by the poverty of old age depends on one’s private coverage. The government generously admits this is unaffordable for most when it waives control over pensioners over 65 still having income from work besides their pension. Many retired people — not just those who were previously cheap labor — continue working somehow; supplementing the state pension through private insurance is just unaffordable for most. It therefore mainly takes place on a higher level in the form of company pensions, i.e. when companies negotiate an appropriate agreement with a trade union or staff representatives, or set up a pension fund as a company benefit.
Company benefits follow their own logic. The capital calculates the expenses for its own corporate pension fund as a component of the company payroll: as part of the cost that it pays for the use of the work force. On the other hand, this wage component has the small characteristic that it is not disbursed to its “recipients,” but remains in the hands of the company and adds handsome sums to it. The money does not lie around in a company safe deposit and wait for payment, but is used, like any money not required for the immediate continuation of business, as capital, i.e. invested in profit-yielding securities, where they – if everything goes according to plan – fetch surpluses. [6] These surpluses then, when the workers retire, serve as their pension entitlements. So quite compatibly with the system, the wage component becomes capital and vile capitalist profit is placed in the service of the social security of proletarian old age; and the state, for which this type of social provision is only correct, favors it with tax subsidies for employee pension plans and tax exemptions for the disbursed pension contributions.
In this way the internal, or equally the union controlled, “pension funds” have grown into the largest financial capitals in the United States – the pension funds of companies have tripled their magnitude in the last 10 years to reach 13 trillion dollars. The business with private pensions is even a great basis for capital formation and accumulation. The small contradiction in this special form of capital investment remains, however, its somewhat capital-adverse purpose: the property increase which takes place here has to stand directly for – in the end – disbursements, which in accord with timing and scope owe their criteria not to the optimal interest in wealth, but the contractually defined pension claims of the beloved employees. Of course, companies command all kinds of methods for dealing with this contradiction, namely: adapting the financial situation of the fund to the pension sum paid in each case and vice versa. Originally, most pension claims were based on so-called “defined benefit plans,” in which the amount later paid is certain; the amount of the calculated wage component, which the company pays in each case per person employed into this fund, is then be redefined anew in each case or renegotiated between union and company. The majority of companies have in the meantime converted their pension funds into “defined contribution plans,” [7] in which the deposit amounts are fixed, but it remains open how much the person then gets at the end in the pension. In the course of the introduction of these new pension plans, the beneficiaries are asked in all the rules for additional payments. In this way the companies ensure free disposal over the funds as a means for increasing capital: The inflow of contributions into the fund remains reliable, and the question of how much money lands in the pockets of each of the prospective retirees is their risk.
The American welfare state does not know a health insurance fund system just yet which is analogous to the pension fund scheme. [8] Concern for one’s preservation and care for one’s own physical condition is in the United States just a private matter like eating and housing – at least for starters. And because for a working person this risk of living is just as little overcome privately as is the poverty in old age, the same applies to health insurance as to the pension: for the duration of an active working life it is a matter of negotiation between capital and labor, thus of company health insurance schemes. It's primarily in areas of the economy in which the unions could assert themselves, but other companies also know definite principles that allow them to see the rationale of establishing a company health insurance plan. These company health insurance funds finance themselves in the same way as the company pension funds and are likewise fiscally supported by the state. Within a framework of regulations, the state makes sure that capital, in setting up the funds, complies with certain basic requirements in terms of health care. How the companies book the costs for the fund as a wage component and how their staff fits into the calculation is left up to them.
With the exploitation of the enormous demand for “health services” and employers who know how to make a business out of everything, the basis is laid for the largest health industry in the world [9] – and thus health care for the wage earning masses is made an all around unsure thing. Not only is the scope and extent of the health insurance of that section of the proletarian class who has work explicitly and from the outset made dependent on the business calculations of capital; for all those who have none, these funds are not responsible. Comprehensive health care for the population does not come about because of this; a circumstance for which the American state yet again assumes rudimentary compensation. So in the 1960s it supplemented its old age pension insurance with “Medicare,” its health insurance for retirees, which as a compulsory insurance is a part of the pension fund and is financed by an additional contribution quota – also, by the way, already a reaction by the state to the fact that company health funds less and less often insure retired employees. And only recently the state felt forced to supplement this sick person's care of the elderly with a pill insurance; “Medicare” affords little – obviously only the minimum health care that the state holds to be absolutely essential for the elderly. Also here it takes effect that goods and services are obtained only by those who – exactly like the pension – have worked continuously usefully for a minimum of 10 years for capital. The rest must be content, if at all, with painfully noticeable bad care within the framework of “Medicaid.” With this program, established in 1965, the state takes care of those who verifiably have absolutely no means of their own for health care – also here by no means in every case, but rather in accordance with state-defined criteria for authorizing access. [10]
Whoever in the USA has the misfortune to populate the free labor market but does not land a job is – as willed by the “laws” of the free market economy – destitute. Whether he gets to enjoy any state benefits, and when and how much, remains to be seen. With “Unemployment Insurance” (UI) the state recognized in the “Social Security Act” of 1935 that “hire and fire” indeed belongs to the life risks of a wage laborer; which means that for a long time it did not want to sort all the people for whom capital has no use into the category of the “unemployed.” Also “unemployment” is a status that one must have earned; namely by the fact that one has already worked, so one’s usefulness for an employer has already been proven. Only then one gets the benefit of entitlement to payments from a UI fund.
The federal state leaves the establishment and organization largely to the budgets of the individual states [11]; these define whether unemployment is generally a case for state support. This is very appropriate: the authorities take “a business-oriented approach” about what means they want to lay out for the care of the current surplus part of the local reserve army. Then they infer from their budgetary situation if they can do what they plan. It falls under the jurisdiction of the individual states to get the tax contributions from the entrepreneurs which then forms the “trust fund” for the payment of unemployment benefits; the companies as a rule shift this amount usually onto the wages. Who is then eligible in each case is defined by the authorities with relevant titles [12]; who gets how much money, how long, is a dependent variable of the financial situation of the UI fund. At most 26 weeks of support is possible; in cases of officially declared emergencies – such as Katrina – this deadline is extended by 13 weeks. The nationwide average comes to about a 16-week period of unemployment benefits, with significant differences in the amounts disbursed; the nationwide average is for 47% of the final salary. So the state ensures with the payment period and the stipend amount that the laid off workers never get the idea of getting used to the status of state-supported unemployed persons instead of striving to take self-responsibility for new employment – if need be, even in an opposite corner of the vast country. A large part of those who do their services in the wonderfully flexible labor market – the army of part-time workers, temporary workers, contract workers, etc. – are, with their unreliable labor relations, simply unable to verify any claim authorization.
This much is clear: the unions play an important role in what wage workers in the USA can expect in social benefits. They compensate their members not only in wages but also social benefits; in addition to the internal funds for health and pension plans, they include elements of job security. In union organized companies, the union authorizes ascent within the job and the wage hierarchy; likewise over dismissals and reinstatements; thus in contrast to the army of those who must take any work, unions members are provided with the privilege of belonging to a special “human resource.”
This privilege of working in a “unionized company” is then the main promotional argument by the American workers associations for why workers should unionize:
“Union members obtain higher wages and benefits than workers who are not unionized. On average, the wages of union workers are 28% higher than those in non-unionized areas. Only 15% of the non-organized workers have guaranteed pension entitlements, with union members it is 69%. 80% of all union members are covered by health insurance. For non-union workers the percentage is 50%.” (www.afl-cio.org)
So goes the union message on the “union advantage.” The catch is: the majority of American workers are not unionized and therefore are not included in the union-won social benefits. This has something to do with the conditions under which the right to trade union representation comes about in the USA.
Like every capitalist country, the United States has to judicially oversee the conflict between the nation’s workers and their employers. The union objection against the proletariat’s terms of employment and living conditions, which are imposed by capital, must be – if it cannot be permanently banned – legally channeled.[13] In the process, it becomes, like everywhere, thereupon respected that the union objection operates in the proper relation to the simply authoritative interests of business. In the USA, since 1935 there is a National Labor Relations Board (NLRB).[14] This authority gives procedural forms to union claims to representation, regulating the realization of trade union representation in a company. However, whether a union can assert itself as representative or not – this is left to the relative strength between capital and labor.
It goes like this: if a union can present signatures from 30% of a workforce, it requests the government labor authority intervene and organize an election for recognition.[15] If more than 50% of the workforce votes yes, the union is recognized and can apply for inclusion in collective bargaining with the company. Whether those negotiations will also come about, however, is still very much in question. NLRB regulations determine prior veto rights for the employer, which can indefinitely delay “collective bargaining.” Indeed, there are statutory deadlines for the initiation of negotiations, but a company management knows how to weigh all the fines for exceeding deadlines against the benefit of a union-free operation – especially as it can use the time gained equally sensibly to disabuse the applying staff members. If the union or the union substructure project decides to enforce the initiation of collective bargaining with a strike, the company may show the union members the door and permanently substitute them with willing strikebreakers. So that this strategy also “goes” properly, the law creates still another hurdle: until senior management consents to the initiation of collective bargaining, no union member may enter the workplace without their approval. So it is arranged that an answer to the question as to when a union’s objection is legal is left to the question of its enforcement on the spot. There is also the whole recognition process in reverse: if at least 30% of a staff applies for it, a union already established in the company can subsequently be voted out with the same procedure (more than 50%) also again.
From the start, the state puts some areas of the national economy, in terms of union activity, under special rules. Not covered under the NLRB statute are, for example, the areas of agriculture and infrastructure, and particularly public service. Here it is left to the Public Employment Relations Board (PERB) of the individual states to what extent the rules of the NLRB at all find application to the state as an employer. In this field again the southern states stand out especially; calculated on a national average, about 40% of state employees are prohibited from union activities in the workplace. Nevertheless, union organization is still highest in the civil service.
A) “Organize or die”
The US unions participate in this state procedure as a positive basis for representing the interests of workers. Union life looks accordingly. The negotiation of wage agreements with capital takes place between individual companies, businesses, or branches of these companies and 1000 union “locals” nationwide. Even where “locals” are organizationally united into a bigger union federation, which is usually the case, there are different agreements for different companies and groups of workers. If multiple unions are responsible for different business parts or want to fight for their primary jurisdiction there, then it is not unusual that one union in its fight for representation comes into competition with another; one union offering itself as a strikebreaker on the beat of the other “brotherhood” is in the program as an enforcement strategy. Accordingly, there is fierce bluster not only in the hostilities of the union units with capital, but for all intents and purposes against each other also. An American trade union does not organize the class; it does not at all want to be such a thing as the “arm of a labor movement.” It gains and defends with its struggle for recognition of the “bargaining units” the special rights of their clientele; its success in this question also always decides at the same time their right to represent this. Therefore, it tries to makes itself as indispensable as possible for this clientele, and strives to do this by making every possible condition of working life a subject of agreement with the company management: wage brackets, occupational categories, promotion paths, social benefits for sickness and pension. Thus those represented by unions get the status of being “better-off” – a status that exists only according to the requirements of the company, thus as a rule not at all.
This is how the social that these workers representatives organize looks: to what extent wage workers get benefits is from front to back dependent on what industry, which region, which trade union powerful- and competitive situation they are lucky or unlucky to work.
B) The union as a lobby
The unions have an umbrella organization over them, the AFL-CIO. This represents the “union advantage” above the competing interests of the individual unions, much like a united trade union movement for “working America.” Because in one thing the individual unions are nevertheless still in agreement on: the success of their struggle is dependent on the “strong arm” of the state. Of this, they hear that their voice counts for something in Washington; they matter on account of this, because in the end they are organizers of social welfare in important parts of the American industrial landscape. So “working America” or the “American middle class,” as the AFL-CIO prefers to call its privileged worker clientele, gets a lobby with the state power. The umbrella organization takes its responsibility to be the advancement or hindrance of union concerns in relation to state measures; in any new law, the appropriate level of trade union influence should be read, or – what is supposed to be about the same thing – a more or less good condition for union work.
In order to promote such terms and conditions, the union brass seek to spread their point of view among politicians and parties, according to which the political authorities are well advised if they recognize the unions as key representatives of a major category of striving citizens and include them in their decision-making. To spread this point of view, the union bosses then, like any other lobby, also let plenty of election campaign contributions flow. They not only approach state agencies specifically relevant to the social, but also the trade and state departments, to bring about union-friendly decisions on budgetary matters, in terms of foreign trade, etc. This entails that in the name of American jobs they side with American high-quality workmanship and American companies against foreign “competitive distortions” and in all the government’s trade policy undertakings, from CAFTA to China, insist that Washington from the highest level put the kibosh on using cheap wages outside America.
C) Why union influence dwindles
To their amazement, the success of the American competition society is no thanks to the unions’ state-pressuring “legwork.” Already for some years the unions in the USA have been increasingly shuffled away from responsibility for labor and social contracts.[16] The umbrella organization registers this fact as if its member unions had not been on the scene the whole time:
“The American middle class is in danger – this is demonstrated by the growing number of private bankruptcies, an unmatched level of private debt and a growing uncertainty about the job. It tears apart the social safety net, both at the state level, where the last budget presented by the Bush administration once again cuts crucial social programs; as well as in the private sector where employers take back more and more from health and pension insurance and rarely always pay wages with which a family can make ends meet.” (www.afl-cio.org) [17]
The attack that capital and the state have launched in the USA for some time against the livelihood of the workers does not also lead to a strengthening of the organizations that declare protection of the standard of living as their explicit purpose, but on the contrary weakens them: nationally, the degree of union organization has in the meantime sunk to less than 10%. Any union that organizes wage labor depends on the interests of capital, but there are additional reasons for this attack on unions …
– Capital has never given up on putting the kibosh on union influence wherever possible. The procedure by which the state regulates the licensing of a union in a company already opens a lot of possibilities for capital to not at all allow union representation to come about in the company. In addition, American businesses pull out every conceivable stop if they have decided to get rid of union representation once established – this means “union busting”: from the use of specialized lawyers, one-to-one ad campaigns in job security, to “bribery” of the workforce with benefits so that unions remain sidelined. The showcase for the latter strategy is WalMart, America's largest non-union-employer. With its voluntary health insurance program for its 1.3 million employees, WalMart effectively demonstrates that “working America” is much more American without unions. The fact that the program includes substantial co-payments from wages and covers only rudimentary basic care is not evidence detracting from the intended proof, as it is combined with a tangible threat: whoever is active in unionization risks their insurance coverage. Thus, according to the compelling logic of WalMart, unions are harmful if one wants to cope as a worker in the competition.
– The state makes sure not only in its labor administration that the company concession to unions is and remains a question of relative strength between capital and labor and will remain one. Since Reagan, strengthened regulations of union laws, with which the state from its considerations restricts the power of unions and criminalizes their operation, are used. [18] This first concerns nationally undesirable strikes: thus those that endanger the “national health or safety,” according to the state’s decision. Thus Reagan did not only prevent a strike of the air traffic controller union PATCO at that time with his objection; the strike leaders were treated as criminals, strikers fired, the strike fund seized, the union denied the status of collective bargaining partner. Even after Reagan such actions have not remained uncommon, such as, for example, at the end of 2001 the prohibition of a strike by mechanics at United Airlines, or in 2002 the suppression of strikes by the Longshoremen in Oakland, California, because they – according to the state reasoning – would have “hindered” the military logistics for the deployment of the Iraq war. Since “9/11” the state secondly casts still another eye on the union struggle for self-assertion: with the “Homeland Security Act” new legal barriers were created for union activity. Thus, for example, the “screeners,” those who inspect luggage at airports, were at the beginning of 2003 banned any right to collective bargaining at all; with the new “Transportation Security Act” these employees are also directly subordinated to the federal government – here it does not help the AFL-CIO and its individual unions at all that they are mostly loyal behind the “war on terrorism.” With the forcible suppression of strikes, together with the organizing of unions, the state provides still one more clarification about which “side” in the struggle between capital and labor it perceives national security interests in good hands. In the very partisan finding of the state, it is the unions with their defensive battle against wage cuts, which disrupt the “social peace” [19] on which the state depends. So the political power with its violent intervention thus “proves” the ultimate impotence of unions in the question as to which class is entitled to power over working and living conditions in a free America.
In their way, the unions defend themselves against the attacks by capital and the political power. Where a significant representation potential still exists, such as in the automobile industry, they prove with creative “concession bargaining” their responsibility for the survival of “their” company. With this strategy they therefore “fight” to secure their acquired right to representation of their respective workforce at all – and in doing so, its members lose any reason to make themselves strong for further union representation. Also, for this reason, it seems that the WalMart strategy proved to be right after all. [20]
D) How the unions respond to their weakening: they split up
The unions report that the attacks of capital and the state are a failure of their efforts to convey to their potential clientele sufficient reasons to materialize as their membership. Their base dwindles – and with it, in their findings, also their ability to still somehow make an impression on the company and in relation to the state. What is to be done to correct this dwindling base – in this the unions are divided. The union organization recently split over this issue. Since September 2005, there are two governing bodies on the American union scene, which dispute the national representation of the “union advantage.” Both want the same thing: to offer the proletariat a successful agency for the American dream of success.
The new union federation of secession is called CTW: the “Change to Win” coalition, its new program is programmatically called: “Restoring the American Dream.” This association now has gathered more than 40% of the former AFL-CIO members. It accuses the old umbrella organization of having done too little for the much-needed growth in members. As a reason for the increasingly declining influence of unions on wages and terms of employment, the new “coalition” sees the circumstance that they weaken by competition their own ability to generally wring contracts from capital, and therefore recruit fewer members. So that the union can better position itself in order then to again have more say with the state, it demands:
”All unions should be common, not competing concerns together. All union members with the same employer or in the same industry or same sector – no matter how they are union organized – should unite their power to secure better contracts and to fight for better state legislation.”
The remaining former half (AFL-CIO) sees things exactly the opposite. Their new program, entitled “Strengthening our union movement for the future,” which it gave itself on the occasion of the split, blames the dwindling influence of the unions in Washington on the fact that union concerns in the country by now count so little overall. They praised the efforts they undertook in the last presidential election as a tried and true way to strengthen the union movement:
”We have sought from the solidarity and strength of the election campaign of 2004 to do our best and take the steps that are required to ensure that the trade union movement can grow.”
The American unionists do not let the defeats meted out to them by capital and the state arouse the slightest doubt about their project of organizing wage laborers behind their service to capital as a successful life program. They define their failure strictly as an organizational problem – and they take this so seriously that they even split over it into two parts. The higher-level organization activities of the umbrella organization just never lifted the lively competition between the individual unions, but only continued it. And now also still competing federations sort themselves exactly according to the principles on which the “local” unions have always worked and in which they have measured their umbrella organization: how do we attach weight to our most powerful weapons? Rather to secure unity more “from above” over all conflicts and by successful lobbying create the conditions so that more of a base can be recruited? Or is it better to recruit members with more successful work “from below” in order to then make the lobbying more successful? As if coping with the “pursuit of happiness” isn’t enough now it is expected that the American proletariat should decide between these “interesting” alternatives…
How extensively the social system in the United States is based on company established funds – whether they are fought for by a union or set up by capital from its own calculations – becomes clear no later than when the companies start radically reducing their pension and health insurance funds or raising their price for the employees. Meanwhile, the company pension payments and health insurance benefits have become accepted as almost unbearable burdens for capital. [21] And also no secret is made about why that is:
”The car companies, but also many other traditional companies, suffer from the costs of health insurance for its employees and pensioners ... Now takes place the revenge that the big industrial groups granted their well-organized employees back in the seventies social benefits that they could not afford. A dangerous alliance of shareholders and unions ensured that the expensive promises were funded by risky investments in the capital market. When the stock exchange crashed four years ago, the disaster was clear. The pensions and health insurance could only be financed by contributions from the companies ... The dream of social stability after decades of work disappeared for many families.” (Süddeutsche Zeitung [a national German newspaper], 10.19.05)
It might seem to the not quite ideologically pigheaded reader rather that the staffs of such “traditional companies” cannot afford benefits that only work out if the managers get lucky while gambling in the capital market. But so be it: always, if capital “suffers” if it must pay “support” to pensioners and sick people against every reasonable capital calculation, it knows on whom it must shift this suffering – and can. Unlike the financial obligations that companies have towards their class brothers, the social costs have for companies the obvious advantage that one can get rid of them. With them it just concerns wage costs: and contractual arrangements over those always count only as long as they are profitable for the company. If the expenditures of the company for benefits are bound in contracts with the unions – then these contracts just have to be killed. [22]
In pension matters, the companies confront their employees with the relevant demands. For new recruits, benefits are either cancelled or massively reduced; already retired employees are asked to make payments again, such as co-payments for health insurance; fixed pension commitments are converted into variable; it becomes a “voluntary” fund in which employees must pay up to two-thirds of the contributions, etc. etc. Other companies, such as the major airlines, make various salary cuts and increased contributions the transition to the goal of simply canceling its pension obligations. The same with health insurance: health insurance protection to co-insure family members is cancelled; the continuance of company insurance is made dependent on additional payments and benefit cuts; etc. – so that it becomes ever more questionable whether and to what extent company insurance still regulates damage claims at all. Always new parts of the workforce lose any health insurance. Ever since the collective bargaining of 2004, the big auto companies have put 10-year job security on the table. So capital makes the total wage liable for whether the calculations of the company with the social security funds pan out as investments; at the same time it makes sure with rationalizations and layoffs that the company’s payroll, which flows into the funds, constantly shrinks. [23] The whole thing runs in the usual way: strikes, negotiations and “compromises” received with a “heavy heart.” They all run the same way: unions and staff representatives can be proud if they succeed in saving the company social benefits at all; capital defrays each concession by wage lowering.
It is especially straightforward in cases of bankruptcy. If a company is bankrupt, they drop their payment obligations to the funds from which the pensioners and patients are paid their support. This is why many companies use the declaration of bankruptcy proceedings to get rid of their respective obligations. In the proven manner, their union contract partners are faced with the alternative of either being made responsible for the total bankruptcy of the company or giving their approval to radically lower wages and benefits. This is what happened with the auto-supplier Delphi:
”The wounded American automotive supplier Delphi Corporation can fulfill its pension commitments in the long term only if the employees work in the future for a third of their current salary and benefits ... Only a significant reduction in wage costs could generate sufficient profits to the close the existing gap between pension liabilities and the existing assets to the amount of about $5 billion. Delphi has applied for creditor protection under Chapter 11 of the American bankruptcy law. Previously, the automobile workers union rejected the reduction of the wage package and benefits from an average of $65 per worker per hour to about $18.” (Frankfurter Allgemeine Zeitung [national German newspaper], 10.12.05)
So goes the “reduction of the costs of fringe benefits” in America: not as a large-scale state program to reduce benefits pay as in Europe, but as the direct abolition of wage components by capital. The effect is just the same as in Europe: the people are always poorer and less and less capable “on their own” of providing in some way for a “risk.” On the other hand, different: the people fall back on what the government provides for them, and this was never intended for them to survive off. The state responds – accordingly.
The condition of the social services is constantly criticized. Those affected then voice, when they are sometimes asked, the suitable lament [24] – so much for that too. And trade unionists always find the opportunity to denounce the social conditions, which were negotiated with them, as defective. However, the only criticism of the welfare system that becomes practical is that by the organizer of the whole thing. The tills from which the state pays support for the elderly and the sick always costs too much and achieves too little – as measured by the demanding criteria that in coming to the aid of the striving wage laborer they only act to compensate his efforts to overcome his personal circumstances. This surely matters when the state discovers more and more people falling out of the old security systems because they are simply no longer there. A way to manage this situation ultimately comes not into question: the political power itself admits the necessity to step in with its own payments when capital says goodbye to the organization of the social wage components. Conversely, the fact that the state is obliged to step in to a certain extent – such as recently, for example, with “Medicare” – is the whole bad state of affairs that is to be dealt with.
– State expenditures for health are too high. “Medicare” and “Medicaid” together now constitute approx. 20% of the national budget; that is already a really unacceptable scandal. [25] Likewise, every new government discovers with regular certainty a “coverage gap,” thus an undersupply of the total population with health insurance. It is necessary to do something about both these bad situations. What is to be done is then measured by the fact that, on the one hand, in no case may business-adverse considerations for the health of the employees be imposed on capital; on the other hand, the state should not accrue still additional costs. The principle to date of the reform measures consists therefore in promoting with always new “incentives” the willingness of capital to organize a reasonably reliable and at the same time affordable medical care, at least for the people who work. So far, the latest project was a “Health Security System” under Clinton: in it particularly small and medium-sized businesses, which are the largest reducers of health insurance coverage, should negotiate amalgamated and inter-company group contracts with health insurance coverage (“health alliances”) – like the big corporations under federal guidelines, individual state supervision and expanded tax relief. The plan failed in the legislative process because of its egregious interference in the freedom of entrepreneurial decision-making.
– Also the pension fund has always fallen under the critical eye of the state – specifically because it makes up a major part of the American state budget. Since its establishment, the pension fund has dispensed a substantial surplus from which the state helps itself quite naturally with its budget balancing. On this basis it is always busy securing the “financial feasibility” of pensions. Contributions were gradually raised from the original 2% up to 12.4% of total wages; in 1983 a “trust fund” was established out of the premium income as a reserve for later accruing outstanding payments; at the same time, a pension tax was introduced, whose revenues are credited to the pension fund, and the statutory extension of the category of compulsory insured persons decided. In addition, the retirement age for those born after 1959 was increased from 65 to 67 ... Meanwhile, the state diagnosed a principle flaw in its pension fund: if large parts of the pensioners live only off the state pension payments to retirees and at the same time are a burden on still other welfare state departments – then something is going wrong with the principle of self-responsibility, which the funds should nevertheless help prop up.
Thus the political power once again becomes a fundamentalist towards its own social services. In view of the circumstance that ever more ordinary Americans no longer make ends meet without state benefits, the senior office holders become self-critical of the fact that the state ever meddled in an un-American way in the social care of the proletariat. For this reason, in this current question, the dominant opinion in the United States is again that the government has violated the spirit of self-responsibility that is supposed to essentially characterize every American citizen. If the government now decides to turn responsibility over to its citizens for their own social position – then it is not for such disdainful goals as merely relieving the strain on the state budget from the social costs of wage labor; it is a matter of reviving that spirit again. In the words of the President:
“The more ownership there is in America, the more vitality there is in America, and the more people have a vital stake in the future of this country.” [26]
The Bush program is called the “ownership society,” which the President wants to bring in line with a fundamental reform of the pension fund.
On the basis of projections that the surplus eventually threatens to flow out completely in pension payouts, the Bush administration has proclaimed the impending “bankruptcy” of the state pension insurance:
”You should realize that the pension system will simply be bankrupt if the United States does not act now” (Bush on his 60-day tour through the country on the subject, May 13, 2005). [27]
As a reason for it he wants to arrange that the citizens have “control” over their “property” – saying their claims to “Social Security funds” would be lost to “government and health bureaucrats” (Bush). The “return” of this “property” to its rightful owners will kill two birds with one stone: the reform should not only dispose of bankruptcy once and for all; it should at the same time relieve the real owners of the pension money to self-manage the insurance money. It is this easy to transform the compulsion to provide for the material hardships that come from wage labor into freedom: if this compulsion is no longer exerted as a state collection of contributions and allocation of payments, but everybody may decide for himself how to get by with his meager means of compensation between his current lack of money and that predictable in old age – then this is no longer compulsion, but freely taking responsibility for one’s own circumstances.
The same money, which in the hands of the fund is not enough for the support of the pensioners, is affordable in the hands of free citizens – this, according to the Bush administration, also applies. The pension fund still accumulates gigantic surpluses: [28] and they would be much better off in the capital market for subsequent pension payments. Because the state has taken over pension matters, it has in accord with this view of things in fact impeded the average Yank from being provided with affordable pensions, health insurance, etc. It has withdrawn the finances, which the state has accumulated in its social funds, from the capital market: invested there and related to business, they would be a tried and true means to solve all the social problems of the proletariat. In this diagnosis, American politicians do not bamboozle about the possibility of various pension funds going bankrupt in the course of stock market crashes – just as they do not want to pass any judgment about the trend of business with the financial assets, but announce a principle: if in the free-market economy all income, including the measly pension and health care for retired proles, depends on the growth of capital – then, according to this point of view, the safeguarding of pensions can only succeed if the funds for provision are also put in the service of this growth.
The diagnosis defines the cure. According to the President’s plan, the pension fund should be strengthened by the fact that younger wage laborers, in addition to their pension fund contributions, “invest” in private annuity contracts [29] on the capital market and finance about a third of their future pension fund this way. The pension contributions should be frozen; for those who are already retired or are about to be, nothing in the amount of benefits should change. For the company 401(k) programs it is intended that incoming payments are to be increasingly tax deductible, moreover, the transferability of pension claims from one company to another should be made easier. The whole thing is supplemented by an agenda item named “Ensuring Freedom of Choice”: whoever for at least 3 years has paid into a 401(k) plan should be able to decide for themselves in which fund the money is put. In the long term, it should moreover be possible to put some of the statutory social security contributions into private pension insurance funds. And when one is already in the process, one can indeed always speculate on whether the capital market does not offer the solutions for all the perils of a worker’s life:
“Lifetime Savings Accounts would give all Americans the opportunity to save tax free for a professional or higher education, to pay for the down payment on a first house, a car for the journey to work or pay for retirement” (Bush).
First of all, the whole project costs the state budget something. Payments into the pension fund slump off, while disbursements are still to be carried out; tax losses are to be expected ... – according to government estimates, it adds to the budget debt between $50 and $200 billion over the next 10 years. Therefore, there are bipartisan debates, as well as in the political public sphere, over the project. The need for reform is on all sides as equally certain as the basic objective. At the same time, to relieve the state budget and to offer a perspective of self-responsible financing of old age to the current and prospective retirees, any American politician would find that, of course, fine in principle. But is it? Does this not become too expensive? Is the current radicalism, as propagated by Bush, absolutely necessary? [30] And – this concern becomes vocal – does not the state with the privatization of “Social Security” resort to a substantial revenue item that was always good for co-financing other state spending? These objections go in a colorful jumble; always under the point of view of how the state budgetary condition is to be made better compatible with the circumstance that the growing old age poverty just costs the state – somehow or other. And also the suspicion must not be absent in the political spectrum that Bush with his whole maneuver in reality just wants to put the hard-earned nest eggs of decent Americans into the gambling hands of the financial vultures on Wall Street. To this it should only said that first he truly wants this, and that secondly it is however completely mistaken to view these circumstances of injuring the common good for the promotion of special interests as a breach of presidential duty. The busy private money interests are after all “the economy” of the capitalist nation the USA; in whose hands would the pension funds be better off? Nevertheless: it may be that the entire project in its current form will still fail. A general murmuring among the people about wasting hard-earned pension money has “resistance growing in Bush's own party against the reform. Next year Congressional elections take place and the candidates do not want to risk being punished by the voters who fear pension reform.” (Süddeutsche Zeitung, 9.11.05)
Education work is still needed so that the American wage laborer correctly understands the propositions and challenges that the politicians offer to him in terms of a self-responsible lifestyle and honors them with a ballot mark in the right place.
The American state does not let it be said that it has to restore the reproduction of wage labor, which by itself is no good for living, for functionality only through social state support. Because in the most capitalistic of all capitalist countries, in the general opinion, there is no working class; no class of people whose common characteristic lies in the function they have to perform for the wealth of capital; whose reproduction is also thereby determined by what profitable work costs capital. Instead, in the land of unlimited opportunities there are lots of free, equal, striving with private luck citizens who are struggling through life under very harsh conditions; some of them get their “pursuit of happiness” on the assembly line or on the shipyard, others on the stock market or in the boardroom. No matter: wherever the “hard-working American” stands in the social hierarchy, every penny that he owns he has earned himself; he uses it for every opportunity which presents itself, does not let himself be impressed that one often falls flat on one’s face in the process, and is proud of the prosperity that his work creates. The state concedes social benefits to such people with pleasure: they have earned every penny they receive from the state, and even have by honest work a right to it. Ultimately, with their striving for their own success they make themselves at the same time useful for the community: the “working American” is the solid basis on which the nation in all its power and glory rests. On this then one may be proud as an American wage laborer: in one’s own work, one’s own success – and the esteem that both enjoy in the self-image of the nation.
Whoever is a citizen of the United States of America must get by on their own ability and with their own resources, as a dishwasher or stock market speculator, in any case get through life by hands on use of his money, labor or other assets. The principle applies in general as it does in the realm of “social security” in particular. The American welfare state makes one exception for an unmistakable “disability”: those persons unable to work according to federally standardized guidelines and individual state special rules get a benefit fixed accordingly. [31] But whoever disposes over a minimum of labor power also has, as an American, the stuff to fight for a decent living. The people who absolutely do not carry it off have already been judged in principle: these are not decent Americans in this sense. A large part of them also promptly provide the practical proof by getting caught with criminal offenses and landing in that department of the social net which is connected to an extensive – and following its partial privatization, strongly flourishing – prison industry. [32]
In one respect, the calculation that the state power commissions and exercises admittedly does not apply. The legislature programmatically clarified in which case in the “Social Security Act of 1935” by squarely designating a special additional aid institution: the need for AFDC, “Aid for Families with Dependent Children.” By definition, the dependent little ones really still cannot provide for themselves; they should also not be accused if or because their parent lacks a “self-responsible lifestyle.” By their misery and threatening neglect, America’s sociopolitical heart finds itself challenged to provide emergency assistance.
The state does this out of respect for the institution which it quite generally esteems as the fundamental economic and moral basic unit of its society, as miniature communities created by the citizens themselves, as the practiced public spirit of the competitive vultures that the economic “American way of life” requires: the family is from the perspective of the sovereign who orders over a capitalistic class society the real duty, the moral imperative and at the same time the most beautiful and natural, intimate and compelling motivation for proving oneself as a “hard working American” in the relentless bourgeois life struggle, the social habitat of the real US citizen, who gives it their best and if necessary lionizes one’s own family happiness and the “dependent children” even for the homeland. These “family values” are also honored by the political leaders if the actually responsible boss of the germ cell dies or lands in prison, or somehow or other in some way flies the coop or is a hopeless failure. Even in such a desolate situation the family should still do its service as a survival unit and moral institution: the still available parent should reflect and pull themselves together in the interest of the children or fight in the social competition and so teach the little ones through their practical example how a self-responsible lifestyle is led in the “Land of the Free.” Therefore it is not enough, especially in economic crisis periods, to put everyone somehow capable of work to the productive compulsion of destitution: in the insight of the most compassionate government that the United States ever had, it brought itself in light of an explosively growing pauperism to organize a type of support which includes money allowances in order to enable families sunk into poverty to lead a moral family life. This American social policy is maintained in principle up to the present day.
However, they always have a fundamental problem with their – rather tight financially – generosity: the support payments provide no guarantee that they make the supported families into moral self-supporting institutions as quickly as intended. Neither the child’s parents prove themselves reliable as guarantors of a decent conduct of their “ghetto kids” [33] nor the adults themselves succeed to the desired extent in starting new competitive careers with the success that would make further support superfluous. In this respect, the organized “welfare” misses its goal – the state money gifts were never meant as a permanent substitute for a successful struggle to survive by family self-sufficiency, the only “way of life” for US citizens. Whoever accepts it, possibly for a long time, therefore attracts the alert distrust of the authorities, that here again somebody makes themselves comfortable in the social hammock and is guilty of disregarding the basic rules of “fair play.” Inevitably the suspicion arises that the “welfare” recipient only had the children to get the benefit of AFDC payments; in this respect, the social policy ultimately created its impoverished clientele itself by its quite un-American support payments. The politicians then take from the increase of their clientele the clue that they therefore essentially make it too easy for the poor to be poor. Then they look in this way for a remedy:
With the critical inspection of the national pauperism, American politicians are struck by the finding – and if not discovered by themselves, then again and again by colored and also non-colored civil rights activists – that one and a half centuries after the violent slave liberation “from above” and decades after the successful battle against racial segregation and for a real legal equality for the colored US citizens with the colorless majority, the masses of “welfare” clientele have dark skin color. This makes them think.
No attention – to say this beforehand – is paid to finding the political-economic reason for the large number, as well as permanent existence, of people who fail to make it, keep up in the bourgeois competition over jobs and money, or participate in general. The fact that the capitalistic economic mode has no use for a substantial percentage of the national population, that relative overpopulation in the country belongs to the necessary effects of the primordial American “pursuit of happiness”: this insight has no place in the world view of those responsible. Instead, the conspicuously one-sided distribution of squalor to those who have dark skin is noticed. Even this, however, is no longer made with the critical point that there might be an injustice here, a violation of the sacred principles of “fair play” that have to be repaired. Complaints and demands of this type had their time: between the end of World War II and that of the Vietnam War, when black Americans, in the proud consciousness of having bravely served their country as soldiers and thereby to have earned unrestricted recognition, protested against the legal rules and social customs that intentionally or virtually blocked the way to unhindered participation in the bourgeois life struggle. At that time, some groups went so far in the name of the official American “dream that all men are created equal” as to deny the US government its American character and to threaten termination of their loyalty. The state put up with this just as little as it did the Black Panther Party’s transition to “class struggle” ideas. With many imprisoned and a few deaths, it provided clarification that there is one “American dream” and a “pursuit of happiness” against it and outside its jurisdiction does not exist. It accommodated civil rights activists who counted on the state in the spirit of loyalty – and after significant unrest and the resistance of its holdout Southern states, it heard the call for “equal rights and opportunities” and answered it in 1965 with the Civil Rights Act. Racial discrimination on the free labor and housing markets, in education, in participation in public life has since then been generally prohibited and gradually gone out of fashion; government programs, especially in education, enriched the nation with a black elite. And it was made practically possible and judicially aided for the citizens of darker skin color nationwide to enforce potential claims for support from the “welfare” fund – with the interesting result that they are now not just far disproportionately represented among prison inmates and candidates for the death penalty, but even among the officially managed paupers. The enforced social-legal equality of this part of the population changed nothing in the fact that it represents the major contingent of the capitalistically produced relative overpopulation of the USA, it has ensured only that this proportion is reflected in the clientele of national “welfare.”
This, as said, strikes those responsible, and indeed extremely unpleasantly. They cannot resist the impression that with their families-relief assistance they have spared an entire, long ago no longer fit for the bourgeois competition struggle, excluded part of their people, from striving for a bourgeois career. The suspicion is directed not only, but very specifically, at the civil rights pacified poor blacks that they kick back in welfare to get child money support – the scandalous figure of the fat black surrounded by countless children of different fathers, carefree to be a slutty “welfare queen,“ serves as a virtually in the flesh proof of the need to completely, but without any new racial discrimination, reform the egalitarian AFDC system.
America’s presidents lead one “war against poverty” after another, but the numbers of' “welfare” recipients will not diminish, but shows a rising trend. This harms not only the state budget, but in the official view throws a bad light on the intellectual and moral constitutions of a large segment of the population, which quite obviously deprives them of the “American dream” of happiness through competitive success. The permanent high crime rate, the decay of entire neighborhoods into “no go zones” where the police must ensure peace with pseudo-military operations, and an escalating seedy drug scene confirm the sad result: family maintenance has failed all down the line – orderly, socially, educationally, financially. The state power does not fail to respond.
a) “Ending welfare as we know it”
In the reform program of the Clinton Administration, which carries the typical title “Personal Responsibility and Work Opportunity Act,” the state accuses itself of the hitherto failures of the welfare system: of having precipitated the high costs, the decline of morality and the neglect of the people themselves. By ever having granted a legal entitlement to social assistance, it instigated non-self reliance in the poor and by its help for families with children destroyed the healthy family who masters life independently; the wretched figure of the applicant at the social welfare office would not at all arise without the poor support. To abolish this “welfare as we know of it,” it is defined as a measure in the well understood self-interest of the affected persons, as a liberation from state paternalism and a chance to finally lead a self-determined life
Consequently, the reform of the social policy pursues this goal and measures its success by a decrease in the number of cases that must be administered in the records of the social welfare office. The federal government achieves this by simply abolishing the legal entitlement to “welfare.” The new Temporary Assistance for Needy Families (TANF) is tied to the obligation of the head of the family to procure their livelihood on the labor market: “needy families” receive “welfare” only if the adult reports daily to the job search center. Within the two years in which they receive support, they must find a job or, alternatively, take part in work training or perform community work. Social assistance can be received for a maximum of five years over a whole lifetime. Thus nobody can argue any longer with the misery of children in order to calculatingly procure their own maintenance. It is – at long last again – the reverse: whoever does not succeed in providing for themselves must answer immediately to the growing need of their children.
To the others, the federal government delegates implementation of the program to the individual states and gives them conditions for the awarded means. They receive federal funds as “block grants,” which vary according to fulfillment of the target, the reduction of the number of benefit recipients, thus working as a financial reward or punishment. In this way, the individual states are responsible for the budgetary reduction program. Since 2002, in order to continue to receive federal funds, they have to prove that 50% of assistance recipients are pursuing work on the open market or are active in official work programs. Moreover, the individual states are free by decree to define the maximum period to less than 5 years; which nearly half the states have already done. They may take support away from parents for a child who was conceived during the time in which the family received “welfare.” Several states require that “welfare” recipients, through “personal responsibility” contracts with the authorities, commit to discipline and good behavior in the workplace.
The result: the number of social cases is reduced within two years from 4.4 million to 2.5 million. The beneficiaries are under control because they are entirely dependent on whatever any regional authority decides about their case. So much for the restoration of “personal responsibility.” Whether the rest have found a chance to work is no longer the concern of the state.
b) The restructuring of the family “as a last resort” against moral decay
“Strengthening families and working towards independence and self-reliance” is what Bush, the Republican President of “compassionate conservatism,” calls the continuation of his democratic predecessor’s reform, which was agreed to by both parties. This reform is regularly reviewed for its effectiveness every 3 years during the budget extension. The success of the ongoing “war on poverty” is measured in three ways: first, in the reduction achieved in the number of beneficiaries; second, in the savings effect; third, in the effects contributing to social order and morally beneficial effects on the people, which the government promises from its “welfare” spending – because the effect on political order is not eliminated with the aim of saving money.
Therefore help, if it is already approved, should also be disbursed. This stepped somewhat into the background, since the federal government made the individual states into the savings officials of their budget, that their success in saving rewarded and thus promoted a certain creativity in their efforts to reorganize their budgets – for example, some did not send the support at all or late so as to collect interest. This situation should be corrected. Help for selected poor, who despite working at a job cannot survive, is partially even expanded: in order for them to “give their all” to their job when the wages are not even enough to survive from one day to the next, they can receive, instead of a maximum of $7000, now up to $16,000, and for coping with special emergencies – how should they get to their jobs, where do they leave the children ... – there are special grants.
However, all these measures, according to the Bush administration, are basically worth nothing if they do not bring the slum and mobile-home residents a moral reorientation towards “family values.” The government sees that a direct link exists between all the regulatory problems that cluster in the poverty districts, such as unemployment, drugs, youth violence and crime, and a wrong family structure: the growth of these problems, say their social statistics, is accompanied by an increase in illegitimate births. The key to a fundamental improvement in the situation is therefore to promote the healthy family. Therefore, the emergency relief program complements the category “Family Composition.” Thus, people are taught in special education courses that one has to remain abstinent before marriage and that marriage has to be monogamous and permanent; young couples are encouraged through material incentives to have normal marriages. Teenagers with illegitimate children are forced by the threat of the withdrawal of welfare benefits to live with their parents and attend school. With redoubled effort the breeders of illegitimate children are traced and made not only morally responsible. So the richest nation in the world newly organizes its “welfare” families. The question of whether this moral corset stabilizes its slum population, the government will submit to itself as always and decide in observation of its budgetary situation.
In the world on the other side of “endless opportunities” there is in America an incalculable “plenty”: one to which the state leaves poverty to its devices. So it's good that Americans, especially the rich, have a compassionate heart and gladly help the weak. That they do not do it at all from a bad conscience, such as overcomes the socially egalitarian inclined Europeans now and then and wants to be satisfied with a donation. Someone who has “made it” in America discovers in the beggars and the needy – if they must not immediately be reckoned with as criminal failures – either the “less fortunate,” the neighbors whom bad luck has thrown off course and who one helps to a successful restart, or, depending, a member of that large unhappy part of humanity who for some reason – still – has not arrived in that great American system which offers everyone his chance and inevitably ensures – the charitable rich are the best proof – happiness and prosperity if one only participates with enough self-confidence. One lets those who remain outside and those who skid outside share a little bit in the blessings of this system so that they see and believe with new courage how great the “American way of life” is in general and “he who succeeds” in particular.
In this sense, once a year the decent American on the third Thursday in November thanks his economic system in the form of a turkey dinner, respectively his highest authority guaranteeing success, the God of the USA, for how far he has come in it and under its custody, and under the invocation of verses 31 and 40 of Chapter 25 of the Gospel of Matthew [34] invites selected “fellow citizens” to the table to fill them with food and himself with pride. However, for all his heartfelt charity, he knows to discriminate and subdivide his donations.
Those needy people who have the good luck that their misery in some way tarnishes the national honor – all exceptional cases, because basically the capitalistically produced poverty and the ruling system is never ever accused of even once in all its greatness having failed; rather, it testifies only to what a misfortune it is to not belong to it. But there are nevertheless from time to time exceptions; e.g. neglected war veterans – to abandon them, every upright US citizen would perceive as a personal disgrace. On behalf of his nation, he also may not in any case be accused of heartlessness towards malnourished children. And for AIDS sufferers, the national celebrities are, if not themselves endangered, nevertheless collegially concerned for their own network. Paupers in this category can hope that TV evangelists and talk show moderators or the social networks of the elites adopt one of their problems with “charity parties.”
A variety of professional “charity” enterprises take care of the large number left over. Best known in America are the mostly religious soup kitchens, which sometimes also serve as “homeless shelters.” One cannot accuse these feedings of excess; they are kept qualitatively and quantitatively clear. They are frequently distributors of food whose expiration date has passed or are donated for tax write-offs and advertising by local supermarket chains. Generally, attention is paid to publicly showing the major charity donor in a good light; in matters of charity, hypocrisy is unknown in America, and bravado is a good custom – why should it be good to hide their own charity if they can use the benefits, if it does no harm to the recipient of their modest gifts?! So selflessness or modesty is not expected of the relief agencies endowed with donations, but professionalism is required – philanthropy with no ulterior motive is seen as rather silly and in any case is held as an unsuitable basis for solid “charity” work. Serious “charity” keeps a sharp eye on the beneficiaries and preaches a decent conscience: they are all suspicious, somehow un-American characters; a member of decent society would like to have a certain amount of reinsurance that the old clothes from the garage do not end up in the hands of scroungers. The TV charity professionals gladly incorporate such “screening” of the alms recipients in the same manner as the entertainment part of their begging shows.
Well known outside America is the army of God, the “Salvation Army,” which has chosen the dubious nature of the poor as its mission. Within the United States, it thus has an important image advantage over the competing donations collectors; it is there as a first point of contact in natural disaster relief. Its actual achievement, however, is that it was the first NGO to have carried America's reputation as homeland to a charitable imperialism to over 100 countries in the world: a synthesis of helpful sharing and “public relations,” which in the meantime has been perfected by countless new organizations. Half the world becomes infused by American aid agencies, which with their mission to foreign, “less fortunate” countries place the “American way of life” as a model and as an embodiment of all their unmet desires in mind. So in the end even the paupers of the capitalist world power are useful for something: as a model that makes from their misery a publicity event for “family values” and for America as their protecting power.
[1] On the concept of the welfare state, see Chapter 5 of The Democratic State: Critique of Bourgeois Sovereignty, by Karl Held and Audrey Hill. On the British welfare state see: Great Britain — the pioneer of modern social reforms: A model lesson on the magic formula for how to use wages and the social welfare budget as weapons in global competition.
[2] “America has need of idealism and courage because we have essential work at home – the unfinished work of American freedom ... In America's ideal of freedom, citizens find the dignity and security of economic independence, instead of laboring on the edge of subsistence ... We will widen the ownership of homes and businesses, retirement savings and health insurance – preparing our people for the challenges of life in a free society.”
[3] The self-employed pay the full 12.4% contribution rate, but only up to a maximum salary of $90,000. Income above this limit is not liable.
[4] This dependence of the average prole on the state pension payment is the solid basis for the good opinion the people have of this fund: the check, it is said, can’t be taken away from them. So wrong can they be.
[5] This state point of view – the deserving elderly should not fall into poverty – is the basis for all the ideologies in circulation among the people about “Social Security.” No Yank who suspects that every recipient of state allowances, no matter how hopeless, is a parasite who wants to escape his duty to compete would entertain the idea that this accusation applies to the pensioners: They have in fact earned their right to self-insurance benefits!
[6] The General Electric Company, for example, during 2001 made 15% of its profits from investment gains from its pension fund.
[7] These are called “401(k) plans” in the relevant paragraphs of the Internal Revenue Code.
[8] In Roosevelt's legislative proposal to “the Social Security Act of 1935” there was a “feasibility study” on the question of whether health insurance should also be drawn up as a collective compulsory fund. Such plans arose again in the Truman era and again in the Clinton years. In all cases, the American rationale prevailed with the majority of politicians in Washington – with active lobbying by the AMA (American Medical Association) – against the hint of socialism. In the modern discussion: if the growing impoverishment of the American people – pursued by the state and capital – would make a public health insurance necessary for the states to secure the functionalism of its resource: the people is under scrutiny. After all the growth of the wealth of the nation needs useable healthy people and an unwanted side effect from poverty is an unreliable health. In an unfortunate twist of logic, the working people do not take the attempt of the welfare state to secure poverty as an argument against its organizers. They rather see in the willingness to cope with these results a benevolent disposition of the national leaders.
[9] According to official statistics in the United States, more than 13% of the Gross National Product goes for health care, while European countries spend about 9-10%. Of the approximately 285 million Americans, 55% are covered by company health insurance, 9% are insured privately or by the military, 10% through Medicaid and 13% through Medicare. 13% have no health insurance.
[10] “Medicaid is accessible only to those individuals and families with low incomes who are eligible according to federal and state laws. According to the laws of the respective state, a small part of the costs must be paid in addition for some medical benefits. Many populations are covered by Medicaid; however, within these groups certain conditions have to be fulfilled for the entitlement (age, pregnancy, disability ...); income and other possible financial resources (such as bank accounts, real estate or other things for sale) are examined; likewise, whether one is a US citizen or has a permit for legal residence. The rules according to which income and other financial resources are taken into account differs from state to state, as well as between the various groups of beneficiaries.” (www.epi.org).
[11] “Federal legislation lays down general guidelines and some minimum standards to which states must adhere.” (www.epi.org).
[12] An unemployed person has to prove that it was “not his fault” he lost his job. Among the criteria for possible non-fault, in all states for several years, is the fact that one was laid off because the product that the company produces is now imported. Thus, the state’s point of view that the losses of US firms in international competition can only be the result of unfair competition is taken up in support of the working class: as a legal claim of the working man who has become the victim of such unfair competition.
[13] It took quite a long time and a lot of blood before the political power in the United States arrived at this “insight.” Until the years of the first world economic crisis, the first response of the state to any rebellion by the proles, to any attempt to form a resistance against the working conditions and wages imposed on them by capital, was merciless suppression, bludgeoning strikers and shooting their leaders. In this way, the state put an end to the anarchistic workers associations in the 1920s. On the basis of the “New Deal” the offer was issued to state-loyal workers’ associations to cooperate constructively in the reconstruction of the nation. In this sense, in the war years the unions in the relevant industries proved deserving as the material basis for the war victory, and thus laid the basis for the type of union power over which they have today.
[14] “Congress established the National Labor Relations Board (NLRB) in 1935 to administer the National Labor Relations Act (NLRA), the primary law that governs relations between unions, employees and employers in the private sector. The Act guarantees employees the right to organize and to bargain collectively with their employers or to refrain from such activities. The Act, which generally applies to all employers involved in interstate commerce, implements the national labor policy of assuring free choice and encouraging collective bargaining as a means of maintaining industrial peace.” (www.nlrb.gov).
[15] In principle a union can fight for representation in a company without taking the path of the NLRB’s so-called “voluntary recognition.” For obvious reasons, the slight union right to have a say has come into being “voluntarily.”
[16] Since Reagan, the AFL-CIO is no longer represented in the governing bodies of the NLRB.
[17] It is no coincidence that the union, in its complaint about declining wages, appeals to its effect on the family. Their reproach to the American employers is that their private profit interests shake the foundations of what every good Yank knows to appreciate as the bulwark of the national community: the cohesion of decent, hard-working people in the family. So with the defense of the “American middle class” the union represents itself as the authority that ultimately is just the highest expression of national morality: “family values.” Capital and the state are less impressed: Bush sees things rather in such a way that these “values” do not entitle demands, but rather help ensure that wage earning families can manage the hardest conditions as challenges.
[18] The “Taft-Hartley Act” of 1947 was the first response of the state to the attempt by the unions to secure their material position during the war with the help of the “closed shop”: they struck agreements with companies that only hired union members. The individual states became free to implement the unrestricted “right to work” law, thus prohibiting the “closed shop.” This principle has now been implemented in 20 states, mainly in the south. It forms the basis for the company’s strategy of getting rid of union influence by shifting operations to “union free” states or by similar “outsourcing.”
[19] The companies know this, of course, and use it: in the strike by the longshoremen, capital refused any negotiations with the union and asked the state to decide the matter finally from reasons of national security.
[20] “Forget organizing. Why would anyone want to join a union proud of the fact that it may now have lower standards than non-union plants?” (One-Sided Class War: The UAW-GM 2007 Negotiations; Sam Gindin, Labor Notes, Nocember 2007).
[21] “Without the pension and health insurance contributions, the profit margin of GM might possibly rise from a meager 0.5 percent to 5.5 percent ... According to estimates by analysts, the cost portion for the inherited burden at General Motors in the United States amounts to $1,784 per vehicle produced.” (Die Zeit, 4.10.05)
[22] Capital, of course, tries to reduce its entered into payment obligations retroactively, but that is only partially legally possible. Also “the firms try to shift the company's existing pension obligations, with every accounting trick, onto the state pension insurance PBGC. This institution, created in the 70s, should really only step in in emergencies ... But massive failures ... have led to the PBGC itself to the verge of insolvency. To avoid collapse, the American taxpayer will sooner or later have to step in…” (Süddeutsche Zeitung, 11.09.05)
[23] Meanwhile, for example at General Motors, 2.5 pensioners are financed from the occupational social insurance of one currently working employee.
[24] Perhaps so: “In a 1993 survey, 90% of Americans complained that health care was too expensive, three-quarters felt the insurance protection was not enough, and nearly half was dissatisfied with the quality of care.” (From the German magazine Politik und Zeitgeschichte 8/96, p.13) Certainly nothing will have changed in the last 10 years.
[25] As early as 10 years ago it was said: “The increase in members and of costs (for medical benefits) has led the Medicare program to become a burden on the federal budget.” (Ibid.). It can only get worse.
[26] “The more ownership there is in America, the more vitality there is in America, and the more people have a vital stake in the future of this country.“ “Bush's idea of an ‘Ownership Society’ in which everyone is responsible for their own provision is the appropriate counterpart for the 21st century to Roosevelt’s New Deal.” (Wall Street Journal, 10.19.04)
[27] The transition to losses is officially predicted for 2018/19; bankruptcy is predicted for 2025.
[28] “In its annual report for 2002, the Supervisory Board of Social Security predicts that the pension fund will take in more in contributions until 2017 than they are taking on payments.” (www.epinet.org)
[29] “Retirement Savings Accounts (RSAs).”
[30] “End the drama: Social Security is financeable.” (The Seattle Times, 3.29.05)
[31] In addition, the expenditures of the individual states are supplemented with contributions from the federal budget in the same amount.
[32] The states lead the way here socio-politically and in education and treat the losers of the nation with absolute severity – “zero tolerance” – and the threat of absolutely disproportionate punishments – “3 strikes you're out” life sentences on the third conviction even for only the smallest offenses – thus a massive deterrence policy for prudence in career planning.
[33] Before the beloved “dependent children” of the underclass ultimately take the crooked path, the welfare state gives them one more chance: at the request of parents who no longer know how to help themselves any other way or by a decision of a juvenile court, as an alternative to first imprisonment, children and adolescents can be transferred to “boot-camps” where the rules are ingrained in them with military drills, whose observance distinguishes the ordinary bourgeois competitive fight from its criminal variant.
[34] For the other 364 days a year, verses 14 to 30 apply without qualification and in the most literal interpretation.