MIM review of Workers World (WW, October 20, 1994 & October 27, 1994): Some more proletarian accounting exercises on the labor aristocracy Workers World Party 55 W. 17 St. NY, NY 10011 (212) 627-2994 I. The $10 an hour minimum wage demand II. Four proletarian interpretations of imperialist accounting that show roughly the same thing: no exploitation of the white working class III. Dividing up the booty IV. The social-chauvinist statistical arsenal MIM reviewed the CPUSA's paper called People's Weekly World and the Workers World (WW) paper at the same time. As a result, we notice that the subject areas of both papers are fairly similar. WW gives more attention to international and gay issues, but both papers tail after the insecurities of bought-off workers in the imperialist countries. The Workers World Party describes itself this way: "JOIN US. Workers World Party (WWP) fights on all issues that face the working class and oppressed peoples--Black and white, Latino, Asian, Arab and Native peoples, women and men, young and old, lesbian and gay, disabled, working, unemployed and students." Like PWW, the WW opposes NAFTA, supports the players in the sports strikes, makes solidarity with Cuba a special task above solidarity with other Third World countries and believes the conditions of the white working class are ever-declining. MIM does not agree with PWW or WW on any of these issues. I. The $10 an hour minimum wage demand Typically, the WW does not explain anywhere how it is going to achieve its demand for a $10 minimum wage for workers of the whole world. It only talks about a $10 an hour minimum wage for U.S. workers, specifically in the context of a Michigan campaign. (October 20, 1994, p. 5) Just as the bourgeois candidates ask each other how they are going to pay for more prisons, cops, war and other programs, we must ask the WW how it is possible for U.S. workers to receive a $10 minimum wage without joining in an alliance with the imperialists to oppress other workers abroad. What the WW is doing with this $10 an hour thing is like the bourgeois politicians' promising tax cuts without telling how they are going to pay for them. It's just vague opportunism. MIM does not support a $10 an hour minimum wage. Of course that will come some day under socialism, but for the immediate future, such a demand only stokes up the chauvinism of Amerikan workers who will make a deal with the imperialists to share in the exploitation of Third World workers. Even if all the profits of the U.S. imperialists were re-distributed to Amerikan workers, the imperialists still could not afford a $10 an hour minimum wage without sucking even more superprofits out of the Third World. Hence, MIM does not make this sort of demand at this time and instead our first priority is redistributing U.S. profits to the Third World, because that is where they came from in the first place. II. Four proletarian interpretations of imperialist accounting that show roughly the same thing: no exploitation of the white working class MIM proved this idea in MIM Theory #1 and follow-up articles in other MTs, but let's take this opportunity again to undo the distortions of the "Left" and fight for some sense of proportion. Here we use figures previously unpublished by MIM. 1. The figures on wealth in the United States show as MIM explained before, not that a class of new trillionaires is created every year, but that the relevant surplus value total extracted by capitalists is never enough to create more than one trillionaire a year (just kidding; it never happens that way because then there would be nothing left over for other capitalists), probably something like $500 billion or less. According to the Statistical Abstract of the United States 1993 (p. 477) "fixed reproducible tangible wealth" including nonresidential equipment, nonresidential structures, residential property and government property increased $510 billion adjusted for inflation in the latest year we have available, between 1990 and 1991. $96 billion in that growth of "gross stock" was in government wealth. Other parts of that wealth are mostly owned by the middle classes. That means the growth in gross wealth (different story for net wealth created) does not all go to the capitalist class, which in this society is dominated by private capital instead of state capital. Once again the evidence points to the surplus-value extracted by capitalists being less than $500 billion a year in categories relevant to exploitation of white workers. Of course, if we were to look at the surplus- value sucked in by the white workers as white collar workers in government, advertising, the military, banking and so on, we would be talking about over $2 trillion a year. We aren't counting that $2 trillion because it is going to the white workers and we are concerned with whether it can be said capitalists exploit white workers. We go through these exercises because looking at the same pie, it is possible to do different accountings. The same slice of pie can be counted under different names or concepts invented for accounting purposes. The Department of Commerce offers us at least two more of interest not previously discussed by MIM. 2. One way of looking at the pie talks about corporate profits and net interest as separate categories. Looking at the 1990 pie of $4.46 trillion, the Department of Commerce sees $819 billion of net interest and corporate profits, mostly net interest. Most of this actually ends up in the hands of the middle classes including the labor aristocracy. Yet it is another way of setting an upper limit on surplus value relevant to our calculations of whether or not the white working class is exploited. 3. If you don't look at net interest and corporate profits and instead look at things in a different stage, like after the corporate profits have been distributed, then you get a second way of accounting. What is telling is that there was $124 billion in dividends in 1990. That shows what happens to profits after paying taxes and leaving some around the company to invest. MIM has already shown that the capitalists only own about half the stocks, so they may receive about half the dividends and even 100 percent of $124 billion going to capitalists is definitely no sign of white working class exploitation as we showed in MT #1 calculations. Then if we count people's savings accounts, bonds and pensions, we get $721 billion in "personal interest." MIM has already detailed in the MIM Notes how the largest pension funds are worker-owned. This accounting does not account for inflation from year to year, so this category of "personal interest" is also not very promising for revealing much surplus-value being extracted by the capitalists from white workers. (The World Almanac and Book of Facts 1993 p. 130 is one place to obtain this common Department of Commerce accounting.) The surplus-value is easily accounted for by exploitation of Third World workers and oppressed nation workers within U.S. borders. 4. Perhaps the best accounting is the most simple and it is made possible by figures released in the Statistical Abstract of the United States 1994. These figures give us a look at the bourgeoisie roughly speaking, because the cut-off the government chose to use also includes some people in the middle-classes (and of course the government didn't set out to do an accounting of the "bourgeoisie.") What the government did is look at the "gross assets" of everybody who has "gross assets" worth more than $600,000. All capitalists must have substantial "gross assets" unless they control production through the state, which is not the main approach of capitalists here within U.S. borders. On the other hand, not everyone who has large gross assets has high "net worth" which accounts for debts and losses. A large portion of people in the above $600,000 gross asset category actually has negative net worth as shown right in the government table. Yet again, people allowed to roll the dice by the banks may have negative net worth one year and positive net worth the next. One such person is Donald Trump who has not escaped speculation concerning his net worth being very low or negative at times. In any case, if you think about people with $600,000 in gross assets, it's conceivable at an average profit rate of 8 percent, a person would obtain $48,000 a year. After inflation and taxes and supporting family, we might think of this as a good number as a cut-off point: the cut-off between having to work and being able to live just from owning things. In a corporate capitalist society like U.S. society, this is a distinguishing feature of the capitalist class. Capitalists here may choose to work, but they don't have to because they would survive just by owning things. The one drawback of what we do with this favors our critics. We count some people in the middle class by using the gross asset definition instead of "net worth." Actually for many in the gross assets greater than $600,000 group, some or all of that $48,000 has to go to paying interest on debts. These people aren't really capitalists, but we don't want anyone to say we undercount the number of capitalists or the surplus-value we calculate, so we include the people with low or negative net worth. This government definition counts about 3.5 million people, many who aren't millionaires. Their net worth totals under $5 trillion according to the Statistical Abstract of the United States 1994, so let's round up to $5 trillion just to make calculations simpler and to flatter our critics further. The $5 trillion is one part of the puzzle. The other part we need is the profit rate on capital, the rate of return capitalists get just for owning things. Luckily for us, by both bourgeois economic assumptions and Marxist economic assumptions, the interest rate is a good indicator of the average rate of return on capital. The reason is that capitalists invest where they can make money. The interest rate tends to reflect the average profit rate because capitalists will borrow money whenever they can make more profits than they pay in interest on borrowed money. They keep borrowing money until they can't find anymore places to make profit exceeding the interest rate. By doing this, they bid up the interest rate to be something like an average profit rate. This is another way of saying the capitalists are willing to loan out money to other capitalists based on supply and demand, so the interest rate will tend to reflect the average profit rate. In recent months, the "prime rate" of interest has been around 8 percent. Mortgages for example are around 8 percent. As long as we don't think the rate is 80 percent because we are from Mars like some "leftists," it won't matter too much whether we use 6 percent or 10 percent as our interest rate. In actuality, inflation is 3 or 4 percent, so the real interest rate is lower than 8 percent per year. The interest rate is the second part of the puzzle we need here. If the interest rate is 8 percent and we assume no inflation, then the capitalists with $5 trillion rake in $400 billion a year in surplus- value. If the rate is 10 percent, they get $500 billion. In actuality, a realistic estimate is probably closer to $300 billion given inflation. In MT #1 we showed it is easy to account for $300 billion just from discrimination against workers of color within U.S. borders. There is no way to see any net surplus-value coming from white workers as a class. Their role is to assist in the realization of surplus-value. They don't generate it, anymore than the petty-bourgeoisie does. III. Dividing up the booty Even with figures larger than $500 billion for surplus-value extracted by capitalists for themselves and not paid to white workers in advertising and so on, we have already shown elsewhere that a majority of white workers cannot be exploited. If we take all of that $500 billion we originally discussed in the section above on "gross assets" and re-distribute it to 250 million U.S. residents, there will be $2000 for every person. There will also be no growth in housing, government or workplace property by that means of accounting. If the actual figure is more like $100 billion, then there is only $400 a year for every person to re-distribute. >From such calculations we see that giving the entirety of the surplus in wealth to the Third World in re-distribution still would not come close to cutting the inequality between imperialist countries and oppressed countries. If we go further and cut the salaries of the top 5 percent of the population by two-thirds so that its income is more like that of ordinary people, we might gather another $350 billion a year. If we go after the top fifth of the population, we can squeeze out about $700 billion a year. (Based on chart No. 722 Statistical Abstract of the United States 1993, p. 463 and GNP figures same section repeated in several tables.) This would mean some very serious political egalitarianism not likely under imperialism. What the Workers World Party is doing only ends up stoking up the economic demands of workers in a vague sort of way without explaining the economics of socialism. The workers are likely to turn around and ask the imperialists for $10 an hour to join in exploiting the Third World. The Amerikan workers will not attempt to carry out the above redistribution. Still, say the workers and imperialists suddenly agreed to a completely equal redistribution of income or more realistically, space aliens landed in the United States and through absolutely superior force imposed egalitarianism. MIM would go to these space aliens and suggest that a $10 an hour MAXIMUM wage within U.S. borders would be a good first step forward given the history of social relations on our planet that the space aliens don't know about. If we take the U.S. GNP and set aside a realistic part for health care benefits and investment in the means of production, then we can have approximately $4 trillion a year to distribute to workers in wages. How many could we hire for $10 an hour? If people work 30 hour weeks 50 weeks a year, that will be $15,000 a year. That means we could hire 267 million at $10 an hour in addition to the medical sector and other workers we set aside money for. This leaves no money for additional reparations owed to the Third World. That would be a serious drawback of our proposed plan for the space aliens to implement. The oppressed peoples should not have to go to the United States to collect their reparations. On the other hand, right now, according to the U.S. Department of Labor, only about 120 million have jobs. If we had 267 million jobs at $10 an hour, we could take care of the unemployment of the United States and open the borders to give jobs to many immigrants- -a kind of reparations program, not the only kind and not necessarily the best kind, but a step in the correct direction. Chances are that with that many people working, and working hard thanks to the space alien slave- drivers, a person's $15,000 would go a lot farther than it does now where people get paid for shuffling paper and owning things-- welfare handouts for the rich and the labor aristocracy. Economic development throughout the world might be spurred in a socialist way through the establishment of a maximum wage in formerly imperialist Amerika under enlightened communist space-alien rule. Nonetheless, the above is an interesting arithmetic exercise, but it does not address political realities, since there are no all-powerful communist space invaders to ally with. It is difficult for MIM to see a glimmer of socialism from what WW says, but if WW agreed to $10 an hour as the MAXIMUM wage for Amerikans, MIM might also agree to $10 an hour as the minimum wage. Usually, MIM is just in favor of "from each according to his ability, to each according to his work" and no pay for just owning things for the first stage of socialism. The space aliens idea would be much further advanced. In general, the WW shares with most of the "Left" the incorrect idea that Amerikan workers are exploited. What the social- democrats, Trotskyists, crypto-Trotskyists, neo- Trotskyists and CPUSA all have in common is a mythology of the white proletariat. (See the book MIM distributes called Settlers: The Mythology of the White Proletariat) This means putting together half-baked analyses and half-truths to sustain a sentimental view of white workers as oppressed. IV. The social-chauvinist statistical arsenal One of the more valiant attempts in backing this white proletarian mythology is in the WW of October 20,1994 (p. 3). According to WW: "In 1993 the U.S. economy was in an upswing. Official unemployment dropped to 6.8 percent from 7.4 percent the previous year. The overall economy grew by 3 percent. "Yet annual income for the median working family dropped by $300. And a million more people sank below the official poverty line. "The median income is the one right in the middle. It's the most typical. Half the households have higher incomes, half have lower. "Last year confirms a longer downward trend. Since 1989, the median annual income has decreased by $2,344, or 7 percent of total family income. The U.S. Census Bureau released these numbers Oct. 6." MIM appreciates this attempt at analysis, which is all too rare. Perhaps the collapse of the Soviet Union and much phony socialism has some people in WW and the PWW using their own brain cells for once. The above is the best our "Left" can do in defeating MIM's analysis. The last bit is the single most effective statistic in the arsenal opposing us. Let's look at this in more detail. First, WW mentions the unemployment figure and concedes the possibility given by the government that unemployment actually went down. This is better than what some "leftists" would do: just ignore the unemployment rate without believing any figures and still manage to believe that the unemployment rate is always increasing. Obviously that is not possible because once you get to imagining 100 percent unemployment it's not possible to fantasize about any further degradation of white workers, so good for the WW for recognizing the possibility that unemployment does not always go up. In fact,the percentage of the white nation employed has gone up steadily, even while the unemployment rate gyrates. Secondly, the figures regarding poverty's increase are estimates. They are based on samples of the population. No one actually counted 1 million more people in poverty. That's a minor detail; what is important is that poverty is still confined to the bottom fifth of the population, which is disproportionately oppressed nationalities and single women. With regard to this bottom fifth of the population, MIM does have considerable evidence that its position has gotten worse in recent years. National oppression is largely centered in that bottom fifth and MIM champions the people in that group. Average U.S. income goes up while the income of the bottom fifth can and does go down. Where MIM disagrees with the other organizations is that MIM does not believe it is possible to stand for the majority of people within U.S. borders without selling out the bottom 20 percent, not to mention the more abundant proletariat outside U.S. borders. This also has the implication that democracy, or majority rule within U.S. borders is infeasible for progressives. We must instead insist on majority rule without borders, majority rule for the Third World laboring masses. Right now we have majority rule within the white nation determining the rules for the governments of all peoples. The strategy of obtaining a majority for elections or independent movements within U.S. borders necessarily means that the movement is not anti-imperialist. MIM is only interested in movements that can be sustained as anti-imperialist movements in line with the interests of the international proletariat. That is one reason we support the maximum wage idea as superior to WW's minimum wage idea. The more immigrants U.S. residents come in contact with and have surrounding them, the greater the chances a really strong and dominant proletariat can form within U.S. borders. For that matter, that is another reason to hold the internationalist bourgeoisie to its free trade rhetoric and never ally with the anti-NAFTA, anti-GATT Amerika-first bourgeoisie as the CPUSA and WWP do. The U.S. residents will never develop a dominating proletarian consciousness without more open borders. We also support reparations to the Third World countries in their countries and not just by opening the borders to share the wealth with those who walk in. This is a priority for us before various demands of the white nation working class. Finally, even if we grant the WW its best statistic, we do not support forming a coalition with the people of the 50th percentile to get their 7 percent back. Even if the median is down 7 percent over four years that does not make the 50th percentile people interested in revolution. They just want their goodies back like in the old days of imperialism. This year, they think they want to cut welfare and keep immigrants' children out of school. That way they will get their 7 percent back. And if we encourage the labor aristocracy of the imperialist countries to think about its 7 percent, that is what it is going to do, try to shave it out of the hide of genuinely oppressed people. As it turns out, that figure on the median is bound to get a lot of play in upcoming months, so let's look at it carefully. One thing misleading about household or family income is that it does not account for how many wage-earners are in the family or household. If divorce or death rates affect this from year to year, the median family income figure will change from year to year without meaning anything in incomes changed. The figure also can't account for trends in family structure and it arbitrarily defines "primary families" as the only object of study. It turns out that between 1985 and 1993, the size of households and families went down. (Statistical Abstract of the United States 1994, p. 58) With fewer people in households and families and the number of single-person households and families rising, of course the median household and family income is going to go down. What we really want to know is the median of individual workers in 1989 and 1993, adjusted for inflation. When we look at men, we do see a decline. However, female full-time year- round workers did not see a statistically significant decline in income between 1989 and 1993 and their incomes as individual workers have increased dramatically since 1970. (Ibid., p. 473) More importantly, the number of female workers went from 53.03 million in 1989 to 54.61 million in 1993, while the number and percentage of male workers working has stayed pretty much the same. There were 64.32 million male workers in 1989 and 64.7 million employed in 1993. In fact, the participation rate in employment by male workers with less than a high school education increased between 1985 and 1991. (Ibid., p. 397) The figures on male and female participation rates by education level also bring up another problem and a weakness of using median figures. If there are ten people and only three work one year and then seven out of ten work the next year, the median income can go down, but some people will have incomes for the first time. That is one way average incomes can go up while median incomes go down, besides the usual mechanism of the rich getting richer and the middle getting poorer. When it comes to the revolutionary consciousness of white nation workers in their alliance with imperialism, workers employed for the first time may bring down the median figures but they are not likely to be in a revolutionary mood. From their perspective, these new workers think their position has improved and in some sense, they are right because overall a higher percentage of the white nation is employed while the median goes down. No one contends that average per capita income figures are going down. The latest figures still show them going up--just slower than they used to in the 1950s and 1960s. (Ibid., p. 427) Furthermore, many misleading statistics used by the social-chauvinist "left" discuss a decline in hourly wages excluding benefits, but the index of compensation including benefits has always increased. Even between 1989 and the 1993, which is the selection of years the social-chauvinists like to talk about lately because of the quirky high figures for 1989, compensation including benefits (employment cost index) increased 20.2 percent! (Ibid., 431) Finally, between 1989 and 1993 even one index that the social-democrat- chauvinists like to talk about increased--the share of total income going to employees as salaries and benefits. It went from 73.0 percent to 73.4 percent. (Ibid., p. 459) The remaining 26.6 percent of the pie goes to the petty- bourgeoisie that works for itself or on its own property, the middle classes' dividends and interest payments, and the capitalists' share of the surplus-value. In any case, 7 percent just isn't going to make a class revolutionary. A seven percent decline every year over 10 or 20 years would make a difference, but the 1980s saw gains for all but the bottom fifth, so the middle classes still think this is a temporary problem and they are correct. Related to this, we are disturbed to see that the CPUSA, the Workers World and the Spartacist League could not use Lenin's term "labor aristocracy" even to refer to the baseball players, who are members of the labor aristocracy, petty-bourgeoisie and bourgeoisie. To these fake communist groups, the baseball players are all just exploited workers. At least David North's Trotskyist group said the baseball players were the "most pampered workers," but even those Trotskyists supported the baseball players. MIM for its part does not care. It's like watching a battle between GM and one of its glass or steel suppliers as they haggle over price. The international proletariat does not care about the outcome of the baseball players strike except in a Hollywood entertainment sense. In contrast with its stuff on U.S. economic conditions, the WW articles on proposition 187, Haiti, Iraq, Korea and Turkey are more reasonable. As in the case of the PWW though, the good work is just the lure. It is an attempt to mislead the international proletariat into being used by the Amerikan labor aristocracy. What the one hand offers, the other takes away in chauvinist class demands via NAFTA, the minimum wage and general class collaboration with imperialism. MIM invites the WW members to bag WW and the reactionary part of its line and join MIM.