Low-Wage Capitalism: Colossus with Feet of Clay


Through an examination of current corporate practices, historical evidence, and Marxist theories, this critique reveals the direct correlation between new technologies, globalization, and the dramatic drop in worker wages worldwide and proposes alternatives for dealing with the crisis. The narrative traces the advances in production, communications, and transportation that have enabled transnational companies—such as Dell Computer, the “Big Three” U.S. auto companies, IBM, Liz Claiborne, and Boeing—to outsource ...

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Through an examination of current corporate practices, historical evidence, and Marxist theories, this critique reveals the direct correlation between new technologies, globalization, and the dramatic drop in worker wages worldwide and proposes alternatives for dealing with the crisis. The narrative traces the advances in production, communications, and transportation that have enabled transnational companies—such as Dell Computer, the “Big Three” U.S. auto companies, IBM, Liz Claiborne, and Boeing—to outsource to many diverse suppliers in numerous countries to make a single product. As a result of this global outsourcing, workers are no longer competing with others within their city, state, or country but with those thousands of miles away and have in essence entered into a worldwide wage competition that consistently lowers the wage floor. Compounding the crippling effects of these practices is the near doubling of the global workforce resulting from the collapse of the USSR and Eastern Europe’s political systems. Using Karl Marx’s law of wages and other findings, the chronicle maintains that these developments will not only continue to drive down wages but lead to a profound revival of working class struggle. This analysis argues that the only way to reverse these trends is to implement various strategies to fight back, especially regarding the labor-community alliance and class-wide strategies for struggle.

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Product Details

  • ISBN-13: 9780895671516
  • Publisher: World View Forum
  • Publication date: 9/1/2009
  • Edition description: New Edition
  • Pages: 338
  • Product dimensions: 6.00 (w) x 8.90 (h) x 0.70 (d)

Meet the Author

Fred Goldstein is a contributing editor to Workers World newspaper. He lives in New York City.

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Table of Contents

About this book v

The workers and the warfare state ix

A note on the current capitalist crisis and low wages xi

Postscript: the crisis within the crisis xv

Section 1 Imperialist globalization and worldwide wage competition

1 Doubling the global workforce 3

Political expansion after 74 years of contraction 10

The new international division of labor 11

Corporate design for worldwide wage competition 13

Marx on wages and competition 15

2 New global networks of exploitation 19

Dell: 'Collaboration of individuals' or global regimentation of workers? 19

Toyota, the pioneer 22

Hewlett-Packard 22

International Business Machines 23

Liz Claiborne 23

U.S. auto companies 24

Boeing 25

Making stuff cheap 25

3 Supply chains: vassals of the lords of capitalism 27

Flextronics, the lead vassal 28

Solectron 30

Boeing and 'reverse auctions' 31

Cisco sheds factories 32

Contracting out for super-profits 33

Price-setters and price-takers: workers are on the bottom 36

Fears of the overseers and secrecy of the monopolies 37

4 Offshoring: millions of service jobs at risk 39

Offshoring fever rises in the boardrooms 40

White-collar outsourcing by Europe and Japan 44

Blinder comes up with miserly 'solutions' 45

5 Marxism and globalization 49

Lenin on twentieth-century imperialism 51

The dual character of imperialism 53

Three factors behind new 'globalization' 54

Marx on technology and the international division of labor 55

Lenin on the previous imperialist division of labor 56

International solidarity and globalization 57

An irony that helped the globalizing exploiters 58

Impact on U.S. workers of defeat of socialistbloc 60

Anti-communist crusade showed ruling-class fear 62

Socialist camp set standard for working-class security 65

Global expansion can't dispel crisis of overproduction 67

Section 2 Three decades of getting poorer

6 Where high tech is leading 75

High tech and the military 77

Role of technological offensive in weakening unions 79

Changed social composition of the working class 82

Declining rate of profit and capitalist crisis 83

The era of permanent layoffs 86

30 million lose their jobs 87

'A ceaseless bloodletting' 89

The end of 'safe' jobs 91

Law of capitalist accumulation applied to U.S. 93

High tech and increased exploitation of labor 95

Manufacturing jobs down, manufacturing up 98

From manufacturing jobs to low-wage service jobs 100

7 Globalization and low pay 105

44 million low-wage jobs in 2006 107

Deskilling jobs and the 'education' scam 108

Marx on wages and growing poverty 111

More multi-earner working-class households 115

Costs rise, men's wages fall-women take up the burden 119

Driving down the value of labor power 121

As real poverty goes up, official poverty goes down 123

Why the bosses need Wal-Mart 127

8 Sexism, racism, and low wages 133

Women in the workforce 133

The class nature of Clinton's welfare 'reform' 134

National oppression and low-wage labor 136

African Americans and capitalist restructuring 137

Racism and low wages in the prison-industrial complex 143

9 Globalization and immigration 149

Lenin on immigration 149

Searching for cheap labor at home and abroad 150

May Day 2006 in the United States 151

Latina/o immigrants pulled into low-wage labor force 153

Vast super-profits behind debate in U.S. ruling class 154

NAFTA and the crisis of Mexican workers and peasants 156

Remittances and the global migrant labor force 159

10 Late 1970s: Attack on unions begins 161

The importance of unions 161

Listening to the boardrooms, Reagan ambushes PATCO 164

'PATCO scenario' takes off 166

Globalization and the 'fear factor' 167

Section 3 Lessons from the past for the future struggle

11 Decades of rank-and-file fight-back 173

Solidarity Day and beyond 174

State of the unions: glass half-empty or half-full? 192

12 Reviving the struggle 195

Two earlier periods of great struggle 195

Labor's failure to fight racism undermined struggle 199

Stirring examples of rank-and-file control 201

From class struggle to witch hunt 209

Rank-and-file support against reaction 210

13 High tech undermines old forms of class organization 213

Limitations of craft unionism 214

Assembly line brought industrial unions 215

Rising tide of deskilled jobs 216

Breakup and dispersal of working-class centers 217

The growing retail proletariat 218

Marx's law of wages confirmed, with a vengeance 219

14 Building a broad working-class movement 221

The struggle against racism and oppression-key to class unity 223

U.S. working class: over one-third comes from oppressed nationalities 223

Katrina disaster called for working-class action 226

Women's and LGBT issues are workers' issues 229

Union cities and urban struggle 232

Need for other workers' organizations 234

Marx on unions as organizing centers for the whole class 237

The Million Worker March Movement 241

For a militant, unified labor movement 245

For coordinated, class-wide struggle 246

15 Class struggle and capitalist legality 249

Taft-Hartley, 'right-to-work' laws: illegal brakes on workers' rights 249

Human Rights Watch on repression of U.S. labor 252

Unequal 'protection' for unions 254

Legality follows struggle 256

Plant occupations and the right to a job 258

16 Class consciousness and class struggle 261

Challenging the capital-labor relationship 263

UAW concessionary contracts of 2007 266

Breaking through the bosses' ideology 269

Globalization and international solidarity 273

The end of capitalist stability and social peace 276

New phase of permanent crisis for workers 277

Socialism the only way out 278

Afterword: Imperialist war in the 21st century 281

Three stages of imperialist war 281

'Regime change' from Clinton to Bush 283

Colossus with feet of clay 285

Peace, an interlude between wars 287

Expand or die 288

Acknowledgments 289

Bibliography 291

Endnotes 297

Index 303

Tables and charts

Employment growth 61 months after peak 68

Manufacturing increases & employment decreases 99

Additional hours worked per two-earner family per year 116

The self-sufficiency standard for Philadelphia in 2004 124

Effects of anti-labor offensive & restructuring on African-American workers 139

Jobs of undocumented workers 155

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