Saturday, December 20, 2008

A Bailout in Exchange for Wage and Benefit Reductions

A bailout in exchange for wage and benefit reductions, especially retirees' pensions and health care benefits -- that's the ruling-class program for auto workers . . . and all other workers, union or non-union, in the primary labor market in the United States. 

Even while the ruling class deviates from the neoliberal orthodoxy in monetary and fiscal policies, lowering interest rates, monetizing debt, and creating temporary jobs and extending temporary benefits in an attempt to stimulate the economy, it continues to push to structurally transform labor in its neoliberal image (the strongest weapon of neoliberalism is its ability to pit the workers in the primary labor market -- the public sector and oligopolistic industries -- against workers who are excluded from it to begin with, weakening the former even while extending thin new benefits to the latter to maintain the neoliberal hegemonic bloc, at which Brazil's Lula and Turkey's AKP for instance are expert).  That is what the ruling class did to workers in Japan, increasing poverty and aggravating inequality.

Needless to say, making labor more precarious is a recipe for prolonging rather than exiting deflationary stagnation, no matter how much fiscal and monetary stimuli the government applies at the same time.  The crisis doesn't automatically bring an end to neoliberalism.  It's up to the working class to end it, or else the economy won't even recover.

1 comment:

Unknown said...

Yoshie, I realize this is an ancient post, but it's the last one with the "Japan" label.

Did you notice this item in the NY Times recently? Yes, the actions are small and milquetoast, but based on this and other evidence, perhaps the Japanese people (especially the young precariat) are awakening from their long slumber:

And sure, the JCP is no great shakes, but young folk are signing up like gangbusters.