by Helen Zivar
From fast-food workers, actors and screenwriters, book sellers, hotel housekeepers, nurses, pharmacists, UPS workers, brewery workers and Starbucks workers, to autoworkers, hundreds of thousands of workers across America have been striking or threatening to do so over the last few months. This wave of workers strikes reflects growing public support for unions and the fact that the workers are banding together to leverage the most powerful economic tool they have—to associate and strike—to fight against the capitalists’ deepening exploitation.
Workers are watching how the CEOs and other high-ranking managers are reaping the profit created by the working class, but their own wages are not enough to cover the basic necessities of life—even when the wages grow they rarely keep up with inflation and they even less shrink the difference between what the capitalist reaps and what the worker brings home by the sweat of their own brow. This decline in workers’ real wages and a decline in the relative wages—the gap between the share of created value going to the workers and the share going to the capitalists—has become a flash-point most recently in the UAW strike and contract negotiations, with even Biden commenting on it.
Workers have to choose between paying for food and medicine or rent. This inequality has climbed sharply over the past 40 years and is becoming more visible.
According to the Economic Policy Institute (EPI), CEO pay has skyrocketed 1,460% since 1978, while the wages of millions of workers have been stagnant. The gap between the CEO and average worker’s pay has also skyrocketed over these years, and this does not even take into account the profits divvied out to shareholders. In fact, the value of the federal minimum wage is at its lowest point in the past 67 years—its purchasing power is now 42% less than what it was in 1968. With rising prices, the minimum wage (i.e., nominal value) did not increase as much and so the purchasing power (i.e., the real value) of it declined. This means that the harder the workers work to earn a living (because of the declining purchasing power of the wages), the more exploitation they have to suffer which leads to higher profit for the capitalist. Further, the more the workers make for the capitalists, the more the capitalist can invest in machinery and techniques which make the work more drudging, lower paid, and more sparse. Layoffs and lower wages fall to the workers while higher and higher profits fall to the monopoly capitalists. In other words, the worker is more alienated from the product of his or her labor. The more they make for the capitalists—the less they have.
The Institute for Policy Studies’ (IPS) 29th annual report on “Executive Excess”, published in August 2023, examined the one hundred S&P 500 corporations that had the lowest median worker pay levels in 2022 and found that the CEO of these companies receive on-average 603 time as much as the median worker’s pay. These companies use a financial maneuvering technique, called stock buybacks, that artificially inflates the value of a company’s stock and the CEO’s stock-based pay, while it drains funds from workers’ wages and other potential investment opportunities. This was an illegal form of market manipulation in the past, but now is a common practice to make those executives at the top of the company even richer. For example, in 2022, “Lowe’s spent $14.1 billion on stock buybacks, enough to give every one of its 301,000 U.S. employees a $46,923 bonus.” The median annual worker pay at Lowe’s was a meager $29,584 last year. 51 of these 100 companies received taxpayer-funded federal contracts, worth $24.1 billion during 2020-2023 fiscal years. For example, Amazon, the largest contractor in the IPS study sample, pocketed at least $10.4 billion taxpayer-funded contracts from Uncle Sam “with most of that haul coming from a National Security Agency web services contract. The company has reportedly received additional classified defense contracts.”
The U.S. government’s tax policy has tremendously helped with widening the gap and increasing inequality. In early 1960s the richest people faced a 70% tax rate on income in the top tax bracket. President Kennedy and, later, Reagan lowered the rate to 28%. The top tax bracket for the wealthiest Americans is now 37%, but as ProPublica’s study titled “You may be paying a higher tax rate than a billionaire” revealed, they actually have paid a much lower rate, or any taxes at all. On the other hand, over the years, a higher portion of the government’s revenue is funded by individual taxes and the share of taxes from corporate profit has declined from 12% of government revenue in the 1960s to 6% today.
The workers fight for better pay is a struggle for better conditions for the workers to sell their labor-power to the capitalist class, i.e. for better conditions for their exploitation. This struggle alone will not lead to lasting justice and freedom for the workers because they can exist only by laboring for another, enriching the capitalist and thus increasing the capitalist’s ability to exploit them further.
In response to this quandary, Marx said back in 1865 that workers ought “…not to be exclusively absorbed in these unavoidable guerrilla fights incessantly springing up from the never ceasing encroachments of capital or changes of the market. They ought to understand that, with all the miseries it imposes upon them, the present system simultaneously engenders the material conditions and the social forms necessary for an economical reconstruction of society. Instead of the conservative motto: ‘A fair day’s wage for a fair day’s work!’ they ought to inscribe on their banner the revolutionary watchword: ‘Abolition of the wages system!’”
To replace the conservative slogan with the revolutionary one means to inject the labor movement with class consciousness: understanding that the problems in society are resulted from the system and the fight should not just be for a higher wage, but also for the abolition of the private ownership of the means of production by the handful of exploiters lording over the vast majority of mankind—the fight for socialist revolution. This is the broad task of revolutionaries while facing the strike wave—unite the workers and spread this consciousness. This means to educate from within the heart of the class struggle—on the picket lines, in debates at union meetings, and so on, and not at the margins of the struggle or separate from it. Educate the working class about the first phase of implementing Marx vision: about socialism and the workers’ liberation, how to move towards elimination of the private ownership of the means of production, to the end of exploitation of man by man.
photo: National Nurses United, Ascension nurses picket
