Is full employment possible under capitalism?
by: Sam Webb
The following are remarks given by Communist Party USA
chair Sam Webb at a Feb. 25 University of Georgia debate sponsored by
Phi Kappa Literary Society. The debate topic was "Is full employment
possible under capitalism?" Webb debated Greg Morin from the
Libertarian Party of Georgia.
Billed as "The Debate That Never Happened," UGA's Phi Kappa Literary
Society decided to recreate an attempted 1963 debate between CPUSA's
Arnold Johnson and UGA economist David Wright. That attempt had been
squelched by a unanimous vote of the Faculty Committee on Student
Affairs. The society was accused of attempting to "incite riot." In
the spirit of free speech, the society hosted this debate during its
THANK YOU, AND thanks to Phi Kappa Literary Society for the invitation
to participate in this debate on this beautiful campus and in this
historic chapel. Thanks also to Speak Progress.
The debate question - "Is full employment possible under capitalism" -
is by no means an academic one.
By last count, approximately 12 million Americans were officially
unemployed. Of those, 4.7 million have been jobless for 27 weeks or
If we include in our calculations discouraged workers who have stopped
looking, and part-time workers who would prefer full-time work, the
number is much higher - roughly 20 million people.
If you are African American, Latino, Native American Indian, and/or
young, you are going to be overrepresented in those figures.
Here in Georgia the unemployment rate stands at 8.6 per cent. Without
fundamental changes in public policies, it is hard to see how this
awful situation will change.
Which prompts the question: Is persistent and high joblessness - not
to mention stagnant and falling living standards - U.S. capitalism's
If it were, it would contrast with the world that I grew up in. That
era, stretching from the end of World War II to the early 1970s, is
sometimes referred to as the "Golden Age" of capitalism.
This phrase doesn't capture the full complexities of that period, but
it does capture some of its most salient features, namely, that it was
an era of sustained growth, diminishing inequality, and low
unemployment - the likes of which we hadn't seen before or since.
My father, for example, who was a lineman in the backwoods of Maine,
never experienced a layoff, even a short one, in a work life that
began during the Depression and ended in the late 1960s.
At the time, economists thought that the cyclical ups and downs of the
economy had been tamed and that full or near-full employment was the
normal condition of capitalism, not only here but also in Western
Europe and Japan.
But looking back a half-century later, one has to think that this
period might well be the exception rather than the rule of capitalist
Now it's true that during the Clinton and Bush years rates of
unemployment were relatively low and the recessions were relatively
mild, but I would add four caveats.
First of all, the expansion of employment during this period took
place mainly in low-wage, non-union and service sector jobs. The
growth of Walmart into the nation's largest employer is emblematic of
The second caveat is that under the weight of chronic overproduction
in global commodity markets, a new phase of the technological
revolution, and the relocation of production to low wage economies,
tens of millions of jobs, especially in manufacturing, were
permanently lost. Many of these jobs provided livable wages and modest
health and retirement benefits to "middle class families."
Another caveat is the Clinton-Bush years were marked by growing income
inequality and downward social mobility. The gap between the top
income layers of our society - the one per cent - and the vast
majority of wage and salary workers grew enormously to an historic
A final, and especially damning, caveat is economic growth and
employment levels rested on enormous stock, housing, and financial
bubbles, massive deregulation of markets, and the production of
unending amounts of business and consumer debt.
While providing a lift to an otherwise sluggish economy, this
financial frenzy engineered on Wall Street and in Washington and
driven by corporate capital's drive for maximum profits wasn't
sustainable, and eventually came to an end in an economic crisis, the
likes of which we haven't seen since the Great Depression.
To sum up, the Clinton-Bush years are not cracked up to what
conventional wisdom would like us to believe.
Since 2008, some pickup in economic activity has occurred, but overall
employment gains and economic growth have been fitful and meager.
Moreover, it's hard to see where the economic dynamism and jobs are
going to come from without action by the federal government, and the
restructuring of the economy on a scale that only a few in Washington
are ready to embrace.
After all, debt and bubble-driven growth that greased the wheels of
the economy during the Clinton and Bush years is not an option.
Nor should any help be expected from our global partners. Europe is
stuck in an economic quagmire and its austerity policies are only
making it worse. China isn't positioned to carry the rest of the world
on its shoulders. In fact, the Chinese economy's growth has also
slowed, and it is feeling the contradictions that come from its deep
integration into the capitalist global economy.
Furthermore, the longer-term processes that I mentioned earlier -
overproduction in global commodity markets, job-displacing
technologies, and global supply lines that fan out to distant lands -
will only become more pronounced in the years ahead.
Economic crises are supposed to be how capitalism clears away the
debris that impedes a revival of production, profits, employment and
growth, but that scenario doesn't appear to be the case today.
So I'm guessing you know how I'm going to answer the question of this
debate: is full employment possible under capitalism in today's
My answer, in case there is any doubt, is NO!
Transnational corporate capitalism, in its endless quest to accumulate
capital and wealth, has morphed from a generator of jobs and rising
income to a generator of unemployment, inequality, and insecurity.
I would quickly add that there are ways to ameliorate the jobs crisis.
But only if the American people bring the power of their numbers and
unity to bear on government at all levels, much like Americans did in
In his first four years, President Obama enacted policies that
prevented the floor from falling out of the economy - an economy, by
the way, that was stalled primarily due to insufficient demand for
goods and services.
In his recent State of the Union address, President Obama proposed a
higher minimum wage, stronger educational opportunities, rebuilding
the deteriorating infrastructure, immigration reform, and investment
in green technologies and jobs.
He also resisted calls for sweeping austerity measures from his
Republican counterparts, since if enacted, they would reduce aggregate
demand and in turn exacerbate the economic and jobs crises.
All of which are welcome.
Nevertheless, the president's package of proposals addresses only the
edges of the deep and long-term jobs crisis that faces our country.
Indeed, he missed an opportunity to project a bold, transformative
"new jobs" agenda. For the sake of our fragile planet and ourselves,
such an agenda would transform our economy from one dominated by Wall
Street, Lockheed Martin, Peabody Coal, Exxon and Walmart to a Main
Street economy rooted in a green, demilitarized production, clean and
renewable energy, livable wages and union protections, publicly-owned
banks, public controls over the investment policies of the Fortune
500, affirmative action and equality, the modernization of mass
transit, aid for small and medium-sized businesses, renewal of both
urban and rural communities, democratic forms of worker ownership, and
a progressive tax structure.
This reorientation of our economy would create millions of jobs, raise
living standards, promote fairness and equality, and give us a
fighting chance of mitigating the worst effects of climate change.
Of course, if I had my druthers, I would prefer socialism -
democratic, working people driven, and people not profit centered.
But that debate is for another time.