The New York Times (NYT) reported on May 31st that housing prices fell for the eighth straight month and hit the lowest level since the current depression began. According to ShadowStats, the actual unemployment rate has crept back up to 22.3%, despite a brief dip down to 22% in March as seasonal employment began to pick back up. Consumer spending has remained flat as wages continue to fall, despite a small spike due to rising gas and food prices.
The April index of pending deals (a measurement of anticipated home sales) dropped well below a predicted 1% dip to a collapse of 11.6%. With continuing high unemployment and mass wage-cuts, workers are in no position to buy a house in a market flooded with foreclosed homes.
According to the NYT (5/22), banks currently own 872,000 foreclosed properties and in are in the process of foreclosing on one million more. As long as this massive shadow inventory of homes exists, housing prices will continue to fall.
In his blog, economist and NYT columnist Paul Krugman (5/25) proposed that the U.S. is entering a third great depression, less like the Great Depression of the 1930s and more like the Long Depression that dragged on for four decades, from 1873 to the start of World War One. Workers should be warned that both the Long Depression and the Great Depression were worldwide crises in the capitalist imperialist economic system, and that they were “alleviated “ only by world wars.
A blogger writing on the continuing depression comments, “Congress just doesn’t seem to ‘get it.’ They don’t understand what people are going through” (Mike Whitney, Counterpunch, 5/27). Yet the facts are so obvious and the government’s effort to confuse it is so thorough that one would be hard-pressed to conclude that the capitalist class and their political minions don’t “get it.”
Capitalists Use Crisis to
Attack Workers
Capitalists are predictably using this crisis as an excuse to launch an attack on workers in the U.S. that is unprecedented in the modern era. Using national and state debt as an excuse, legislators have begun to undo the last vestiges of the social safety net that capitalists reluctantly put into place under the New Deal. These 1930s reforms were aimed to deflect the anger of workers who were organizing mass protests and industrial unions with Communist Party leadership.
Unemployment and welfare benefits are being cut when they are needed most. The recent attacks on government workers’ unions have largely finished off what remained of the right of workers to organize. At the same time, banks have been granted unprecedented power over workers’ financial livelihoods and bosses given huge leeway in their right and ability to abuse and exploit their workers.Capitalism survives on workers’ blood. This parasitic system will continue to breed sexism, racism, poverty and imperialist wars.
The working class can only combat this blatant capitalist attack by organizing for a class war of our own. Multi-billionaire Warren Buffet was correct when he said, “There’s class warfare, alright, but it’s my class that’s making war, and we’re winning” (NYT 11/26/06).
PLP urges workers to join with us in organizing a mass, revolutionary communist party. Only such a party, with a communist analysis of the capitalist system, can lead the fight to smash capitalist exploitation once and for all.