Monday, 9 August 2010

Class war in the USA?

Friday's New York Times carried an interesting opinion piece from Ron Lieber. The opening gambit: "There’s a class war coming to the world of government pensions."

Of course, the American press is - even more so than its British counterpart - biased in favour of established power. The spectrum of opinion it allows is very narrow, debate within that spectrum conforming to disagreement between elite sectors.

Hence, perhaps, this interpretation of the class divide;
The haves are retirees who were once state or municipal workers. Their seemingly guaranteed and ever-escalating monthly pension benefits are breaking budgets nationwide.

The have-nots are taxpayers who don’t have generous pensions. Their 401(k)s or individual retirement accounts have taken a real beating in recent years and are not guaranteed. And soon, many of those people will be paying higher taxes or getting fewer state services as their states put more money aside to cover those pension checks. 
Those reading this in Britain should be familiar with this rhetoric. See, for example, PCS's myth-busting on this subject, in opposition to the commonly-held view that they are "unaffordable."

In the US, too, the position against government pensions is largely dogma and bluster. Certainly, to suggest that government pensions will be responsible for higher taxes and cuts to services, after the $4.6 trillion bailout of Wall Street, is absurd.

As Dean Baker points out for Monthly Review;
We have just seen the Wall Street crew get trillions of dollars of loans and loan guarantees to protect their multi-million dollar salaries and bonuses.  The government routinely gets taken left and right by Halliburton and other defense contractors.  Doctors and drug companies use their political power to ensure that they can charge far above competitive market prices.

With all these millionaires and billionaires getting even richer at the public's expense, why would there be a class war over public pensions?  Clearly this is Mr. Lieber's desire, but so what?

Lieber does his best to whip up the hysteria -- near the beginning of the article he describes the pension shortfall: "At stake is at least $1 trillion.  That’s trillion, with a 't,' as in titanic and terrifying."  Since we're doing the alliterations with "t," how about throwing in "two" as in a shortfall that is less than 2 percent of projected state and local government spending.  Current spending is close to $2 trillion a year.  If we assume that a shortfall must be filled over a 30-year period, then this would imply a gap that is less that 2 percent of projected spending over this period.  That is not a trivial sum, but it is not obviously "titanic" or "terrifying," at least to adults who do not scare easily.
The clear aim, as Baker points out, is "to direct public anger at school teachers and custodians rather than the people who hold real power and wealth in this country."

Interesting, though, is Lieber's use of the term "class war." There is not going to be a class war between private and public sector workers. The real class war continues to simmer, below the radar of mainstream media coverage.

Take, for example, this recent press release from the IWW's Starbucks Union;
Baristas and community supporters shut down the 15th and Douglas Starbucks (SBUX) this morning demanding that management reverse all cuts to healthcare, staffing, and benefits that have been imposed during the recession. The baristas claim that executives have no justification to squeeze working families with Starbucks raking in profits of $977.2 million in the past four fiscal quarters.

“We are being squeezed, and we can't take it any more. Since the recession began, Starbucks executives have ruthlessly gutted our standard of living. They doubled the cost of our health insurance, reduced staffing levels, cut our hours, all while demanding more work from us. Starbucks is now more than profitable again. It's time for management to give back what they took from us,” said Sasha McCoy, a shift supervisor at the store.

Since the onset of the recession, Starbucks imposed a series of deep cuts on its workforce. Starting in 2008 as the economic downturn began, the coffee giant shuttered over 800 stores and slashed over 18000 jobs. The remaining skeleton crew workforce was stretched out, forced to push VIA and other promotional products while keeping the stores running with insufficient staffing levels. CEO Howard Schultz then doubled the cost of the company health insurance plan in September 2009, leaving many workers unable to afford medical treatment because of sky-high deductibles and premiums. While the cuts continue, Starbucks made a record profit of $207.9 million in the last quarter according to company figures.

The protesting baristas are members of the Starbucks Workers Union, which is an international campaign of the Industrial Workers of the World labor union. The store action makes the 15th and Douglas location the first Starbucks in Nebraska to have a public union presence. The workers decided to move to unionize after watching their standard of living be whittled away while top executives chose to reward investors with dividends.
This is what real class war is.

It doesn't matter that one segment of the working class happens to have the state as their employer. They still have to sell their labour to survive, and to face cuts in their standard of living to prop up their bosses.

That they may not have it quite as bad as their private sector counterparts in some instances does not justify a race to the bottom. The only people who benefit from that kind of inter-class antagonism are the bosses, who are waging the real class war.

That goes in the US as in Britain, or anywhere else in the world. The real enemy in the class war isn't slightly more privileged workers - it's those at the top whose wealth our labour creates.