The Stanly News and Press (Albemarle, NC)

Opinion & Letters to the Editor

August 21, 2013

Why the economy won't work for all

Economist Michal Kalecki knew 70 years ago why big business and its political apologists conspire to prevent full employment. Obviously few people listened, but with the still shrill deficit alarmists and the rabid push for austerity, some are trotting Kalecki back onto the stage to show why.

I'd never heard of Kalecki until I read a column by Paul Krugman. Kalecki was a Polish, Marxist economist (and, really, who knew capitalism better than Marx?). In a short 1943 paper called "Political Aspects of Full Employment," Kalecki wrote that government intervention is needed to get all people to work. This was shortly after John Maynard Keynes wrote "The General Theory of Employment, Interest and Money," (1936) with many ideas shared by Kalecki.

President Roosevelt had already used the government to alleviate the appalling unemployment during the Depression, with programs such as the Works Progress Administration. But even with this so-called government interference in the market, there was never full employment. Big business likes it that way. In fact, even mainstream economists view an unemployment rate of 3 to 4 percent as "full employment."

Kalecki writes that there are three reasons why business doesn't want everyone to have a job: (1) dislike of government interference; (2) dislike of direction of government spending (public investment such as roads and subsidizing consumption, such as welfare and food stamps); and (3) dislike of the social and political changes resulting from the maintenance of full employment.

This is where it gets interesting. Commenting on the third point, Kalecki says businesses fear full employment because it will give workers confidence to form unions, fight for higher wages and create better working conditions. Those are capitalism taboos.

Of course, Kalecki maintains that full employment would mean a boost to production and hence a rise in profits. Then the economist goes on to argue that businesses will gladly give up some profits in order to maintain rigid control over workers and (my words) be able to threaten their livelihoods with firings and layoffs.

Text Only
Opinion & Letters to the Editor
  • Do White Castle prices tell us anything about the minimum wage?

    NEW YORK - Economists love hamburgers. Specifically fast-food burgers. This is partly because all right-thinking human beings love ground meat on a bun, but it's also because the sandwich makes a handy yardstick for international financial comparisons. The ingredients and labor involved in preparing a Big Mac are pretty much the same no matter where you are in the world, so by looking at how many hours of toiling it takes a worker to earn enough to purchase one, you can get a sense of how wages really stack up across countries. The Economist famously created the Big Mac index in 1986 to see which currencies were overvalued. It started as a joke. Now, as the magazine proudly notes, it's a subject of academic study.

    April 22, 2014

  • Can Hillary Clinton rock the cradle and the world?

    WASHINGTON - What's most interesting to contemplate is the effect becoming a grandmother will have on Hillary's ambition. It's one of life's unfairnesses that a woman's peak career years often coincide with her peak childbearing years.

    April 22, 2014

  • Doug Creamer All in the Family

    We had a family get-together at my brother’s house on Easter Sunday. It’s hard to get our family together because we are spread out, especially when you consider nieces and nephews. My parents and siblings all made the gathering this year. Some of my nieces and nephews are far away, but they all remember gathering at my brother’s house for the holidays. Easter is known for the Jell-O eggs and the famous Easter egg hunt.

    April 22, 2014 1 Photo

  • Victimized by the 'marriage penalty'

    In a few short months, I'll pass the milestone that every little girl dreams of: the day she swears - before family and God, in sickness and in health, all in the name of love - that she's willing to pay a much higher tax rate.

    April 19, 2014

  • The case for separate beds

    WASHINGTON - The other night I slept on a twin bed in the guest room of the house I share with my husband and our two kids.
    It was the best night's sleep I've had in years.

    April 19, 2014

  • taylor.armerding.jpg Obama's equal pay exaggeration leads us all into danger

    The president's claims of national shame over gender-based pay inequity spring from distorted calculations, as well as some convenient political math.

    April 12, 2014 1 Photo

  • Teens trading naked selfies for mugshots

    Will teenagers ever learn? You think yours will. Maybe so. But it's likely that was also the hope of the parents of children who were so shamed by nude photos of themselves that went south - how else can they go - that they killed themselves.

    April 12, 2014

  • Brent Laurenz If you want to vote in primary, you need to register to vote now

    RALEIGH – North Carolina voters will head to the polls on May 6 this year to cast ballots in important primary elections across the state.

    April 11, 2014 1 Photo

  • Scott Mooneyham Heeding the voter fraud call in N.C.

    RALEIGH – Legislators found the findings outrageous.

    April 11, 2014 1 Photo

  • Doug Creamer Roots

    I took a few minutes over the weekend to enjoy our yard and the arrival of spring. There seems to be so much work that needs to be done, it is hard to decide what to do first. I am excited that I got to run my tiller through the garden. I didn’t go very deep, but I did at least break up the soil. I have a couple of raised beds and the soil in them was in very good shape. I didn’t plant my peas and now after the big rain we got on Monday I realize that I missed a window of opportunity.

    April 11, 2014 1 Photo

House Ads
Seasonal Content