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Lessons: Why This Economic Recession Will Become a Great Depression
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The Wall Street crash of 1929, called "Black Thursday/Friday," sent the US and the global economy into a great depression throughout the 1930's.  By 1932, the US economy had declined by half, and one-third of the workforce was unemployed.  Whereas white unemployment was 30-40%, Black unemployment was 60-70%.  Blacks literally lived hand to mouth for well over two decades, from the early 1920's to the mid 1940's.  After a huge speculative rise in the late 1920s, based partly on the rise of new industries, shares fell by 13% on Thursday, 24 October.


Despite efforts by the stock market authorities to stabilize the market, stocks fell by another 11% the following Tuesday, 29 October 1929. By the time the market had reached bottom in 1932, 92% had been wiped off the value of shares. It took 25 years before the Dow Jones industrial average recovered to its 1929 level.   Study this carefully.


The effect on the domestic economy was widespread and negative.  Whole companies collapsed, industries were left without production for years.  Loss of share ownership meant that the losses were felt by many middle-class consumers.  Nothing much could be bought, nothing large could get credit, spending was cut, (cars, homes, major appliances were not purchased) while businesses postponed investment and closed factories. The whole US financial system also went into meltdown, with a shutdown of the entire banking system in March 1933. Again, this period should be studied carefully. 


The US economy did not fully recover until World War II, when massive military spending eliminated unemployment and boosted growth by destroying markets and creating artificial scarcity so that capitalist industries could rebuild those markets. Today's wars are best fought without soldiers.  Today's weapons are best made without workers.  Robots and computer automation are much more productive.  This time the crisis will not be solved in old ways. 


Context

The present economic crisis is unlike any before in world history.  Recently, US wall street stocks fell over 478 points before settling around a -129 point lost in one day; this will only get worst overtime.  Recently, the stock market lost over 370 points in one day with news of a collapse in employment in the domestic service sector after losing 130 points the day before.  Stocks will be volatile weekly. 

Factory orders will continue to plunge downward; the dollar, already at its record low against the euro will continue to lose value given that the US economy cannot employ its workers, pay them livable wages/salaries, and allow for essential housing, transportation, food, and health care.  Over 12 million homeowners are in negative equity.  By the end of the year 2008 nearly 21 million households, or over 37% of home owners, will own homes that have negative equity---meaning the home owner owes more on the loan to the bank for the house than the house is worth.  Those homes will be foreclosed because home selling prices have already collapsed even before the subprime rates kick in for the 4-5 millions borrowers duped into tricky/sliding-scale interest rate schemes.  As a result, nearly 53 million family members (including children and the elderly on fixed incomes) face the streets/homelessness/eviction.  Black populations are already facing the worst of this collapse.

Early January 2008, the European stock market went into meltdown as £84 billion was wiped off City of London shares - the biggest fall since the financial crisis precipitated by the 9/11 terrorist attack on New York.  They will recover some then fall hard again. When major insurers of debt lose their bond rating due to massive national loan defaults, the entire financial structure will go into crisis.

In one day of frantic trading, the UK FTSE 100 index dropped 5.5 per cent to 5,578.2. That pattern was repeated around the world as other markets went into freefall. The CAC-40 in France plunged even further, dropping 6.8 per cent to 4,744.15, while Germany's blue-chip DAX 30 slumped 7.2 per cent to 6,790.19.  Markets in Asia, India and South America followed the trend, heightening the worry that the meltdown sparked by the US subprime mortgage losses could spark a world-wide economic collapse.  Africa and Africans are at the bottom of the global economy and will suffer worst first.  

In sum, Asian markets will plunged on any steep drop on Wall Street because the U.S. economy is the place where Asian exports are sold.  When the American market cannot buy, the export oriented capitalist businesses in Asia go into bankruptcy. European markets also will collapse, with the U.K.'s FTSE 100 Index, and France's CAC-40 Index being the centerpiece of the crisis.  In time, both the U.S. and Europe will move from their recessions to depressions, thus dragging down Asia---Tokyo, the Nikkei 225 index, the Hong Kong's Hang Seng index, Australia's key indexes, Thailand's market, markets in China, South Korea and Taiwan.  Economic struggle for markets, then political fights in states, then military lines will be drawn along class, race, and cultural lines.  Wars are imminent.  Civil wars, ethnic wars, and regional wars will lead to world wars.  Sides will be taken; in the end the divisions will be based on injustice or justice, inequality or equality, slavery or liberation, dependence or independence---labor replacing technology for the wealth of a few with hundreds of millions being wiped out, or labor replacing technology for the benefit of all human life.


Black people in the United States and the world have a plenitude of human weaknesses that must be jettisoned---sentimental, soft, unscientific, speculative, easily taken advantage of by just about any white, Arab, Jew and now Asian that shows up armed.  Regardless of this correctable behavior, we must become sober to the realities of a global economic collapse, a Great Depression, that is already here, although in the embryonic stages of its maturation.  Your learning curb, this time, must be sharpened or most of you will not make it through.  This is an unforgiving period in which only the strong and clear thinking/behaving will survive.  You must master the fundamentals of economics from land, labor, money-capital and technology to a society's system of production, distribution, exchange, consumption, and reproduction.  If you do, you will appreciate that this period in which robots have removed human labor from the manufacturing, construction, mining, and agricultural equation---almost completely---is unlike any in human history.  Attitudes and behaviors must change accordingly.  This is the end of the road.  All the capitalist have left is to instigate a world war which they will attempt to use as a demand-generating, deficit-and-debt-financed public works program for whites in the US.  This won't work in the long term. 


This depression will be worse than this generation could ever imagine. Jobs are being eliminated and not replaced.  The ones that may be available are temporary, low paying (like cook, security guard, fast food, mailboy, waiter, carwash, waitress, scab, bar-tender). Whole government programs for social services are being cut-out leaving women and their children without food, health care or housing.  Black folk are literally being forced out on to the streets in the thousands.  The foreclosures in Black communities are almost triple the rate of those in white communities.  Generally, there actually are not any jobs or credit available for working class families in need of work that may sustain the personal expenditures of the last several years. This includes whites and nonwhites. 

Consumer home-equity, pay-day loans,  money-market accounts, and credit cards are tapped out; cars are being repossessed, layoffs are everywhere, food and energy prices are rising while income is falling, workers are being forced to pay health care, they are having their pensions/retirement benefits taken, and they fear losing jobs or perhaps have already lost their job.  They generally will not have the income to support their families, let alone "support the national economy" by spending so capitalists can sell the glut of products sitting unsold in warehouses around the glob.  This recession is the most severe since the Great Depression.  It will get worst because the traditional means of getting out cannot work in this period. 

Foreclosures, defaults, repossessions, closed hospitals, closed schools, closed plants, closed recreational centers, mass unemployment are a daily occurrence and will get much worst, especially in the Black communities.  The USA government is wasting trillions of dollars fighting a predatory oil war; they are sending billions of dollars to Arabs, Jews, Afghanistan, Palestine, Iraq, Pakistan, etc. to pacify and payoff prostrated yet warring populations.  Over 3.5 million American families have lost their homes to foreclosure in less than 19 months; disproportionately many of those families were Black.  Over 78 million Americans can't afford health care or have health care benefits which are inadequate; over 64% of Black people have no health care at all and over 41 percent of Blacks (including youth) are in need of jobs and do not have them.  The nation has an ever-growing trade deficit, budget deficit and nearly $21 trillion in national/consumer debt; jobs were shipped to Asia, millions of them, factories are closed in the USA, the new factories opened in the USA are robotised and do not need human labor.  Industries are closing, moving production facilities abroad, seeking to invest in developing nations that offer cheaper, more efficient labor and production cost.


The debt ridden American government is injecting pennies on a dollar into the economy to stimulate it. The capitalist logic is when business cycles peak, start their downward slide, government should increase federal spending, cut taxes on the wealthy, give tax rebates to those who would quickly spend the money, lower short term interest rates to increase money supply and expand credit.  They think demand stimulated by deficit spending and cheap money will pull them out of recession.  Like throwing pebbles into the ocean, none of this posturing will work in this period.  Markets are plummeting across the globe as a direct result of American economic crisis, and its $16.9 trillion dollar debt crisis, banks are failing, credit has contracted, GDP is stranking, service employment is negative,  currency is depreciating, trade deficit has exploded, the federal budget deficit is substantial and climbing.  This is only the beginning. 

The so called stimulus package of $167 billion dollars is not even 1% of the trillions in debt the nation is awash in. Making cheap money available for white capitalist companies/multinationals to borrow isn't going to solve the fundamental economic problem: they will have to invest it abroad where the most profits can be made cheating Asian, African and South American workers. What the Federal Government is doing with "liquidity injections" is merely letting institutions borrow short-term against the federal government using smoke and mirrors as collateral. Essentially this is a "loan before payday" for rich Wall Street using working people's tax dollars only with exceptionally favorable rates. It may get the institutions to next month but they'll have to pay back the loans to the government or go bankrupt. Many will go bankrupt, layoff their staffs/workforces and begin the process of avoiding paying retirement benefits to the workers they scatter out into the streets.


The tax cut of $800-$1200 being floated is nothing to the masses of US workers who are not able to pay insurance, house notes, car notes, pay for gas or buy food. It's like giving people chump-change that they must spend in order for the capitalist to sell the glut of products they cannot sell otherwise, before they go bankrupt.  That keeps the system from completely backing up due to all the money held in illiquid assets, but it fundamentally doesn't restore the economic system's ability to distribute what it produces to the millions in need but are without wages, salaries or incomes.  

Simply put, those companies heading for bankruptcy now will still end up bankrupt, out of business, defaulting on loans, they will just be able to hide it for a few months longer.  It does let money that was trapped in illiquid assets "move" but it doesn't really change the balance sheets of any of these institutions.


The capitalist class, its government, federal deposit insurance companies, and wall street knows that there are going to be massive bankruptcies from entire industries/businesses who cannot sell what they produce and will default on trillions in loans.  Cheap credit and liquidity injections does nothing to fundamentally restore the fundamental economic system of production, distribution, exchange and consumption.  We are now in a massive recession which will become a great depression.

Look for 45%-60% unemployment this time for Black populations and 20% to 25% for white.  Black men, already hard hit, will be hit the hardest because the jobs they had were semi-skilled, factory manufacturing/service, and tied to obsolete technologies which are being replaced.  Then the political system will move to crisis, the whites will take mostly conservative/reactionary sides as usual, the nazi movement will grow, scapegoats will be identified, and final solutions will be attempted.  Black populations are at the bottom of all of this and therefore will face the worst of the worst.  Understand the fundamentals of how this process reached its present point. 


(1990-2008+): Why this Period Fundamentally  Leads to Economic Depression

By now you have heard the news stories and are sorting through the spin.  Caught in the midst of a severe economic downturn  many Black folk are losing houses, cars, jewelery, and appliances.  Some are losing everything, including their families and people they thought were their friends.  Real work economics must be understood in order that you may know what to do in this epoch.

Profits at their source come from human labor.  After it all is said and done, people who produce must be able to buy back what they create in order to satisfy their needs and wants, then to produce profits for a business which must sell its commodities.  If they have no jobs, they have no wages or salary to purchase what has been created.  Nothing bought, nothing sold: the company goes bankrupt. 


Today greater and greater surplus value is extracted from fewer and fewer workers on a global scale. Robots and computer automated machine production has replaced human labor in the production equation.  The worker today is competing with a robot that is not paid wages---so the tendency is for the value of labor power, and hence, the value of human life, to be driven toward zero.  Wages are driven down, safety nets are being destroyed, health care benefits cut, retirement cut, schools closed,  homes foreclosed, families evicted, regulatory oversight is being eliminated, tax systems dismantled and rebuilt around new military priorities, and civil and criminal law systems are being transformed in the direction of removing any government responsibility for the welfare of society and its citizens.


Employers cut American jobs by the largest amount in five years and hundreds of thousands of people dropped out of the labor force. For the third straight month, employers got rid of jobs nationwide. The flood of pink slips was widespread: hospitals, shops, stores, schools, factories, clinics, construction companies, cleaners, mortgage brokers, security guard companies, real-estate firms, retailers, shoe stores, specialty shops, temporary-help firms, child day-care providers, hotels, carpet cleaners, educational services, print shops, restaurants, accounting firms, sandwich shops and computer designers were among those shedding jobs.  African Americans are five times more likely to lose a house in foreclosure than whites; African American women supporting a household on one income are 11 times more likely to lose their home in foreclosure than the general white population.  Given that they are the only money earners in the house, if they lose their job, literally they lose their house and the family's livelihood. 

In February, they sliced payrolls by 91,000, even deeper than the 29,000 cut in January. Over 567,000 people left the labor force for any number of reasons. Economists thought many people probably gave up looking for work.  The elimination of 81,000 jobs in February was the most since March 2003 and marked the second month in a row of job losses. The last time the economy suffered two consecutive months of job losses was in May and June 2003, when the labor market was still struggling to recover from the blows of the 2001 recession.  The Labor Dept.'s monthly employment report for February, released Mar. 7, showed a decline in nonfarm payrolls of 63,000 for the month, to 137.993 million, its second consecutive decline. January's 17,000 drop in payrolls was revised to a decline of 22,000, and December's 82,000 increase was halved to 41,000, for a net downward revision for the two months of 46,000.

The drop in payrolls was spread across most categories, with declines of 39,000 in construction, 52,000 in manufacturing, and 34,000 in retail. Health care, leisure, and government rose.


And yet, the incomes of the top 20% richest people in the country have grown much faster than earnings of those at the middle or bottom of the income distribution. The income of the top 1% and top 0.1% have grown particularly rapidly. From 1995 to 2007, the pay of chief executive officers of major companies rose by 239%. The equivalent figure for median hourly wages was 7.3%, leaving the ratio of CEOs' pay to that of the average worker at 301. In the 1960s, the comparable ratio figure was 25.  In 1988 there were barely 23 billionaire in America; today in 2008 there are over 493 billionaires and millions of millionaires.  How did this occur?  Tax cuts, and profits made wih robots and cheap labor doing the work.  Bush and the congress cut taxes on the rich for eight years.  In addition, the share allotted to corporate profits increased sharply, from 18.2% in 2002 to 23.6% in 2007, while the share going to wages has reached a record low.

Meanwhile, a large section of the workforce - the unemployed or those not seeking work - have not benefited from economic growth. Unemployment has remained stubbornly high despite the economic recovery.  Overall job growth in the first half of the current decade has been just 1.3%.

In the 1990s, job growth of some 12% goes some way towards explaining why prosperity in that earlier period spread down the income scale.


The features of this economic depression are obvious to everyone paying attention.

Occurring about every seven years, the 11 U.S. recessions since World War II have lasted from eight to 17 months and have seen the level of real gross domestic product decline by an average of 2.7 percent. This period will be much worst because robots will have replaced the high paying jobs. Over 25-30 million workers who have lost their jobs in manufacturing, mining, construction, and services will never get those jobs back. Computer automated machine production will be used to carry out those previously human tasks. 
  • 1. The most severe recession in the postwar era was from November 1973 to March 1975, exacerbated by an Arab oil embargo.
  • 2. In that 2 year period, inflation ran into double digits and stocks fell over 25 percent during the recession and lost nearly half their value during the entire down cycle. This period will triple that one in severity.
  • 3. This is the worst recession since the Great Depression, with double-digit unemployment, double-digit interest rates and double-digit inflation, with the basic cost of living, food and energy rising high, the housing market going from boom to bust, real estate and home construction markets collapsed, loan defaults and foreclosures proliferated, and damage has continued to spread through the nation's financial system.
  • 4. The hardest-hit occupations in terms of recent job losses include real estate brokers, financial services sales agents, loan counselors and public relations specialists, education, retail, construction, services, manufacturing, factory labor, and government services, recent government figures show.
  • 5. The double blow of a gutted housing market and oil that topped $100 a barrel has sunk the world's largest economy into a recession. Consumer spending, which drives almost all fundamental economic output, has slowed dramatically in recent months, as was evident in the drop in holiday retail sales reported by the government on Jan. 15---this month forecast an actual decline in same-store sales this year at the nation's retailers -- the first since the recession of 1991. And more people are having trouble paying their bills.
  • 6. This outright contraction of economic activity and employment will last for years. Consumers who are essentially 2/3 of the formula for the commodity getting bought, will continue to cut spending, with results for businesses, retailers, industries, and corporations being a decline in profits and a move to cut spending by laying off workers and withdrawing advertising monies. Housing prices, which have fallen an average of 9.6 percent nationwide and as much as 61 percent in some markets since peaking in 2005, will continue to drop for years.
  • 7. Unemployment could climb another 10-15 percentage points to 35 percent, which would be the highest in 70 years and leave another 8-11 million working class African Americans out of work. This is essentially the core of Black families in the United States. Stocks will continue to drop.  Capitalist governements will continue to bail out large banks with hundreds of billions of dollars of taxpayer monies while letting tens of millions of working class families be made homeless from foreclosures.
  • 8. In Cleveland, and Detroit, epicenters of the foreclosure crisis, the cities have 6 out of top 10 zip codes for foreclosures in the nation. Cleveland has demolished 1,000 abandoned homes in the past year that had become targets for vandals, in order to save money on policing those neighborhoods. Most of those homes had been financed with subprime mortgages. 2.5 to 3 million homes are slated to be foreclosed by the end of 2008; at least 30% of those homes foreclosed will those of African Americans, although they make up only 8.8 percent of the home buying market.  Evictions are at record highs, as are car repossessions, and demands at food banks (where even middle class families line up for food donations just to get through the month.)  Pay-day loans are at all time highs with the interest rates, alone, chewing up 20-25% of a borrower's pay check. 
  • 9. Small businesses are also feeling repercussions and reporting that conditions are soft as customers cut back. Galleries, specialty shops, shoe stores, fast food, book stores, t-shirt shops, clothing stores, computer stores and repair shops, and restaurants have closed because shoppers and tourists are spending less.
  • 10. Another surprise: McDonald's Corp., typically a winner in a downturn with its low-priced restaurants, show sales at their lowest level in at least seven years.   In fact, service industry jobs, usually the poorest paying, also dropped drastically over the past three months.
  • 11. The nation's banks and brokerages will not recover from heavy losses incurred in the collapse of the subprime and now the prime mortgage market. The Consumer confidence sank to the lowest level in at least seven years amid growing worries about jobs, energy bills and home foreclosures after the unemployment rate rose to new highs in the Black community. This will result in a prolonged credit contraction which will force millions of would-be buyers out of the market. As the economy teeters on the brink of collapse, next the dollar will go into freefall as global investors lose confidence in the U.S. economy.
  • 12. Merrill Lynch & Co. and Citigroup Inc. reported $20 billion in fourth-quarter losses between them earlier this month as the corporate earnings season opened with a flood of red ink. Bank of America lost $6.5 billion in one quarter in 2008.  Banks, brokerages and insurers announced staggering write-downs, largely due to bad subprime mortgage bets. They also added to the jobless ranks. Citigroup said it had slashed 4,300 jobs as it braces for more consumer-related trouble and mortgage lender IndyMac Bancorp Inc. cut its work force by 24 percent, laying off about 2,500 employees as it tries to weather the housing slump.
  • 13. Automobile manufacturers, parts plants, dealerships, production assembly-lines, and tooling factories are in unable to sell what they produce and are therefore facing bankruptcy. Consumers cannot get credit, many are not willing to go back into debt, while others are letting their cars go into repossession. U.S. new car and light truck sales fell by 475,000 vehicles or 3.3 percent, to 16.1 million last year, and could drop toward 10 million or below in a recession. Other industries, including truck, building construction, machine robotics, computers, trains, and airlines, are vulnerable to the necessary huge cutbacks to come.  GM has offered its 74,000 hourly workers buyouts.  They lost $39 billion dollars last year, their largest lost ever.  
  • 14. AT&T said recently it's disconnecting more phones because of delinquent customers, and American Express Co., whose customers are generally affluent, said it expects slower spending and more missed payments on credit cards throughout 2008. As conditions worsen, with food and fuel cost rising, African Americans and others will try to use credit cards to pay for basic essentials, including their rent. That credit will be called in. Balances surged through last fall 2007 well into the trillions, Federal Reserve figures show.
  • 15. The downturn also is taking a toll on city governments because revenue from property taxes will decline along with home values, thus forcing governments to cut city services, layoff workers, cut shifts, reduce spending and close facilities such as hospitals, clinics, schools, recreation centers, police stations, fire stations, and government social service programs.
Features are not at the foundation of a system of economics.  The fundamentals are land and all of its natural resources, somebody laboring, somebody with money-capital and technology, and somebody in charge of who gets the wealth, who owns the state and the military, and who is in charge of the society---which class, race, gender, culture rule the society in its own image and interest.  These are fundamentals. 

Fundamentals of How Recessions Become Depressions

The source of wealth is land, labor, scientific knowhow, and stored up capital/value.  Everything that surrounds us in our daily life---food, clothing houses, cars, trains, shoes, hats, dvds, tvs, ovens, ipods, computers, trucks, hospitals, medicines, hotels, beds, laptops, buildings, books, watches, printers---everything is created by human labor, molding and fashioning raw materials through a mass production process, organized with scientific knowhow and existing capital necessary for commodity production, distribution, exchange consumption, and reproduction. 

Color/race is useless in this formula in and of itself.  It only comes into view when you focus in own who owns the process and how is what gets produced distributed, how much, what quality, and who benefits.   Then race, class, culture and gender take center stage.

Part of this wealth is appropriated, taken, set aside, directed, channeled without indemnity by the ruling race, class, culture, gender and sometimes ethnicity when ethnic groups are involved.


The mechanism of the way wealth is channeled to the ruling population is always different and depends upon the stage of maturation of the society, its historical conditions of development, and the relationship with the ruled populations being taken advantage of.


Consequently wealthy population in the world are wealthy only because their population is oppressing and impoverishing other populations.  There are a finite amount of wealth circulating in a domestic economy and even the world economy.  Someone has the wealth and the rest of the population merely shows up to work, sells their labor power, collects a check, pays for life necessities and sometimes luxuries, ultimately making their capitalist employer wealthy and maintaining their own existence as long as the employment opportunity poses itself.  


Today, international capitalist production has developed rapidly, globally dominated by European and Asian computer automated machine production regions and the multinational corporations that operate globally within them.  Large scale productive forces have evolved nationally from simple machine production to large scale mechanical machine production to semi-automated machine production, to automated machine production, to computer automated machine production: from labor enhancing to labor saving to labor replacing technology.


Capitalist production has begun the absolute elimination of workers out of all agricultural, manufacturing, mining, construction, and service spheres of production. When a capitalist economy emerges from a crisis and production begins to work under normal economic conditions, factories automate production, streamline management, and thus hire fewer people than before the recession.  Fully robotized factories are more productive than manned ones, especially when robots become more and more advanced.

The process of robotization of capitalist production becomes stronger each year, increasing productivity, reducing costs, speeding up production, reducing human error, and increasing volume and quality of production in every single field where the technology has been implemented.   When able to sell these products, capitalists are able to increase profits, which is the main reason for the implementation of the new technology.  When not able to sell products to people with money, the companies savage each other like sharks biting their own tails in a feeding frenzy.   This process is obvious today.
  • 1. Millions of workers, black and white, are being made unemployed each year without any hope of finding jobs to secure the average standard of living. At the same time, the quantity, quality, volume, mass of produced commodities for mass consumption increases into the millions of units due to the high productivity of computer automated robotized factories. This is at the heart of the present economic crisis in the United States and the world. This undermine the domestic market:
  • 2. People with a smaller salary, lost jobs, cut health care, and reduced benefits cannot afford to buy houses, boats, gold, trucks, cars and other expensive items;
  • 3. They stop traveling and dining out.
  • 4. In the long run all these industries will suffer severely from reduced salaries of working people.
  • 5. By allowing capitalists to reduce their expenses by laying off workers, slashing payrolls, cutting their employees' salaries, the state creates a temporary advantage for domestic businesses with out-of-date technology to compete on the world market with businesses using higher technology, robotized and automated factories.
  • 6. But this also leads to technical stagnation of domestic capital.
  • 7. It also ends up with a high prevalence of low paid jobs such as security guard, cooks, waiters, fast food, delivery, clean-up, etc.
  • 8. This will ultimately reduce the government budget and as a result all social programs for which progressive people have fought will be in jeopardy. In time they will be cut: workfare, food stamps, unemployment insurance, medi-care, medi-caid, housing assistance, job training, wic all will be cut while capitalist business are given huge tax breaks and government loans/bail-out scams.
  • 9. To increase the revenues the (federal/state) governments will be forced to increase taxes on working people, reduce spending on social programs, and these actions will decrease the solvency of the market, which affects, eventually, the whole domestic economy.

Today, Ford, GM, Chrysler, Citicorp, Microsoft, Apple, etc. produce goods for mass consumption on an increasing scale and at the same time eliminate the consumer market as they lay off millions of workers.  For this reason the companies can't realize their profits, stocks fall, cash reserves collapse, spending is cut, advertising is cut, workers are laid off, mergers and take-overs intensify, companies go bankrupt, loans go defaulted, the general economy enters into recession then into depression.

They move over seas to find the cheapest labor, but this only intensifies their problem.


  • 1. The implementation of Machinery Flexible Systems (FMS), just-in-time, computer automated machine production demands huge capital investments and they are profitable only with mass production of manufactured goods such as computers, cars, trucks, jet planes, prefab homes, ipods, dvds, trains, buses, tvs, toasters, microwaves, etc.
  • 2. Therefore, the migration of productive businesses into underdeveloped countries, before robotization becomes the dominant form of production. This is directly motivated by cheap labor in these countries. Study Asia and Africa.
  • 3. Manufacturing of goods with cheap labor temporarily makes a business competitive on the world market filled with goods produced by robotized factories.
  • 4. The growth of robotization of production and the growth of productive labor at a certain point will reach a level such that the cheapest labor in the world will be unable to compete with robotized factories. Then the inversion of the process takes place. This may require years to fully mature.
  • 5. At that moment the migration of productive businesses will not only stop, but it will reverse.
  • 6. All these businesses will start to move back to the countries where they came from.
  • 7. The main reason for this process will be reduced production expenses, but this time caused not by cheap labor but by elimination of transportation costs for delivery of the merchandise to the consumer market.
  • 8. Since the developed capitalist countries are the main consumers, it is natural that capital will move back to these countries.
  • 9. As the result of this process, export of goods to developed countries will diminish, because each of them will use unmanned factories to produce products for their domestic market.

The result: an economic crisis that cannot be solved with old economic policy, the essence of which is to stimulate the private sector by reducing taxes on capital, by reducing the interest on money borrowed from the Federal Reserve, in short, by creating favorable economic conditions for capital to function.

This economic policy will fail again, because the main reason for the crisis is absence of a solvent market in the face of high unemployment, consisting of workers who never will be engaged in production, and never will restore the market for goods of mass consumption.


The old means of treating an economic crisis by stimulation of business with low cost loans, which in turn enhances market solvency by attracting more and more unemployed people into production, will no longer put workers back to work because robots will forever eliminate workers from production.  The capitalist will take the loan, invest abroad in cheap labor, then use the profits to build robotisized computer automated machine production plants domestically. 


The existence of the global market only postpones the economic crisis in a given country, because capital increases export of its goods abroad for realization of profits when the solvency of the domestic market diminishes.This process will proceed until the robotization of production in underdeveloped countries reaches the same level as it has in developed capitalist countries. International competition will force them sooner or later to implement robotization. When the cheapest labor no longer can compete with unmanned factories producing the same product, underdeveloped countries will be compelled to implement robotized production, and they will feel the same consequences that developed countries experience.

Under these conditions the global market will exhaust itself as the valve that eliminated economic pressure on the domestic market.  Then the economic crisis moves from social decomposition and destruction to political crisis. In concrete terms, this point will be reached when the American economic system is no longer able to come out of the crisis situation.


Under these conditions it is most likely that the patience of working people left without work will be exhausted and they will begin to fight openly for jobs and fair distribution of wealth.


Economic Crisis/Government Crisis

A distinct class, race, and sex after drafting its constitution, creates it own government in its own image and interest.  The major tasks of government is to create the institutions via legislation which creates the social programs, and policies that allow the economy to grow and develop in the image and interest of that particular ruling race, class, and sex.  In the United States of North America, that ruling race is white, principally of English ethnic ancestry; the ruling sex is male; and the ruling class is capitalist.  The ruling culture id Greco-Roman/Christian English.  Within this racial, sex/gender, culture and class context white male capitalists created the constitution---writing into existence their government and all of the necessary institutions for their independent rule. 

Real household incomes, the median point - the level at which half of households earn more and half less - has actually fallen over the past five years. The contradiction of economic expansion without significant job or wage growth has been confusing US economists of all political persuasions: it however is simple.  Robots, computer automated machine production, flexible manufacturing systems, just-in-time production, and remote processing is doing the work as opposed to human labor.   Productivity measured with robots doing the work does not translate into income for a person who has been made unemployed.  In addition they cannot buy back the product produced by the computer automated robotic system because they do not have a wage, salary or income. 


During the six years from 2002 to 2008, the US economy grew in size from $10.3 trillion to $13.1 trillion, an increase in real terms of 12.8%. Productivity - the measure of the output of the economy per worker employed - grew even more strongly, by 20.3%.

But over the same period, the median family's income slid by 4.5%, in contrast to the 9.7% gain registered in the second half of the 1990s.  The wages of households of African or Hispanic origin fell even faster. And new entrants to the labor market fared particularly badly. Average hourly real wages for both college and high school graduates actually fell between 2002 and 2008, and fewer of the jobs they found carried benefits such as health care or company pensions.


Oil prices, which have set a string of record highs in recent days, now top $105 a barrel. Gasoline prices have marched higher, too. Consumer confidence sank to a new low of 33.1 in early March, according to the RBC Cash Index. That was the worst since the index began in 2002.


On Wall Street, stocks tumbled. In first week of March, the Dow Jones lost 146.70 points, a little more than 1 percent to close at 11,893.69. The Dow was down 370 for the last two days of the week.  Major U.S. equity indexes have lost more than 16% of their value since their peaks in mid-October 2007. New record high oil prices suggest growing inflation.  The broader S&P 500 index fell 10.97 points, or 0.84%, to 1,293.37. The tech-heavy Nasdaq composite index shed 8.01 points, or 0.36%, to finish at 2,212.49.


The Fed, which has been reducing the interest rate since September 2007, recently turned more forceful. It slashed the rate by 1.25 percentage points during just eight days in January - the biggest one-month reduction in a quarter-century.  To relieve persistent credit problems, the Federal Reserve will increase the amount of loans it plans to make available to banks in March 2008 to $100 billion. It has already provided a total of $160 billion in short-term loans to cash-strapped banks since December 2007.   


February nonfarm payrolls fell 63,000, more than double the 30,000 decline that economists had expected on average and the largest decline in five years. January's drop was revised lower to 22,000 from 17,000, while December's growth in payrolls was halved to 41,000 from 82,000.


Employment measure fell 255,000, and was overwhelmed by a hefty 450,000 drop in the workforce.  The jobs picture dimming will force homeowners to sell their homes.  This is a liquidity situation. The well-being of the consumer, whose spending accounts for more than two-thirds of economic activity, is key to investors' hopes of avoiding more economic pain amid the ongoing pullback in home values and credit troubles.  The week also saw the dollar continue to drop, helping push several commodities to record highs. Many commodities are traded in dollars and so a weak greenback can make their prices rise. Gold, often regarded as a defensive investment, surged to near the psychological benchmark of $1,000 an ounce.


Despite the injection of hundreds of billions of dollars and euros, interest rates on inter-bank lending are still unusually high. And banks are tightening up on their lending to individuals and companies, restricting the amount of lending as well as making loans more expensive.

There are also hundreds of billions of dollars worth of short-term debt obligations that will fall due in the next six months, which could further depress the market if no buyers can be found for them.


Thousands of people are having their homes repossessed, and with a glut of homes on the market prices are dropping. The crisis began when US mortgage companies made hundreds of billions of dollars of sub prime loans. These debts were then packaged up and sold to financial institutions around the world, who then sold it on to pension funds and hedge funds. They were adjustable rate mortgages (ARMs). Foreclosures and late payments on home mortgages are will continue to rise.  With low or negative equity in their home, a stressed borrower has less ability - because there is no home equity to tap - and less financial incentive to try to remain in the home.  Why pay for a home that is worth much less than you paid for it? The housing collapse dragged down home values. Many are therefore left with mortgages that exceed the value of their homes. In addition low introductory rates on their adjustable mortgages reset to higher rates, are making monthly payments difficult or impossible, to afford. Add to this the fundamental problems in the credit markets have made refinancing a mortgage harder.


The payments were fixed for two years, and then became both higher and dependent on the level of Fed intereset rates, which also rose substantially. A wave of repossessions is sweeping America as many of these mortgages reset to higher rates in the next two years.

And it is likely that as many as three million families will be evicted from their homes as their cases make their way through the courts.


Mortgage companies are finding it difficult to raise money even to lend to sound borrowers. So despite a pledge by the US government to help, house building is at a record low.

Although there are far fewer sub-prime mortgages in the UK, mortgage lenders like Northern Rock are also finding it difficult to raise the cash to pay for additional mortgage lending. So it could become harder to get a mortgage, and it could cost more - and both these expectations are lowering house price inflation.


Construction is a big part of the economy, and people who move house are also more likely to buy consumer goods like washing machines. The tightening up of credit and worries about mortgage repayments may make everyone more nervous about borrowing money to buy big-ticket items like cars. The Commerce Department said that construction spending fell 1.7% in January, the biggest fall in 14 years. Spending on homebuilding has been slashed, but the report also showed that there were cutbacks on commercial projects such as hotels and highways.

Separately a report from the Institute for Supply Management (ISM) showed that factory activity shrank in February. The index for national factory activity fell to 48.3 in February from 50.7 in January. A reading below 50 indicates that the manufacturing sector is contracting.



The dollar is already weak because of the huge trade deficit the US runs with the rest of the world - nearly $1 trillion - which has been a big boost to the world economy. But if the US economy slows, and interest rates are cut sharply, the dollar will become a less attractive currency and could fall further.

This in turn would make imports into the US more expensive, and make it harder for exporters like Britain to win orders. A big decline could also force countries like China, which hold $1.3 trillion in currency reserves, mainly in dollars, to diversify their holdings, further depressing the greenback.


When the government was the instrument of slave owners and land thieves (calling themselves farmers and colonists), that government did the things necessary to protect and expand the plantation. The indigenous Chechimecans were exterminated with the remaining decimated population remnants being cleared from the fertile lands, herded onto reservations (concentration camps).  Then the African population was invaded, captured, kidnapped, packed in fort dungeons, herded on to boats, shipped around the world to be worked to death on any fertile lands that whites had seized in their genocide age of conquest.  Slavery of Africans was therefore sanction by the government and the church (including all the Popes), enforced by the white military, and was protected by the general white population---all because it benefited them.  Sure people fought; sure their fight shaped the contours of the movements, sure there were successes.  But, is this not still a white, capitalist, Greco-roman/Christian, male dominated society from its highest levels to its lowest?  Are not the masses of Black population on the bottom of everything in this society?  Who is hit first and hardest by natural disasters, evictions, foreclosures, school closures, plant shut downs, hospital closures, hunger, homelessness, increased gas and utilities prices?  Black people.


As these parasitic processes of whites caring for their agricultural survival needs became industrialized, plantations gave way to factories and industrial districts.  The white government transformed itself into a committee to take care of the new needs of mechanized/semi-automated industry.  Manual labor was transformed into mechanical labor, then semi-automated, then automated, then computer automated.  Government institutions grew as industries expanded, employment expanded, profits expanded, demand expanded, the economic system expanded, neighborhoods expanded, communities expanded, cities expanded, counties expanded, states expanded, and the entire nation expanded.  Industry needed literate workers, so the school system expanded under a secretary of education. The whites continued to get the best education, they moved to suburbs financed with government grants and new schools---those who could leave inner cities. 


The army needed healthy young men (now black and white) to fight wars brought on by industrial expansion, so a school lunch program was initiated as industry got expanded.  Bureaucracy department of Housing and Urban development provided social order to rapidly expanding cities and suburbs---especially suburbs.  As industry and the workers moved outward, a department of transportation organized the transportation explosion.  In other words government became expanded bureaucracy government in order to serve the needs of capitalistic manufacturing industry: as it became expanded bureaucracy industry. The white workers were kept relatively healthy and the unemployed Blacks were warehoused in projects in such a manner' as to keep them available for work with each industrial expansion.


Advances in technology from manual production to computer automated machine production have necessitated changes in government.   Labor saving technology has been transformed into labor replacing technology.   Labor replacing technology makes workers who would buy back what they produce obsolete.  Computer, robots and other machines cannot buy back what they produce.  Just look at the decimation in Michigan, Ohio, Illinois, Indiana, Kentucky---most of the Midwest manufacturing belt. 

Homemarkets contract, the economic system contracts, employment contracts first in a relative then an absolute form.  Economic contraction leads to social, political contraction.  Not only are expanding sections of the working class superfluous to production, but computer automated machine production, the leading edge of the Scientific and Technological Revolution no longer needs a reserve army, of unemployed.  Nor does it need healthy young men for an infantry war.


As industry gave way to the new electronic means of production, it downsizes, forces workers out of work, reduces human labor time, forces able bodied women, men and children into the streets with life sustaining employment, wages, or salary.   The expanded bureaucracy government that once managed expanded bureaucracy industry and an expanding economy must now necessarily manage contracting industries and a contracting economy which does not have life sustaining jobs to offer its population.  Government programs shrink as government institutions are legislated out of existence because of their obsolescence to profit. 


Big government becomes small government, welfare becomes workfare, education grants become loans, labor saving technology becomes labor replacing technology, domestic plants move to international cheap labor, manufacturing labor is replaced with service labor, high paying jobs are replaced with low paying jobs, full time is replaced with part time/contract nonunion work.   


Human Obsolescence and Social Degeneration


As the applications of these new scientific technologies to the workplace expanded a new economic category, the structurally unemployed, was created.   This was the industrial reserve to be thrown into the battle for production -as the need arose. The structurally unemployed were something different, They were a new, growing permanently unemployed sector created by the new emerging economic foundations. Robotics, entered industry at the lowest and simplest level. Its first victims were the unskilled and semi-skilled workers, many of whom are black and brown populations. 


For historic as well as racist reasons the Black workers were concentrated there.   The widespread liquidation of the Blacks in the industrial work force was inevitable being that the African American was last to be allowed the least developed industrial positions and the least developed industrial technologies are the first to be replaced, thus replacing the technology and the worker from the production equation.  This is a systematic process whereby Africans are last to be hired and first always to be fired.

It was difficult to see the effects of robotics on the white unskilled and semi-skilled workers. 
They were scattered throughout the general white population and especially in the suburbs. The African Americans were concentrated in a relatively small urban area were the percentage Black industrial laborers to the total African-American population was higher than that of white industrial laborers to the white population. The consequent creation of the ghetto, that human dumping ground for the impoverished Black, the permanently destitute, the economically trapped downtrodden, rotting-inner-core of the formally central working class area of the city, was as inevitable as the move to warehouse them in prisons and next exterminate them in the same goal in mind (but with much more lethal murderous technology) that Hitler and the murderous white Nazi Germans had in mind for the Jews. 


Mass prison building, privatization of prisons, Nazi movements within the military, conservative/Nazi politicians being voted into office by the mass white population, and emerging mass murderous white militia movements in the United States at a time when education and job opportunities are being cut out of existence is no accident.    The murderous logic of every move is obvious to any holocaust survivor. 

For those who claim that this is a second reconstruction period they are dead wrong.  This is not a white reactionary movement to control nonwhites, this is a white Nazi movement to exterminate non profitable Africans made obsolete by advances in technology, take back the country, expropriating everything that nonwhites have accumulated (including everything defined as wealth, including bank accounts, gold, silver, diamonds, cars, jewlery, cash and other valuables), ridding white of the expendable criminal elements and therefore solve "Black Question" in a hail of bullets, death camp/prison chain gangs, smart bombs, fire, lethal chemical injections, injections of lethal biological pathogens, AIDS virus, drugs, etc.  This is a Final Solution.  This is the white final solution to the African problem that they caused in 1492.   


The new productive equipment's polarizing wealth and poverty as never before.  Absolute wealth in the form of 497 billionaires and absolute poverty in the form of homelessness is new to this country. The second polarization was the increase in production accompanied by an increase of unemployment and joblessness.  

White will lose jobs then livelihood and end up on the streets destitute just like Africans ---only much later and with less frequency.  


23.jpg

Conservatives/Nazis


The modern white ruling class inherited a history of subjugated Africans underneath whites.  This is the objective reality that they have to work with.  They have to replace manual, and mechanical production from factory manufacturing; in their replacement, they will use robots with computerized laser guided systems.  They care nothing for their own people, and they care less than nothing for Black People.  Soberly look at what they are doing at Bear Stearn, Bank of America, Citicorp, Ford, GM, Chyrsler, Sony, Yahoo, GTE, GE, etc---the layoffs, buy-outs, plant closings, cuts in retirement, cutting out health care, cutting out union workers, cutting contracts, hiring part time workers, closing training centers, avoiding taxes, moving production abroad for cheap labor, and building only robotic plans in the United States..

In the mean time, the globalization of the cheapest labor allows them to move to China, South Korea, Thailand or anywhere labor can be bought at its cheapest prices.  This is an objective process.  It unfolds daily.  In the process, Mexican undocumented replacement workers were imported in the 10's of millions from 1980-2000; this was not their fault, they were just desperate impoverished people caught up in yet another skin game of the profit hungry whites.  Blacks (in the country as citizens, and being kept out of the country while Mexicans are allowed in) are the odd population out---slated for mass joblessness, obsolescence, homelessness, hunger, and social upheaval.  The white economic system keeps Black populations dependent in and away from any science/engineering means.  Dependent peoples get crushed in times of economic crisis.

Today, the US economy has been fine-tuned---the Black population in mass has been fastened to the bottom of this degenerating economy---the most brutal negative manifestations of this process places the Black population squarely in line with the nazi genocide in Namibia (early 1900's), and Germany with the Jews and other populations scapegoated in that country. 


History shows us that each qualitatively new epoch of technological revolution creates a new class, and rids itself of others that cannot make a transition.  Previously, each new class has been the owners or operators of the new equipment, they seize power, reorganize the society in their own image and interest, they rewrite the laws to put themselves in charge, they reflect the means of producing the necessities of life in that society. 

Because the society works for the majority of people, the majority supports it even if it enslaves over 25% of its domestic population (as was the case from 1619-1865).  This new dispossessed population of Blacks and whites, created by robotics, is not simply driven out industry, it is driven out of capitalist society, evicted, dislocated, hungry, homeless, tossed to the side.  It is destitute, expendable, permanently unemployed and is therefore being made ready for slaughter.  There is historic parallel, although premature:  Nazi Germany.   This type of social degeneration will take at least nearly a decade to reach maturity, but once it gains momentum it is in most cases lethal and final.



Social Classes, and the Unfolding of Reform Movements


Study the direction of mass movements and who leads them.  Which class, race, culture, gender leads?  What direction are they taking the national economy.    This is the central question of any movement.  Depending on who leads, one can predict the direction of the movement, even what the movement can achieve given its goals.



Example #1


More importantly in history, no system has ever been overthrown by an internal class, race or sex being replaced.  Study this inference carefully. In the United States, the slave system was overthrown from the outside, not by the enslaved population. 

The whites using mechanized machine production via the republican forces channeled the religious/mystical abolitionist movement into a civil war victory while using (on the north and south side) the black population as contraband.  The whites in the north won, united with the whites in the south with the whites in the north in leadership; then together they fastened Black people to another form of slavery for another century.  Essentially, Reconstruction meant reconstructing the white nation, temporarily pacifying the Blacks, sending the Black men to the west to kill Indians as buffalo soldiers, and in the process terrifying the mass of Black people with the KuKlux Klan and lynch mob law.  When it was over black folk were re-fastened to slave labor in a sharecropping system now controlled from the north via the southern middle men until the mid 1960s---nearly 100 years later.  Whites have essentially stuck together across class line for all of this country's history, there have been only a few minor deviations (all explained by temporary white self interest).  Even in moments of reform, the whites generally were themselves fighting for a higher level of social standing, while moving the nonwhite populations into the obsolete positions the whites were abandoning.  Study this carefully. 


Civil War: War Between Whites in the North and Whites in the South


1856-1866 to period of of Reconstruction


Emerging out of decaying feudal economies, African slavery was utilized to jump-start the white capitalist economy in North America.  In order to keep Africans building the wealth of the United States for whites, whites established Black Codes in 1667, and Slave Codes of 1822 and 1831. 


From the moment that 20 enslaved Africans (Black people) emerged in bondage from the Dutch ship in 1619 to be worked to death planting and harvesting food, and fiber for their enslavers, African American labor has been a central element social production in the United States. 


All significant social movements of Africans in US history have had their roots in essential human labor commodity production, distribution, exchange, consumption, and reproduction.  From 20 enslaved African Americans at the beginning of the 17th century to 20,000,000 segregated African Americans by the middle of the 20th century to nearly 54,000,000 at the beginning of the second decade in 21st, the centrality of African American labor is essential to understanding its present and future social, economic, educational, political, and cultural existence. 

Within white countries where hundreds of years of enslaved African  labor has prepared the conditions for the Industrial Revolution, mechanization of machines had become the essential element in the structure of capitalist industrial production.  Machines were initially made by means of manual labor.  When machines began to be used to make other machines, large-scale industry was provided with an adequate technical basis. 


With: (1) the ending of the Civil War in 1865, which fiercely expropriated the slave economy while opening the South up for mechanical capitalist agricultural production; and (2) the completion of the Reconstruction Period dating 1865-1877 which transformed African slaves into share-croppers, and reorganized the political structure of the South in line with the dominant Northern capitalist class, the nation was set for an intense period of industrial, economic, demographic and geographic expansion.[1]


After the American Civil War ended direct enslavement of Africans in America, theoretically sharecropping in the Southern region of the United States was a scaled down version of European feudalism: a hybrid transitional socio-economic system that bridged the agricultural abyss between agricultural slavery and agricultural capitalism from 1865-1945.  The African Americans were the serfs, and white ex-slave landowners being the landlords.  The landowning class was to provide the sharecroppers with credit for seeds, tools, land, cattle, implements, house (shack), and food; in return the African Americans worked the land for an agreed-upon share of the selling price of the crop, minus what they spent to plant and subsist.  In reality, plantation owners cheated the African Americans as a standard practice, leaving them in more debt and poorer each year in yet another form of bondage.  Segregation, or American apartheid maintained menial manual Black labor and mechanical industrial white labor with all of its liabilities and assets.  As a result the African Americans were again tied to the land, forced again to work for starvation wages. 


          Next, white fought each other in a civil war and ended slavery in the second half of the 19th century in order expand the capitalist economy.[2]  For centuries, some Africans had fought whites  in small scale rebellions.  However, it was not until the economic liabilities of keeping Africans enslaved in the South outweighed the assets of implementing mechanized production and expanding westward, that the mass white population was organized to end slavery.[3]  Direct colonization for the purposes of extracting raw materials, and precious mineral would follow as capitalist production shifted to mechanized industrial production of commodities for distribution on an evolving global capitalist world system.  Segregation would become the legal institutional instrument which would keep nonwhites on the very bottom of the economic structure.  In order to maintain southern privileges for white slavemasters, whites instituted Home Rule Codes in 1865.

          After a civil war and a short period of reconstruction, southern white slavemaster were helped by northern liberal whites to reassert their murderous domination over Africans.   With the Tilden-Hayes election of 1876, white liberals and conservatives again unified against their common subjects peoples.  Landlessness, stripped of political gains, desperate for work, homeless, near starvation, and penniless, Africans were fastened to segregation for another 90 years.   Slavery had not been ended; whites had merely changed its form.  Through the imposing of white Klan terror, lynchings, castrations, mutilation, rape, murder, grandfather clauses, poll taxes, and literacy laws Black people were left with no rights, no wage-paying jobs, no suitable houses,  no land, no nutritional food,  no equal education, and still had little choice but to go back the white plantations and work for their slave former slavemaster.  

          In 1883, the U.S. Supreme Court had declared the Civil Rights Act of 1875 unconstitutional, thus robbing all African Americans of citizenship rights.  By 1894 the section of the Emancipation Act dealing with the right of African Americans to vote was repealed.  By 1888, Africans in the United States had been freed from slavery and made into sharecroppers.   Destitute, landless, existing outside of the money economy, owning no capital, living at the mercy of degenerate whites on plantations, sharecropping was nothing but slavery by another term.  White liberals and conservatives had again tricked and maneuvered the African race into yet another parasitic system of exploitation and degradation.  Again, almost all of the white race benefited from this system, and almost all of the African race suffered.  Therefore, almost all whites defended this system, and the privileges gained from taking advantage of Africans.

          In the United States, after slavery and the reconstruction of the South, segregation was started as white labor protectionism designed to keep Africans and indigenous Chechimecans nailed to primitive agricultural and mining manual labor.  White wage labor was kept one notch above black labor as to stop any racial class unity.  Every institution of the society reflected this white privilege.  Nonwhites were denied access to quality education, housing, food, clothing, health care, transportation, legal assistance, recreation, culture---everything essential to development.  State's Rights Laws in 1886, mass lynchings, mutilations, castrations, and rapings against African men, women, and children enforced this system of apartheid.  This system of rigid segregation, supported by white terrorist and the Supreme Court ensured white supremacy.  Sharecropping, therefore, was little more than slavery by another name.

          With: (1) the ending of the Civil War in 1865, which fiercely ended the slave economy while opening the South up for mechanical capitalist agricultural production; and (2) the completion of the Reconstruction Period dating 1865-1877 which transformed African slaves into share-croppers, and reorganized the political structure of the South in line with the dominant Northern capitalist class, the nation was set for an intense period of industrial, economic, demographic and geographic expansion.[4]  The early alliances between Africans and white farmers were racist and paternalistic.  White liberals were so racist and opportunistic in all of their relationships with Africans that they even allowed Harriet Tubman, the great African freedom fighter to live and die in destitution.  There were alliances between Africans and white ablutions in the United States after the Civil War, but once whites had begun to seek the benefits of ending slavery they turned and defended the Ku Klux Klan.  




[1]Louis M. Hacker and Benjamin B. Kendrick, The United States Since 1865, New York: F.S. Crofts & Co., 1933, pp. 150-280.

[2]An excellent discussion of this summary statement is documented in Jack Gratus, The Great White Lie: Slavery, Emancipation, and Changing Racial Attitudes, New York: Modern Review Press, 1973.

[3]One could follow the logic of these deductions from the time of the first population invasions by Europeans in 1492 by referring to Jacques Legrand, Chronicle of America, Chronicle Publications: Mount Kisco, 1989.

[4]Louis M. Hacker and Benjamin B. Kendrick, The United States Since 1865, New York: F.S. Crofts & Co., 1933, pp. 150-280.




Rebuilding/consolidating the rule of the country under the leadership of northern whites

Hayes-Tilden Agreement-A tie in the elections.  For Hayes presidency, he agree to withdraw troops from south.



1866-1920

1866-13th Amendment passed-civil rights (black people citizenship)

1866-14th Amendment-federal protection of civil rights for blacks

1867-KKK founded in TN

1870-15th Amendment-cant discriminate in voting (for men)


1. From 1866 to 1872, reconstruction had been winding down gradually before its final closure. In short, the whites had repaired their country and were getting back to the form slavery would take under capitalism.  After enslaving, murdering, breeding, selling, and working to death 10's of millions of Africans in what became the United States since 1619, Black people got seven years to collectively think of freedom.  Then they were fastened to slavery all over again, after the whites reconstructed their nation, infrastructures and economies.  Black skin was criminalized in to enslavement again with anti-loitering laws: For a Black man, no land, no job, no property=slave labor on chain gangs, plantation serfdom, or to the coal, silver and gold mines.

2. With the economic system in crisis, unemployment widespread, death and destruction visited on African Americans throughout the south, white Democrats had reclaimed state governments in Tennessee by 1869; in North Carolina, Georgia, and Virginia by 1870; in Arkansas, Alabama, and Texas by 1874; and in Mississippi by 1875. By 1877, the party of Lincoln controlled only the statehouses of Florida, South Carolina, and Louisiana. Whites in the north and south were moving in the direction of their unusual white backlash.

3. Capitalist in the Republican Party quickly moved to the reintegration of southern states into the national economy, under capitalist control. Red republicans laid down politically as is usually the case with white radicals, the KuKluxKlan was turned loose in force, and lynching and burning Black flesh was the standard means of terror for these white degenerates, regardless of their class make-up. From 1873-1965 this was standard policy. The state/federal governments stood and watched, and in some cases helped the murderous white lynchers with intelligence and by not prosecuting known killers.

4. In black-majority areas, white Democrats had already begun using terror tactics against black Republican voters in the elections of 1875 and 1876. Before the state elections in Mississippi in 1875, white military companies in Yazoo and Coahoma Counties, deep in the delta, attacked black Republican meetings and murdered several black leaders. In South Carolina's piedmont area, gangs of white men rode through the countryside before the 1876 election terrorizing black neighborhoods and keeping Republican voters home on election day.

5. The election of Rutherford B. Hayes as president in 1876 was the end to what had been muted federal oversight of local affairs in the South---a means of reconstructing the south along capitalist lines and pacifying the majority Black population. Hayes's campaign platform pledged strong protection of Black citizens in the South, to get the Black vote. He got the black vote, and as usual, when the election collapsed with the rigged voting in Florida, South Carolina, and Louisiana, Republicans worked out a compromise that gave them the presidency in exchange for formally ending Reconstruction.

6. The necessary electoral votes went to Hayes while the statehouses in the disputed states went to the Democrats. Hayes withdrew the federal troops from South Carolina and Louisiana and included Ultra white supremacist, Nazi, southern Democrats and Confederates, in his federal cabinet appointments.Hayes's policy healed sectional strife between whites in the north and south, pacified the Black male vote long enough to get the Klan in place, won a rigged election and consolidated power for white industrial capitalists in the north and white agricultural capitalists in the south. Black people ended up fasten to the most oppressive agricultural labor in the country until the early 1970's.

7. The federal government, while using its troops to fight Indians in the West and to break railroad strikes in northern cities in the summer of 1877, would not help the thousands of Blacks facing ropes, lynch mobs, tar and feathers. The violence, burning, lynching, killing, hangings, and election fraud, the cheating in the state and congressional races of 1878 were greatest in Black-majority states where white Democrats needed to suppress Black Republican votes to get or maintain power. We lost every right won in the 13th, 14th, and 15th amendment. Study what the red republicans did after this. Nothing.

8. Reports from Louisiana suggested that animals preyed upon the hundreds of unburied bodies of African Americans slain on election day. The number of Republican ballots cast in South Carolina dropped from 94,000 in the fraudulent 1876 election to a mere 4,200 in 1878. The Republican Party thus crumbled in the Black Belt southern states that had the largest number of potential Republican voters.

9. The pattern would continue in the 1880 elections. Only two Republican votes were recorded in Yazoo County, Mississippi, a county that was 82 percent black. The Republican presidential candidate of 1880, James A. Garfield, received his lowest percentage of votes in states that had the highest proportion of black residents, while he polled the greatest percentage of southern votes in border states with the lowest black populations. Thus, African Americans virtually lost voting rights in the areas where their numbers threatened white control.


Example #2


In Europe, earlier, the feudal system was overthrown by the classes (the capitalist/socialists) outside the feudal system, not by the serfs although they like other classes participated.  The concept of class struggle has been convoluted to express the struggle for reform which is the only possible social struggle between two classes internal to society.  Revolutions overthrow, not make populations more comfortable with oppression of others.


Class struggle begins when qualitatively new means of production bring about an economic revolution and the economic revolution forces a social revolution.  The system collapses economically, then the social institutions---education, religion, health care, transportation, criminal justice, recreation, law, housing, families, mass media---all of them begin to decompose/rot.  People in up on the street, destitute and ripe for social upheaval.  The ruling class knows this. 

Study the history of communalism, slavery, feudalism, capitalism.  Appreciate the birth, development, maturation, decline, and decay phases.  The social revolution necessitate a political revolution---a revolution in class, sex, or race rule.  The struggle of the old, reactionary classes inside society- against the new class outside society over who is going to create the new social order is the so called class revolutionary struggle.  Hope for the best plan for the worst. 


Marcus Garvey understood this.  He walked into the Great Depression which had already hit the Black race and organized millions (over 5.3 million card carrying Black members) to leave America with him.  The whites, their ruling capitalist class, allowed it until they appreciated a future need for the Black labor force in its transition from dominant agricultural production to dominant manufacturing factory production.

Then they framed him, shut down the movement, got through the great depression and used the civil rights movement to integrate Black workers at the bottom at mechanized manufacturing production while white workers were being transitioned to semi-automated, and automated machine production and to the suburbs.  

During economic crises in the United States, Blacks (Africans) have historically been forced to move because of the murderous white backlash. In the process of being run out of the south at the turn of the 20th century, over half of the African population in the United States moved from south to north.   This mass migration from the South to the North led Africans to move into ready made slums where dilapidated houses, filthy streets, rat infested alleys, open sewers, poor sanitary conditions, and rotten food awaited them. African women worked as servants , maids and nannies; African men worked as janitor, servants, sleeping car porters, and menial manufacturing jobs. African men and women were actually locked out of the skilled trades by the unions of the white working class.    African migrated from the South to the North and West.    Florida, Georgia, South Carolina, North Carolina, Virginia, Maryland migration led to settlements in Philadelphia, Pennsylvania; Trenton New Jersey; New York, New York; and Boston, Massachusetts.  Migration out of Mississippi, Alabama, Tennessee, and Arkansas went north into Gary Indian; Detroit, Michigan; and Chicago, Illinois.  Migrations out of Florida, Louisiana, and Texas end up in Los Angeles, and Oakland California. 

          The attraction of higher wages in northern cities combined with the eviction of millions of destitute Africans from southern plantations due to their being made obsolete by advances in technology led to the largest and fastest mass migration of African people in the history of the United States.   During World War I alone, over 500,000 Africans migrated from the South to industrial cities in the Mid-west and the North to search for employment.  Between 1930 and 1970 over 8,342,000 Black people left the south to move northward or westward.  White hostility based on competition for lower-paid jobs, and Africans moving into their neighborhoods resulted in race riots or social disturbances in over 27 lmedium to large cities.  Hundreds were killed, most of them Black people.  Thousands were wounded and hundreds of millions of dollars of property damage.  Race riots, beginning in Longview Texas spread to Washington D.C., and Chicago, among other places.  The Chicago riot in July was the worst, lasting 13 days and leaving 38 dead, 520 wounded, and 1,000 families homeless.  Fear of returning Black veterans in the South lead to an increase of lynching from 34 in 1917 to 60 in 1918 and 70 in 1919.  Some of the victims were veterans still in uniform.  Most know about Rosewood, and Tulsa. 

          In the North, by the turn of the 20th century, discoveries and inventions initially developed in Britain, had been diffused around the European world and were beginning to solidify in the United States.  Like almost everything else of significance to mechanized production and capitalism in North America was imported from Europe or Africa, ready-made, and modified to fit the particular circumstance of the new environment.  It was transplanted.  This rapid transplantation of people, production, and culture was the key to the ending of slavery.  It also was the primary thrust of the unprecedented period of economic expansion in the US.  After the Civil War, one billion acres of land is transferred into the hands of railroad and land-owing capitalists, dating 1860-1910. 

          Pennsylvania, Delaware, New Jersey, Ohio, or other industrial cities and states in the eastern region of the country.  Africans this crisis was extremely traumatic both in intensity and duration.  Whereas the average white worker began to experience the economic crisis of circulation in the early 1930s, the African worker had begun suffering the effects of the Depression in the early 1920s. Garvey's "Back to Africa" movement was directly constructed out of the Black Great Depression and the murderous white terrorism throughout the south and midwest.  Whereas whites went hungry, Africans starved.   In the United States, African have always been concentrated in occupation that are the dirtiest, lowest paying and most hazardous to life and limb. Whatever the rate of massive unemployment, homelessness, evictions, farm losses, loss of businesses, etc., for white population, those figures could be doubled and tripled for African populations. 

          White supremacist groups such as the Ku Klux Klan, and the White Camelias terrorized Africans in the early 1900s and spread rapidly in the North and South.  By 1925 it had over 5,000,000 members and tens of millions of sympathizers and supporters.  On August 8, 1925, 45,000 members of the Ku Klux Klan marched to the nation's capital waving American flags, over 434,000 spectators lined the streets, came out of their homes, came from surrounding cities, and cheered this huge parade of white degeneracy and terrorism as it marched to the foot of the Washington Monument. 

In Washington D.C.,  these white murderers did not wear the masks that they traditionally hide behind.  At the rally, they openly outlined their plans for the bloody and animalistic/terroristic "Negro hunts" which they had raised to the level of an art form during the 1870's and 1880's.
[1]  For nearly one hundred years, as opposed to dragging African men, women, and children from the African continent, these white brutes raked out trillions of dollars worth of mineral resources, raw materials, and food so that white societies around the world would prosper.   This technical metamorphosis was reflected in the socio-economic transition from feudalism to capitalism, and the political transition from aristocracy to democracy---capitalist democracy.  In the US, being a transplant society, this process expressed itself belatedly with the ending of direct African slavery and the reorganization of the entire continent on capitalist production, with Africans and indigenous peoples confined to the bottom of everything in America.   White capitalists called this form of oppression, segregation.  

          White mechanical labor was paid a higher wage than nonwhite manual labor.  Higher wages meant higher living standards, i.e., better education, housing, health care, clothing, food, culture, sports, transportation, entertainment, legal aid, etc.  Almost every single white worker defended this arrangement because they benefited from it.

          The Great Depression of 1929-1945 was yet another result of a transition, this time a quantitative transition from mechanical to semi-automated mechanical.  It expressed itself in a worldwide glut of commodities.  Demand had to be created.  As a result, two world wars were fought to destroy commodities, humans, and carve out new territories, thus expanding new markets.  Over 61,000,000 humans were slaughtered, maimed and murdered in these two white world wars that were fought over colonial loot, artifically created markets, and geo-political spheres of military control/influence.  World War I and II artificially ended this  glut, i.e., excess industrial and human capacity, by bombing and burning reserves in human labor and the commodities that they produced until there was a commodity and labor hunger in the capitalist world.




[1]

Marcus Garvey ‘s Back to Africa Movement (early 1920's)


World War I (1916-1919) -

First Great Black Migration North and to Urban South

Detroit, Cleveland, Chicago, Philadelphia, New York, Boston

Draw Black men between 15-35 years, preferably single

Black women in North-domestics in the homes of whites


Strengths

Weaknesses

  • Kept Africa at the center of his movement-Back to Africa Movement
  • Made black people proud, stand up, hold head high-self and others
  • Promoted black independence-advocated starting and supporting black businesses and independence of whites
  • Unity
  • Drew membership and support from the masses of black people
  • Simplicity and frugality
  • Committed and strong
  • Very serious
  • Authoritarian
  • Lack of business sense
  • Put incompetent people in place, trusted the wrong people
  • Linking with whites in theory
  • Not having screening mechanism
  • Didn't do right by family situation (or self)
  • Lack of or inefficient system of accountability


Civil Rights Conditions (1945-1970)

From the above, it is clear that conditions lay the foundation for leadership; just think if Garvey had come along in the 1960's when labor shortages called for whites to integrate Blacks into their machine/factory industrial economy (at the botom) as opposed to merely running them/tractoring them off of sharecropping land as was happening during Garvey's period of th 1920's and 1930's. 

Along the same lines, segregation was legally formalized and enforced in the North and in the South from 1877-1965 as a political method of keeping the most primitive manual labor in agriculture attached to Africans and all levels of mechanical labor in factories reserved for the white population.  Even the schools were set up on this basis; the curricula was separate---one dumbed for the Blacks and the other inflated/scientific for the whites.  Segregation only ended when there was an economic necessity for the white ruling class to integrate African workers into the lower sector of the mechanical labor force.   The white capitalist ruling class ended segregation to expand its economic homemarket.  Nothing else.  Why, if the economic crisis had worsened similar to the German crisis, you would have had gas ovens and concentration camps throughout the United States with more than Japanese in them.

           The 1952-1972 Civil Rights Movement was the result of yet another quantitative transition (although in embryo) from semi-automated mechanical to automated mechanical which was so deep, domestically, that it reached down into the lowest rungs of the society to necessitate the integration of previously manual African labor power into the lower sector of mechanical labor.  And to their credit, Africans, indigenous Chechimecans, Hispanics, and a few sympathetic whites organized themselves and did the things necessary to desegregate the society.  But the change came from the top of the capitalist ruling class as they developed yet another system of managing their oppression of nonwhites.

          In the past, the United States had imported other Europeans to serve as the strata that would fill the void left by a promotion of the domestic white labor force to a higher rung of mechanized production.  However, the Cold War and the evolution of socialism via the Communist International Movement restricted migration from Eastern and Western Europe.  The "communization" of European countries effectively ended the flood of Europeans in to the US.  With an internal labor shortage looming in the midst of unprecedented domestic economic expansion, capitalists would have to settle for the southern and northern Black population.

          Although this process occurred in both the North and the South, the South had more of a rural based African labor force to attempt to integrate, and an overt legacy of treating Africans as sub-humans.  When southern domestic homemarkets had to be expanded to a certain degree, and a new wave of immigrants could not be imported from largely "communized" European countries, Africans had to be integrated into the lowest rung of mechanized production.  They were, thus, desegregated, assimilated, and merged into an American labor force and society which was, of course, dominated by whites on all levels and in all institutions of power.

           By the 1950's, with Africans vigorously fighting national liberation struggles, whites again were forced to dismantle and modernize their parasitic segregation and colonial systems or face the possibility of losing them completely.  Expediently, and with much reluctance, whites replaced their old forms of theft, pillage, and money-changing with another more profitable modern system of white imperialism. 

          In sum, dating from the end of the Civil War, through the period of reconstruction, to the great depression, to the 1950's great expansion, to industrialization of the South (Civil Rights Movement), to the present 1990's emerging final great depression, the American capitalist society has moved from initial primitive accumulation, to fertilization and conception, through formation, consolidation, embryo, fetus, term, birth, childhood, adolescence, and maturity. 

Today this parasitic white society has passed its highest point of development and is in decline.  Conservatism will rapidly pass into Nazism as the economic condition of the nation worsens past repair.


Present Motion Toward Economic Depression (2008+)


          Today, while hundreds of millions of Africans stand begging with starving children in their arms, whites prepare to reap the benefits of yet another revolution in production, the Scientific and Technological Revolution (STR).   Over 798,123,000  women, men and children of African descent globally live in utter poverty.  At the same time, these whites are, again, unifying around the world (this time, white capitalist and communist) in yet another of their "New World Orders" that will allow them to live at the expense of nonwhites for another 100 years. With the nuclear capacity to destroy five of the nine planets in the solar system, or 61 Earths, these whites roam around the planet inspecting petty, insignificant,  nuclear reactors in North Korea---who are at least 30 years behind the destructive capacity of whites.   With no remorse for the centuries of destruction they heaped upon Africans lives, they again prepare, daily, to gut millions of  Africans, this time with the biological warfare agent, AIDS.

          Since 1985, the white caused "Third World" has already been ravaged by seve