cyRev Online Journal

From Cash Nexus to Needs Nexus: A Radical Response to Growing Poverty (page 2 of 2)
By Bruce E. Parry

The counterparts to the capitalists in bourgeois society, as Marx was wont to note, were the proletarians, the workers, those who owned nothing and were therefore forced to sell the one thing they had: their ability to work. The unemployed were a "reserve army" ready to be thrown into the battle of work as soon as capital expanded sufficiently to require their services. They stood by, in poverty, waiting for a chance to work, acting as an social anchor on the wage rate.

It is within that context that the New Deal was born. Unemployment compensation, Social Security, and later various public assistance programs, housing and food supplements, were stopgaps. They were supposed to allow the poor to survive until the expansion of the economy pulled them into employment. The programs also helped maintained the wages of the employed. When the rising waters rose, all boats were supposed to float away from the pier of the government dole.

And so it was according to scholarly and popular perception--until the emergence of that anathema to modern society: the permanent welfare recipient. This was no longer someone being maintained between jobs. The perception has shifted: many or most are no longer employable. They are not just unemployed workers, they have no relation to the means of production.

History has not been kind to the poor and it isnt likely to be in the 1990s. The first to identify this grouping referred to it as a "lumpen proletariat," for one reason or another incorrectly confusing it with the detritus of feudal society Marx referred to as "criminal flotsam." The next scholar to label it was William J. Wilson, who called it the "underclass," the term which has stuck in polite company. The popular media has variously identified its members as "welfare queens," "inner city poor," and other, less flattering appellations. In each case there is an implication that because of certain social standards of conduct, the words "Black," "Latino," or "minority" are there but have been spoken. The references are often made with regard to youth, gangs, drugs, and criminal activity. This New Class has been portrayed as the very reason that upstanding, suburban [white] people should not dare to come to it.

In fact, the New Class is the key to understanding the economic, social and political climate in which we are living. Its existence, its meaning, its members and why they are important reveal why the political climate is shifting to the right, why politicians are calling for all the social cuts, why we are experiencing social crisis and what the historical result is going to be.

The New Class

The New Class, like so much resulting from the implementation of electronics, is new and unformed. But it exists. It consists of all those who are and have been thrown out of the process of production and distribution, and are moving into a position of having no relation to these basic economic functions. Historically large groups of African Americans, Latinos and other minorities moved into this class first. But the New Class isn't Black. Layoffs, poverty, and homelessness are hitting whites too. Youth are particularly hard hit.

One of business' goals is to cut taxes and eliminate all other tariffs, fees, regulations, laws and customs that will tend to reduce their final [after-tax] rate of profit. The only way to do that is to eliminate what the taxes are spent for. The programs most vulnerable are social programs that affect specific groups. There is plenty of history and discontent to whip-up in order to swing the political mood behind such cuts, not excluding racial antagonism.

Every proposed change affects millions of people and businesses. It is therefore becoming more difficult to get consensus among the parties. Of particular concern to the rulers are the disenfranchised. Those with less and less political access have no recourse but to demonstrate their dissatisfaction in the streets. That, in the most general way, is what happened in Los Angeles in 1992. The leaders are removing the economic basis of a minimum level of political satisfaction. They are therefore losing the economic basis of their political control and support of the masses of people. They must adopt some other form of control. The laws are being continually molded to do that. The latest efforts include both the termination of affirmative action and the streamlining of death penalty appeal processes.

Programs like welfare reform have been touted as the next step in the process of change. It is not politically viable to call it what it is: the next step in its elimination. The term "welfare" is a collective term covering a number of programs. The elimination of welfare has already led to the elimination of numerous general assistance programs, aspects of supplemental security income, limitation of AFDC and strictures on food stamps. We are told the reform will not go too far, but will merely eliminate "unneeded" programs. Public assistance programs are being dismantled piece-by-piece, programs such as food stamps, AFDC, supplemental security income, social security disability and eventually social security.

What is true for public assistance, among the most vulnerable program, is true of other programs. The effort in education is to eliminate public education and move to private education. Health care is the same: the elimination of public health care and its privatization. We have already proceeded to the point where there are more than 40 million people with no health care of any kind. In parkland, in oil reserves, even in the prison system, they are selling off every possible government function.

No conspiracies

This is not a conspiracy. These things do not happen because business people are bad or just because the wrong politicians are being elected. The reasons run deeper; they are systemic. When these programs were begun many businesses understood that sharing the costs of maintaining a labor force (and relative labor peace) at home was the condition for maximizing profits.

Business no longer feels that necessity. It is educating enough workers to meet its needs. A recent pole showed that 95 percent of Americans feel corporations are responsible to the communities they are in and to the workers they employ[4] . There is no legal basis for that supposition, however. Business is not mandated to provide health care, education or anything else not in its own self-interest.

It is in this sense that the New Class is politically key. It is the members of the New Class who are first experiencing the final vestiges of economic security being removed. As AFDC, general assistance, SSI, food stamps, and housing assistance are curtailed or terminated, they are left without recourse. They are the ones who become homeless, who are left in the streets, who the media and politicians blame in order to turn our enmity against them.

People continually ask, "Why doesn't the government do the logical thing?" Why don't they provide food for the hungry, health care for everyone, and equal schooling for children? Why don't they reform the electoral process so that anyone can run? Why don't they enforce equal rights? The answer is that the politicians are doing the logical thing: logical for them and for the businesses that foot their bills.

There is no conspiracy. The truth is coldly calculated. Business computes how much health care might cost under various proposals and then how much it ought to spend lobbying on the issue. It is just as coldly calculated as calculating how much insurance to get. It is a cost-benefit analysis. It answers the questions of cost minimization and revenue maximization under given conditions. It is not that the system is crazy; it is just that the system is cold, impersonal, calculating and not in the interests of anyone who does not live off profit.

We need politicians and political parties that are willing to take up the fundamental questions. One is, "Why does every law passed have to guarantee profits?" Another is, "Can we actually debate that question openly and fairly in the U.S?" If not, then politics has to be taken outside the normal, electoral bounds.

Conclusion

Americans have long-established "rights," developed through legislation and custom. They are in serious danger. Their legal basis will never be maintained if the struggle remains within the political parties of the capitalist class: the Democrats and Republicans. But there are no established parties that are even nominally independent of the capitalists. Establishment of such a party must be the next step.

The very technology that seems to be creating the chaos is the solution to it. It is possible to completely eliminate the "Cash Nexus" and replace it with a "Need Nexus." Instead of rationing goods and services on the basis of money income, it is time to move to a system that rations it on the basis of need. When we produce with computers and robots that require no labor, it only makes sense that the fruits of that production process also require no labor. Instead, the goods must be made available to everyone who needs them.

At the same time, there is plenty of work to be done. Education, establishing equality, providing housing, food and health care, rebuilding infrastructure, cleaning up the environment and a million other tasks present themselves. They are not being done because they are not profitable. But they are beneficial, even crucial. If all the work and labor to be done were shared, we could evenly reduce the number of hours and intensity of work. We could raise the standards of living of everyone.

That is the kind of system we need to fight for. The economic basis of the current system is corrupt. It can no longer provide what it once guaranteed: life, liberty and the pursuit of happiness. We, on the other hand, can settle for nothing less.

Endnotes

Technically, there were two downturns, a brief one in 1979 followed by a longer 1980 to 1981 recession. I feel, as did many of my colleagues, that it was actually one long recession with a fortuitous (1980 was an election year), but chance upswing in the middle.
Rationing has become a bad word since the enforced shortages of World War II. What is not said, is that in day-to-day existence, income is a rationing system. Goods and services are rationed to those who have the money to pay for them. The distinction between "demand" and "effective demand" demonstrates this: despite personal demand, you can only buy that for which you have the money.
Business Week, March 25, 1996.
Business Week, March 11, 1996.