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On The Recent Wall Street Crash

The Working Class Wage Correction Is Causing The Crisis of The Market not Computer Algorithms

By Gerry Fitzpatrick

9 February 2018

Computers don't have minds of their own. The business execs and quants who set up the financial networks are not there to act morally, but to act and operate on a limited rationality. And the logic of that limited rationality is ideological now more than ever before. What the quants algorithms are now telling them is that they are in trouble. But what is the bad news that is caused them to loose so much and for the mainstream media to sing them so many soothing songs?

Today, when the information and comment cycle can be scrutinized in closer detail, it has become easier to recognize how capitalist denial and panic quickly follow one another and mutually reinforce each other in response to one economic indicator: the rise in real wages:

For activists, it is not difficult to understand why this has occurred, as the control of real wages has been a touchstone of political economics for the last forty years. Not being able to control real wages means the system is “out of control.” Initially, the Trump administration had the desired effect of suppressing the recent revival in real wages. However, by July of last year this trend has been reversing significantly:

It is this aspect that has recently been identified as posing a significant political threat. There is also the other important phenomena: most active and militant workers aged 16-24 who have achieved large pay increases were not members of trade unions—their struggle being one of purely political self-organization, which bypassed and overtook existing conservative Trade Union bureaucracies. However, while it is true that in the next age group 25-35—the age when most workers think of starting a family—union organization has been the highest of all age groups. But it is also true that the working class in the US as a whole, has simply pushed ahead with its successful campaign for a $15 minimum wage; so much so that since 2012 17 million workers either have benefited, or are due to benefit:

At present it has been the focus of (revolutionary) socialists to try to encourage militant workers to unionize their work places. What appears to have happened instead is that the most militant have chosen to join socialist and other political organizations first. This is an understandable reversal of recent previous socialist organizational experience and history, where the most militant activists tended to be from unionized workplaces who then chose to join socialist organizations later.

Having grown up in a country where unions were “not news” but history, a large number of the current generation have chosen to join directly those who they perceive to be the best political and ethical organizations. This has only recently begun to change the make-up and focus of revolutionary socialist organization in both the US and Britain where activists have not only been joining socialist organizations, but have been politically effective in forming their own.

Consequence of The Revival of Feminist Activism

Feminist analysts would be the first to say and rightly so, that this wage militancy is also a consequence of the recent strong revival in feminist politics:

This has led not only to direct political upheaval in bastions of reaction like Alabama—where women were decisive in ending centuries of racist and reactionary political domination. The new movement has also caused panic and denial in state institutions and centres of economic power. Here again the news media have missed the real implications behind their coverage. The media have reported this as a show case issue where powerful women executives are preparing to sue for equality:

But generally speaking this also marks a significant change in ideas held previously by those born between 1960-1980 who usually indicated when surveyed that they were concerned about what it meant to be female in society but that they were personally “not feminists”.

This de-politicization was blown apart by the Trump election campaign. In the era of new media what was once only achieved after years of hard political and legal campaigning has been replaced by women directly publicly attacking company management regimes with evidence of long standing discrimination. While this has happened as a consequence of ending of company pay secrecy, the issue has been revived more broadly as a class issue: that women no matter what they do—will still be treated as second class citizens. Needless to say, the fury that has been directed at the governing corporate powers has provoked uncertainty, then denial and then as we seen panic. But it’s where the words that will be converted into pay deals that has company leaderships genuinely worried about the prospects for industry wide wage controls.

Black Wages Matter

The Alt-right have been eager to cast Back Lives Matter as simply a narrow morally focused movement when its militancy has helped extend existing black union organisation and connect all related struggles in and outside the work place – including the national drive for a $15 minimum wage increase.

Try as they might the Right has singularly failed to stop the growing push back against neoliberalism. That is why we are again asked to believe that Wall Street, “has just got it wrong” and that the recent rise in wages is good news—not bad—simply caused by generous employers passing on the benefits of Trump's tax bill. But it will not be long before the same analysts and news teams will resume their role as soothers of nerves of those with their heads in their hands.

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