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Full text of "Unemployment, why it occurs and how to fight it"

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Article Author: Browder, Earl, 1891-1973., 

Article Title: Unemployment, why it occurs and 
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Why It Occurs and How to Fight It 

By 

EARL R. BROWDER 




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JUN 27 1940 



Unemployment 

Why It Occurs and How to Fight It. 
By Earl R. Browder. 

Unemployment is steadily growing in the United States. 
'Today (in August, 1924) more than two millions of workers, 
able and willing to serve society, are denied the opportunity 
to labor, and are thrown upon the streets to starve or to be- 
come beggars or criminals. Each day the industrial crisis 
now developing in America becomes more acute, and con- 
stantly more workers are added to the ranks of the unem- 
ployed. It seems quite likely, unless some upheaval, such as 
another world war intervenes, that the coming winter will 
witness a more serious crisis than that of 1921, when 
6,000,000 workers were on the streets. 

Causes of Unemployment 

How can the working class fight against this terrible 
menace, which threatens untold suffering, misery, and death? 
Before this question can be answered, it is necessary to study 
the problem, in its various parts and as a whole, and under- 
stand the forces at work which create the crises. 
3 Unemployment is a "normal" phase of capitalist society. 

This fact must be the starting point of any understanding of 
its causes. Always there are a number of workers • (larger or 
smaller, accordingly as the period is one of ' prosperity or 
of "depression" or crisis) who are possessed of no means ol 
livelihood except the sale of their labor power, and who can 
yet find no buyer for their labor power, who cannot get a job, 
who are "unemployed." These workers make up the indus- 



trial reserve army, the reservoir of unused labor power that 
the capitalist system creates at the expense of the working 
class, as one of its instruments of exploitation. 

The industrial reserve army is an entirely "normal" part 
of the capitalist system. It is the starting point of the 
process of capitalist production, and continually exists and 
functions as an essential part of capitalism, with the excep- 
tion of brief moments, such as a period of general mobiliza- 
tion in war-time. The individual workers who make up this 
"army" change from week to week and month to month, but 
the army itself remains. Unemployment in this form is 
always present, pressing upon the working class, a constant 
threat against individual workers who would demand better 
conditions, and a source of strike-breakers and scabs against 
strikes and other concerted actions. It is estimated that from 
500,000 to 1,000,000 workers are "normally" unemployed in 
the United States. • 

The industrial reserve army expresses one of the funda- 
mental contradictions at the very roots of capitalist produc-* 
tion. It is the embodied symbol of the fact that the working 
class is an expropriated class, placed in a position of irrecon- 
cilable conflict with the expropriating and exploiting class, 
the capitalist class. It is a fundamental phase of the class 
struggle. 

Periods of unemployment, where extra-ordinarily large 
numbers of workers are thrown into the so-called industrial 
reserve army by the closing down of factories, mills, and 
mines, are the next development coming out of the regular 
operations of the capitalist system of production. Regularly 
the capitalist system goes through the cycle of prosperity- 
overproduction — crisis — readjustment— prosperity. The period 
of crisis in capitalist production corresponds with the period 
of acute unemployment and suffering for the working class, 
, inevitably accompanying capitalism. 

The Normal Cycle of Capitalism 

„i M A ^P^yjef 8 w° rkin S class, faced by a relatively small 
class of capitalists in possession of the means of production, ■ 

is the starting point of capitalist society. This it is that pro- | 

t«»w ♦ f dUS n la i . re . se r ve arm y. a »ody of workless men, f 

Zh^S u,™ ™ ?1 "*° m ? us fry to take the place of others * 

who, in turn, must take their place in the reserve army. This 
it is, also, that produces the crisis of overproduction/and all 

4 






the phases of the consolidation of capital, colonialism, impe- 
rialism, the struggle for the world markets, and finally im- 
perialist wars. 

Propertyless workers, under the lash of unemployment, 
must come to terms with the employing capitalists. What- 
ever these terms may be, they always involve the production 
of a surplus value, over and above the wages paid to the work- 
ers as the price of their labor power. This surplus value, 
distributed among the members of the capitalist class in 
accordance with the laws of capitalist distribution, in the 
forms of interest, rent, and profit, becomes in its turn the 
starting point of the normal cycle of capitalism: prosperity — 
overproduction — crisis — readjustment — prosperity. 

Surplus value, in its various forms, places a large part of 
the wealth produced in a given period in the hands of the 
capitalist class. A part of this wealth is expended in the 
luxurious and riotous living among the so-called "upper 
classes"; but another, and by far the most significant part 
goes to increase the total capital engaged in production. This 
additional capital must, in its turn, be invested productively — 
that is, it must also be engaged by the propertyless workers, 
in the production of further surplus values. 

This is the dynamic factor in the capitalist system of 
production. It is the source of all the internal and external 
changes, th6 enormous growth of machine, mass production, 
and the extension and development of the world market, with 
all its attendant conflicts. The increased capital brings the 
employment of a greater number of workers, improvement 
of the means of production, greater volume of commodities 
thrown upon the market. This is the period of prosperity. 

But the greater volume of commodities quickly gluts the 
markets that had been developed in the previous phase of the 
cycle. The phenomenon of overproduction appears. The capi- 
talists must find new markets, pending which production must 
go through a drastic period of readjustment. When new mar- , ' 
kets have been captured from rival capitalists, or developed 
through the exportation of capital to undeveloped lands, the 
"normal" crisis is overcome, a new period of prosperity be- 
gins, and capitalism starts upon another round of the cycle — 
but upon a new level of world-development. 

The Present Crisis 

The crisis through which the capitalist system of the 
world is now going is, however, of a fundamentally different 



:^^h^H*->Mmwm 






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nature from the crisis of the normal cycle of capitalism just 
described, although it is the logical and inevitable outcome of 
their cumulative effects. Prior to the world war, periods of 
depression and unemployment were the incidental accom- 
paniments of the general increase of capitalist production as 
a whole. But the war marked the world-crisis of capitalism, 
where capitalism itself, and not its component sections, had 
reached the limits of its contradictions, had exhausted the 
possibilities of solving these contradictions and entering upon 
a new cycle of upward development. The present world crisis 
is marked by the general decrease of capitalist production as 
a whole. The world war was the beginning of the breakdown 
of capitalism. 

It is not the purpose of this pamphlet to review in detail 
the present world economic crisis. But the larger features of 
the situation are necessary to any sound approach to the 
question of unemployment. A brief review of these features, 
in Europe and the United States particularly, will bring us to 
the question of means of struggle for the workers. 

In Europe the crisis is accompanied by large-scale deteri- 
oration and destruction of the means of production. Un- 
counted billions of dollars worth of wealth were destroyed in 
the war itself. The "peace" has been more destructive of the 
means of production than the war itself, what with its multi- 
plication of customs-boundaries, its arbitrary partition of 
economically united regions, its occupations, its reparations, 
and its accompanying rivalries, jealousies and fears. The 
machinery of production, the .necessary prerequisite to the 
employment of the millions of European industrial workers, 
has been largely destroyed and the destruction is still 
going on. 

The equilibrium between the various factors in the world 
market has been upset and, despite the most energetic efforts 
of capitalism, cannot be restored. This is illustrated in the 
chaos that exists in the exchange values of the various cur- 
rencies. Without a stable basis for exchange, the restoration 
of capitalist production for the world market is impossible. 

The relations between industry and agriculture have been 
upset, with a resulting world-wide agrarian crisis. Prices for 
grain, figured according to the purchasing power of gold in 
1913, have decreased by somewhere between 15% and 25%. 
The result has been a sharp decline in the volume of agricul- 
tural production, curtailment of the agrarian market for in- 
dustrial products, deep discontent and unrest among the 



agrarian masses, and the consequent intensification of the 
crisis, both in its economic and political phases. 

Another factor of prime importance that prevents the 
capitalist class from overcoming the disorganization of their 
world system, is the break in their lines caused by the success- 
ful revolution of the Russian working class. One-sixth of the 
earth's surface has been taken from under the domination 
of the capitalist class, and is ruled by Soviets of workers and 
peasants. Unable to reconcile themselves to this fact, the 
capitalists have even intensified its economic effects upon the 
world crisis, by pursuing the policy of blockade, by means of 
which Russia is still kept out of the world market to a certain 
degree. 

In the United States 

The course of the crisis, and consequently of unemploy- 
ment, has differed in the United States from that in Europe, 
according to the different role being played by this country. 
The American capitalist class (personified in the figure of 
J. P. Morgan) profited greatly from the war, as did the capi- 
talists of every other country — but with this essential differ- 
ence, that in America the means of production were injured 
only indirectly and to a much less degree than in Europe. So 
much less, in fact, that American capitalism was able to use 
a period of extensions and replacements just after the war 
for a period of unexampled industrial activity that brought 
American industry to a new high point of productive capacity. 

But if the direct effects of destruction of the means of 
production have not been a large factor in America, the dis- 
location of the world market and the agrarian crisis have 
joined to bring home to the United States the fact that it 
exists within a system that is sick unto death. In 1921-22, 
the United States, while it boasted of the greatest riches of 
the world's history, was forced to admit that 6,000,000 unem- 
ployed workers walked the streets at the same time. And in 
the now developing crisis, with more than 2,000,000 workers 
already unemployed, the United States is feverishly planning 
the subjugation of the European markets through the Dawes 
plan, the conquest of the Asiatic markets through the crowd- 
ing-out of Japan and an understanding with Great Britain, 
and the more intensive exploitation of Central and South 
America. The internal policy to accompany the Morgan plans 
for world-domination, carries with it the corruption and paci- 
fication of the small section of organized and highly skilled 



workers, with the brutal suppression of the masses, and the 
destruction of all effective labor organization. 

Various Phases of Unemployment 

Before passing on from this general industrial and politi- 
cal background of the unemployment problems to the methods 
of fighting, it will be helpful to consider the various conditions 
under which unemployment is manifested in the United 
States. / 

In addition to the general unemployment, created by the 
action of the world crisis, various special and local causes 
bring about or accentuate unemployment in particular dis- 
tricts or industries. In treating of any specific unemployment 
situation, it will be found of great value, as an aid to select 
the most effective methods of struggle, to know to what ex- 
tent it is a part of a national and world situation, and to 
what extent it is special and local. 

Take, for example, the coal mining industry. Here is to 
be found the most intense distress and suffering among the 
workers, as a result of widespread and long-continued unem- 
ployment. This condition is being intensified by the present 
crisis, but it existed while "prosperity" was still general, dat- 
ing back to the period immediately after the world war closed. 
The special intensity of the unemployment among miners 
finds its roots in the unexampled expansion of that industry 
during the war. When the exceptional demands of the war 
ceased, it was found that coal mining in America had been 
developed to a capacity 40% above the needs of the domestic 
market in times of peace. More than 200,000 miners were in 
the industry, above the number required for this production. 
The capitalists immediately took advantage of this to begin 
shifting production to the low-cost and non-union fields. • The 
main burdens of unemployment have thus, in this instance, 
fallen upon the shoulders of the best organized and highest 
paid workers in the industry. And while the industry as a 
whole is in the midst of a most profound crisis, certain low- 
cost, non-union fields are operating at capacity. 

The copper industry presents a somewhat similar situa- 
tion. This industry was also keyed up to great demands dur- 
ing the war; it is now largely cut off from the European mar- 
kets. To this has been added the fact, that new low-cost 
fields have recently been opened to exploitation, through the 
investment of large sums of capital, which has shifted the 
center of gravity of the industry, and driven tens of thousands 

s 



of copper miners into new fields of labor. Butte, Montana, 
once the center of the copper industry, is now almost a dead 
city. 

Another example of special causes, intensifying the gen- 
eral unemployment, is to be found in the textile industry. 
Like coal mining and copper, textiles are undergoing a shift 
in production from one field to another. In the textile indus- 
try it is a question of average wage standards between the 
North and South, that is stopping the New England textile 
mills, and that throws the bulk of production to the South, 
where child labor and starvation wages rule. The idle textile 
workers in New England see their place being taken in in- 
dustry by a new strata of proletarians, the industrialized "poor 
whites" and Negroes of the hitherto agrarian South. 

Unemployment caused by a shift in the fields of produc- 
tion, will be found to accompany the growing centralization 
of the industry under monopoly capital. In the coal industry 
it is largely the power of the Steel Trust, the dominant organ- 
ized interest in the coal fields, that makes it possible to carry 
through such a shift without serious struggle among the 
capitalists themselves. Profits from the low-cost fields are 
used to recompense the loss from non-use of invested capital 
in the high-cost areas. It was the final merger of the hitherto- 
competing copper organizations into the Copper Trust, that 
marked the death of the Montana industry. The textile in- 
dustry was finally brought under one single head, both in 
the cotton and wool branches, before the large-scale swing 
to the South took place. The concentration of capital thus 
increases the menace of unemployment to large sections of 
the working class, independently of the general condition of 
industry. 

Increase in Numbers of Working Class 

Another factor, contributing to the growth of unemploy- 
ment, is the increase in the number of industrial workers. In 
the United States at this time, this is occurring inat least 
four ways that demand notice. These are: (1) Immigration; 

(2) Influx of farmers to the cities, due to the agrarian crisis; 

(3) Industrialization of the hitherto agrarian South; (4) Mi- 
gration of the Negroes to the industrial North. 

Immigration is still a large factor, even under the restric- 
tive legislation of the post-war years. It is even more of a 
factor than is shown by the official figures, for there is con- 
stant immigration of Mexican common labor into the United 



States, carried on in an organized fashion, particularly by the 
railroad interests and the Steel Trust, of large numbers of 
workers outside the regular "quota" of immigration. Restric- 
tion of immigration by the capitalist government would cer- 
tainly not be a remedy for unemployment, however, even if 
rigidly carried out, and it is certain that immigration legisla- 
tion is always used as a weapon against the working class 
interests. 

The agrarian crisis has also done its bit directly to swell 
the ranks of the unemployed. Forced off of the land because 
of bankruptcy, literally hundreds of thousands of farmers and 
their families have been driven to the cities to seek work in 
the shops, mills, and factories. Where they have secured 
work, they have forced out some other workers onto the 
streets; while many of them find themselves unemployed and 
unable to get work of any regular kind. 

Industrialization of the South also adds to unemployment 
by increasing the number of workers in industry. Particu- 
larly in the textile industry, where the combination of cheap 
labor with the source of raw materials is so inviting to capi- 
talists, made hungry for large profits by the war, is this true. 
Also in the coal mining industry, the South is being rapidly 
developed, at the expense of unemployment for the workers 
of the North. 

Migration of Negroes from the South, into the basic in- 
dustries, particularly, of the North, is still a factor and prom- 
ises to be so for some time to come. The great reservoir of 
labor contained in the 12,000,000 black men and women of 
the South has barely been touched. With the growing con- 
sciousness of the black workers, their protest against the 
semi-feudal conditions of the South, taken together with the 
desire of Northern capitalists for their services to displace the 
most costly labor of the industrialized white workers, it can 
be expected that Negro migration northward will continue. 

Reform versus Revolution 

When the problem of unemployment is attacked by the 
workers, the fundamental conflict of reformist versus revolu- 
tionary methods and policies come to the forefront, as in 
every other aspect of working class life. Here, as elsewhere, 
the struggle of policy within the working class is between 
class collaboration on the one hand, and class struggle on 
the other. 

10 



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The actual measures that may be put forth from time to 
time for relief of the unemployed workers, in periods of acute 
crisis, by reformists and revolutionists will usually differ in 
this respect, that the reformists will pare down the demands 
to the least that will possibly be accepted by the suffering 
workers. The revolutionists, on the contrary, will always 
fight to make the demands as broad and deep as can possibly 
obtain the mass support of the workers themselves. 

But cutting much deeper than this difference in the ex- 
tent of relief to the unemployment to be demanded from the 
capitalists and their government, is the sharply antagonistic 
nature of the methods of struggle advocated to the working 
masses themselves. The revolutionists call upon the working 
class to organize its own power for struggle against capital- 
ism, while the reformists call upon it to collaborate with capi- 
talism and "come to some working agreement satisfactory 
to both sides." 

The reformistic attitude toward unemployment, as in all 
other vital issues of the labor movement, is the most deadly 
poison. It paralyzes action, or turns it into the blind-alley of 
futile policies which, depending upon a non-existing "com- 
munity of interest" between workers and capitalists, amount 
in practice to a betrayal to the enemy. It divides the workers, 
isolates the employed from the unemployed, and generally 
acts as a buffer between capitalists and workers, to save the 
former from the blows of an aroused working class. Every 
manifestation of reformism in dealing with the unemployment 
problem must be vigorously fought against by the revolution- 
ary workers. 

The revolutionary attitude towards the struggle against 
unemployment is based upon an understanding that the prob- 
lem cannot be solved short of the complete abolition of capi- 
talism. This fundamental truth must be made a major point 
in all of our work among the unemployed, if the best results 
for revolutionary progress as well as practical results for the 
unemployed themselves, are to be achieved. But this does not 
mean that no immediate and realizable demands are to be 
put forward and fought for. On the contrary, the revolution- 
ists must be the most practical of all fighters for immediate 
relief, and tangible bread-and-butter results; for otherwise 
they will be playing into the hands of the agents of the capi- 
talists, the reformists. 

The reformists like to tell the working masses that they 
are "practical" leaders who can gain real benefits for them, 

li ■ 



while the revolutionists are Utopians who ask them to await 
a problematical future revolution before anything practical 
can be done. This is a lie, of course, but it is not enough to 
call it a lie when dealing with the great masses of una wak- 
ened workers. It must be shown to them as a lie, by the revo- 
lutionists taking the lead, in a practical and energetic man- 
ner, in every movement of the workers, employed and unem- 
ployed, for measures of relief for the manifold evils that 
accompany unemployment. 

The Workers Party Program 

A practical revolutionary program for dealing with the 
problem of unemployment was adopted by the Central Execu- 
tive Committee of the Workers Party in March, 1924. It is 
based upon an analysis of the problem, along the lines of the 
foregoing pages, and gives practical direction in tackling this, 
one of the most difficult problems before the revolutionary 
movement today. It should be studied carefully, and the gen- 
eral measures therein outlined should be applied to specific 
problems and to local conditions, with all due allowance to the 
special circumstances. ' 

The tactics of working for and advocating a United Front 
of all working class organizations for the fight against un- 
employment, should be applied oa the widest possible basis. 
This should never, of course, be allowed to obstruct or hamper 
the fullest freedom of action of the Workers Party in any 
action necessary to properly fight for and defend the interests 
of the unemployed workers and of the whole working class, 
nor should it detract from the role of the Workers Party as 
the center of the struggle against unemployment, and the 
most energetic fighters and leaders of every working-class 
movement. 

# * # * 

The Workers Party program on the fight against unem- 
ployment says: 

The Workers Party shall take a leading part in the fight 
against unemployment in all its phases. The following gen- 
eral considerations will guide our participation in such 
struggles: ' 

Unemployment is an inevitable accompaniment of capi- 
talism, and can only be abolished with the abolition of the 
system that produces it. The struggle against unemployment 
must be calculated to enlighten the workers to this fact, with- 

12 






GHWWWWWSffW 



out dampening the ardor of their struggle but rather intensi- 
fying it. To this end, practical sets of demands must be 
formulated and a program of action established, designed to 
weld all manifestations of protest against unemployment 
into a national movement; this must in turn be adjusted to 
each local and industrial situation in a practical manner. 

The slogans and practical actions of the struggle will 
follow two general channels, the political and industrial; they 
will be directed against the Government as the representative 
of the capitalist system, and against the industry and indi- 
vidual employer as the immediate exploiter. These two 
aspects will often be intertwined and interchangeable, but for 
the sake of clarity may be considered separately. They will 
follow the direction of the following slogans: 

Political 

Governmental operation of non-operating industries and 
shops. 

Inauguration of public works. 

Maintenance of unemployed at union rates of wages. 

Nationalization of mines, railroads, and public utilities. 

Abolition of child labor. 

Recognition of and trade relations with Soviet Russia. 

Unemployed insurance administered by the workers. 

Grants for relief from the Government treasuries. 

Industrial 

Industry must be responsible for the maintenance of its 
workers. 

Equal division of work among workers in each industry 
and shop. 

Assessment of employed for the relief of unemployed. 

Establishment of control committees of workers to regu- 
late production and investigate accounts. 

Struggle against the sabotage of employers. 

Unemployment insurance supported wholly by the em- 
ployers and administered wholly by the workers. 
■ ■ ' ^ * * * • • 

In every action the aim shall be to combine the utmost of 

13 



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■w i awpywiin 



political enlightenment with the greatest possible immediate 
struggle. The political nature of the fight against unemploy- 
ment must be developed and strengthened, without carrying 
the immediate struggle so far ahead of the understanding 
of the workers involved as to destroy the mass character of 
the movement. It shall be a major effort to actually obtain 
all possible immediate benefits for the unemployed which 
must then be made the basis for wider demands and more 
intense struggle. The trade unions, all workers' organiza- 
tions, and the unorganized employed workers, must be drawn 
into participation into the unemployed demonstrations and 
actions. The slogan of "Solidarity of interest between em- 
ployed and unemployed," -must be heavily stressed at all times. 

The methods and instruments of action, in the fight 
against unemployment, will include every section of the or- 
ganized labor and revolutionary movements. In all political 
actions of the party, the unemployment issue must be brought 
to the foreground more and more as the crisis develops. The 
issue of unemployment must be raised in all councils, con- 
ventions, and other gatherings of workers or their represen- 
tatives, by proposals for concrete actions, including joint 
committees of trade unions, etc., with the unemployed, 
demonstrations, deputations to legislative bodies with de- 
mands based upon the slogans of the struggle, and in all 
shops and factories by proposals for action uniting the em- 
ployed with those thrown upon the streets. 
* • 

The Workers Party must be made the organizational 
and ideological center for the entire movement. The party 
press must develop an agitational and educational campaign 
on unemployment, giving an increasing amount of attention 
and space to it. Every party committee must make a special 
study of unemployment as it develops in its own particular 
sphere of activity, and must report from time to time to the 
Central Executive Committee. .Workers Party members must 
participate in a leading manner in every action of the unem- 
ployed, giving it direction and consciousness. 

As unemployment develops upon a mass scale nationally, 
which is definitely to be expected in the not-distant future, 
the party must take the lead in stimulating, initiating, and 
organizing councils of the unemployed in co-operation with 
trade unions and other workers' organization, upon a local, 
state, and national basis. 



14 



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Unemployment 

Why It Occurs and How to Fight It. 
By Earl R. Browder. 

Unemployment is steadily growing in the United States. 
Today (in August, 1924) more than two millions of workers 
able and willing to serve society, are denied the opportunity 
to labor, and are thrown upon the streets to starve or to be- 
come beggars or criminals. Each day the industrial crisis 
now developing in America becomes more acute, and con- 
stantly more workers are added to the ranks of the unem- 
ployed. It. seems quite likely, unless some upheaval, such as 
another world war intervenes, that the coming winter will 
witness a more serious crisis than that of 1921, when 
6,000,000 workers were on the streets. 

Causes of Unemployment 

How can the working class fight against this terrible 
9 menace, which threatens untold suffering, misery, and death? 
M Before this question can be answered, it is necessary to study 
■ +\ the problem, in its various parts and as a whole, and under- 
5 i stand the forces at work which create the crises. 

Unemployment is a "normal" phase of capitalist society. 
This fact must be the starting point of any understanding of 
its causes. Always there are a number of workers (larger or 
smaller, accordingly as the period is one of "prosperity" or 
of "depression" or crisis) who are possessed of no means of 
livelihood except the sale of their labor power, and who can 
yet find no buyer for their labor power, who cannot get a job 
who are "unemployed." These workers make up the indus- 



'■•1 



W'i 



•}.? 



--/ 



-r t 



f 



X , . 



trial reserve army, the reservoir of unused labor power that 
the capitalist system creates at the expense of the working 
class, as one of its instruments of exploitation. ; « 

The industrial reserve army is an entirely "normal" part », 
of the capitalist system. It is the starting point of the *" 
process of capitalist production, „ and continually exists and 
functions as an essential part of capitalism, with the excep- 
tion of brief moments, such as a period of general mobiliza- 
tion in war-time. The individual workers who make up this 
"army" change from week to week and month to month, but 
the army itself remains. Unemployment in this form is 
always present, pressing upon the working class, a constant 
threat against individual workers who would demand better 
conditions, and a source of strike-breakers and scabs against 
strikes and other concerted actions. It is estimated that from 
500,000 to 1,000,000 workers are "normally" unemployed in '. 
the United States. 

The industrial reserve army expresses one of the funda- . 
mental contradictions at the very roots of capitalist produc- V 
tion. It is the embodied symbol of the fact that the working ' 
class is an expropriated class, placed in a position of irrecon- 
cilable conflict with the expropriating and exploiting class, 
the capitalist class. It is a fundamental phase of the class 
struggle. 

Periods of unemployment, where extra-ordinarily large 
numbers of workers are thrown- into the so-called industrial 
reserve army by the closing down of factories, mills, and 
mines, are the next development coming out of the regular 
operations of the capitalist system of production. Regularly 
the capitalist system goes through the cycle of prosperity- 
overproduction — crisis — readjustment — prosperity. The period 
of crisis in capitalist production corresponds with the period 
of acute unemployment and suffering for the working class, 
inevitably accompanying capitalism. 

The Normal Cycle of Capitalism 

A propertyless working class, faced by a relatively small 
class of capitalists in possession of the means of production, 
is the starting point of capitalist society. This it is that pro- 
duces the industrial reserve army, a body of workless men, 
waiting to be called into industry to take the place of others 
who, in turn, must take their place in the reserve army. This 
it is, also, that produces the crisis of overproduction, and all 



• -it 



the phases of the consolidation of capital, colonialism, impe- 
rialism, the struggle for the world markets, and finally im- 
perialist wars. 

Propertyless workers, under the lash of unemployment, 
must come to terms with the employing capitalists. What- 
ever these terms may be, they always involve the production 
of a surplus value, over and above the wages pajd to the work- 
ers as the price of their labor power. This surplus value, 
distributed among the members of the capitalist class in 
accordance with the laws of capitalist distribution, in the 
forms of interest, rent, and profit, becomes in its turn the 
starting point of the normal cycle of capitalism: prosperity — 
overproduction — crisis — readjustment — prosperity. 

Surplus value, in its various forms, places a large part of 
the wealth produced in a given period in the hands of the 
capitalist class. A part of this wealth is expended in the 
luxurious and riotous living among the so-called "upper 
classes"; but another, and by far the most significant part 
goes to increase the total capital engaged in production. This 
additional capital must, in its turn, be invested productively — 
that is, it must also be engaged by the propertyless workers, 
in the production of further surplus values. 

This is the dynamic factor in the capitalist system of 
production. It is the source of all the internal and external 
changes, the enormous growth of machine, mass production, 
and the extension and development of the world market, with 
all its attendant conflicts. The increased capital brings the 
employment of a greater number of workers, improvement 
of the means of production, greater volume of commodities 
thrown upon the market. This is the period of prosperity. 

But the greater volume of commodities quickly gluts the 
markets that had been developed in the previous phase of the 
cycle.. The phenomenon of overproduction appears. The capi- 
talists must find new markets, pending which production must 
go through a drastic period of readjustment. When new mar- 
kets have been captured from rival capitalists, or developed 
through the exportation of capital to undeveloped lands, the 
"normal" crisis is overcome, a new period of prosperity be- 
gins, and capitalism starts upon another round of the cycle- 
but upon a new level of world-development. 

The Present Crisis 

The crisis through which the capitalist system of the 
world is now going is, however, of a fundamentally different 

5 



nature from the crisis of the normal cycle of capitalism just 
described, although it is the logical and inevitable outcome of 
their cumulative effects. Prior to the world war, periods of 
depression and unemployment were the incidental accom- 
paniments of the general increase of capitalist production as 
a whole. But the war marked the world-crisis of capitalism, 
where capitalism itself, and not its component sections, had 
reached the limits of its contradictions, had exhausted the 
possibilities of solving these contradictions and entering upon 
a new cycle of upward development. The present world crisis 
is marked by the general decrease of capitalist production as 
a whole. The world war was the beginning of the breakdown 
of capitalism. 

It is not the purpose of this pamphlet to review in detail 
the present world economic crisis. But the larger features of 
the situation are necessary to any sound approach to the 
Question of unemployment. A brief review of these features, 
in Europe and the United States particularly, will bring us to 
the question of means of struggle for the workers. 

In Europe the crisis is accompanied by large-scale deteri- 
oration and destruction of the means of production. Un- 
counted billions of dollars worth of wealth were destroyed in 
the war itself. The "peace" has been more destructive of the 
means of production than the war itself, what with its multi- 
plication of customs-boundaries, its arbitrary partition of 
economically united regions, its occupations, its reparations, 
and its accompanying rivalries, jealousies and fears. The 
machinery of production, the necessary prerequisite to the 
employment of the millions of European industrial workers, 
has been largely destroyed and the destruction is still 
going on. 

The equilibrium between the various factors in the world 
market has been upset and, despite the most energetic efforts 
of capitalism, cannot be restored. This is illustrated in the 
chaos that exists in the exchange values of the various cur- 
rencies. Without a stable basis for exchange, the restoration 
of capitalist production for the world market is impossible. 

The relations between industry and agriculture have been 
upset, with a resulting world-wide agrarian crisis. Prices for 
grain, figured according to the purchasing power of gold in 
1913, have decreased by somewhere between 15% and 25%. 
The result has been a sharp decline in the volume of agricul- 
tural production, curtailment of the agrarian market for in- 
dustrial products, deep discontent and unrest among the 



-agrarian masses, and the consequent intensification of the 
crisis, both in its economic and political phases. 

Another factor of prime importance that prevents the 
capitalist class from overcoming the disorganization of their 
world system, is the break in their lines caused by the success- 
ful revolution of the Russian working class. One-sixth of the 
earth's surface has been taken from under the domination 
of the capitalist class, and is ruled by Soviets of workers and 
peasants. Unable to reconcile themselves to this fact, the 
capitalists have even intensified its economic effects upon thf 
world crisis, by pursuing the policy of blockade, by means of 
which Russia is still kept out of the world market to a certain 
degree. 

In the United States 

The course of the crisis, and consequently of unemploy- 
ment, has differed in the United States from that in Europe, 
according to the different role being played by this country. 
The American capitalist class (personified in the figure of 
J. P. Morgan) profited greatly from the war, as did the capi- 
talists of every other country — but with this essential differ- 
ence, that in America the means of production were injured 
only indirectly and to a much less degree than in Europe. So 
much less, in fact, that American capitalism was able to use 
a period of extensions and replacements just after the war 
for a period of unexampled industrial activity that brought 
American industry to a new high point of productive capacity. 

But if the direct effects of destruction of the means of 
production have not been a large factor in America, the dis- 
location of the world market and the agrarian crisis have 
joined to bring home to the United States the fact that it 
exists within a system that is sick unto death. In 1921-22, 
the United States, while it boasted of the greatest riches of 
the world's history, was forced to admit that 6,000,000 unem- 
ployed workers walked the streets at the same time. And in 
the now developing crisis, with more than 2,000,000 workers 
already unemployed, the United States is feverishly planning 
the subjugation of the European markets through the Dawes 
plan, the conquest of the Asiatic markets through the crowd- 
ing-out of Japan and an understanding with Great Britain, 
and the more intensive exploitation of Central and South 
America. The internal policy to accompany the Morgan plans 
for world-domination, carries with it the corruption and pacir 
fication of the small section of organized and highly skilled 



workers, with the brutal suppression of the masses, and the 
destruction of all effective labor organization. 

Various Phases of Unemployment 

Before passing on from this general industrial and politi- 
cal background of the unemployment problems to the methods 
of fighting, it will be helpful to consider the various conditions 
under which unemployment is manifested in the United 
States. 

In addition to the general unemployment, created by the 
action of the world crisis, various special and local causes 
bring about or accentuate unemployment in particular dis- 
tricts or industries. In treating of any specific unemployment 
situation, it will be found of great value, as an aid to select 
the most effective methods of struggle, to know to what ex- 
tent it is a part of a national and world situation, and to 
what extent it is special and local. 

Take, for example, the coal mining industry. Here is to 
be found the most intense distress and suffering among the 
workers, as a result of widespread and long-continued unem- 
ployment. This condition is being intensified by the present 
crisis, but it existed while "prosperity" was still general, dat- 
ing back to the period immediately after the world war closed 
The special intensity of the unemployment among miners 
finds its roots in the unexampled expansion of that industry 
during the war. When the exceptional demands of the war 
ceased, it was found that coal mining in America had been 
developed to a capacity 40% above the needs of the domestic 
market in times of peace. More than 200,000 miners were in 
the industry, above the number required for this production. 
The capitalists immediately took advantage of this to begin 
shifting production to the low-cost and non-union fields. The 
main burdens of unemployment have thus, in this instance, 
fallen upon the shoulders of the best organized and highest 
paid workers in the industry. And while the industry as a 
whole is in the midst of a most profound crisis, certain low- 
cost, non-union fields are operating" at capacity. 

The copper industry presents a somewhat similar situa- 
tion. This industry was also keyed up to great demands dur- 
ing the war; it is now largely cut off from the European mar- 
kets. To this has been added the fact, that new low-cost 
fields have recently been opened to exploitation, through the 
investment of large sums of capital, which has shifted the 
center of gravity of the industry, and driven tens of thousands 



of copper miners into new fields of labor. Butte, Montana, 
once the center of the copper industry, is now almost a dead 
city. 

Another example of special causes, intensifying the gen- 
eral unemployment, is to be found in the textile industry. 
Like coal mining and copper, textiles are undergoing a shift 
in production from one field to another. In the textile indus- 
try it is a question of average wage standards between the 
North and South, that is stopping the New England textile 
mills, and that throws the bulk of production to the South, 
where child labor and starvation wages rule. The idle textile 
workers in New England see their place being taken in in- 
dustry by a new strata of proletarians, the industrialized "poor 
whites" and Negroes of the hitherto agrarian South. 

Unemployment caused by a shift in the fields of produc- 
tion, will be found to accompany the growing centralization 
of the industry under monopoly capital. In the coal industry 
it is largely the power of the Steel Trust, the dominant organ- 
ized interest in the coal fields, that makes it possible to carry 
through such a shift without serious struggle among the 
capitalists themselves. Profits from the low-cost fields are 
used to recompense the loss from non-use of invested capital 
in the high-cost areas. It was the final merger of the hitherto- 
competing copper organizations into the Copper Trust, that 
marked the death of the Montana industry. The textile in- 
dustry was finally bought under one single head, both in 
the cotton and woo branches, before the large-scale swing 
to the South took piace. The concentration of capital thus 
increases the menace of unemployment to large sections of 
the working class, independently of the general condition of 
industry. 

Increase in Numbers of Working Class 

Another factor, contributing to the growth of unemploy- 
ment, is the increase in the number of industrial workers. In 
the United States at this time, this is occurring in at least 
four ways that demand notice. These are: (1) Immigration; 

(2) Influx of farmers to the cities, due to the agrarian crisis; 

(3) Industrialization of the hitherto agrarian South; (4) Mi- 
gration of the Negroes to the industrial North. 

Immigration is still a large factor, even under the restric- 
tive legislation of the post-war years. It is even more of a 
factor than is shown by the official figures, for there is con- 
stant immigration of Mexican common labor into the United 



States, carried on in an organized fashion, particularly by the 
railroad interests and the Steel Trust, of large numbers of 
workers outside the regular "quota" of immigration. Restric- 
tion of immigration by the capitalist government would cer- 
tainly not be a remedy for unemployment, however, even if 
rigidly carried out, and it is certain that immigration legisla- 
tion is always used as a weapon against the working class 
interests. 

The agrarian crisis has also done its bit directly to swell 
the ranks of the unemployed. Forced off of the land because 
of bankruptcy, literally hundreds of thousands of farmers and 
their families have been driven to the cities to seek work in 
the shops, mills, and factories. Where they have secured 
work, they have forced out some other workers onto the 
streets; while many of them find themselves unemployed and 
unable to get work of any regular kind. 

Industrialization of the South also adds to unemployment 
by increasing the number of workers in industry. Particu- 
larly in the textile industry, where the combination of cheap 
labor with the source of raw materials is so inviting to capi- 
talists, made hungry for large profits by the war, is this true. 
Also in the coal mining industry, the South is being rapidly 
developed, at the expense of unemployment for the workers 
of the North. 

Migration of Negroes from the South, into the basic in- 
dustries, particularly, of the North, is still a factor and prom- 
ises to be so for some time to come. The great reservoir of 
labor contained in the 12,000,000 black men and women of 
the South has barely been touched^ With the growing con- 
sciousness of the black workers, .their protest against the 
semi-feudal conditions of the South, taken together with the 
desire of Northern capitalists for their services to displace the 
most costly labor of the industrialized white workers, it can 
be expected that Negro migration northward will continue. 

Reform versus Revolution 

When the problem of unemployment is attacked by the 
workers, the fundamental conflict of reformist versus revolu- 
tionary methods and policies come to the forefront, as in 
every other aspect of working class life. Here, as elsewhere, 
the struggle of policy within the working class is between 
class collaboration on the one hand, and class struggle on 
the other. 

10 



The actual measures that may be put forth from time to 
time for relief of the unemployed workers, in periods of acute 
crisis, by reformists and revolutionists will usually differ in 
this respect, that the reformists will pare down the demands 
to the least that will possibly be accepted by the suffering 
workers. The revolutionists, on the contrary, will always 
fight to make the demands as broad and deep as can possibly 
obtain the mass support of the workers themselves. 

But cutting much deeper than this difference in the ex- 
tent of relief to the unemployment to be demanded from the 
capitalists and their government, is the sharply antagonistic 
nature of the methods of struggle advocated to the working 
masses themselves. The revolutionists call upon the working 
class to organize its own power for struggle against capital- 
ism, while the reformists call upon it to collaborate with capi- 
talism and "come to some working agreement satisfactory 
to both sides." 

The reformistic attitude toward unemployment, as in all 
other vital issues of the labor movement, is the most deadly 
poison. It paralyzes action, or turns it into the blind-alley of 
futile policies which, depending upon a non-existing "com- 
munity of interest" between workers and capitalists, amount 
in practice to a betrayal to the enemy. It divides the workers, 
isolates the employed from the unemployed, and generally 
acts as a buffer between capitalists and workers, to save the 
former from the blows of an aroused working class. Every 
manifestation of reformism in dealing with the unemployment 
problem must be vigorously fought against by the revolution- 
ary workers. 

The revolutionary attitude towards the struggle against 
unemployment is based upon an understanding that the prob- 
lem cannot be solved short of the complete abolition of capi- 
talism. This fundamental truth must be made a major point 
in all of our work among the unemployed, if the best results 
for revolutionary progress as well as practical results for the 
unemployed themselves, are to be achieved. But this does not 
mean that no immediate and realizable demands are to be 
put forward and fought for. On the contrary, the revolution- 
ists must be the most practical of all fighters for immediate 
relief, and tangible bread-and-butter results; for otherwise 
they will be playing into the hands of the agents of the capi- 
talists, the reformists. 

The reformists like to tell the working masses that they 
are "practical" leaders who can gain real benefits for them, 

ai 



while the revolutionists are Utopians who ask them to await 
a problematical future revolution before anything practical 
can be done. This is a lie, of course, but it is not enough to 
call it a lie when dealing with the great masses of unawak- 
ened workers. It must be shown to them as a lie, by the revo- 
lutionists taking the lead, in a practical and energetic man- 
ner, in every movement of the workers, employed and unem- 
ployed, for measures of relief for the manifold evils that 
accompany unemployment. 

The Workers Party Program 

A practical revolutionary program for dealing with the 
problem of unemployment was adopted by the Central Execu- 
tive Committee of the Workers Party in March, 1924. It is 
based upon an analysis of the problem, along the lines of the 
foregoing pages, and gives practical direction in tackling this, 
one of the most difficult problems before the revolutionary 
movement today. It should be studied carefully, and the gen- 
eral measures therein outlined should be applied to specific 
problems and to local conditions, with all due allowance to the 
special circumstances. 

The tactics of working for and advocating a United Front 
of all working class organizations for the fight against un- 
employment, should be applied on the widest possible basis. 
This should never, of course, be allowed to obstruct or hamper 
the fullest freedom of action of the Workers Party in any 
action necessary to properly fight for and defend the interests 
of the unemployed workers and of the whole working class, 
nor should it detract from the role of the Workers Party as 
the center of the struggle against unemployment, and the 
most energetic fighters and leaders of every working-class 
movement. 

# # # # 

The Workers Party program on the fight against unem- 
ployment says: 

The Workers Party shall take a leading part in the fight 
against unemployment in all its phases. The following gen- 
eral considerations will guide our participation in such 
struggles: 

Unemployment is an inevitable accompaniment of capi- 
talism, and can only be abolished with the abolition of the 
system that produces itt The struggle against unemployment 
must be calculated to enlighten the workers to this fact, with- 



out dampening the ardor of their struggle but rather intensi- 
fying it. To this end, practical sets of demands must be 
formulated and a program of action established, designed to. 
weld all manifestations of protest against unemployment 
into a national movement; this must in turn be adjusted to 
each local and industrial situation in a practical manner. 

The slogans and practical actions of the struggle will 
follow two general channels, the political and industrial; they 
will be directed against the Government as the representative 
of the capitalist system, and against the industry and indi- 
vidual, employer as the immediate exploiter. These two 
aspects will often be intertwined and interchangeable, but for 
the sake of clarity may be considered separately. They will 
follow the direction of the following slogans: 

Political 

Governmental operation of non-operating industries and 
shops. 

Inauguration of public works. 

Maintenance of unemployed at union rates of wages. 

Nationalization of mines, railroads, and public utilities. 

Abolition of child labor. 

Recognition of and trade relations with Soviet Russia. 

Unemployed insurance administered by the workers. 

Grants for relief from the Government treasuries. 

Industrial 

Industry must be responsible for the maintenance of its 
workers. 

Equal division of work among workers in each industry 
and shop. 

Assessment of employed for the relief of unemployed. 

Establishment of control committees of workers to regu- 
late production and investigate accounts. 

Struggle against the sabotage of employers. 

Unemployment insurance supported wholly by the em- 
ployers and administered wholly by the workers. 

^ * w w 

In every action the aim shall be to combine the utmost of 

13 



political enlightenment with the greatest possible immediate 
struggle. The political nature of the fight against unemploy- 
ment must be developed and strengthened, without carrying 
the immediate struggle so far ahead of the understanding 
of the workers involved as to destroy the mass character of 
the movement. It shall be a major effort to actually obtain 
all possible immediate benefits for the unemployed which 
must then be made the basis for wider demands and more 
intense struggle. The trade unions, all workers' organiza- 
tions, and the unorganized employed workers, must be drawn 
into participation into the unemployed demonstrations and 
actions. The slogan of "Solidarity of interest between em- 
ployed and unemployed," must be heavily stressed at all times. 

The methods and instruments of action, in the fight 
against unemployment, will include every section of the or- 
ganized labor and revolutionary movements. In all political 
actions of the party, the unemployment issue must be brought 
to the foreground more and more as the crisis develops. The 
issue of unemployment must be raised in all councils, con- 
ventions, and other gatherings of workers or their represen- 
tatives, by proposals for concrete actions, including joint 
committees of trade unions, etc., with the unemployed, 
demonstrations, deputations to legislative bodies with de- 
•mands based upon the slogans of the struggle, and in all 
shops and factories by proposals for action uniting the em- 
ployed with those thrown upon the streets. 

The Workers Party must be made the organizational 
and ideological center for the entire movement. The party 
press must develop an agitational and educational campaign 
on unemployment, giving an increasing amount of attention 
and space to it. Every party committee must make a special 
study of unemployment as it develops in its own particular 
sphere of activity, and must report from time to time to the 
Central Executive Committee. Workers Party members must 
participate in a -leading manner in every action of the unem- 
ployed, giving it direction and consciousness. 

v As unemployment develops upon a mass scale nationally, 
which is definitely to be expected in the not-distant future, 
the party must take the lead in stimulating, initiating, and 
organizing councils of the unemployed in co-operation with 
trade unions and other workers' organization, upon a local, 
state, and national basis. 

14 



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