The GOP’s Unemployment Freakout & Supply Side Economics

The GOP freakout about the supposed pressure COVID-related spending is putting on the job market is, of course, telling. In fact, the last COVID relief package is turning into a sorta reverse-engineered “proof of concept” that’s demonstrating once and for all (as if we need more evidence) that the wealth-hoarding system of Supply Side economics depends upon manipulating and impoverishing the labor market to the point that wage earners (in the world’s wealthiest economy) are forced to accept less and less while, at the same time, they’re expected to be increasingly more productive.

The truth of this “bargain” has been laid bare by the possibility that the extension of relatively meager unemployment benefits (vis-à-vis the top 5, 2 and 1% income tiers) is somehow dissuading workers from returning to their “working poverty-level” wages. If true, the fact that a paltry $300 per week could actually be enough to keep people from reentering the service economy only highlights the brutal logic that’s powered the wealth hoarding machine called the US economy. And if true, it reveals the rationale behind a fifty year-long strategy of dismantling the “social safety net,” gutting collective bargaining, culling defined benefit pension plans, plundering the social security trust fund and a “no-matter-the-human-cost” refusal to extend universal healthcare.

By turning the labor market into a survival of the fittest struggle that pits workers against each other in a life or death competition for an ever-diminishing pool of wages, resources and benefits, the Supply Siders “fixed” the post-WWII “problem” of increasingly shared and, compared to the last forty years, surprisingly well-distributed wealth. That post-war blip put more money, aka power, into the Demand Side of the economy. The Supply Siders didn’t like that. So, once they took control in 1981, they realigned the power balance heavily in favor of those who control capital (the Supply Side of the economy). That, in turn, transformed the power balance in favor of finance, turned the stock market into a casino, turned debt into an exotic commodity, turned a manufacturing economy into a service economy and turned the boom-and-bust business cycle into perpetual wealth hoarding machine.

These shifts toward an ever-more financialized economy, along with outsourcing and automation and the downgrading of a high school education (to the point that a college education is now the entry point into the middle class … and an unguaranteed one at that), drained economic power out of the hands of workers on the Demand Side of the economy. That, in turn, allowed the Supply Side to demand massive growth in US worker productivity without having to increase compensation in any appreciable way … it even allowed them to force workers into forfeiting health care and pension benefits in an effort to keep the stagnant wages they had.

Not coincidentally, Supply Siders were eager to make up the shortfall between their low compensation and the consumer aspirations they sold through advertising, Not through wages, but through consumer credit, which spiked along with the wealth gap throughout the 80s and 90s. With the Supply Side in command of the economy, the economy became a giant “company store,” working Americans became debt slaves and their debt became exotic financial instruments the Supply Siders packaged and traded amongst themselves …. and, sometimes, they even sold it back to the Demand Side in the guise of “investments.” Those investments were often in lieu of the defined benefit pensions the Supply Side was busily dismantling.

But now the proposition that a mere $1200 more per month can derail the service-driven economy not only pulls back the curtain on the Supply Side economy, it rips it from the rod and tosses the theoretical justifications for Supply Side-ism into the dumpster fire of history. That “conservative” GOP Governors want to “opt out” of the additional benefits in an effort to force the servants in the servant economy back into the workplace only underlines the “bottom line is the only line” thinking that’s masqueraded as governance for the last forty years.

Add to that the refusal to accept the ACA’s Medicaid money by a bloc of GOP-dominated Southern States, and you can see the reason why these states are populated with people who see government as the enemy. It certainly isn’t their friend. And now, on top of the Republicans’ refusal to extend the healthcare to the working poor in these Southern states since the ACA was passed, they are shielding them from the terribly underreported expansion of ACA subsidies included in the last COVID relief package. It was a huge infusion of assistance that, at least in California, allows wage earners above the poverty line to get healthcare for as little as $1 per month. That, in turn, frees up capital for the Demand Side of the economy … putting more money in the hands of those who’ve had to use those hands to fight and scratch for nickels to pay for healthcare their employers often don’t provide.

Instead of funding the Demand Side of the economy, many states and the politicians who run them offer the bitter salves of cultural warfare and divide-and-conquer racism … and, thanks to Surveillance Capitalists, the American dream has been replaced with a petty online celebrity nightmare where we chase the attention of others to accumulate “likes” and heart emojis instead of accumulating the individual and collective power that comes from the acquisition of real wealth by those on the Demand Side of the economy. With that wealth comes the power to make real economic demands on the market and real political demands on the Supply Side of the economy. Remember, money is speech. The more money you’ve got, the more speech you can afford … and vice versa.

Liked it? Take a second to support jpsottile on Patreon!


'The GOP’s Unemployment Freakout & Supply Side Economics' has no comments

Be the first to comment this post!

Would you like to share your thoughts?

Your email address will not be published.