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Ernest Lund

The Layoff Is the Payoff!

(27 August 1945)

From Labor Action, Vol. IX No. 35, 27 August1945, pp. 1 & 2.
Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

As peace “broke out” last week, it found those who had planned war production schedules to the minutest detail without all-around plans for full peacetime production and employment.

The winning of the war was considered essential enough to have central planning and control over production, materials, contracts, etc. The providing of full employment, however, is being left to the profit incentive of “free enterprise” corporations.

It seems to be the consensus of opinion on the part of government, business and labor economists that the reconversion period will last for the next six to eight months. During this period, retooling, shortage of certain materials, relocation of workers and similar problems will continue to make for an unstable economic situation. Estimates vary on the number of unemployed duringthis period from five to seven million. This figure will, of course, be vitally affected by the number of men released from the armed forces during these months.

The editorial spokesmen for big business see this reconversion period being followed by a “boom,” based on stabilizing unemployment around the six million mark and drawing upon the accumulated savings of the war period for purchasing power.

This “official” outlook, however, errs in two important respects:

  1. It does not allow for the rapid absorption of some eight million servicemen who may be released at the peak rate of one million a month next spring. This number will have to be released if the armed forces are to be reduced to four and a half million within a year.
  2. This outlook banks far too heavily upon the inclinations of workers to make ready and steady expenditures on the basis of bank accounts and bonds. It fails to note that the degree to which workers will draw upon their savings to invest in cars, radios, washing machines, furniture and other articles of consumption will depend directly upon their own prospects for staying on the job. The purchasing power will be tapped only when the people have a feeling of economic security based upon a regular and dependable pay check.

The New York Times of August 19 presents a graph which predicts eight million unemployed next spring. These eight million, together with some five million still in the armed forces at that time, will total thirteen million men and women outside of the market as consumers of the things that make industry run. These thirteen million unemployed and misemployed compare with the official figure of 10.2 million unemployed in 1939. (In 1939 the armed services contained considerably less than a million.) If we had a continuing depression in 1939 with 10.2 unemployed, can we expect a “boom” on the basis of eight million unemployed and five million service men remaining removed from direct consumption?

It begins to appear that all those factors which the capitalist spokesmen point to as the basis of the boom, like great consumer needs, accumulated savings, etc., will serve merely to cushion the worst blows for a year or so. These factors will stave off during 1946 the full effect of capitalist crisis with its mounting unemployment figures that may reach over the twenty million mark two years from now.

Capitalism is still capitalism. The ten long years of depression from 1929 to 1939 were no mere accident. They were the death throes of a sick and dying economic system. The war has not cured the economic ills of capitalism. It merely cured the paralysis of depression with the fever of mass destruction. But more, the wartime production has speeded up the development of labor-saving devices so that each worker produces more today than he did before the war. When the chill of depression again settles over capitalism, it will prove more deathly than in the past.

That “free enterprise” will not give us sixty million jobs most every worker understands. However, sober reflection will reveal that “free enterprise” cannot operate for any length of time on “stabilized” unemployed of eight million. Perhaps for a year it will succeed in warding off the worst. But then the deluge. Just as the invention of the atomic bomb makes socialism the imperative necessity if mankind is to survive, so the economic catastrophe that threatens us makes socialism likewise imperative if we are not to become a nation of twenty-five million employed, twenty million unemployed and five million soldiers and sailors, that is, a nation where half work long hours at miserable pay in order to pay the taxes for keeping the other half on the dole and in the armed forces.

The Workers Party, proposes its own program for reconversion which appears elsewhere in this issue. But readers of Labor Action must know that these can only be the first necessary steps. They can serve as the bridge toward what must become the final solution – planned production for use on the basis of a socialized economy. The working class must take over political power through a workers’ government. The workers’ government must take over and operate industry through the workers committees and trade unions.

”Let the workers own the government and let the government own the industries.” That is the heart of socialism. No worker who understands this issue has the right to stand aside. Into the ranks of the Workers Party! Into the fight for socialism!

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Last updated: 14 December 2017