from john passant ….

Two items I read today got me thinking, again, about the Abbott government’s ongoing war on social services. Whether it be the low paid, the sick, the unemployed, the disabled, students, pensioners, or Aborigines, to name a few, the Abbott government is unleashing a war on those whom the community supports in some form.

Why?

These attacks are part of a pattern of global attacks by ruling classes, as Allen Myers makes clear in an excellent article called ‘A worldwide attack on social welfare’.

The reason can be found in something Rick Kuhn wrote on Facebook in response to the Bank of International Settlements warning that low interest rates may generate the next financial crisis. He said:

The clearing house for central banks points out that neither increased government spending nor printing money (to which austerity could be added) have restored healthy economic growth and that low interest rates have encouraged another speculative bubble. The underlying problem remains low rates of profit, a consequence of capitalism’s own success in increasing the productivity of human labour.

Marx identified the tendency of the rate of profit to fall as the dagger at the heart of capitalism. The more successful individual capital is, the more of a problem it produces for capitalism. Labor is the sole source of value. The drive for more profit over competitors sees as a generalisation more and more profit reinvested in capital compared to capital at a greater rate than increases in value extracted from workers. Profit rates fall.

There are counteracting factors to this tendency. Many of them are at work today. Lengthening the working day is one, and that is certainly happening in Australia and elsewhere. Cutting the share of national income going to labour and increasing the share going to capital is another, and that too has been happening over a long period of time in Australia. Cutting real wages is another and that has happened at times over the last 3 decades in Australia, most spectacularly under the Hawke and Keating Labor Governments and the Accord.

Much of the manoeuvring of this Abbott government has been to put greater downward pressure on wages. Dumping the unemployed off the dole for six months, forcing the disabled to work, increasing the pension access wage to 70 are all about forcing desperate people to work for lower wages and drag down other wage rates or slow their increase. Sacking tens of thousands of public servants throws many onto the rubbish bin of unemployment and that too puts downward pressure on wages as more workers compete for fewer jobs.

Another is to cut taxes (on both capital and if needed on workers, but I don’t have the time to go in depth to go into the arguments here.) This frees up more surplus value to be distributed in the form of profits, interest and the like to capital rather than in taxes to the State, and puts less pressure if taxes on workers are cut for capital to pay increased wages.

With less revenue, the State winds back its spending on social services, be they direct payments to the working class (e.g. the dole, disability support pension, family tax benefits, youth allowance) or indirectly through cuts to public services like health, education and transport and support systems like Aboriginal support services, women’s refuges, pensioner concessions, and on and on it goes.

That is why the attacks on the poor, the low paid, the disabled, the unemployed, pensioners, students, Aborigines and others are a class issue which requires a class response.

That is why I say the best way to fight back is stop work to stop the bosses’ budget.

Bust the budget rallies are being held across Australia this coming Sunday, 6 July. Make them the first step in a major industrial campaign to stop Abbott attacking us and to send a warning to Labor to abandon its attacks on us when it is in government.

Why the attacks on the disabled, pensioners, the low paid, the unemployed, students, the sick, Aborigines…?