Capitalism chokes on its own production

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to the explanation offered by Karl Marx. The fundamental contradiction of capitalism, Marx pointed Financial institutions around the world are in trouble. out, is that between the growth of the productive forces In 1986, the 25 largest U.S. banks were forced to write and the restrictive forms of capitalist property relations. off over 1 percent of their total loans. This is nearly four This inevitably leads to overproduction, which in turn times the 1981 rate of 0.29 percent—itself a post- causes unemployment. The full-time equivalent of a halfbillion people worldwide are unemployed today.

In 1980, 217 banks were on the U.S. government's Overproduction does not mean that more is produced list of financially troubled "full service" institutions. At than is necessary to meet human needs. Rather, more the latest count, some 1500 banks graced the roll-10 commodities are produced than can be sold at a profit on percent of U.S. banks, with the list growing at the the world market. At the same time, human needs are not As of mid-November, 125 U.S. banks had failed since Indeed, since the 1960s, overproduction has assumed the start of 1986, another post-Depression high. The gigantic and generally growing proportions throughout figures do not include limited-service banks such as the capitalist world. In 1984, the last year for which savings and loans, or non-federally insured banks-which reliable figures are available, 33 percent of the total The total debt owed to capitalist institutions worldwide Not a single industry group reached even 85 percent of at the end of 1985 amounted to a massive $8 trillion, capacity; several were below 60 percent. Construction, mining, and materials-handling machinery recorded 48 When asked why their factories were operating below What is happening? After all, didn't 1986 mark the capacity, 89 percent of plant managers cited "insufficient fourth year of a capitalist "economic recovery?" orders" as the most important reason. That is, To understand the problem, one must ultimately turn The problem is hardly limited to the United States.

Four years ago, some two dozen industries in Japan were classified by the government as "structurally depressed" 2nd National Convention: because of overproduction. The list has been growing "The Coming Working Class Fightback rapidly, especially in the past year. Among affected industries are chemicals, textiles, shipbuilding, and Eighty percent of Japan's aluminum industry has been 3435 Army St., Rm. 308, S.F. CA 94110 idle since 1974. In 1985, the brand-new Brazilian steel industry was operating below 40 percent of capacity. The 2 SOCIALIST ACTION FEBRUARY 1987 By W.I. MOHAREB Depression high.

extraordinary rate of one a day.

are generally in worse shape.

with "de facto" defaults growing rapidly.

Crisis of overproduction Available Now! Political report from our in the United States" 25 cents (includes postage) met. percent of capacity.

overproduction. lumber. practical U.S. capacity lay idle.

An international crisis below 25 percent of capacity.

cooking fuel. idle today.

to repay principal and interest. fundamental contradiction. Fund, and their local agents. profits of a few.

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Euphoria has gripped Wall Street as the stock market reaches historic highs, economic indexes turn upward, and headlines speak of a fifth year of recovery. Other headlines, however, suggest the darkest days of the Great Depression.

"General Motors will shed 27,000 workers." "Gemco Stores closing: will lay off 4000." "Bank of America lays off 5000; expects 5000 more to go." For the last decade stories of plant closings, retrench -ments, and layoffs have sent ripples of fear through all corporate levels from the executive suite down to the shop floor.

No one's job is safe, as rumbles of impending change shake up even the most solidly established enterprises. A number of scenarios playing in the business world today can lead to workers being thrown on the industrial scrap heap long before their productive years are over.

The rust bowl of the Midwest is one such scenario. Steel mills with obsolete equipment cannot compete with newer foreign plants. Mill owners choose to shut down and move their capital elsewhere rather than reduce profits. The thousands laid off have no hope of getting another job at comparable wages.

Layoffs have a ripple effect throughout the community. When 20,000 steel workers in East Chicago were laid off, another 10,000 jobs in the community were lost within a year. Nationally, about INDUSTRY UNEMPLOYED SOCiALiST ACtiON ..re educate relocate.

it's computers, son!

The Jobs are in high tech!

HIGH TECH UNEMPLOYED in think, hamhamm Trench tries, murmun wages, son! The Jobs are in fast food!