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Labor Day—what is it? Perhaps not many Americans any longer know, so here is my explanation.

In my time Labor Day was the unofficial end of summer, because school began after Labor Day.

Today school begins almost a month before. When I was in school that would not have been possible, especially in the South. The schools were not air-conditioned. If school had started in August no one would have showed up. It was difficult enough getting through May before school was out in June.

As most Americans probably thought of Labor Day as the last summer holiday, now that Labor Day has lost that role, what is Labor Day? The holiday originated as an apology capitalists tossed to labor to defuse a standoff.

Workers understood that labor was the backbone of the economy, not Wall Street moguls or bankers in their fine offices. Workers wanted a holiday that recognized labor, thus elevating labor in public policy to a standing with capital. Some states created labor day holidays, but it wasn’t until 1894 that Labor Day was made a federal holiday.

Congress created the federal holiday in response to the murder of strikers by US Army troops and federal marshalls during the Pullman strike of 1894. The factory workers who built Pullman railway cars lived in the company town of Pullman. George Pullman provoked a strike by lowering wages but not the rents charged in the company town.

President Grover Cleveland relied on Attorney General Richard Olney to restore capitalist control. Olney, a former railway attorney, sent in the federal violance to break up the strike. Olney still received a retainer from his railway company that was larger than his salary as US Attorney General. So we know whose side he was on. The presstitute media portrayed the beaten down strikers as unpatriotic foreigners, and the strike leader, Eugene Debs, was sentenced to federal prison. The experience radicalized Debs and turned him into a socialist.

The obvious injustice created more sympathy for labor than capitalists could stomach, so Congress defused the situation by creating Labor Day. President Cleveland washed his hands of the blood on them by signing the legislation.

Officially what we are celebrating on the first Monday of September is American labor, but what is really being celebrated is the success of capitalists again flummoxing the people and avoiding a real social revolution.

The labor movement, which gave us Labor Day, is no longer with us. The American labor movement died about ten years after the death of its most famous leader, George Meany of the AFL-CIO. Meany, born in 1894, died in 1980.

I remember when labor was at the center of politics and policy. There was even a field of economics called “labor economics.” The political influence of labor ended with the offshoring of US industrial and manufacturing jobs. For years US capitalists tried to avoid a fair shake for labor by locating their facilities in Southern states that had right to work laws. But with the collapse of the Soviet Union and the change in attitude of India and China toward foreign capital, capitalists learned that they could increase profits by using foreign labor offshore to produce the goods and services that they sold to Americans. The difference in labor costs flowed directly into profits, executive bonuses, and shareholder capital gains.

Free market economists, who live in a make-believe world, pretend that the lower labor costs flow into lower US consumer prices and that consumers beneift despite the loss of well-paying jobs. The problem with free market economics is that a priori reasoning takes precedence over empirical fact. For free market economists, the way the world should be prevails over the way that the world actually is.

As a consequence of jobs offshoring, industrial and manufacturing cities became semi-ghost towns with declining populations. Municipal and state governments, deprived of tax base, found themselves under duress to make pension payments. To avoid immediate bankruptcy, cities such as Chicago sold off public assets such as 75 years of parking meter revenues for a one time payment.

The Democratic Party, which had been the countervailing power against the Republican business party, was deprived of union funding as the jobs that paid union dues were no longer in America. By moving production offshore, capitalists turned the Democrats into a second capitalist political party dependent on funding from the business sector.

Today we have one party with two heads. The competition between the parties is about which party gets to be the whore for the capitalists for the next political term. As Democrats and Republicans swap the whore function back and forth, neither party has an incentive to do anything different.

The offshoring of high productivity, high value-added US jobs has destroyed the labor movement. How much luck will labor leaders have organizing people who hold part-time jobs as waitresses, bartenders, hospital orderlies, and retail clerks? As I have pointed out for years in
my reports on the monthly payroll jobs reports, the United States now has the labor profile of a Third World country. The absence of jobs that can support an independent existence and family life is the reason that more Americans aged 24-34 live at home with parents than live independently. The absence of jobs is the reason the labor force participation rate has declined for years. The absence of jobs that pay sufficiently to provide discretionary income is the reason the economy cannot grow.

Looking at last Friday’s BLS payroll report, the jobs are in the lowly paid, part-time service sector. The goods producing sector of the economy lost 24,000 jobs. The jobs are in retail trade, health care and social assistance, waitresses and bartenders, and government which is tax supported employment.

ORDER IT NOW

Whether Washington policymakers realize it or not, the American work force smells like India’s of a half centruy ago. Whatever deranged Hillary and her neoconservatives claim, there is no evidence in the compositon of the US labor force that the US is a superpower. Indeed, what the employment statistics show is that the United States is a third world country, a country whose leaders are so out of their minds that they are picking fights with first world countries—Russia and China.

The United States of America is on its last legs. As there is no willingness to recognize this, nothing can be done about it. America’s last function is to cause World War 3 in which all of us will expire.

(Republished from PaulCraigRoberts.org by permission of author or representative)
 
• Category: Economics • Tags: Free Trade, Labor Day, Unemployment 
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  1. American Governments have been in favour of Free Trade ie Globalisation since at least the 1950s. This is the root cause of America’s economic troubles. The Kennedy Round of Gatt brought Free Trade to fruition in the late 1960’s.Real Full time wages for American workers peaked in 1973. Real median wages are now less than three-quarters of what they were in 1973.
    You were a member of the American Government in the 1980s, yet you have never publicly apologised then or now for your support for these disastrous globalisation policies.
    You really are a two-faced turd.

    • Replies: @landlubber
  2. @Verymuchalive

    You are a Verymuchaturd.

    During his government tenure PCR was focused on a policy of lowering marginal tax rates in the US with the intent of spurring investment in US enterprises. This policy was implemented, but of course, other policies (such as deficit-financed spending on new military programs) were implemented in the same time frame. So a legitimate criticism of PCR might question whether supply-side economics or other factors brought about the lowering of inflation and unemployment in the mid-1980s.

    • Replies: @Verymuchalive
  3. Thanks for a nod in labor’s direction. I remember big union picknicks on Labor Day with beer and hot dogs and soft ball and swarms of kids running everywhere. We were prosperous and respected. It changed quickly after Bill Clinton kicked us to the curb to curry favor with the bosses. It’s been one party rule ever since and the working class has no friends in Washington.

  4. Anon • Disclaimer says:

    I don’t understand this sentence:

    Olney, a former railway attorney, sent in the federal violance to break up the strike.

    Is violance a contraction of two words?

    • Replies: @LuckyRetired
  5. @landlubber

    An Aunt Sally argument, landlubber, and you know it. It completely fails to answer my complaint.
    Free trade policies have been in place since the late 1960s. The Reagan administration, including Dr Roberts, continued to support these policies. The effects of such policies were abundantly manifest even then: massive import penetration by foreign competitors, closure of whole sectors of industries, rapidly rising unemployment in manufacturing and spiralling trade deficits.
    Dr Roberts has since dropped his support for Free Trade policies, but, as far as I know, has never apologised for his part in helping to implement them. He has never said, ” Sorry, I was wrong,” or ” It is the thing I most regret in my professional career.”
    Dr Roberts, a little humility will go a long way.

    • Replies: @John Jeremiah Smith
  6. MEexpert says:

    Thank you Dr. Roberts for an enlightening article.

    When it becomes profitable to outsource the workings of the US government the congress will do so. Then the President and the congress can stay home and collect their paychecks and enjoy the labor day and other federal holidays.

    The slogan “God Bless the United States” will change to “God Help the United States.”

  7. @Verymuchalive

    Dr Roberts has since dropped his support for Free Trade policies, but, as far as I know, has never apologised for his part in helping to implement them.

    Why do you phonies always demand apologies from people who speak out about the current situation? It seems more like active effort on your part to squeeze some degree of attributed ill-repute to some one who says what needs saying.

    I rather suspect WE should demand an apology from 5th-column assholes like yourself, who are dedicated to the oligarchic evil. Nothing you wrote is relevant to September 2016, but I do thank you for the opportunity to call you out on your simpering backbiting. You are yet another tool of neo-feudalism.

    Please, trumpet your ordure more loudly.

  8. @Anon

    Obviously a typo; surely should have been violence.

  9. @John Jeremiah Smith

    You obviously haven’t bothered to read what I typed, you arrogant ignoramus.
    Free Trade, aka Globalisation, has been detrimental for the vast majority of Industrialised states and for America and a number of others, it has been absolutely disastrous. These catastrophic effects have been apparent from the 1980s if not the 1970s. I was a student of Economic History at the time, late 1980s, and I have been an opponent of Neoliberalism ever since.
    I am very pleased that Dr Roberts no longer supports Free Trade. Many of his articles attacking Neoliberalism have been very well written. However, the elephant in the room is that he was a member of a government that implemented Globalisation policies in the 1980s. Then as now, the effects were disastrous for Americans.
    You can quibble that he was a minor official and was employed for only a short time. But EMPLOYED he was. Dr Roberts admits that Neoliberalism is a thoroughly malign policy. He should be man enough to admit his failings and apologise for his tainted conduct as a government official.

    • Replies: @John Jeremiah Smith
  10. @Verymuchalive

    You obviously haven’t bothered to read what I typed, you arrogant ignoramus.

    Quite the contrary, it was quite easy to understand what you typed. You focused on excoriating someone for now-irrelevant events of 30 years past. That is, you gave us a classic demonstration of arrogant backbiting, failing utterly to address the actual issues raised by the essay.

    So, kiss my ass.

  11. ” now-irrelevant events of 30 years past”
    Very few people are members of a government who implement policies which 30 years later they then diametrically oppose, without even mentioning that they were members of that government or apologising for doing so.
    You haven’t answered my point, nor has Dr Roberts. Your resort to personal vituperation indicates the weakness of your case

  12. bluedog says:
    @Verymuchalive

    In reality who really gives a rats ass about what happened 30 years ago, for it seems you are trying to steer the discussion into a personal direction rather than a constructive one which far to many try and do.!!!

  13. @Verymuchalive

    Your resort to personal vituperation indicates the weakness of your case

    No, vituperation has no effect on validity of a case made or not made. What a surprise that you don’t know that, eh?

    Buh-bye.

  14. @bluedog

    In reality who really gives a rats ass about what happened 30 years ago, for it seems you are trying to steer the discussion into a personal direction rather than a constructive one which far to many try and do.!!!

    Yes, misdirection is a common means of diverting from relevant issues. In 2016, in context, after reading Roberts’ article ref. “Labor Day”, what conceivable relevance does it have to dissimilar events of 1986?

    None.

  15. Edd Baker says:

    Labor Day is, and always has been in my lifetime, just a long weekend for those whose employers observe it as a long weekend with a paid Monday off. Those who got this paid holiday during my life as a worker were government employees and union workers. Everyone I worked with simply showed up for work on that Monday.

    The standard jibe at people who wanted that Monday off was, “On Labor Day we labor”. That was because we wouldn’t get a paid day off if we didn’t show for work and might not have a job on Tuesday if we left our crew short-handed on Monday. Labor day has always been for do-nothing assholes, in my view. I kind of expect Roberts to wax rhapsodic about any progressive inspired historical perspective, since he’s a leftist.

    • Replies: @Orville H. Larson
  16. @bluedog

    Whether or not your comment is apropos to the current conversation, the American philosopher Santayana has a rather famous remark concerning your attitude that you might wish to consider.

  17. The natural date for the USA’s Labor Day would have been May first, when most European workers expressed solidarity with one another and which eventually became an official holiday celebrating working men in most European countries. My understanding is that the date of the US holiday was deliberately chosen to alienate US workers as much as possible from their unionist, socialist and communist comrades.

  18. @Edd Baker

    ” . . . Labor day has always been for do-nothing assholes, in my view. . . .”

    Thanks for your opinion, Mr. Baker. Clearly, you’re a blunt-spoken fellow!

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