Middle Class Economics and the Industrial Reserve Army

During his State of the Union address, President Obama coined the term “middle class economics.” Days later a blog post appeared on the Huffington Post further explaining what he meant. He opened by asking

“Will we accept an economy where only a few of us do spectacularly well? Or will we commit ourselves to an economy that generates rising incomes and rising chances for everyone who makes the effort?”

These two generalized questions demonstrate our economic and political discourse. He softly recognizes that the wealthiest 20% people in the country own 85% of the wealth and resources. If the economy does not change, they will continue to increase their wealth. Additionally, he insinuates that if one works hard that our government and capitalist economy will assure that one is rewarded with by her or his efforts. Yet, those President Obama missed in his address are ‘the industrial reserve army’ and those who work hard at several part-time jobs making minimum wage only to scrape by. Karl Marx describes this underclass as a symptom of capitalism.

The economy in capitalism must grow and multiple or it cannot survive. Marx in the Communist Manifesto described that capitalists continually must revolutionize their technology, labor, and other modes of production to make a higher profit. As well, competition among businesses is often a zero-sum game with larger companies absorbing smaller ones. In this way, “the big capitalists grow bigger and fewer.”* For example, in the US, two cable companies, Time Warner Cable and Comcast, dominate one’s ability to access the Internet. Like wayward lovers, they’ve created territories with what city each one can occupy. As a result, the underclass suffers as these companies gain more business.

Marx wrote that the finished is not the only commodity, but also the labor of the worker. He would go on to theorize this as the fetishization of commodities. And as capitalism forcibly travelled around the world, it exponentially created more commodities. Call centers were set up in India providing customer service and paying workers small wages. Sweatshops landed in Malaysia, Indonesia, China, and Bangladesh providing slave wages for the underclass and children (in those countries who turn an eye away from this horror). Answering phone calls half way round the world, sowing fashionable clothes by people who cannot afford to wear them, and child labor became commodities within the last fifty years. And these all affect the lower classes.

Karl Marx wrote on, systematized, and enlightened the world when he described the destructive nature of capitalism, yet few listened. Today’s discourse of middle class economics blatantly ignores the industrial reserve army. It tries to inspire people to work even harder to achieve the mythical American Dream. Until the monster of capitalism is slain, we will continue to have unemployment, people without homes, peopleless homes, people without healthcare and refugees.

poor of the world

*Wielenga, Bastiaan, Introduction to Marxism, Centre fro Social Action (Bangalore, India) 1984, p. 62


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