The Invisible Handcuffs of Capitalism: How Market Tyranny Stifles the Economy by Stunting Workers by Michael Perelman Page A
Authors: Michael Perelman
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1970, used to say that the job of the Fed was to take away the punch bowl when the party gets going. With labor traumatized, the Federal Reserve no longer had to maintain a watchful eye over the economy. Instead, the Fed carelessly spiked the punch bowl with low interest rates and limited oversight of the financial system, fueling a series of bubbles during the Greenspan years. If economists paid a small fraction of the attention they paid to the purchase price of labor to labor’s contribution to the process of production, perhaps policymakers would pay more attention to the system of production and be less likely to allow such bubbles to get so far out of hand.
The bursting of those bubbles ultimately traumatized much of the world. Although Greenspan was confident that labor was in no position to challenge capital, many of the rest of the economic pundits were still obsessed with keeping labor tamed, so much so that they were unable to pay attention to the impending disaster.
In stark contrast to the sadistic attitude toward labor, when speculative excesses or some other miscalculation create adverse economic conditions that threaten to harm powerful business interests, especially in finance, the Fed is almost certain to rush in to the rescue, throwing money at business interests while letting labor hang out to dry.
More Discipline
Public policy has further traumatized workers. Since the 1970s, the U.S. government has shredded the social safety net. Access to supports such as welfare and public housing is fast becoming a thing of the past. To make matters worse, governments are making laws to make life difficult for those without employment. For example, some cities have criminalized feeding groups of poor people unless those organizing the food distribution have a permit, but then city officials refuse to issue the necessary permits when requested.
Workers are aware of these negative signals regarding the harsh consequences of unemployment. To capture the reality of this disciplinary environment, Jared Bernstein, today chief economic advisor to Vice President Biden, coined the expression YOYO economy—meaning that workers are told “you’re on your own.” 51
Prisons also serve to reinforce the discipline of the workplace. The United States presently incarcerates more than two million people. Some prisoners represent a serious threat to society, but most do not. Given the popular association of marijuana with a lackadaisical work ethic, the harsh penalties connected with this substance may be relevant to efforts to maintain discipline.
Whether by design or not, the fate of prisoners and the homeless stands as a stark warning, not just for those who might find themselves without employment, but for those people who might otherwise dare to resist the Procrustean way of life. Be thankful for your employment or you might have to share the fate of those unfortunate people.
The Lethal Costs of Discipline
Although traumatization may be useful in disciplining the working classes, the heightened levels of stress takes a toll on workers’ health. Unemployment increases workers’ level of mortality. 52 A study of younger workers who were part of a mass layoff confirmed the lethaleffect of job loss. These workers had persistently 15 to 20 percent higher mortality rates than others in their cohorts. 53
The dread of unemployment creates stresses that affect others besides the workers themselves. Family members and others are drawn into the depression, anger, and even diseases that traumatization inflicts on workers. The recent expression “going postal” suggests how the traumatization of the unemployed can harm people outside the family.
Sado-monetarism threatens health in other ways. Because the purpose of this branch of Procrusteanism is intended to aid the rich at the expense of the poor, nobody should be surprised that it is associated with increases in both poverty and inequality. Richard Wilkinson is at
The bursting of those bubbles ultimately traumatized much of the world. Although Greenspan was confident that labor was in no position to challenge capital, many of the rest of the economic pundits were still obsessed with keeping labor tamed, so much so that they were unable to pay attention to the impending disaster.
In stark contrast to the sadistic attitude toward labor, when speculative excesses or some other miscalculation create adverse economic conditions that threaten to harm powerful business interests, especially in finance, the Fed is almost certain to rush in to the rescue, throwing money at business interests while letting labor hang out to dry.
More Discipline
Public policy has further traumatized workers. Since the 1970s, the U.S. government has shredded the social safety net. Access to supports such as welfare and public housing is fast becoming a thing of the past. To make matters worse, governments are making laws to make life difficult for those without employment. For example, some cities have criminalized feeding groups of poor people unless those organizing the food distribution have a permit, but then city officials refuse to issue the necessary permits when requested.
Workers are aware of these negative signals regarding the harsh consequences of unemployment. To capture the reality of this disciplinary environment, Jared Bernstein, today chief economic advisor to Vice President Biden, coined the expression YOYO economy—meaning that workers are told “you’re on your own.” 51
Prisons also serve to reinforce the discipline of the workplace. The United States presently incarcerates more than two million people. Some prisoners represent a serious threat to society, but most do not. Given the popular association of marijuana with a lackadaisical work ethic, the harsh penalties connected with this substance may be relevant to efforts to maintain discipline.
Whether by design or not, the fate of prisoners and the homeless stands as a stark warning, not just for those who might find themselves without employment, but for those people who might otherwise dare to resist the Procrustean way of life. Be thankful for your employment or you might have to share the fate of those unfortunate people.
The Lethal Costs of Discipline
Although traumatization may be useful in disciplining the working classes, the heightened levels of stress takes a toll on workers’ health. Unemployment increases workers’ level of mortality. 52 A study of younger workers who were part of a mass layoff confirmed the lethaleffect of job loss. These workers had persistently 15 to 20 percent higher mortality rates than others in their cohorts. 53
The dread of unemployment creates stresses that affect others besides the workers themselves. Family members and others are drawn into the depression, anger, and even diseases that traumatization inflicts on workers. The recent expression “going postal” suggests how the traumatization of the unemployed can harm people outside the family.
Sado-monetarism threatens health in other ways. Because the purpose of this branch of Procrusteanism is intended to aid the rich at the expense of the poor, nobody should be surprised that it is associated with increases in both poverty and inequality. Richard Wilkinson is at
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