The Economic Crisis:
How It Impacts African-Americans and Labor
by Muhammad Ahmad

     Lecture delivered at the Economic and Black Labor Forum, the
Philadelphia Community Institute for Africana Studies, 22 October 22 2009

http://mrzine.monthlyreview.org/ahmad021109.html

The present Great Recession is the latest and largest crisis of
capitalism since the Great Depression of the 1930s.  During the Great
Depression over half of all African-American men were unemployed.  The
present Great Recession is much deeper because the finance sector of
capitalism has exhausted its debt.  The Federal Government is in debt;
the states are in debt; most cities are in debt or near debt; and
consumers (the working class) are in debt.  This crisis, the worst in 90
years, has a greater impact on African-American workers because they are
concentrated in the public sector.

When state governments are in debt and the financial bubble bursts, the
future of public-sector workers is threatened, a future they have built
through the unionization process.  It is essential that African-American
workers, particularly in the public sector, protect their self-interests and
power by transferring their labor power into an economically and politically
self-reliant form, by creating a black workers' society.

African-Americas are the majority or near majority of the population in 26
or 27 large cities in America.  Between 1910 and 1970 six and a half million
African-Americans left the South.  Today 58-65% live in urban areas.

What I will concentrate on is not only the crisis, but alternatives to the
crisis.  In the 1930s unemployment was as high as 25% of the entire
population.  Today, "[o]fficial U.S. unemployment is over 9% while real
unemployment, taking into account all those wanting jobs and part-timers
desiring full-time work, is close to twice that."1

It is estimated that 122,000 new jobs need to be created each month in order
to come out of the present crisis.2  We should realize that the crisis is
great.  It is serious and it will not be the last.  Economic crises tend to
reoccur at times that we cannot predict.

In 1963 James Boggs said that with the increase in automation in the
production process, capitalists would be able to produce more goods
(commodities) faster and with fewer workers, which intensifies
unemployment.  Racism in the labor market keeps young African-American males
a permanent and marginalized sector of the working class.3  There are not
enough workers with buying power to purchase all of the commodities; the
stores are full and everyone is in debt.  There is a global glut of
overproduction and under-consumption creating this crisis and a falling rate
of profits.

This is the structural crisis of monopoly finance capital: the latest of
three major stages of capitalism.

The first stage was "mercantilism," which began in the 16th century
continuing into the 18th century.  The second stage, "competitive
capitalism," the outgrowth of the industrial revolution, took hold in the
late 18th century until the mid 19th century.  The third stage is called
"monopoly capitalism," which began in the last quarter of the 19th century.
It consolidated in the 20th century and became more global in the late 20th
century as finance played a larger role in warding off crisis and stagnation
through wars, debt, and speculation.

For instance, the dominant U.S. financial firms of 1909, J. P. Morgan,
Goldman Sachs, and National City Bank are still at the center of the economy
one hundred years later.  One notable exception was the failed Lehman
Brothers which lasted for 99 years.

     The stagnation tendency endemic to the mature, monopolistic economy, it
is crucial to understand, is not due to technological stagnation, i.e., any
failure at technological innovation and productivity expansion.
Productivity continues to advance and technological innovations are
introduced.4

In this period from 1974-1975, the U.S. economy and the world economy as a
whole entered into a full-fledged structural crisis after a long boom.  Thus
began decades of deepening stagnation.  The finance bubble provided a
partial fix for the economy, which resulted in mountains of debt and
tremendous growth in financial profits.  What also resulted was the
increasing dependence of the entire economy on one financial bubble after
another, which kept the economy afloat.

     Every crisis leads to a brief period of restraint, followed by further
excesses.  Other external stimuli such as military spending, continue to
play a significant role in lifting the economy, but are now secondary in
impact to the ballooning of finance.5

Another stimulus to the economy has been the privatization of prisons, a
constantly increasing prison-industrial complex and a drug culture/illegal
economy that is laundered 24/7 into the legal economy.  This has created the
"silent" criminalization and genocide of two million African-Americans and
has devastated African-American families and communities.

The official unemployment rate for African American men was 15% as of March
2009.

     Over a third of young black men, ages 16 to 19 in the labor market are
unemployed.  In fact a recent report found that 8% of all black men have
lost their jobs since November 2007.6

The Center for Economic and Policy Research estimated that African-Americans
in manufacturing jobs fell from 23.9% in 1979 to 9.8% in 2007.

African-American men have been affected by the instability in the automotive
industry.  They earn higher wages than in other industries and make up a
fifth of the workforce.  Twenty thousand African-American autoworkers were
either laid off or took buy-outs from the Big Three in 2008.7  Three million
jobs could be lost within the next year -- a result that would grossly
affect African-Americans if one or more of the domestic automakers were to
fail.

African-American workers suffered from a severe decline in decent employment
opportunities and have also faced decreasing rates of unionization related
to the shrinking manufacturing industry.  The median unionized
African-American worker earned about $17.51 per hour from 2004-2007,
compared to $12.57 per hour for his non-union counterpart.8  The unionized
workers were also more likely to have health insurance and pension plans.

Black men have traditionally held the highest union membership rates of all
demographic groups.  In 2008, 15.9% of black men were members of unions, the
greatest participation of all groups and higher than the national average of
12.4%.  However, black union membership has been declining at a faster rate
than membership among whites since the 1980s.9

Thus African-Americans are impacted by the military-industrial complex, the
prison-industrial complex, and finance capital.  C. L. R. James, in his
article "Black People in the Urban Areas of the United States," says,

     . . . The Black people in the United States are the most socially
united
group in the country, they all have one unifying characteristic -- they
suffer from that historical development which has placed them in the role of
second-class citizens.  There is no other national group which automatically
constitutes one social force with a unified outlook and the capacity to make
unified moves in politics and to respond to economic problems.10

Henry Nicholas says, "The only thing we own is our labor power."  We should
learn to use our labor power to serve ourselves, African-American workers.
We should use the unions we are in for the benefit of our people.  We should
use our spiritual power to develop economically self-reliant projects
through our churches and masjids (mosques).  Thus unions, churches, and
mosques should be our bases of power.  If we utilize them for economic
self-reliance and unite with progressive allies, we will have a collective
financial basis for workers' "people power" wherever we reside.

Dr. James Garrett says we need five ingredients for economic self-reliance:

    1. Development of a core group to generate capital formation or
accumulation that would develop industrial companies.

    2. Utilization of land where we are.  Dr. Grace Lee Boggs in her
article,
"A New Kind of Organizing," talks about community land trusts (CLTs).  These
are unique forms of common-based property rights where a block of land is
removed from the real estate market and owned by a people's board of
trustees, possibly a community development corporation.  These community
land trusts could be investment projects of African-American workers' funds,
which can be negotiated with a developer, to grant seed money to undertake a
development which includes individual houses, sites for businesses, parks,
and community centers, etc.  Within this utilization of land where we are is
the movement that Dr. Boggs has implemented in Detroit, Michigan: the
formation of organic community urban gardens.  The Universal Negro
Improvement Association (UNIA) in Philadelphia has a Black Farmers Market
where the produce of Black farmers is sold.  The institution of neighborhood
installation of solar paneling in homes, the establishment of health food
stores and other co-ops and fish farms, as Dr. Claude Anderson has
advocated, is essential.  All this develops at least a three-day supply of
food in times of crisis.  In the area where we live, we should think about
water: purification, treatment, and harnessing.  Eventually we should turn
our community into Green communities; and we should invest in wind energy.
During the 1930s, Ella Baker organized Housewives Leagues into collective
buying cooperatives where neighbors bought in quantity, cutting down on
costs.

    3. Consolidation of capital, which can be done through credit unions.
There are 43-50 credit unions in Philadelphia.

    4. An organization -- every project needs organization.

    5. People who are willing to be trained to make the project theirs and
willing to accept the awesome responsibility of leadership to take over and
continue the organization.  They must be willing to sacrifice and be
dedicated, sincere, principled and willing to do the work.

Dr. Grace Lee Boggs states that in a new kind of community organizing we
need housing groups to assert the right of people to remain in their homes
by blockading residences threatened with foreclosures and evictions, forcing
banks or lenders to renegotiate loan terms.

Dr. Boggs explains that we can have local production for local needs.  We
can create health and wellness, public gathering places, youth development,
and conviviality.11  We can grow our own food; live healthier lives, (eat to
live rather than living to eat as Elijah Muhammad used to say); create
enterprises that will sustain the family and the community; create
neighborhood programs (mural painting, theater, dance, sports --
Philadelphia has the Black Star Games every summer, sponsored by the Poor
and Righteous Nation).

We can create a green economy by bringing together environmentalists, labor
unions and the community organizations, to improve the environment.  We can
practice energy efficiency by biking or taking public transportation,
converting power sources to renewable energy, restoring wetlands and
riverbanks, and creating high quality jobs in the modern energy economy.

Dr. Boggs goes on to say that we can bridge the gap between the middle and
upper classes who have moved to the suburbs by creating regional councils
that struggle to reduce inequities by sharing revenues and reallocating
investments.  She calls for a new kind of governing: a movement much like
the civil rights movement, that is grounded on a new concept -- what it
means to be a human being.  This movement empowers citizens with new
concepts of ownership, of democracy, to engage in transformative activities,
depending on themselves, rather than elected officials.

Here we must start with the concept of Umoja circles.  We can develop a
holistic, dialectical, humanist culture and re-education process by creating
communiversities that implement the study of progressive African-American
labor, world history, and political theory, combined with practice.  It is
through a revolutionary politicized culture that the ethos of mass organized
struggle resistance movement is passed on to the forthcoming generation.  C.
L. R. James said,

     I believe that black people in America must recognize the opportunities
which history has placed in their hands, not only to record the advancement
of their own situation but in regard to the ideas and activities of
oppressed people the world over.12

A people united will never be defeated.  We will win!  As Salaam Alaikum.



1  John Bellamy Foster and Robert W. McChesney, "Monopoly-Finance Capital
and the Paradox of Accumulation," Monthly Review, Volume 61, Number 5,
October 2009, p. 1.

2  John Wojcik, "Needed: 122,000 Jobs Per Month," People's Weekly World,
Volume 24, Number 15, September 12-18, 2009, p. 1.

3  James Boggs, The American Revolution: Pages From A Negro Worker's
Notebook(New York: Monthly Review Press, 2009), p. 46-61.

4  Foster and McChesney, op. cit., p. 9.

5  Ibid, p. 15.

6  Alexandra Cawthorne, "Weathering the Storm: Black Men in the Recession,"
Center for American Progress,p. 2.

7  Jonathan Mahler, "GM, Detroit and the Fall of the Black Middle Class,"
The New York Times, June 28, 2009, p. 3.

8  Cawthorne, op. cit., p. 4.

9  Ibid, p. 4.

10  Anna Grimshaw (ed.), C. L. R. James Reader (Oxford, U.K. and Cambridge,
U.S.A.: Blackwell, 1992), p. 375.

11  Grace Lee Boggs, "A New Kind of Community Organizing," The Michigan
Citizen, July 5-11, 2009, p. A10.

12  Grimshaw, op. cit., p. 377.
Muhammad Ahmad is the author of We Will Return in the Whirlwind: Black
Radical Organizations 1960-1975 and Black Social and Political Thought.

Humanities & Social
Sciences Online

Copyright © 1995-2006 - Contact Us
RSS | Validate: XHTML | CSS