US Economy & Unemployment: What Is To Be Done?

On Wednesday, Marketplace's Kai Ryssdal interviewed Stephanie Elsenpeter, an unemployed mother living in New Hope, Minn. Elsenpeter discussed how her emergency-extended unemployment benefits are going to run out the week of Jan. 8.

On the topic of her unemployment benefits running out, Ryssdal asked, "What happens now? What are you going to do?" After explaining how she is in the process of building up a list of clients for a potential house-cleaning business, Elsenpeter responded to Ryssdal's questions with more questions, "How long is that going to take me to do that? How long is it going to take money to start rolling back in, you know?"

As with many of the economic problems facing the US, answering some questions only leads to more questions. Elsenpeter told Ryssdal that she thinks that "we've all been kind of forgotten by Congress. They need to really come up with a new plan on how to deal with this government, because right now, things are not working like they should be." Elsenpeter continued, "They don't know a direction to go with this stuff. It's just not helping, nothing's happening." Elsenpeter again concluded her response by asking, "What are these [unemployed] people supposed to do? What am I supposed to do? What are they going to do after [unemployment benefits run] out?"

Elsenpeter's sentiments reflect the feeling of desperation that many Americans currently share. To say the least, the Zeitgeist of the US economy today is ominous. With ongoing problems in Washington and the specter of crony capitalism, many Americans may be left wondering to themselves, "What is to be done?"

In response to that question, MarketWatch's Paul B. Farrell had a very good article Tuesday about how the Occupy Wall Street movement is preparing for a new American revolution in 2012. Farrell: "Think Occupy Wall Street disappeared in winter's cold? Wrong: The 99% just declared a new aggressive, covert special-ops war strategy to take back our democracy in 2012." Farrell discussed how Occupy Wall Street will be modifying their strategies in 2012, including the use of guerrilla-style in-and-out surprise attacks through non-violent means.

Farrell suggested that the US is going to be getting hundreds of "wake-up calls" to deal with the Occupy Wall Street movement in 2012 -- on local, regional, and national levels. In anticipation of the Second American Revolution, Farrell wrote about how the energy behind the Occupy Wall Street movement "comes from deep within the collective soul of a new generation of young Americans who have been disenfranchised by clueless politicians who are trapped deep inside a corrupt two-party political system no longer capable of changing."

In pertinent part, Farrell explained that "America's youth are the voice of the 99%". With a lack of employment and hope, Farrell suggested that the coming war is not merely about class warfare. Farrell: "It is more a generational war between America's youth and a wealthy entrenched establishment". While America's youth expected change from Pres. Obama, things in the nation have gotten worse. Farrell's commentary portends that "investors...better watch out" as this societal frustration and angst "will explode across the economic and political landscape in 2012".

In sum, Farrell concluded that the wealthy elite cannot attack the young generations in the US and get away with it. Farrell: "Our leaders are ideologically blind to the need to invest and invest big in jobs before this accelerating rage reaches a critical mass and ignites, triggering another American Revolution and the Second Great Depression." And in due fairness, in taking into account issues the younger generation is facing, the situation is precarious. On education -- a higher education bubble, pyramid-scheme-style training. On marriage, romance, and children -- difficult to afford given the economy. For retirement -- as Rick Perry said, Social Security's a Ponzi scheme. On employment -- there are few jobs out there; very few are hiring. Taking this all into account, the younger generation is waking up to our predicament, and the crux rests in the younger generation's desire to survive.

Those who follow my articles on Benzinga know that I generally adhere to the Austrian School of economics. Nevertheless, as much as an Austrian-School-style government may be desirable in the nation at this point in time, such hopes feel far from reality. Many of the problems in the US go back to the fact that the political process is not working thereby creating uncertainty in the markets. Where I have been a harsh critic of central-planning and government intervention as in socialism or communism, in a neo-Marxist sense, it's starting to appear that any solutions are going to have to come about from the people in the nation themselves -- and such change will have to be brought about on a global level.

The facts of the matter are that the specter of American crony capitalism cannot be diminished, unemployment cannot go down as older generations clog up the job pipeline, the political process has not been & is not working to resolve issues that need to be resolved, and hope is fleeting from the populace. The reality of these issues is that there may be no easy answers to our current socio-economic problems.

As much as I have been a critic of Marxism, for all intents and purposes, it appears that capitalism is breaking down. This appears to be due to the fact that market mechanics are so closely tied to government. (The camel seems to have entered the tent so much so that if it tried to get out, the tent would collapse and tear itself apart.) Occupy Wall Street is a symptom of that fact; the market is faltering and tripping up over itself as neither commerce nor the political process can function. In a country where one cannot hope to find a job or get married one day or have children, there are going to be severe socio-economic problems; one way or another, such an environment can last for only so long before changes must be made. I have previously written that, "Capitalism is not inherently self-destructive because its goals are geared towards the survival of the species", but in that context, I referenced theoretical capitalism as a default survival-of-the-species economic system and not the temporal and historical capitalism that Marx criticized. Unfortunately, in this world, what should work in theory often does not work in reality. In light of our current global situation with nuclear weapons, international terrorism, global revolts, and environmental damage, it becomes difficult to argue that historical capitalism does not in some ways result in self-destructive behavior collectively. That being the case, if not in capitalism, what hope is there? I believe the answer to that questions rests in evaluating the state of the human collective consciousness and the ever-evolving nature of humanity.

From an old 1983 edition of Funk & Wagnall's Encyclopedia, I read that, "In the long run, Marx believed that capitalism was certain to falter because its tendency to concentrate income and wealth in fewer hands created more and more severe crises of excess output and rising unemployment." The article later continued, "According to Marx, the crises of capitalism were certain to manifest themselves in falling rates of profit, mounting hostility between workers and employers, and ever more severe depressions. The outcome of class welfare was fated to be revolution and progress toward, first, socialism and ultimately communism."

Where the fall of the USSR and free-market reforms in countries like China, Vietnam, and now even Cuba seem to suggest that Marx's analysis was off, it appears that a global neo-Marxist specter (in the spirit of thinkers like Michael Hardt and Herbert Marcuse) now haunts the world. As I wrote recently, even in Russia the ghost of the USSR appears to be returning. And in the long-run, it appears that the thoughts of writers like Hardt and Marcuse will take hold.

Contrary to the idea that revolutions would occur based solely on class warfare, it appears that worldwide revolutions are going to occur because of generational income differences. As Marx portended, it is as if some will feel need the need to revolt for the sake of survival.

And here's the rub, because arguably, the Russian Revolution and various other communist revolutions did not occur solely in the spirit of workers' survival. Historically speaking, so-called "communist" revolutions may have come about for various reasons: a desire for power, a desire for a sense of excitement & adventure, from collective frustration, or for amusement. However, from how I interpret Marx, in a genuine revolution, workers would be effectively forced to revolt...workers would be backed up against a wall and would have no choice but to revolt for the sake of their own survival. As there are no jobs and no hope for employment, developments in the current Occupy Wall Street movement hearken back to this idea that citizens would have no choice but to revolt owing to capitalist crises.

In this sense, Farrell's analysis sounds a bit reminiscient of the more neo-Marxist tone of the books "Empire", "Multitude", and "Commonwealth" by Michael Hardt and Antonio Negri. That is to say, this specter of a worldwide revolt appears to be manifesting itself owing to the younger generation's struggle to survive. This specter rises up while individuals think to themselves in the same manner as Elsenpeter: What are unemployed people supposed to do? What am I supposed to do in order to survive in the world? What are we going to do after our unemployment benefits run out?

When it comes to class warfare, crony capitalism, and revolution, we can learn much from history. Even so, the world today finds itself in somewhat uncharted territory. And as I mentioned previously, the human collective consciousness is changing. Humanity has ways to deal with class warfare and the struggle for survival in order to overcome modern-day socio-economic obstacles.

One viable method of dealing with such heavy socio-economic problems that I have often discussed is communalism. I am a bit surprised American society has not yet moved more towards a communalistic culture. Nevertheless, I think at some point if economic struggles continue, many will have no choice but to move towards communalistic living. In time, if the economy fails to improve, there is a fair chance that American society will have to re-evaluate (and in some case, dismantle) things like bureaucratic government, common law, civil codes, higher education, employment, and retirement. Enter communalism.

In the spirit of the Occupy Wall Street movement, many may grow to simply reject bureaucratic processes, legal processes, and political processes in favor of workers' councils and communes, where each commune would have its own court. But even then, there would have to be sufficient demand for such a system. Nevertheless, in a society where individuals cannot afford the high costs of litigation in courts of law with attorneys, citizens will effectively reject the status quo and set up a viable alternative. And when the financial system and political process appear so rigged, so dysfunctional, and so broken, at some point, many may begin to stop playing the game altogether. Enter communalism.

These ideas are by no means new, and various forms of communalism already exist in the US, more or less seen or unseen. Even back in the 60's and 70's, thinkers speculated on communalistic options to replace institutional religion, i.e. an ascension of culture heralding a new "Age of Aquarius". And we see that these various movements did not spread like wildfire and endure across the entire nation. However, as we proceed in uncharted territory, many may find themselves effectively forced into some sort of communalism, a rejection of the bureaucratic, materialistic culture in which many of us were raised.

It is important to realize that communalistic reforms in American society are by no means necessary or fated to occur. Even so, one has to ask: What happens when unemployment benefits run out? What are people expected to do? And while thoughts of revolution or riots may swirl about in commentators' minds, there are peaceful, viable ways for Americans to persist amidst a global depression. There can be peaceful revolutions that honestly bring about real change in the world. Even in the prism of post-Marxist thought, there are peaceful, viable answers to the socio-economic question of what is to be done.