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the Conspiracy to Create Poverty

By Punkerslut

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Image: From PeaceLibertad Blog,
"No capitalisme" Gallery

Start Date: November 13, 2009
Finish Date: November 13, 2009

"Masters are always and everywhere in a sort of tacit, but constant and uniform combination, not to raise the wages of labour above their actual rate. To violate this combination is everywhere a most unpopular action, and a sort of reproach to a master among his neighbours and equals. We seldom, indeed, hear of this combination, because it is the usual, and one may say, the natural state of things, which nobody ever hears of. Masters, too, sometimes enter into particular combinations to sink the wages of labour even below this rate. These are always conducted with the utmost silence and secrecy, till the moment of execution, and when the workmen yield, as they sometimes do, without resistance, though severely felt by them, they are never heard of by other people."
          --Adam Smith, 1776
          "The Wealth of Nations," Book 1, Chapter 8

     What happens when all of an economy is owned and controlled by a very few people? It results in the majority submitting to the will of that small group. Those in the small group might compete with each other, so that you have a choice of your job or what you purchase. But the options presented to you were not your choice, the world around you did not spring forward from your imagination. It came from the minds of those who possess all of society's wealth, and it is organized in a way that specifically benefits the few at the top.

     Capitalist theorists often defend this type of hierarchy and authority, by saying that a competition between them evens the playing field. There may be only a few possessors of factories, farms, and mines, but they each require laborers. They each need to hire workers. Then they compete for laborers. But there has never been full employment, so if a new laborer is ever needed, they are easily found.

     The competition among Capitalists for workers cannot be too great. If the Capitalist refused the deal, they could pick another worker. If the worker refuses, they starve. The odds of this arrangement set things for the possessor of wealth and against the dispossessed. It sets up a social order where the few live off of the labors of the majority, while the many suffer poverty and degrading work conditions. It creates the maximum amount of suffering within a social organization.

     The element of competition is weak in terms of employment. In terms of market, we find a different type of behavior: Monopoly. There is no competition for labor, but there are always new startups that try to take a part of the market -- that try to create their own vision of how society should be organized. New businesses can face tremendous difficulties, but the greatest one is the collusion of all industry giants.

     What does monopoly mean? It means that the owners of wealth have come together and arranged not to compete. If they competed, they would each expend large amounts of energy in keeping up with each other. But if they cooperated, they would be able to spend less on competing. That means, they wouldn't have to satsify their consumers as much.

     Foods contaminated with bacteria and carcinogens, electronics covered in lead dust, and childrens' toys made out of toxic chemicals: these things would naturally be rooted out by competition. But it is cheaper to buy low-quality than to buy high-quality. It serves the profit's bottom line to spend less on production and quality. The rotten, unwholesome products are only possible by the masters of capital coming together and fixing prices.

Archer Daniels Midland -- 1996, fined $100 million for price fixing [*1]

ABN Amro -- 2003, fined 0.9 million ($1.8 million) for price fixing [*2]

112 Construction Companies -- 2008, found to be violating anti-monopoly laws [*3]

Sainsbury's, Asda and Safeway Supermarkets -- 2007, fined 116 million ($232 million) for price-fixing [*4]

Siemens, Alstrom, Areva, Schneider and Japanese firms Fuji, Hitachi, Mitsubishi Electric, Toshiba and Japan AE Systems -- 2007, fined $513 million for cartel activities [*5]

Heineken and Grolsch -- 2007, fined $150 million for price fixing [*6]

     By fixing prices and development, businesses do not need to worry about their share of the market. Since they offer identical products, with identical prices, a consumer has only one choice; and, behaving as a consumer, they have an equal chance of buying it anywhere. To be guaranteed of a slice of the market, a firm in a monopoly must allow the others their slice. But they are promised that their business will live forever -- that they can always live off of the labor of others, without ever working themselves.

     And this is the great interest of the monopolists. They want to do all that they can to maximize their profits and to minimize their risk -- the natural behavior of any investor. If they had competed, it would have meant more jobs for development -- more researchers for technology and industrial progess. It would be a flow of sustenance into communities, a flow of new and innovative ideas in business, but a weakened dollar for the investor.

     A Capitalist can make more if they organize with those in the same industry and rig prices than if they competed. It is the great rule of cooperation, that two working together can produce more than those two competing. So much for the 'glory of competition' in the Capitalist system, when all Capitalists cooperate with each other to improve their interests!

     Some Capitalists organize not to rig prices, but to cut production, so that it will artificially raise the price of their commodity. There are fields that could've have been worked by laborers, and they could have earned their wages, which would have fueled other businesses. But instead, they are left vacant; they aren't unfarmable, but the soil has been poised by property. It has been made useless, even a hazard, to the welfare of the individual. It remains unworked, not because there is no profit to be earned in working it, but because there is more profit in it being unworked.

     You're not unemployed because there's no productive labor left. It's because someone who owned the land knew they could benefit from making you want more -- from making you desperate.

     It is in the interests of the Capitalist that unemployment is created and expanded. What does unemployment translate to? It means a society with more beggars, with more living off of their friends, with more famished community -- with more families made homeless and more patients rejected treatment. This is what poverty means when it strikes through a people, turning out the exploitation of youth, ripping apart the dispossessed and alienated individuals. It turns the well-fed into the hungry, and the hungry into the starving. This is poverty. And it has always been the means of profit for the Capitalist class.

     The Capitalists are inherently organized against us and our interests, against our world and our vision. But they are organized well, because they cooperate with each other. This is the only tactic that we must imitate to become a powerful, social force. We do not need the domination, the control, and the violence to be strong enough to really change the world. We only need voluntary and mutual cooperation. It is in the interest of every worker to organize with every other worker -- to be able to make some different out of this social order.

     Organization amongst the Capitalists has done a tremendous amount for them. They have wanted wealth, power, wars, tariffs, taxes, plunder, oppression, and the destructive exploitation of the environment. If our goal is a world of social harmony, imagine what our organization can do for us...

"Now, how could he find men willing to cross the sea, to travel to China and back, to endure hardship and slavish toil and to risk their lives for a miserable pittance? How could he find dock labourers willing to load and unload his ships for 'starvation wages'? How? Because they are needy and starving. Go to the seaports, visit the cook-shops and taverns on the quays, and look at these men who have come to hire themselves, crowding round the dock-gates, which they besiege from early dawn, hoping to be allowed to work on the vessels. Look at these sailors, happy to be hired for a long voyage, after weeks and months of waiting. All their lives long they have gone to the sea in ships, and they will sail in others still, until they have perished in the waves.

"Enter their homes, look at their wives and children in rags, living one knows not how till the father's return, and you will have the answer to the question. Multiply examples, choose them where you will, consider the origin of all fortunes, large or small, whether arising out of commerce, finance, manufactures, or the land. Everywhere you will find that the wealth of the wealthy springs from the poverty of the poor."
          --Peter Kropotkin, 1892
          "The Conquest of Bread," Chapter IV, Part II



*1. Hunter-Gault, Charlayne (October 15, 1996). "ADM: Who's Next?". MacNeil/Lehrer Newshour (PBS).
*2. ABN fined 900,000 for price rigging.
*3. OFT issues statement of objections against 112 construction companies.
*4. Supermarkets fined 116m for price-fixing.
*5. "Vote call by Siemens shareholders," BBC.
*6. "Heineken and Grolsch fined for price-fixing". The Guardian.

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