Trump’s Tax Cuts and Tariffs Cost Nearly 40,000 Workers Their Jobs

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All over the country, you hear people say how well the economy is doing, Republicans brag about it, Democrats can’t deny it, and it’s repeated by every corporate news talking head. Yet, the boom of the economy moves parallel to the American working class. If anything, the “good economy” is built on the suffering of the American working class. The worker is taxed while the bosses evade paying using tax havens and lawyers. The money the working people of America pay in taxes in then used to pay other bosses to move into a particular neighborhood. The government of the American state has placed trade tariffs on import in order to encourage investment in domestic production. It has resulted in mass layoffs. And while the economy booms and the bosses rake in the profits, they continue to fire large amounts of workers to maintain that profit margin. A “good economy” has meant misery for working people across the country.

As a part of President Trump’s nationalist outlook, protectionist trade policies were put into place. While a number of commodities from around the globe are under import tariffs, and many working people are seeing prices on everyday goods rise, the hampering of trade in heavy industry is having significant consequences on American workers. Ford, the worlds second largest automaker, has posted a loss of over 1 billion dollars this past year. This loss has been seen mainly in the rising cost of heavy industry commodities. By putting tariffs on auto imports, the Trump administration would make domestic producers have to rely on American production or pay the high cost of importing due to the tariffs. As a result, Ford is planning on laying off over 24,000 of its workforce, in early 2019, as a part of the company’s planned restructuring, following the loss of profit.

Ford has found itself in a loss of profit because it cannot import cars from Mexico. First, Ford sticks it to the American worker by outsourcing their job to a country where labor can more easily be exploited by lower wages. The consequence of this is higher rates of exploitation in parts of the world that are already suffering the consequences of American imperialism, and here at home, it creates a precedent for lowering wages and manipulating the American worker. And then, when the Trump administration puts trade tariffs on auto imports, Ford plans to fire more American workers to hold onto their diminishing profits.

General Motors (GM), a staple of the American automaker industry, has announced it is planning on closing seven factories, with a loss of upwards of 15,000 jobs. The company says they will save 6 billion dollars in cutting these jobs. This comes after GM has posted one of its most profitable six months on record, with the company seeing its best back to back quarters in over four years. Yet, the capitalists that own GM are worried. The projections of their financial analysts warn that a dip in the market could come. So, GM is ready to save money while the money is still rolling in, and do this by throwing 15,000 workers under the bus for their profit.

GM would rather put 15,000 people out into the volatile job market than risk having to pay 15,000 paychecks. Even when the capitalists are raking the money in, the worker is on the chopping block. In order to safeguard profits, American workers are being thrown onto the streets without a job. If GM productive sales fall, so will the financial investment into the company. So, in order to maintain a steady level of product sales and keep the flow of capital going at an increased rate, entire factories will be shut down so that less capital investment will be needed to pay workers and maintain workspaces, lowering costs and keeping the posted profits up and growing.

One would think that the richest country in the world would not need government assistance in order to establish a new headquarters. But, Amazon, one of the worlds most profitable companies, will be getting 1.7 billion of taxpayer money in order to open a headquarters in Queens, NY, as workers struggle in the ways highlighted above across the country.  While the tax rate for the rich is set higher, the rich can afford to avoid their taxes in full, and on average, pay around 15%. This is because they can send their money offshore to tax havens and afford the best tax lawyers and accountants to save their money from being subject to tax. The American worker and taxpayer are now paying Jeff Bezos, the richest person in the world, so jobs and revenue will be brought to the area. Jobs, by the way, from a company with a history of abuse towards its workers.

If the economy is doing so well, why is one of the largest companies in it laying off tens of thousands of workers? Why aren’t the tariffs protecting American workers rather than throwing them to the wolves? It is one of the deepest contradictions of capitalism, that the interests of the capitalists, the bosses, are the exact opposite to that of the worker.

Whether the economy is doing good or bad, the American worker is on the sinking end. There is no rich without poverty, there is no profit for the boss without the exploitation of the worker. The capitalist can only profit by exploiting the worker, by keeping money-value produced by the worker over what the capitalist advances for their wages. The average American assembly line worker produces on average $73.50 per hour in output but is paid on average $12.59 per hour. This “surplus-value” is the capitalist’s profit. When the worker cannot be exploited at a sufficient rate, the job is outsourced to somewhere with cheaper labor power. When the company cannot use that outsourced labor, due to tariffs for example, the higher paid American workers get laid off to make up the difference.

President Trump told his supporters that the tariffs would be good for the American worker, to not sell their homes and look for somewhere cheaper to live because the jobs were coming. But the jobs have not come, they have been lost. Factories close to protect the profit of a few board members, while the workers are given nothing so much as a “good luck”. 40% of GMs factory workers expected to get laid off supported Trump, but now must face the empty promises of a capitalist politician. This is also why the hard earned money of America’s working taxpayers are being used to pay some of the richest people on the planet. So long as the profit margin remains growing, even if small, investor confidence in maintained and finance capital is invested in the company.

It has often been said that when the economy is in a boom, it gives the capitalist the least amount of power and the worker the most amount of power in the capitalist system because the price of labor power goes up as unemployment declines. However, we are seeing that this classic formula is breaking down. The high cost of labor power is replaced by outsourced labor and layoffs, financial investment continues to come in, and the capitalist’s profit. In order to maintain a productive economy, and absorb laid-off workers, the job market is filled with menial service sector jobs that cannot afford a living wage.

When the economy is a boom, the capitalist profits and uses that profit to manipulate the worker to continue the growth of profit. When the economy is in a bust, the loss of profit is hedged against the worker. No matter what part of the boom-bust or business cycle the economy is in, the American worker is paying for it. The capitalist system cannot serve the working class of America or anywhere. The capitalist victory is the working classes defeat. The next time someone says how good the economy is doing, ask them why we aren’t seeing that reflected in our paycheck, or why working people are being fired.

It is time to end the dictatorship of the capitalists. It is time for a democracy of workers, a socialist democracy!

 

 

 



Categories: Workers Struggle

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