Restructuring retail: Tens of thousands laid off — more to come

The restructuring in retail is different in form from manufacturing but the same in essence, as far as the working class is concerned.

By Fred Goldstein. Posted April 25, 2017.  

As International Workers’ Day — May Day — approaches, a major crisis is underway for retail workers in the U.S. A process of profound restructuring of the retail industry is unfolding. Driven by internet technology and its utilization by Amazon, among others, it has been made possible by the capitalist scientific-technological revolution.

In manufacturing, the struggle by big industry to increase profits drove automation and offshoring. In the retail industry, the giant monopoly Amazon has developed online shopping, which has already wiped out tens of thousands of retail jobs and is threatening hundreds of thousands more.

Online shopping has brought about a transformation in the so-called brick-and-mortar retail industry.

“This transformation is hollowing out suburban shopping malls, bankrupting long-time brands and leading to staggering job losses,” wrote the New York Times on April 15.

“More workers in general merchandise stores have been laid off since October, about 89,000 Americans. That is more than all of the people employed in the United States coal industry, which President Trump championed during the campaign as a prime example of the workers who have been left behind in the economic recovery.

“The job losses in retail could have unexpected social and political consequences, as huge numbers of low-wage retail employees become economically unhinged, just as manufacturing workers did in recent decades. About one out of every 10 Americans works in retail.” That’s around 15 million workers.

Thousands of mall-based stores are shutting down in what’s fast becoming one of the biggest waves of retail closures in decades.

More than 3,500 stores are expected to close in the next couple of months.

Department stores like JCPenney, Macy’s, Sears and Kmart are among the companies shutting down stores, along with middle-of-the-mall chains like Crocs, BCBG, Abercrombie & Fitch and Guess.

As big retailers shut down in malls, there is collateral damage among the workers in small retail stores and fast food places that draw walk-by customers who shop in the big stores. Furthermore, window designers, lighting and maintenance workers, security guards, sanitation workers and many other mall workers are or will be thrown onto the unemployment lines.

From housing bubble to retail bubble

Online shopping is not the only thing responsible for the present crisis. Marxism teaches that in all industries, capitalist competition and the thirst for profit drive the retail and real estate bosses who rent to them to destroy their rivals by capturing market share. The result is capitalist overproduction. (Overproduction does not mean that capitalists produce more than people need, only more than the stores can sell at a profit.)

“The number of malls in the U.S. grew more than twice as fast as the population between 1970 and 2015, according to Cowen Research. By one measure of consumerist plentitude [capitalist overproduction, F.G.] — shopping center “gross leasable area,” the U.S. has 40 percent more shopping space per capita than Canada, five times more than the U.K., and 10 times more than Germany.” (theatlantic.com, April 10)

“The seeds of the industry’s current turmoil date back nearly three decades, when retailers … flush with easy money, rushed to open new stores. The land grab wasn’t unlike the housing boom that was also under way at that time.

“Thousands of new doors opened and rents soared,” Richard Hayne, chief executive of Urban Outfitters Inc., told analysts last month. “This created a bubble, and like housing, that bubble has now burst.” (wsj.com, April 21)

Amazon won’t make up for jobs lost

The standard line of the apologists for capitalist restructuring is that technological advancement creates new and better-paying jobs that will make up for the job losses. This is complete hogwash.

First of all, the workers who lose their jobs are out of a job NOW. They have the skills and training for retail. The capitalist class and the capitalist government do not swoop in to the rescue and give them jobs and training in new occupations they would feel suited for.

But second of all, assuming that the laid-off workers in the thousands could apply for jobs at Amazon or other online retailers, they would be confronted by the highly automated Amazon warehouse system. This system has far fewer jobs to offer than the 90,000 who have already been laid off since last October and the many thousands more who are in danger of losing their jobs.

Amazon’s automation is infamous among the workers as a speed-up device and a job-killer.

“In 2012, Amazon bought the robotics company Kiva Systems for $775 million — and made it so Kiva’s technology could be used only in Amazon warehouses. These Kiva robots autonomously zoom around the warehouse using a series of barcodes on the floor to guide them, picking items and bringing them back to warehouse workers. These robots save these workers from the immense physical toll of walking as many as 20 miles per shift, sometimes in unbearable heat; but this also means that fewer human workers are needed. The jobs that remain will be less labor intensive, and more like those of a robot supervisor. Since Amazon bought Kiva, a host of other companies are trying to develop even more advanced warehouse robots and sell them to Amazon’s competitors.” (prospect.org, Sept. 27, 2016)

It’s not likely that 90,000 robot supervisors will be needed at Amazon!

Capitalist restructuring in another form

Retail workers have already undergone the pressure of the scientific-technological revolution and the intensified exploitation that it brings. Retail salespeople and cashiers have been subjected to time studies and forced to adhere to a time standard for making sales. Cashiers have to ring up customers in a designated time tracked by the electronic cash register. And they have been subjected to many other profit-squeezing methods.

Now thousands of them are being eliminated altogether by internet technology and online sales.

This is comparable to when auto workers’ jobs were destroyed by robotization or steel workers’ jobs were destroyed by mini-mills and electronic mills. And coal miners’ jobs were destroyed by giant mining machines.

The difference is that this automation is being instituted by an external employer, Amazon. The restructuring in retail is different in form from manufacturing but the same in essence, as far as the working class is concerned. Amazon has reduced the necessary labor time involved in the process of commercial retail sales. As such, it can sell at lower prices and increase convenience for the shopper.

While automation reduces the walking time for workers in the warehouse and the burden of shopping for the consumer, the workers who are no longer needed by capital under the profit system suffer. Instead of the internet and robots being used to ease life for the working class, they are only making things more difficult and insecure.

The masses of workers who lose their jobs will not be able to afford buying anything, either online or in a store. For the working class, the whole capitalist system is a trap the workers must break out of.

Goldstein is the author of Low-Wage Capitalism and Capitalism at a Dead End, which can be obtained from online book sellers.

Airport protests set new level of solidarity

By Fred Goldstein, posted February 1, 2017

Jan. 30 — The wave of airport protests against Trump’s Muslim ban represents a new high-water mark in solidarity with Muslims in the U.S. These demonstrations are a political rebuff to the vicious Islamophobia stoked for a year and a half by Donald Trump, along with his Mexico bashing and many other reactionary themes.

In fact, Islamophobia has replaced anti-communism in the 21st century as the primary divisive, racist, divide-and-conquer strategy to foment war, intervention and police surveillance. Now the Islamophobes are being pushed back.

Since Sept. 11, 2001, and the World Trade Center bombings, Muslims and those in the movement who support them against ruling-class prejudice and persecution have been on the defensive. Solidarity activities have been relatively small and have been in the shadows.

But Donald Trump, Stephen Bannon, Gen. Michael Flynn and company, now hunkered down in the White House, changed all that by issuing a 90-day ban on people coming from six predominantly Muslim countries — Iran, Iraq, Libya, Somalia, Sudan and Yemen — and banning Syrian nationals and refugees indefinitely.

This reactionary White House circle apparently did not get the message from the 3.3 million people who demonstrated around the country on Jan. 21 at the Women’s March. That march was marked by a high degree of solidarity with Muslim women. Instead, Trump and his reactionary circle, which is moving sharply in an authoritarian direction, provoked a massive movement that was already in motion.

100 demonstrations in 42 states

As of this writing, 100 demonstrations in 42 states have been carried out or are planned. Tens of thousands have already gone to airports to protest. (getgroundgame.com/airportprotests)

Television networks have carried the larger, more prominent ones in New York, Los Angeles, Dallas-Fort Worth, Chicago, Boston, Atlanta and so forth.The movement has been powerful enough to force courts in four states to put stays on the deportation of immigrants caught up in the ban and its sudden application. Requests for injunctions have been granted in New York City, Seattle, Virginia and Massachusetts. The Massachusetts injunction goes further than the others, which block deportation but permit detention. Massachusetts is not allowing detention.

The original ban included all people with green cards. This amounts to a ban on hundreds of thousands of people around the world. In their rush to push the ban through, Trump and his National Strategy Adviser Steve Bannon, an ultra-right, Islamophobic, anti-Semite, informed U.S. Customs and Border Protection and Immigration Services of the ban on the very afternoon it was promulgated. Only the massive struggle that erupted at airports the next day forced the head of Homeland Security, Gen. John Kelly, to rescind the green card ban.

In their fanaticism Trump, Bannon, Reince Priebus, Flynn and company showed no concern for all the students from the seven Islamic countries covered by the ban who were returning to continue their studies. They did not care about workers, scientists and technicians returning to their jobs. They showed utter contempt for people coming to be with their families. Even after several court injunctions were obtained, CBP officials refused to allow attorneys to see some detainees and turned away members of Congress who were attempting to find out the status of those detained.

This reflects the authoritarian stamp of the Trump inner circle.

Ideological and political step forward

The legal struggle to eradicate the ban altogether has a long way to go. It will take a great deal of political struggle in the streets, on the campuses and in the communities to push back the Trump administration. But the struggle has begun in a very inspiring way.

A new sense of solidarity has swept the movement, which got a sense of its power at the J21 Women’s March. That power has been transformed into solidarity and militant rejection of Islamophobia.

Anti-Muslim sentiment has been a fundamental ideological and political prop of the ruling class and much of the political establishment since Sept. 11.

By coming out en masse across the country, the airport demonstrators have put up determined resistance to the Trump refugee ban. But they have also struck an ideological and political blow against the Islamophobic poison of the ruling class. These demonstrations have laid the basis for future political steps forward.

Islamophobia has been used to build Homeland Security. It has been used to militarize the police in cities across the country. Above all, it has been used to promote the so-called “war on terror.”

Under the pretext of the “war on terror,” U.S. imperialism and the Pentagon have intervened in Afghanistan, Iraq, Libya, Syria, Somalia and lately in Yemen. The military-industrial complex — the makers of drones, smart bombs, military satellites, bombers, fighter planes, helicopters, tanks, munitions of every kind, military robots, etc. — have prospered producing arms for the “war on terror.”

From solidarity to anti-imperialism

The solidarity shown with Muslims can cause many to question the ideological and material basis that led to the ban in the first place. It is supposedly to protect the U.S. against terrorist organizations like al-Qaida and the Islamic State group (IS). But the ban is part of a broader offensive against the oil-rich and geostrategic Muslim world of the Middle East and North Africa.

It is precisely the Pentagon and the CIA that are responsible for the rise of groups like al-Qaida and IS. Washington has bombed 11 Islamic countries in the last 25 years. The Pentagon has inflicted untold destruction, suffering and death upon countries from Afghanistan to Somalia. The CIA has destroyed all the progressive secular nationalist forces, all those openly anti-imperialist, all the socialist and communist forces in the Middle East.

But the imperialists have not stopped their plunder and their oppression. They have taken Iraq’s oil. They have destroyed Libya and taken its oil. They have financed a devastating war trying to topple the independent government of Syria. The region is strewn with millions of refugees escaping the destruction of drone warfare, F-16s, A-10 killing machines. The oil barons are searching and drilling for oil in the coastal areas of Islamic North Africa. U.S. troops are spread throughout the region.

Under such conditions, with all progressive and secular forces weakened if not destroyed, it is inevitable that the vacuum of resistance will be filled by reactionary forces. The IS group is a patriarchal, medieval, theocratic organization pledged to drive the Western powers from the Middle East — the powers that divided up the region in the first place.

Such forces are at the same time the enemy of both the masses and of imperialism. The “war on terror” has nothing to do with helping women or freeing society. It has to do with reasserting the dominance of imperialism over the oil-rich Middle East and Africa.

Along with fighting Trump and his ­reactionary anti-Muslim tirades, the movement should try to match its dynamic political resistance with a determination to get to the bottom of the problem. The movement must see the commonality of racism, misogyny, LGBTQ and all gender oppression, anti-immigrant poison and the struggle against the multinational working class as based in the same substance as Islamophobia.

At the root is imperialism, the profit system and the domination of the world by capitalist monopolies.

Goldstein is the author of ­“Capitalism at a Dead End” and “Low-Wage Capitalism,” both of which can be purchased from online booksellers.

(Houston airport photo: Gloria Rubac)

German imperialism and the Greek debt crisis

By Fred Goldstein, March 4, 2015

For five years the European Central Bank, dominated by German finance capital, has engineered bailouts and imposed austerity on Greece, Spain, Portugal, Ireland and Italy. And for five years various establishment economists, politicians and pundits in the U.S. like Paul Krugman and James Galbraith have been frustrated and perplexed.

Their complaint? Capitalist Europe is in an economic crisis. Austerity will make the crisis worse. Why don’t the German bankers and the ECB listen to reason? Why pursue such a destructive policy, which harms the economy and causes untold mass suffering?

Marxism explains long-term jobless growth

By Fred Goldstein on March 28, 2014

unemployed-US graph

Number of people in the U.S. unemployed six months or more

Five years into the capitalist recovery, the crisis of mass, long-term unemployment will not go away.

The Labor Department defines long-term unemployment as being 27 weeks or longer without a job. The official number of long-term unemployed in February was 3.8 million workers. (Los Angeles Times, March 20)

The Origins of the “Right-to-Work” Union-Busting Law

By Fred Goldstein

December 17, 2012

The passage of the union-busting so-called “right-to-work” law in Michigan is a severe legal setback for the labor movement and for the workers, the oppressed and all the progressive masses in the state. If not turned around, it will encourage right-wing, anti-labor forces across the country.

It must be emphasized at the outset that so far this is purely a legislative setback. It has not been implemented. The working class has not been defeated in the class struggle but rather the labor leadership was politically outmaneuvered by a cabal of right-wing billionaires and their political puppets in the legislature and the governor’s mansion. These forces conspired to put this reactionary legislation on the fast track without even giving the legally required time and processes for the masses to mobilize against it.