As unemployment (officially reported) soars toward 30 percent or more, an estimated 20 million more people will fall helplessly below the poverty line. In a recent Pew poll, 60 percent of Latinos reported losing jobs or wages, as did more than half of all workers below the age of thirty. In addition to their jobs, millions will lose everything they had spent their lives working for: homes, pensions, medical coverage, and savings accounts.
The difficulties caused to workers by record unemployment during the pandemic are a product of capitalism. Most of the time, employers decide to hire or fire workers depending on which choice maximizes employers’ profits. Profit, not the full employment of workers nor of means of production, is “the bottom line” of capitalism and thus of capitalists. That is how the system works. Capitalists are rewarded when their profits are high and punished when they are not. It’s nothing personal; it’s just business. More
Last Thursday, “P”BS “NewsHour” viewers got to see the show’s longtime economics correspondent (Paul Solomon) give a chilling account of how newly unemployed people are disastrously losing their health insurance in the middle of a pandemic.
In the crash of 2007–2008, it took nearly two years for the unemployment rate to double from 5 percent in December 2007 to 10 percent in October 2009. This time, the rate has quintupled in eight weeks. The only comparable numbers were in the Great Depression, but even then, the increase took much longer. It is hard to describe what we are seeing in these data as anything other than an unfolding disaster. We know that a long spell of unemployment when you are young creates a permanent scar—reducing earnings for decades and increasing the risk of adverse life events. The young are my greatest worry.