The Global Race to the Bottom

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by Lucia Pradella ~ 9/1/15

In a capitalist society profits come from workers’ living labor, so increasing productivity is not aimed at improving living standards, but rather at lowering the relative wage — that is, the difference between the value produced and the value retained by the workers. Capital accumulation thus tends towards an increasing polarization between relative wealth and poverty, which can coexist with increasing living standards for some sections of the working class.

Unemployment has reached unprecedented heights in Western Europe, wages are declining, and attacks on organized labor are intensifying. Nearly a quarter of Western Europe’s population, about 92 million people, was at risk of poverty or social exclusion in 2013. That’s nearly 8.5 million more people than before the crisis.

The poverty, material deprivation, and super-exploitation traditionally associated with the Global South are reemerging in the rich parts of Europe.

The crisis is undermining the “European social model,” and its assumption that employment protects individuals from poverty. The number of working poor — employed workers in households with an annual income below the poverty threshold — is growing, and austerity is going to make things much worse in the future.

Critics of austerity argue that it is absurd and counterproductive, but European leaders disagree. During the latest round of negotiations with Greece, German Chancellor Angela Merkel argued, “This is not about several billion euros — this is fundamentally about how the EU can stay competitive in the world.” ...

More here: https://www.jacobinmag.com/2015/09/merkel-austerity-globalization-eu-poverty/

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