Capitalists Are Escalating Their Shakedown of American Workers

Last year’s modest wage gains have been wiped out by inflation, and prices are up across the board. Meanwhile, the rich are living large on superyachts and private islands — and they’re coming for working Americans’ last scraps of wealth.

American workers are now more poorly positioned than they've been in nearly half a century, while superyacht and private island sales surge. (Arno Senoner / Unsplash)

The soft opening of the Omicron BA.2 variant notwithstanding, world governments seem to have collectively decided that it’s officially time for restrictions — and protections — to end. In the United States, the Centers for Disease Control and Prevention recently eased mask enforcement while the moratorium on student loan repayment is set to expire on May 1. New York City mayor Eric Adams, who has also supported ending restrictions, recently slob-shamed remote workers for opting to “stay home in your pajamas all day” instead of getting back to the office and “cross-pollinating ideas.” In Seattle, where I live, the city council rejected the efforts of socialist councilwoman Kshama Sawant to extend the eviction moratorium.

But as we prepare, yet again, to return to what we are led to believe will be a state of normalcy at last, Americans are more poorly positioned than we have been in nearly fifty years. By almost every measure — inflation, wages, medical expenses, student debt, rent, transportation costs — we are struggling. We are paying more for necessities and experiencing deepening immiseration while corporate profits are higher than they’ve been in nearly a century.

Some of the increased burden can be attributed to the pandemic as well as to supply chain problems and inflation. However, the most significant source of Americans’ current difficulties is that corporations, emboldened by the long decline of consumer protections and the functional indifference of most Democratic (never mind hyper-reactionary Republican) leaders to economic inequality, have opportunistically raised prices.

Writing in the Nation, John Nichols describes a January encounter between Senator Elizabeth Warren and Fed chair Jerome Powell, in which Powell all but concedes that recent price hikes are nothing more than a cash grab. As Nichols points out, politicians on the Left “understand that ‘explanations’ of inflation that don’t address monopoly abuses and corporate greed fail to speak to the economic and political realities of the moment.” But while others in the government besides Warren have raised the issue, there seems to be little likelihood of meaningful policy.

Wage theft and opportunity hoarding are perennial concerns, but what we are seeing now is a gold rush on working people’s remaining savings, scant as they are. In this, Americans are being tested to see just how much we’re willing to endure. Capitalists, having been instrumental in creating a workforce too exhausted and disorganized to mount an effective defense against plummeting quality of life, are betting the answer is quite a lot. And while inspiring union votes are being held across the country, the overall lack of any significant and sustained anti-capitalist movement telegraphs that we will still put up with more.

We need to show that we won’t.

The Fix

Last December, six Amazon workers died when a tornado ripped through a warehouse in Edwardsville, Illinois. One employee, Larry Virden, texted his girlfriend that the company had refused to allow him to leave. He was killed by the collapsing roof as forty-six employees rushed to shelter in the building’s single safe area.

The deaths illuminate the nature of the stress test that most Americans are now enduring as we navigate an economic landscape characterized by precarious labor and diminishing purchasing power. Broke and bullied, we’re discovering that capitalists are trying to squeeze consumers and workers for all we’re worth — even if that means putting us in positions where we are literally dying for the job.

Inflation has decimated the modest wage gains workers saw last year. An hourly earnings increase of 0.4 percent, reported back in October, was obliterated by nearly 1 percent inflation for the month. Over the course of the pandemic, net hourly wages have declined 1.2 percent, while prices have climbed 7.5 percent over the past year, both due to inflation and because of the padding of corporate profits. Food prices, in particular, are up over 10 percent from a year ago.

Rents have similarly exploded, with some cities seeing as much as a 40 percent increase over the past year. While some local governments have passed rent control measures to ease the burden, much of the housing market remains unregulated. One saving grace, at least for those who are mobile, has been that housing costs have remained moderate in the nation’s smaller, less fashionable cities and suburbs — hence the migrations out of New York and Los Angeles and into Frisco, Fort Meyers, and Murfreesboro. But the savings are diminishing. As Conor Dougherty details, even smaller markets like Spokane, Washington, have seen ballooning housing costs, with home prices rising 60 percent since 2020.

Transportation and energy costs have also risen. Gas prices, driven in part by the Russian invasion of Ukraine, have risen 33 cents per gallon since the start of the year. Utility costs have also seen the largest spike in over a decade.

The case of Texas is particularly emblematic of how consumers have been blindsided. Last January, as the state was hit with a massive freeze, the Electric Reliability Council of Texas (ERCOT), presiding over a deregulated and insufficiently winterized grid, cut the power supply to 4.5 million rather than face a full system collapse. Many customers were subsequently billed outrageous sums, reflecting price hikes during the crisis. While the state later reached a settlement with Griddy Energy, Bill Magness, the ex-CEO of the ERCOT, recently testified that Governor Greg Abbott instructed him to keep wholesale power prices at their maximum price cap as a means of keeping rolling blackouts to a minimum. This admission notably contradicts a prior statement from the governor’s office.

Student debt also remains a significant burden on Americans. While Biden has forgiven $15 billion of the $1.7 trillion total, including most recently a $415 million package, these drips and drops fall far short of campaign promises. With student loan repayment set to begin shortly, tens of millions of Americans will once again be thrown into debilitating economic stress. 

The effects of the current shakedown go beyond mere impoverishment, which is certainly dire enough. American life expectancy also infamously dropped in 2020, from a previous 78.8 years to 77.3. While in part attributable to COVID, Americans are statistically dying younger from other causes as well — homicide, diabetes, and what Anne Case and Angus Deaton have called “deaths of despair,” including liver cirrhosis and drug overdose.

While we are seeing significant labor action across the country, we are also seeing increasingly emboldened union busting. Amazon warehouse employees in Bessemer, Alabama, have been allowed a second unionization vote after the NLRB ruled that the company had interfered in the first. In response to a wave of successful unionization drives at Starbucks locations, the company has engaged in practices that workers allege is retaliation — these include spying, coercion, and the termination of several union organizers. And as REI workers sought to unionize, the company responded with a jaw-dropping anti-union podcast swaddled in the language of social justice.

With these sundry intensifications, capitalists are emerging from the pandemic determined and emboldened. Confident in an absolute lack of opposition and with their eyes set on the what’s left of workers’ livelihoods, they are scrambling to get their piece.

Why Does Herr Bezos Run Amok?

While Americans suffer through one of the most difficult economic periods in decades, we do so amid unprecedented displays of wealth. Billionaires, seemingly untroubled by even a passing moment of self-reflection, are on a spree. In the news virtually every day for obscene acts of indulgence, the rich are blazing new trails of conspicuous consumption. Mark Zuckerberg, whose reign of terror could very well be coming to an end with the rocky launch of Meta, has recently expanded his already 1,500-acre ranch on the island of Kauai. Not far away, the Obamas are completing work on their own multimillion-dollar compound on Oahu, their second vacation home after their $12 million estate on Martha’s Vineyard.

The most symbolic display of wealth in recent memory is Rotterdam having to potentially dismantle its iconic Koningshaven Bridge to accommodate the height of Jeff Bezos’s $500 million superyacht. As the New York Post reported, the yacht will be bigger than those of fellow tech moguls Sergey Brin and Larry Ellison. It also requires an $80 million support yacht bringing up the rear.

Sales of luxury goods declined during the first year of the pandemic, but have subsequently rebounded, a phenomenon some have called “revenge spending.” Enormous fortunes have been made during the pandemic, and a rising nouveau riche is clamoring to blow its recently acquired wealth. Superyachts are not just for the top players anymore — sales were up 77 percent last year. Sales of private islands also rose. Luxury properties are going quickly on the metaverse, where, somehow, investors have spent millions on real estate.

Of course, the cryptocurrency and NFT scenes have offered up some of the more ghoulish displays of stupid money in recent years. Dead-eyed, body-snatched celebrities are lining up to display their apes or to con us into being crypto maximalists. Las Vegas–based DJ and Benihana heir Steve Aoki, an unsurprising adopter, has claimed he’s made more from NFTs in the past year than from royalties. Last May, it was announced that Cara Delevingne, in collaboration with Chemical X — an anonymous street artist who makes mosaics using homemade ecstasy tablets — was auctioning off an NFT “about her vagina.” Even Lindsay Lohan tried to make some plays by auctioning off a Cremaster-esque NFT of her “fursona,” an act that greatly displeased the furry community.

This year’s Super Bowl featured multiple aggressors — Matt Damon, fresh from his trial cancellation after admitting to using a slur against homosexuals, strongly insinuated that we were all wusses for not getting into crypto; Larry David disappointed many by lending his star power to an ad for a virtual currency exchange; and Matthew McConaughey reprised his role in Interstellar in an ad for cloud services company Salesforce, touting its new sustainability initiative. Soon afterward, however, the company announced it would be developing an “NFT Cloud” that would rival the popular but scandal-plagued

The crypto and NFT racket seeks not merely to shame workers but also to shake them down. As is now well known, the real money has already been made, but the grifters still need marks to buy in before they themselves can cash out. As Sohale Andrus Mortazavi wrote in Jacobin last month, “New investors are being lured in under the pretense that speculation is driving prices when market manipulation is doing the heavy lifting. This can’t go on forever.” In the end, someone will be left holding the bag. And it won’t be elites. Indeed, there are indications that the bubble is bursting.

The upshot of all of this is that Americans, many of whom are financially hurting and psychologically not ok, are being both humiliated by outrageous displays of wealth and lured with the carrot of instant riches by a few elites looking for an easy hustle. Capitalism has always profited from the most vulnerable, but recent developments suggest a progression toward unconcealed and even self-righteous theft.

Trouble Every Day

In the decimation of workers’ wealth and well-being, we are seeing the teeth of what Nancy Fraser calls “cannibal capitalism.” As she wrote in New Left Review in 2021, “capitalism is a cannibal that devours its own vital organs, like a serpent that eats its own tail.” While the crux of Fraser’s argument concerns the environmental consequences of unchecked capitalist accumulation, it also bears a host of non-environmental destabilizations, including the decimation of human lives.

Capital, Fraser argues, “expropriates human communities, for whom the confiscated material and befouled surrounds constituted a habitat, their means of livelihood and the material basis for their social reproduction.” Capital removes communities’ potential to sustain themselves, and in so doing ultimately undermines itself. But capitalism knows no other way to be.

In the manifest devastation of American workers, we are witnessing the cannibal way in full effect. Amazon remains the exemplar. The company typically places its warehouses in minority neighborhoods, where the air pollution produced from the constant vehicle traffic will go untracked and the attendant health effects will be ignored. It likewise cycles through underpaid employees at nearly double the rate of comparable industries, with an injury rate more than twice that of other warehouses. Metastasizing in neighborhoods and communities across the country, the company is spreading the wealth of misery and downward mobility and sowing the seeds of community collapse — indeed, collapse of the very communities it relies on to both work for and buy from Amazon.

For Fraser, the solution to this problem lies in coalition building among the disenfranchised public. Overcoming atomization and demoralization to amass a bloc big and powerful enough to effectively fight back is vital for American workers being hustled for the remaining scraps of their wealth. Striketober, as compelling a narrative as it offered, wasn’t the coup against underemployment that many had hoped, but it nevertheless offered an important illustration of what collective resistance to exploitation and capitalist appropriation might look like.

Moving forward, we should take cues from the recent strikes of Kellogg’s workers, Columbia University graduate students, and Seattle concrete workers. Capitalists will keep running their confidence game. The Left has to find a way to stop playing.