62. Crisis of 1929 and the United States of today

All of the documentation of the USA’s economic development gives evidence of so many series of differences between the period 1929-1932 and that of the 1958 recession awaited and feared today, that one must conclude that between the two phases there is no analogy and the inter-war crisis of 1939 was by far so much more disastrous. Some trends are even contradictory; and the question is whether a world crisis with the same depth as the one back then will present itself in the future. Our answer derives from fidelity to the original Marxist doctrinal tradition, and it says that such a crisis will come, and that it will long precede a third world war and will beforehand pose the eventuality of an international resumption of the class struggle and of the possible social war, the only alternative to the catastrophe of imperialist conflict.

If the warning signs of today are not yet those of a similar grand crisis, they come nevertheless to confirm the fallacy of all the schools of welfare, and to demonstrate again the classic Marxist thesis that in the market economy every increase of production which only allows a fictitious increase of the average standard of living, and simulation of social leveling, does nothing but prepare the reversal of the process of advancement and a real and proper crisis.

The real and proper crisis which will historically place itself between the second and third world war will, even more than that of the first and second, be international, and how much we are underlining on the collaboration of the Russian State in "anti-crisis measures" serves to prove this; it is a collaboration which, culminating in the therapy of the extension of world commerce between the two purported blocs, even with only its ideological presentation, stands instead to prove, with dialectical force, that the next authentic crisis of overproduction will strike all of the monstrous productive machines of the world simultaneously. It will be the crisis of the superproductive madness which unites the USA and the USSR in the emulative competition so boasted by both parties.

And this crisis will place the world on the edge of another general war, if not the revolution, one of whose conditions is the development - requiring decades - of a party whose programme destroys the "myth of producing" and the "myth of consuming", linked together by the "myth of the market".

The data available today confirms the entirety of this position and we have attempted to recall and summarize them in the preceding pages.

63. Meaning of economic earthquakes

A fact which agrees with all of the large or small crises examined is the arrest of the growth of the index of physical industrial production and its relapse. This occurred between 1929 and 1930 in the USA and is happening today, between 1957 and 1958. The differences here are only quantitative and we don’t believe that we are experiencing between 1957 and 1958 a decline equal to that of 1929-30, which was 12.7%, and then fell for the next two years to 17.3% and 21.6% (in this final balance sheet we omit the intermediate crises, returning to what we have said about it in the varied sections 41 thru 61, and in the general table).

Given that for 1957 the index was 522, for 1958 it should give, to maintain the comparison with 1929-30, 456, or 66 (=522-456) points fewer, and the average monthly loss should be 5.5 points. We outlined the monthly trends, showing that between February 1957 and February 1958 11% was lost, and the fall began in September. From that month the indices are 526, 518, 507, 493, 485, 475 (February) with declines in percentage points of 1.4%, 2.1%, 2.9%, 1.5%, 2.3%. But they are the winter months in which usually production marks time, and it is not clear that the series continued as such until the end of 1958.

However even admitting that the 1958 annual index is 456, there are other quantitative differences that cannot be neglected. The year preceding that of the fall, 1957, compared to 1956 only increased by 1.0%, i.e. it was nearly equal; while 1956 had risen 3.0% from 1955 and 1955 had risen by the well-noted 11.3% against 1954. The series for the years 1954-1958, hypothetical for the last one, would be this: 451, 502, 517, 522, 456. We write the same series for the finished years 1926-1930, the latest being the first year of crisis. From Table 1 we have: 179, 182, 188, 205, 179. If we adapt the first index to 451 to better compare the two trends we have the proportionate series: 451, 459, 474, 517, 451.

The deviations in points from year to year in 1926-30 had therefore been: 8, 15, 43, -66.

And in the imagined period of 1954-58 it would be: 51, 15, 5, -66.

Without making graphs one sees that the two curves are very different. The last non-crisis year back then reported progress of 43 points, now it was almost stationary with only a 5 point increase. It follows that the loss in points (reduced to equal value) was back then in two years a good 109 points; now it would only be, in our hypothesis for 1958, only 71 points. For the entirety of the five years, well, then they were only zero points increase [179 to 179], today they would be 5 points [451 to 456], but precisely this takes away the analogy between the two developments. Back then it plummeted by rushing towards a cliff, today there was the year of stasis 1956-57 at roughly the same altitude. The different course also for this index has weight to establish that there is no foundation in foreseeing that we still have two more years of strong decline in 1959 and 1960, as it happened in 1931 and 1932.

64. A digression for Italy

Italy has had a series of years of progress of industrial production while now it marks the time. But even here it is not a given to make disastrous forecasts. The ascending series persists since 1946, and from 1954 the indexes were (for 1913 = 100; see Table 1): 321, 350, 376, 402; with the annual percentage growths of 9.0, 7.4, 6.9. Wanting to help ourselves to the ISTAT indices referring to 1953, the series from 1954 emerges: 109, 119, 128, 138. A decline in the indices is now being announced, given that February’s was 131.3, decreasing from that of 140 in January. But February is seasonally a month of low production in Italy, like December and like the disastrous loafer, August, which in 1957 gave 116, against 113 in 1956.

Thus it is only to be foreseen that 1958 yields, on 1957, a smaller growth than the preceeding years, and that’s all (there was in fact the small increase of 4.0%). In fact January with 140 has overcome by two points the average for 1957 and by five points against January 1957. The same February exceeds the preceeding February by 2.3 points. Therefore even here we aren’t yet at the reversal of the phenomenon, and the bourgeoisie can rest peacefully in its social and electoral slumber, certain diagrams ofL’Unità notwithstanding. In 1956 and 1957 the index for February was about ten points under the yearly average, which in 1958 would always be, in such manner, above that of 1957.

If then there are other Italian economic indices which flourish in this very spring of polls, which rightly calls all of the asses to bray with love, there is nothing left than to give condolences to the candidates of the opposition who don’t have better polemical trombones for the assault on the carriage of power and the orgy of exaction.

65. Returning to the United States

The direction in which the indices develop between 1929 and 1958 is the same also for employment, which diminishes. Even here the gap is only quantitative. The percentage of those employed in the civilian work force fell between 1930 and 1929 by 5.3. For now 1956 has raked in only 0.1% and 1957 stayed the same. We need not repeat that up to February 1958 the unemployment rate had climbed from 4.7 in February 1957 to 7.7, which means that the employment rate had fallen from 95.3 to 92.3, thus by 3.1%. We don’t believe that one arrives at the 5.3% of 1929-1930, all the more so because March hasn’t experienced a growth in unemployment (sticking to the monthly data 1957 should have diminished by 0.4 and not remained constant). Anyway here the course of the two crises is the same, albeit the quantity is very different.

In order to finish examining all of the concordant phenomena between the two crises, let’s touch upon the gross national product per capital in terms of real value. In 1957 it fell by only 0.3% compared with 1956; and it will fall somewhat (it was by -2.9%) in 1958, but in 1930 compared to 1929 the decline was by a frightening 11.0%! The last piece of data available today is for the fourth quarter of 1957, which shows a small decrease (-1.9% of the 1957 total).

A phenomenon very much relatively concordant is that of the prices of shares on the stock exchange. Thanks to the euphoric crowds of speculators, in 1929 they had increased their earnings by 30.5% against the preceding year. In the first year of crisis the crash was by 19.2%; and it kept increasing, given reported data. What is happening today? In 1955, year of the "boom", the ascent was also dizzying, 36.4%, but in the subsequent year, 1956, it was only 5.3%.

In 1957 there was a performance at 4.1% (unaltered in 1958 at 4.2%).

In the index of the "Economist", after 1957 one has (1939 = 100) that 1957, having given in the entirety of its course an average of 331.4, the movement in the recent months was instead stationary if not ascending; from October 1957 to Febbruary 1958: 306.4, 301.8, 298.5, 304.7, 304.0.

All in jarring contrast with the well known trend of 1930.

Passing to the phenomena which the crises do not have in common, the first, already illustrated sufficiently, is that of the purchasing power of the dollar, which today declines slowly but inexorably; the second is that of both wholesale and retail prices, which are constantly growing.

66. Crisis, deflation and inflation

During the crisis of abrupt arrest of production caused by an excess of manufactured goods there exists the backlash of an increased supply of all of those which choke the warehouses and must be absorbed by the already stuffed-full market, and of a diminished demand from part of the consumers, whether they are workers unemployed due to the closure of factories, or even capitalists whose industries give minor dividends because of the collapse of production and of profits. Equilibrium will be unachievable, through the long general upheaval, other than via selling the overabundant goods at a price - which, if the capitalist economy were capable of avoiding crises, should be identified with exchange-value, equal to the sum of constant capital, wages and surplus value, which come into play together in the normal productive process - at first wholesale and then albeit at one less drastically so in retail, underneath their value of production (we haven’t yet said cost of production).

Therefore in the classical condition of these crises, which is accompanied by the unemployment of masses of wage earners and the bankruptcy of capitalists - who, remaining without profit-revenue, must even sell off their fixed capital and instruments of production - the phenomenon which immediately explodes onto the scene is the slump in prices. Historical capitalism is the economy of high costs for basic agricultural necessities, which interest its wage earners when remuneration is just at the level enough to ensure them life and reproduction. But capitalism is at the same time the economy of low prices for manufactured articles, and it grows physiologically when it can get its proletarians to consume its manufactured products alongside the articles of subsistence.

The survival of the capitalist system yesterday and today has always been bound to the possibility of this double consumption, the welding of the need for food and clothing to the thousand needs for furniture and "appliances" even in the homes of those who live on their labour. In traditional crises the lack of money as much among wage-earners as among profit-earners would immediately cause a further decline of all agricultural and industrial prices, translating to an increase of the buying power of money, with a relative advantage even for the workers, but above all for those strata who can hoard a certain sum of money, or acquire some reserves of various natures, from real estate to furniture and equipment.

Before the epoch of the great wars such crises would begin with overproduction and inability to sell the product of heavy industry; they would be, on the face of it - a face which would give the first alarms - crises of deflation, and obviously of low stock prices which express the value of the means of production possessed by the bourgeoisie, means threatened by long periods of inactivity and paralysis, by their incapacity to be made useful and profitable by human labor.

By the time of the great wars which dragged into their vortex the most populous and powerful of States, and thus even before the outbreak of the European and then global war of 1914, crises started taking on the aspect, at first sight contradictory to the classical one, of climbing prices and demand for goods, especially by large industry. War is an increased consumption of commodities in every sense, and of all species of goods requested in enormous masses for the mobilized armies. All industries are invited to produce and sell more, albeit to the belligerent client-State, which knows how to find the money. Production is stimulated, the stocks of the largest industries don’t collapse but instead climb; every commodity becomes scarce for consumption by the populations and every price soars. It would be pointless to trace out the picture, known by everyone from painful experience, of the inflation of money.

The instability of the capitalist system is given by the fact that the same trepidation strikes the business world when the crisis of low prices (or crisis of peace) and the crisis of inflation (or crisis of war) takes shape. The course of both the one and the other denounces the incapacity of the market system to escape all of these frightening oscillations.

67. Crisis in the thought of Marx

It is necessary here, for its grand importance, to report in full a passage from Marx already made use of in the meetings and cited in the summary reports. It is in Volume 2 of Capital, chapter 20, section 4: Necessities of Life and Articles of Luxury. The argument will be given more systematic exposure in upcoming meetings and, regarding the republication in "Programme Communiste", the French magazine of our movement, in the summary of Marxist economics, which must be continued (MECW, vol 32, p. 409).

«Every crisis at once lessens the consumption of luxuries. It retards, delays the reconversion of (IIb)_V [note: Department II of global capitalist production refers to the production of consumer goods; Marx introduces for it, during a time when little was spoken of furniture, installed systems, and domestic machinery, two sub-sections, being a) basic necessities, and b) luxury goods. A good formula for economic organization under the proletarian dictatorship would be: for the second one to get screwed!] into money-capital, permitting it only partially and thus throwing a certain number of the labourers employed in the production of luxuries out of work, while on the other hand it thus clogs the sale of consumer necessities and reduces it. And this without mentioning the unproductive labourers who are dismissed at the same time, labourers who receive for their services a portion of the capitalists’ luxury expense fund (these labourers are themselves pro tanto luxuries), and who take part to a very considerable extent in the consumption of the necessities of life, etc. The reverse takes place in periods of prosperity, particularly during the times of bogus prosperity [the "boom", we said at Meeting n. 17 in Cosenza!], in which the relative value of money, expressed in commodities, decreases also for other reasons (without any actual revolution in values), so that the prices of commodities rise independently of their own values. [Note that in the prosperous period it is logical that prices rise and the purchasing power of money falls.] It is not alone the consumption of necessities of life which increases. The working-class (now actively reinforced by its entire reserve army [read: full employment]) also enjoys momentarily articles of luxury ordinarily beyond its reach, and those articles which at other times constitute for the greater part consumer “necessities” only for the capitalist class. This on its part calls forth a rise in prices».

«It is sheer tautology to say that crises are caused by the scarcity of effective consumption, or of effective consumers [of luxuries]. The capitalist system does not know any other modes of consumption than effective ones, except that of sub forma pauperis or of the swindler. That commodities are unsaleable means only that no effective purchasers have been found for them, i.e., consumers (since commodities are bought in the final analysis for productive or individual consumption). But if one were to attempt to give this tautology the semblance of a profounder justification by saying that the working-class receives too small a portion of its own product and the evil would be remedied as soon as it receives a larger share of it and its wages increase in consequence we [read: who deny that the solution can be sought in the continuous increase of wages, rather than with the revolution which abolishes waged labor] could only remark that crises are always prepared by precisely a period in which wages rise generally and the working-class actually gets a larger share of that part of the annual product which is intended for consumption. From the point of view of these advocates of sound and “simple” (!) common sense, such a period [the period of well-being...] should rather remove the crisis. It appears, then, that capitalist production comprises conditions independent of good or bad will, conditions which permit the working-class to enjoy that relative prosperity only momentarily, and at that always only as the harbinger of a coming crisis».

This passage from Marx must be properly meditated, in the course of this recapitulation of the discriminating marks of shame of the recent history of US capitalism, the first to loudly speak of luxury and unnecessary consumption for the well-being of the entire population - the most vile!

68. Monetary devilry

At a certain point in the treatment on the simple reproduction of capital, and forewarning that the general conclusion also has value in the study of extended reproduction, or rather of capitalist accumulation, Marx recalls what sense it has to represent the whole social movement of capitalist production, divided into the well known sections, with the same laws with which is divided the value of any quantity of commodities between Constant capital, Variable capital, and Surplus value. The entire construction does not at all tend, as the ancient and modern Proudhonists believe, to concentrate everything, "building socialism", with a different partition, or worse with the hogwash about "abolition of surplus value".

Marxist analysis is based on the fact that in the bourgeois economy all transactions must have a monetary measure, and a certain volume of money must circulate and eventually reproduce itself as capital. Studying this system and its expansion, one arrives at the deduction that it is inseparable from exploitation and is historically transient and degenerative.

Such scientific demonstration builds up in its "counter-pages" and if you want "counter-formulae" the revolutionary post-capitalist program.

When Marx says that goods are only sold to paying consumers, he intends to make his own the opposing hypothesis which says: when everything is an exchange between equivalents (read: of value!), all will go well without catastrophe. And working on such hypothesis he demonstrates how the catastrophe arrives. He therefore doesn’t disregard credit (commercial and banking capital) but admits that in his model of bourgeois society credit is given only for capital and not for consumption.

Reduced to extremes the bourgeoisie has thrown away the classic theory of free exchange (and after all the law of value which the "communists" pick out of the trash) upholds the theory of well-being in which, like in US practice, there is the order: consume and don’t pay, i.e. a vast credit not of capital goods but of consumer goods. Now if Marx has poured over the trenches of the theory of exchange in cash, for us, his pupils, it is a game to pass over the ruins of those of the exchange of credit (an old form of medieval and pre-bourgeois economics over which capitalism would magnify its revolutionary victory, because it is a form which stinks of servitude and slavery).

When we read in Marx the reduction of everything into a monetary equation and show in the front line that in the total social exchange everything proceeds evenly, but like in the single company the extortion of classes persists, we must know how to deduce that in the socialist economy there is no more equivalence and exchange, neither in the elementary relationship nor in the integral one; that the formula of capitalism always remains, despite Keynes and instalment sales, that according to which only paying consumers are known, i.e. cash payers, and credit on tomorrow changes nothing at all. The true formula of socialism is this: the consumer does not pay, neither today nor tomorrow; money is not necessary neither today nor tomorrow.

The Soviet economists say that they are still not at the height of passing over to barter. But communism is not barter, which is only the millennial embryo of the market and the law of value! Communism is to give and take without counting. The formula is not: we would exchange a Russian economist for 10 Americans; or an American for 10 Russians; but rather: let’s make the beer with the ones and the others.

An American "columnist", a propos the whole philosophy of recession to which the overpaid experts abandon themselves - while in America an austere Englishman sees that one gorges and engorges themself behind the backs of all of the colonial servants, white and colored - writes that one head of a big firm thought of submitting all the economists, found to gobble down their salaries, to the scrutiny of a psychiatrist; and that he subjected to comparison the tests of an investigation with yes or no answers made by the experts, and a kindergarten class of employees’ children. The responses of the children proved more useful than those of the economists, and the head "fired them all", he liquidated all of them. A doctrinal and material failure for the theorists of well-being!

69. Let’s resume the comparison

The trend in the buying power of money confirms what Marx proposed. In the periods of productive growth and high consumption the dollar has always been losing value. The only years in which it grew have been years of crisis: 1921, 1922, 1931, 1932, 1938, 1939, overlooking minimal oscillations like a small decline in consumer prices in the boom of 1955.

Today the buying power, measured by both wholesale and retail prices, continues to decline. A result of well-being or of crisis? The professorial economists lose their minds and their positions.

What has happened in the meantime with wages? In general from 1929 they have always grown, even if we express them in real value, also having had to make a reservation for the details of the years 1928 to 1937. Since then the only years with some decline have been 1938 and then 1945. The crises opening and closing the great imperialist war interspersed by periods of great development of trade, take the new characteristic that they yield underproduction, unemployment, and low real wages at the same time: passing from liberalism to well-being-ism, it is the case to say: it was better when it was worse.

Today what takes place? After another period of robust growth of the average real wage, which in 1955 had grown by 7.7%, similar number to the productive crisis of 1954 (industrial production fell 7.1%), 1956 yielded only +2.6%, and 1957 -0.1%. It’s not easy to foresee what 1958 will give (it dropped by 1.3%). It’s certain that prices and the cost of living will continue to rise, but the experts foresee workers struggles to defend wages, while the trade union leaders propose to give a little breath to "business". Nobody foresees or proposes to diminish the working day without layoffs. What insanity, having some free time to study and fraternize, but not being able to buy a new motorcycle and some clothes for the wife!

70. Crisis of labor, not of capital

If we consider the mass of wages for a moment, in other words the entire working class, therefore leaving out the number of employed and unemployed - as if the class fraternity really existed - we could use the following figures, for a further comparison, after having warned that we make use of those of "Labour Income" i.e. industrial income, which joins the wages of the workers with the salaries of the employees of the manufactories, factories and non-agricultural and non-commercial enterprises.

We assume the three dates January 1956, August 1957, and February 1958, of which the second represents the maximum summit achieved, and the third is the last one that we have at our disposal. The series was: 226.3, 249.7, 242.2 billion dollars. It would seem, according to the nominal values of wages, that a slight descent follows a strong ascent. But the real remuneration of the active industrial class is what interests us, and we use the price indices, not of food, but of all retail items, assuming that today the American worker spends his money for everything except for eating! The indices are, in those three dates, 114.6, 121.0, 122.5. Having made the reduction, that is, evaluating everything in January 1956 dollars, the series becomes: 226.3, 236.5, 226.6 billion dollars. Therefore the real phenomenon is that an increase in "wellbeing" of 4.5% was followed from the beginning by a descent of 4.2%, while apparently the difference was +10.3% and -3.0%. If, with reservation for future statistical announcements (maybe the descent of nominal wages stops, but not that of the value of the dollar!) we take into account that our first ascendent interval is 19 months, and that the descending one only 6 months, we have the fact that an increase in the real wage of 2.8% per year, surely considerable, and unknown to the countries where wages are still at starvation-level, is followed by a decline of 8.2% per year, truly severe if such a process was continuous, and oddly contrasting the theory of increasing well-being. This abrupt turn is due to the fact that unemployment was added to increasing prices, to inflation.

We are today in the presence therefore of a rather abrupt turn, but it, different from 1929, it concerns the working class, not capital and its beneficiaries. Then the life of the rich class became for a not brief time a hell, while because of the general slump the workers, despite the vast layoffs, were able to eat, or they could do it with a minimum of class collaboration, something different and far more efficient than social and government aid, through which the dominant class saves only itself.

Surely if we had today data, once given, of the less skilled and less paid (unskilled) workers the comparison would be far more eloquent.

We can get a hint (albeit insufficient) from the figures for total national income in which flow together the incomes of all of the social classes. The figures in the same period were: 316.7, 347.3, 341.7 billion dollars. Reduced also to constant January 1956 dollars we have the real values: 316.7, 328.9, 319.7. The growth was by 3.9%, equal to 2.4% annually and therefore it can be said that nothing changed with respect to the bulk of the wages. Instead the decline was by 2.8%, equal to -5.6% yearly, that is noticeably less serious than for salaries and stipends, which fell 8.2%. This demonstrates that all of the incomes of the non-employed and capitalists have improved the overall average, and therefore dropped very little - or not at all.

Here it’s seen what use the abused "national" figures are for well-being and bourgeois economists, with respect to the classist economics of Marx which from today’s statistics can just be sketched. Even in the USA and with the race to well-being, it’s true (to the extent to which figures - which don’t contain the run- away superprofits of capital and lucrative reinvestments - are true) that the average has improved by 2.4%, while the class which works has improved by 2.8% (from that one would like to draw the conclusion of the well-being impacting every class) but it cannot be hidden that in the recession the average has only recoiled by 5.6% annually, while the toll for the working class, including well-paid specialists and intellectuals, has already fallen by 8.2%, which, especially if we think about the less fortunate layers, is a real crisis.

But, politically, we are not looking for the crisis of the worker, but the crisis of the capitalist. We liked the 1929 crisis, in which the remuneration of the proletariat did not collapse, but rather ruined that of the employer.

The strikes to raise wages do not resolve, also because with that sort of trade union they end in failure, but an effort of the US workers to understand the theory of their home economy would be determinant, and get them to hope for the real bankruptcy of the corporations and of the State.

71. Opposite signs to 1929

We have shown how in 1929-1932 the net and gross profits of the bourgeois enterprises collapsed and even became negative. From 8.6 billion dollars in net profits in 1929 it fell to -2.7 billion dollars in 1932. A true return of the stolen goods to the exploited class, even if there was the game of taxes which caused part of the money of the companies to flow into the coffers of the bourgeois State.

The figures for gross gains of taxes were from 1929 to 1933 the following: 10.0, 3.7, -0.4, -2.3, 1.0 billion dollars, which shows well the volume of money which capital had to give up underpriced after paying for raw materials at old (not fallen) prices, and after which the worker’s wages did not descend but endured and improved, except the drop in the mass of wages due to lower production and unemployment.

Nothing similar in the current recession. We have shown that from 1956 to 1957 industrial profits decreased, despite production remaining the same. What will happen in 1958? We have confessed that industrial production decreases and with it the gross national product and national income, but in proportions much smaller than in 1929. A drop in profits of the kind at the time is completely unthinkable: from 8.6 to 2.9 billion dollars in a year, i.e. 66.3%!

That is to say that a profit of 26.0 billion dollars should be followed in 1958 by one of only 8.8 billion dollars, which is outside of all expectations. Only in 1939, i.e. before the war, would US industry earn a figure inferior to this, and we will certainly not see this in 1958 - if, anyway, the international waters over which reigns an unbearable calm, got tangled, the business affairs of the US factories, one way or another, would be better.

The difference between the two historic situations teaches that with the varied successions of the New Deal, State dirigisme, and economic interventionism, capitalism is incapable of avoiding crises, but achieves a state of affairs wherein these burden more the less remunerated classes than the most remunerated ones, whose attachment to high benefits is guaranteed by the complicated mechanism of State control. This is a theoretical victory for Communism in that the theory of a tolerable capitalism blows up from the point of view of the workers, after having tried to get on its high horse at the expense of the pure and classical Liberal theory, from which Marx had started precisely because it is the most far away to us, not the closest or easiest to surrender to the dialectical-polemical battering-ram.

Such a victory could not be a political victory when fascism won in Italy, in Germany and then in substance, in the economic sense, everywhere; because the disgrace of anti-fascism was to relapse into the liberal doctrine and in the plague of democracy.

72. The elegant deflation

That the current recession is not a serious matter is shown - other than by the course of profits on capital, very far from doing the somersaults of back then - by those of securities on the stock exchange.

We know the ruin which equity stocks have been subjected to after 1930! Well then, some of the latest news is that a few days ago, while these pages were being drawn up, they have reached the peak, i.e. the maximum vertex, of this very tearful beginning of 1958.

This peak was at 167.10 (index of the Associated Press) against 154.30 at the end of the year (if we set 1913 = 100, it was 543.4). How do we reconcile this 8.3% increase with the prediction of a castatrophe, when we have before our eyes in Table 14 the annual collapses of 19.2%, 35.0%, and 49.3% from 1929 to 1932?!

Today the peak, back then the bottom of the abyss.

Since in order to annoy the men of economic science we have not done crisis theory, but only crisis photography, let us treat ourselves with the fall of prices in the period 1928-1933, which we want to set against today’s increase just dealt with in relation to the initial fall in wages.

The price indices of all retail items, which today are racing, we find for the series 1928-29-30-31-32-33 in the official volume Historical Statistics of the United States, 1789-1970, published as a supplement to the annual Statistical Abstract. Those indices (given by us in base 1913 = 100) are: 172.7, 172.7, 168.4, 153.5, 137.7, 130.6.

If instead we take the retail indices for foodstuffs, the series declines even quicker: 163.4, 165.4, 157.2, 129.5, 107.9, 104.8.

The weekly salary in industry in dollars varied thusly: 24.70, 24.76, 23.00, 20.64, 16.89, 16.65.

This puts us in a position to lift the reservation in Table 14 about the series of real wages. If we calculate it based on general retail items, we will have a still descending series, but far less than the nominal one: 24.70, 24.76, 23.59, 23.22, 21.18, 22.02.

But we are entitled to form the series with food price indices, if we think that wages were back then, in dollars, less than a third of today’s; washing machines, TV sets, refrigerators, you name it. Well, out pops the ascending series of real wages during the crisis of 1928-1933. Here it is: 24.70, 24.46, 23.59, 23.22, 26.04, 25.58, 25.96.

The 1929-1932 increase (see column 9b of Table 14) is well confirmed: from 24.46 to 15.58, one has +4.6%.

In 1937, when the crises is over for bourgeois gentlemen, the nominal wage had risen to 23.82 around pre-crisis levels. But prices had resumed the race, and for general prices the index climbed back to 144.8. This means to say that the real wage was just 21.48 compared to 22.02 in 1933. If then we take the index for food, which in 1937 was 131.5, then the wage in real dollars compared to 1933 had even fallen to 18.98. Between 1933 and 1937 the real wage based on general retail prices fell by 2.5% and based on foodstuffs by 26.9%. Since then real wages have risen almost regularly, and they have pissed us off with well-being.

But the law of well-being of the "classless" society of the United States is in conclusion also this. When it goes very badly for the bourgeois, it goes badly, but not as much, for the proletarians. When it resumes going well for the bourgeoisie, it gets worse for the proletariat.

There is no choosing between capitalism without crisis and capitalism in crisis for the proletariat, only the struggle to do away with capitalism, with crisis or without crisis, deflated or inflated.