Vol. 73/No. 6      February 16, 2009

With new layoffs announced by major companies just about every day, the number receiving unemployment compensation is now the highest since records began being kept 40 years ago. Nearly 6.5 million workers receive checks, but at amounts much below their pay than when they were working.

From September to December 2008, U.S. employers laid off 2 million workers. At the end of January large corporations continued to announce layoffs encompassing thousands. BHP Billiton, the world’s largest mining group, is cutting 6,000 workers from its operations in Australia, the United States, and Chile. The company announced plans to cut coal production by about 15 percent.

John Deere & Co., which makes farm equipment, plans to lay off about 700 workers at factories in Brazil and Iowa. Other job cuts include 10,000 at Boeing; 6,000 by British drug maker AstraZeneca; 4,500 by Kodak; 2,000 by airplane maker Cessna; and 7,000 by Macy’s.

Four days after announcing 20,000 jobs were being cut, heavy equipment maker Caterpillar said January 30 it was laying off an additional 2,110 workers at Illinois plants in Aurora, Decatur, and East Peoria, with more to come, according to a company spokesperson.

With a 25 percent decline in sales tied to sharp cuts in commercial construction, Caterpillar, which is the world’s largest maker of mining and construction machinery, has cut its total workforce by 20 percent.

State and city governments are implementing new layoffs and cutbacks in social programs. Detroit mayor Ken Cockrel has called for a 10 percent wage cut for city employees or the layoff of 1,000 workers. New York mayor Michael Bloomberg is proposing to raise $900 million by increasing the sales tax up to 8.625 percent. The mayor is also proposing to eliminate about 23,000 city jobs.

Declining capitalist production is having a devastating impact on toilers worldwide. In South Korea, industrial production plummeted 18.6 percent in December from a year earlier. In China, some 20 million migrant workers—out of an estimated 130 million—have been laid off or are unable to find work, many now returning to the countryside.

In Brazil, nearly 655,000 jobs were eliminated in December. CSN, a steel firm, cut 300 jobs and 3,000 other workers that month were put on “temporary leave.” General Motors, Fiat, Ford, and Vokswagen have placed thousands of auto workers on leave or axed their jobs. In mid-January, General Motors eliminated 802 jobs at its São Jose dos Campos plant located outside São Paulo. In response, workers organized a protest action, downing their tools for an hour at the start of their shift January 13.

In the United States, President Barack Obama is working up details on a plan to provide hundreds of billions of additional dollars to the banks, in addition to the unallocated parts of the $700 billion bailout package approved by Congress last fall.

“Government officials seeking to revamp the U.S. financial bailout have discussed spending another $1 trillion to $2 trillion,” reported the Wall Street Journal January 29, which could include setting up a “bad bank” for “toxic assets.”  
 
Obama’s ‘stimulus’ package
Vowing to save or create 3 million jobs over the next few years, President Obama is promoting the American Recovery and Reinvestment Act of 2009, an $819 billion “stimulus” package. It was passed by the House of Representatives January 28. The Senate began working on its version of the bill February 3.

The House bill provides $275 billion in tax reductions and about $526 billion to be spent in 2009 and 2010 in a potpourri of areas. These include funds for state governments, the military and state and local police departments, health care, education, infrastructure repair, an extension of unemployment benefits, credits to businesses for “creating jobs,” and protectionist measures on use of U.S. iron and steel.

Companies wishing to receive “stimulus” funds are required to participate in the “E-verify” program, which checks a worker’s Social Security number and eligibility to work in the United States.

Only 5 percent of the $819 billion goes toward repairing the country’s infrastructure. The bill includes $30 billion for roads and $12 billion for rapid transit. Nearly $7 billion is being allocated to various branches of the U.S. military as well as to strengthening border patrols by the Department of Homeland Security.

Some companies like Corning Inc., a producer of fiber-optic cable, could get about $9 billion from the stimulus plan to wire community colleges, libraries, and rural governments with high-speed Internet equipment. But that didn’t stop the company from laying off 3,500 workers, 13 percent of its workforce, January 27.

The plan includes extending unemployment benefits through Dec. 31, 2009, covering 65 percent of an individual’s Cobra health insurance premiums for up to 12 months if they are no longer covered by their employers’ group coverage, and allocating $11 billion to provide “temporary optional” Medicaid to some workers newly receiving unemployment checks.
 
 
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U.S. union membership rises 2nd year in a row  
 
 
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