The crash of '87

Liberate labor from the stock market!

(The Workers' Advocate, November 1, 1987, pp. 1,10)


. October 19. Devil's Night came early for the stock market. There was the biggest drop ever. The stocks lost 22.6% of their value in one day. This was almost twice as much as during the famous crash of 1929 which signaled the coming of the Great Depression.

. And October 19 itself followed a week of decline. In a few days' trading one trillion dollars, one thousand billions, of paper values vanished.

. What happened? Had hurricanes and tornadoes destroyed the factories? Had a nuclear exchange devastated lives and property? Had drought and pestilence spread over the countryside?

. No, the country's factories and farms were still there. But under capitalism, one needs more than factories and farms, raw materials and workers' labor, to produce wealth. All these things are owned by a handful of rich. On the stock market, they trade the certificates that stand for this ownership. And only when it helps them make more wealth will the factories produce more goods and will food be available to the people.

A Sign of a Tottering Economy

. The stock market crash is a sign of the rot that has been building for years all through the economy. It has awakened widespread fear of the ruin that awaits the masses under capitalism. It is a warning of the deeper crash that is waiting to happen. And it will bring in its wake more factory shutdowns, more unemployment, more demands for concessions.

. It seems that the stock market is a no-win market for the workers. Today they are talking about the newest increases in stock prices being perhaps a "suckers' rally". But the stock market itself is a suckers' market. Whether it was the long "bull market" of 1982-7 in which the stocks leaped up fantastically, or the stock market crash of this October, it is the workers who are called on to pay the bill.

Behind the Stock Market's Prosperity of 1982-7

. For some time the capitalists had been claiming that the country was prosperous. And certainly the stock market was. From 1982 until the crash of October 19 the stock market had gone up and up, while the economy was pretty stagnant and poverty and homelessness spread.

. From where did all the fortunes come that were made on the stock market? This market had quadrupled in value over the last five years. Production hadn't. So where did all the material wealth come from to fill up the fortunes made on Wall Street? Where did the hundreds of millions of dollars owned by the Ivan Boesky's and other speculators come from? Where did the million-dollar salaries expected by new stockbrokers come from?

The Workers Were Bled for the Profits of the Speculators

. In the final analysis, it was paid for by the concessions and wage cuts that have been forced out of the hides of the workers. Any worker who lost his job and was forced to take a new job at half the wage was contributing to the stock market. Any worker who now has to do the work of two in order to make the same money as before contributed to the stock market. Any worker who was injured because the companies were cutting back on safety equipment was a victim of the stock market.

. The workers and peasants abroad who were victimized by austerity measures to pay back the American bankers also made their forced contribution.

. The stock market went up. But real wages per hour of work went down. To make ends meet took longer hours and more people working per family.

What Was This Sacrifice Used For?

, What was this sacrifice used for? Was it used to build up schools, to clean up the environment, or for some other worthy task?

. No! All this sacrifice went to the rich. It went to their escalating military budget. And it went to finance the huge growth in stocks and bonds, the huge paper profits, the shower of money going into the pockets of the parasites who play with paper on the stock market.

. And now a fourth or so of these values have vanished in a few days. The trading for stock has become revealed as a war of one parasite against another, a war which threatens to ruin the country. The line between investment and speculation has proved to be an illusion.

Trying to Plug the Dike -- With More Sacrifice from the Workers

. Well, now that the paper fortunes have been cut back a bit, will the workers get back their concessions and jobs?

. Not on your life! The capitalists will make the workers pay even more. They differ on their pet schemes, but they all agree that the workers must sacrifice their living standards. Some are trying to fix up the economy by using more federal budget cuts on social programs. This is the meaning of the "fiscal conservatism" that all the Democrats are starry-eyed about. This is the meaning of the talk about "reassuring" the stock market through deficit reduction. This is the meaning of the Gramm-Rudman budget process that Reagan and the Democrats are working together on.

Liberate Labor from the Stock Market

. It is time to eliminate a system that relies on the stock market. To produce food and clothing and housing and all other material wealth takes labor, takes raw materials, takes factories, takes farms. But it does not take stocks and bonds, parasites and rich executives. Stocks and bonds are needed to ensure the wealth of the rich.

. Let us workers take control of the economy ourselves! Let us produce for the sake of satisfying our needs and for the sake of producing more factories and tools that will help us satisfy our needs in the future!

. To do this, to eliminate the rule of the stock market, we will have to overthrow the political power of the rich. We will need a socialist revolution. It will take organization, effort, and solidarity of all who toil for their living. <>

Back to main page, write us!

Last modified: February 16, 2009.