The daily worker. [volume] (Chicago, Ill.) 1924-1958, 1930-01-11

expression in the drastic reduction in short
term credit, namely, brokers' loans, which de-
creased in ten weeks by $3,483 100000, or ex-
actly by 30 percent. The continuous outward
movement Of gold is a factor which will ac-
centuate the financial situation.
Export of capital for 1929 decreased by %
per cent compared with 1928.
). Unemployment, already present on
permanent mass scale, is growing with unpre-
cedented speed. According to the report of
the United States Bureau of Labor Statistics.
November factory employment alone decreased
by 421,000 below the middle of September
The figures certainly are very incomplete and
underestimate the true situation The decline
of employment and payrolls has affected all
strata of the working class including the skilled
workers. Factory payrolls for November alone
have declined $68,000000 from October, or $73,-
100000 from September with further losses 90
ing on. The drastic recession in almost all
lines Of business spreads the reduction of in
come throughout the population, striking es-
peclally upon the masses. On November l. the
American Trade Executives Association estim-
ated, on the basis of the theme existing facts,
that " We enter next year with one third less
buying power than we have had in any of the
past few years." Since that time the effects
of the crisis have begun to accumulate, in the
form of further drastic shrinking According
to the 'Annalist,' both factory employment and
payrolls are below the average of the past ten
years. Certainly more than another half-mil-
lion workers have been added to the already
existing army of more than 100000 unem-
ployed.
4. The crisis is as yet only in its first
stages The cumulative effect of the drastic
shrinking of the domestic market has not had
time to express itself. The 'Annalist,' COM
pairing the present crisis to those of 1898 and
1907, predicts at least six months period of de-
cline, saying:
With four notable exceptions, the November
decrease is probably the largest decrease in
business activity which has occurred in any
one month in the last forty-six years"
Ii we examine the curve of the 192O-21 crisis
we get picture of the dynamics of the CAP
ltallst cycle which gives at least some idea of
what is to come in 1880. In 1920 the crisis be-
gan IN the third quarter of the year and lasted
through 1921; during that IS months employ
ment dropped from an index of 118 highest
IN history down to 70, or more than 40 percent;
should the present crisis reach an equal in
tensity, it would bring the unemployed army
well over ten miAon. Previous major crisis
have extended over periods of IL to Is months
of most acute depression.
B. One of the characteristics of all periods of
economic crisis, concentration and centraliza-
ton of capital, formation of ever-larger COM
bmatlons and mergers, process already gain
ing momentum before the crisis. has been
enormously stimulated. This is at once the
crushing and driving out of the smaller, So
called Indpnpndpnt in ooJ
industry, and the drawing together of the big
ger units of finance capital into few groups
"The year 1929 will go down in financial his
tory as the peak year of the merger move
ment among banks. In New York City alone
there were no less than % mergers involving
A banks. :" IN. Y. American, Dec, 1929
The process extends from the big steel merger,
the gas and utilities merger, and the bank mer-
gers now under way, clear down to the ex-
preparation of the small neighborhood retail
merchant by the chain store system. (The
Interstate Commerce Commission plans for the
merging of the railroads into few great sys-
TENS: the steel merger of the Republic Steel
Central Alloy, Bonner Steel, and Bourne Full
Ter, with $350,000.000 assets, and the acquisition
of Columbia Steel by the u S. Steel Corpora
ton; the taking over of Southern Steel and
Pacific Coast steel by the Bethlehem Corpora
ton; the monster utility, merger, etc., etc..
6. Economic crisis is the inevitable accom-
paniment of the capitalist system of production.
Contrary to the reformist fairy tales of
organized capitalism" the economic crisis, to-
gether with competition end wars, remains the
spontaneous regulator of capitalist economy.
1t is characteristic that the capitalist crisis is
not one of, underproduction or lack of raw
materials, but of overproduction. 1t begins
t1o accin If oil -
industry, caused by the catastrophe dispropor-
ton between the productive capacity and actual
production. Tens and hundreds of thousands
of workers are thrown on the streets, the
enormous restriction of the inner market fol-