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“When the economic crisis becomes acute, when the rate of profit sinks toward zero, the bourgeoisie can see only one way to restore its profits: it empties the pockets of the people down to the last centime. It resorts to what M. Caillaux, once finance minister of France, expressively calls ‘the great penance’: brutal slashing of wages and social expenditures, raising of tariff duties at the expense of the consumer, etc. The state, furthermore, rescues business enterprises on the brink of bankruptcy, forcing the masses to foot the bill. Such enterprises are kept alive with subsidies, tax exemptions, orders for public works and armaments.
In short, the state thrusts itself into the breach left by the vanishing private customers. But such maneuvers are difficult under a democratic regime. As long as democracy survives, the masses, though thoroughly deceived and plundered, have some means of defense against the ‘great penance’: freedom of the press, universal suffrage, the right to organize into unions and to strike, etc. Feeble defenses, it is true, but still capable of setting some limit to the insatiable demands of the money power.
Daniel Guerin
In particular, the resistance of the organized working class makes it rather difficult to simply lower wages. And so, in certain countries and under certain conditions, the bourgeoisie throws its traditional democracy overboard and conjures up with its invocations – and its subsidies – that ‘strong state’ which alone can strip the masses of all means of defense, tying their hands behind their backs, the better to empty their pockets.”
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