On the note of employment providing benefits beyond income loss, there is another example a read recently in a Bill Mitchell blog post which I will paste below:
On December 2, 1930 the Marienthal textile factory was finally shutdown because sales had collapsed as the Great Depression spread. The Depression was the last straw.
At its peak (1929) it had employed 1,200 workers and an addition 90 salaried staff, which constituted about 75 per cent of the local population.
As we read in the book (p.ix):
Over the summer of 1929 the factory and all of its companion plants closed down and nearly every family in the small village became affected by unemployment. The big difference from former recessions was the sheer length of time this unemployment lasted. When the researchers first came to Marienthal more than two years after the shutdown of the factory, the situation had not changed at all; it had became even worse.
The closure saw the people quickly descend into poverty and hopelessness.
The study found that (p.ix):
Only one out of five families had at least one member earning an income from regular work. Three quarters of the families were dependent on unemployment payments, which were dramatically low at this time … when a dog disappears, the owner no longer bothers to report the loss.
The reference to the disappearing dogs relates to the increasing desperation for food among the local population.
The Marienthal study sought to investigate the impacts of this economic catastrophe on the people affected. It was funded by the “Federal Chamber of Labour of Vienna and Lower Austria and by the US-American Rockefeller Foundation”.
Jahoda, Lazarsfeld and Zeisl were working in the private research centre directed by Lazarsfeld – Österreichische Wirtschaftspsychologische Forschungsstelle (Austrian Research Unit for Economic Psychology).
The conjectures entertained by the investigation at the time included whether long-term unemployment would lead to a socialist revolt or, instead, lead to social exclusion, isolation and increased passive resignation.
Interestingly, we read in the Introduction that (p.x):
Marienthal was a stronghold of the Social Democratic Labor Movement. There was a full-fledged Workers’ Library, newspapers were widely distributed and read, participation in the community’s life was strong, many clubs were active and participation in political campaigns and elections was high.
An interesting observation (especially in the face of some of the modern claims about the freedom joblessness would give people with a basic income guarantee), is that given (p.x):
Nearly everything had come to a stop after the closing of the factory … People who should have more time for reading books stopped borrowing them from the library; newspapers were not read as carefully as before, if at all; only organizations offering their members direct financial advantages showed an increase …
The research process began in November 1931 and ran until “mid-January 1932”
What did they find?
- In terms of the typology of changing attitudes to the unemployment, four specific patterns emerged – “the inner unbroken – the resigned – in despair – the apathetic”.
We learn that the unbroken family – one which suffered the least from the unemployment (p.53) was best described as on that engaged in the:
… maintenance of the household, care of the children, subjective well-being, activity, hopes and plans for the future, sustained vitality, and continued attempts to find employment.
However, the apathetic families, which were the most impoverished became passive and exhibited hopelessness. They gave up trying to improve their situation.
Instead of having “plans and hopes for the future”, the unemployment “led to a renouncement of a future that does not even play a role in the imagination”.
- The other finding related to this was that as time passed these typical states became transitions in the path to destitution.
So the “lower the income the more deprived the families reacted”. And those who had previously exhibited hope were worn down by the enduring nature of the calamity and as their resources vanished, their passivity increased.
This was an important observation given the belief among the Social Democrat activists that “a more active, rebellious reaction to deprivation” would result (p.xi).
Marxists of all branches anticipate the revolution to come after the final breakdown of capitalism. Marienthal provided a telling lesson quite contrary to the conventional wisdom and history itself validated the experience.
This is an important point and helps to explain why the elites and capital do not mind entrenched levels of mass unemployment. It helps to explain why Greeks who are enduring above 20 per cent unemployment and increasing poverty still support the institutional structure (the common currency) that has created their plight.
Mass unemployment works for the elites. It demoralises those who are forced by the lack of jobs to endure it. It is not just about the income poverty that results.
Rather, these attitudinal changes are significant factors which act to discipline the workforce and render it compliant to the wishes and desires of capital.
- The study also provided insights in what the authors called the “Meaning of Time” (Chapter 7).
As the Introduction notes (p.xi):
Someone from the research group called attention to the fact that men walked more slowly across the main street and stopped more often on their way that women … A conclusion of their … observations was that women were not really unemployed but only unpaid.
On page 74, we read that “They have the household to run, which fully occupies the day”.
Interestingly, the authors found that when the men were asked about what they did during the day (p.85):
The unemployed are simply no longer able to given an account of everything he did during the day.
They concluded that time and they way it forces the employed persons to divide their time to suit the range of activities they need to fulfill in a day had “lost meaning” to the unemployed.
Public holidays lost their significance and after the collapse the Marienthal population spent much less time occupied with public events or to volunteer for civic duties.
In 1933, the authoritarian Austrian government sought to deal with unemployment after their austerity policies had failed. They introduced job creation schemes about which Marie Jahoda would later write in letters to Paul Lazarsfeld (see footnote 3 in the Introduction to the Transaction Edition):
Only the provision of any work could counter the resignation that comes with unemployment.
The political consequences of the unemployment were clearly significant. Jahoda, herself, later noted that rather than emancipate the unemployed into a politicised and active group, the most likely political outcomes would be to push the workers towards right-wing politics
When I was younger I wondered why the unemployed didn’t take the opportunity to learn things – a new language, a musical instrument etc – given they now had ‘free’ time.
I was naive. The Marienthal study found the workers overwhelmingly failed to use the freedom from work. Their apathy and dislocation became intensified as time passed.
Their aspirations collapsed.
The costs of the unemployment thus went beyond the material losses that a lack of income brings. A job is more than an income, which is as relevant today as it was in the time of the Marienthal study.
Workers deprived of the capacity to gain employment are simultaneously deprived of social interactions that are important in creating aspiration and hope.
Time becomes important and motivation increases as a way to deal with competing time uses.
Now one could argue in the 21st century involuntary unemployed BI recipients might simply spend their days binge watching YouTube, playing video games, become "professional" sommeliers (chronic drinkers), or head off to the gym every so often instead of walking down the main street looking at the pavement. But whether they do that by choice or circumstance is another matter entirely.