General Electric had $122 billion in revenues last year. But in June it was kicked off the Dow Jones Industrial Average.
GE’s replacement was Walgreens Boots Alliance. A few decades ago, Walgreens was just a Chicago drugstore chain.
GE lost over $6 billion in 2017. Since the year 2000, the firm’s “market cap” — the price of all its stock — has fallen by a half-trillion dollars.
The jobs of 300,000 GE workers are in danger. Their pensions are underfunded by $31 billion. (Bloomberg, Feb. 1)
GE was a founding member of the Dow in 1896 and its oldest member. More importantly, GE’s founding father in 1892 was Wall Street’s biggest banker, J.P. Morgan.
This was the first time that U.S. finance capital ventured into manufacturing. Up to that time, Morgan and his fellow loan sharks speculated on railroads and utilities.
Now they got their claws into industrial production. In 1900, Morgan bought up Andrew Carnegie’s steel mills and started the world’s first billion-dollar corporation, U.S. Steel.
These new manufacturing monopolies went hand-in-hand with the bloody U.S. occupations of Cuba, Puerto Rico and the Philippines. In the U.S., hundreds of Black people were lynched every year while the U.S. Supreme Court endorsed segregation in its Plessy v. Ferguson decision.
Almost every major strike was broken by police and private detective agencies shooting workers.
Lenin, the leader of the Bolshevik Revolution, called banking’s control of industry the basis of imperialism, the final stage of capitalism.
GE’s deepening decline
General Electric was a blue chip stock. Back in 2001, it had the highest market cap of any corporation, even greater than that of Exxon Mobil.
GE is also a major player in the military-industrial complex. Last year it sold nearly $4 billion worth of stuff, largely jet engines, to the Pentagon.
Workers at GE made 30,000 types of light bulbs, as well as power plants, home appliances, diesel locomotives, x-rays and cat scans.
General Electric’s management tried to destroy the United Electrical Workers union by red-baiting it to death. As a result, most GE workers in southern states don’t have union contracts and union protection.
Hosting “GE Theater” on television helped propel Ronald Reagan’s political career. Reagan later started his 1980 presidential campaign in Philadelphia, Miss., over the bodies of civil rights workers James Chaney, Andrew Goodman and Michael Schwerner.
And it was then GE-owned NBC that made the racist clown Donald Trump a nationally known figure by having him host “The Apprentice.”
Wall Street loved Jack Welch, GE’s CEO until 2001, for firing 100,000 workers. Schenectady, N.Y., alone lost 20,000 jobs.
It wasn’t immigrants, Muslims or transgender people that stole these jobs. It was corporate greed, propelled by dog-eat-dog capitalist competition, that committed the crime.
GE workers called their boss Neutron Jack. That’s because like a neutron bomb, Welch usually kept the factories intact while destroying the people who worked in them.
This viciousness didn’t stop GE’s stock from plunging from $60 per share in 2000 to $9.28 on Nov. 6. In 2008, GE was bailed out by the Federal Reserve with a $139 billion cheap loan.
Meanwhile, the Fed did nothing to help over five million families who lost their homes because of foreclosure.
Uncle Sam’s lavish corporate handout couldn’t prevent GE from recently cutting its dividend to a penny per share. Now it’s selling off subsidiaries in fire sales.
Longer lives endanger capitalism
Wall Street analysts consider General Electric to be toast. Bloomberg called GE an “astonishing mess” (Feb. 1).
Bankers started GE and during the Great Depression GE created a credit department to help sell its appliances. Usury became so profitable that by 2007, 55 percent of GE’s profit came from its financial institution, GE Capital. (Fortune, May 24)
Turning itself into a bank almost sunk GE during the Great Recession, along with many other banksters.
Now, GE’s high command revealed that the corporation will have to shell out $15 billion by 2024 to cover losses in its remaining insurance business. (marketwatch.com)
GE was forced to divest much of its financial business a decade ago. But it kept long-term insurance contracts bought by seniors to cover nursing home costs.
That seemed to be a sure way to rip off elderly people and help GE’s bottom line. The problem is that people are living longer because of advances in medicine. Longer lives are incompatible with capitalist profit.
GE’s troubles may be a first sign of the next capitalist economic crisis that will come sooner or later. The jobs of hundreds of thousands of GE workers — including those super exploited in GE’s plants in Africa, Asia and Latin America — are in danger.
Capitalism is driving GE into the ground. We need a people’s takeover of GE.
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