The ‘Industrial Reserve Army’

The Wall Street Journal hearts Marx, after an obligatory 'he was wrong, you know'.

In Das Kapital, Marx described a problem he saw in the way capitalist societies function. As companies became more productive, learning to get more from their workers, they would need fewer and fewer of those workers. This would create an “industrial reserve army” of unemployed people, whose desperation to work would keep the fire at the heels of those who had jobs and keep wages in check. As a result, all the added value created by workers would accrue to the owners of the companies.
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Lately, the U.S. recovery has been displaying some Marxian traits. Corporate profits are on a tear, and rising productivity has allowed companies to grow without doing much to reduce the vast ranks of the unemployed.

I suspect the Obama administration is hoping the threat of this reserve army of the unemployed will help drive down wages in the U.S. working class. This would help the US industrial sector to regain competitiveness internationally. I believe this is one reason why the administration never gave a big push for a jobs program.

It's doubtful this type of strategy would work though. Class struggle in the U.S. exists, but not often with marches or strikes. Like America itself, it is socially atomized. People just won't take the work if it's below a certain wage. They will go back to school, try starting a business, be a house husband etc. The assent of neo-liberalism and the assault on working standards is often talked about as a success on its own terms. But neo-liberalism in the U.S has been politically unable to destroy the largest of the social safety nets - Social Security and Medicare. There has been a pushback by the American working class, but we often don't notice it.
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'29.4 Million in ‘Industrial Reserve Army’ - Wall Street Journal Blog; Whitehouse