Your conclusion I didn't think followed from the absolute/relative point so much as from a combination of the A-B-C argument you made, and the one about the pie not being fixed in size, and the perceived vs. actual interests distinction (each argument which really deserves more discussion). So I thought I could disagree on the absolute/relative and agree with the conclusion.
I'll sum up and shut up: The divide-and-conquer story is not false, it's incomplete. There's some interesting literature on this that apparently is not very well known and that is based on marxist political economy. Recognizing that some white (male) workers have an objective material interest (of some type) in racism (patriarchy) has some serious implications for people interested in anti-racist and feminist struggles and in building broad based working class coalitions across "race" and gender lines. If discrimination against African Americans, for example, ended tomorrow, but we still have the same system, some other group will have to make up the low waged, the reserve army, etc. Historically, race, gender, ethnicity, nationality, have mediated who is high waged, who low waged, who employed, who unemployed, etc. So as long as we have capitalism someone's going to be in the reserve army, someone's going to be low waged. Unless capitalism is "reformable" along these lines. So we are back into reform vs. revolution, short-term and long-term strategies and solutions. At the same time, even if one takes the view that racism and race antagonism were created by capitalism, and that capitalist patriarchy is identifiably different from pre-capitalist patriarchies, it is pretty clear that racism and patriarchy have in the last 500 (300? 200?) years taken on a life of their own (mutually enforcing but relatively autonomous?) and so that these modes of oppression and domination should not be expected to simply disappear on their own. So, and this I hope addresses Charles' last response, if we can imagine some non-capitalist but nevertheless hierarchical system replacing capitalism, it would seem likely that racism and patriarchy would continue to mediate the assignment of places in the hierarchy. As painful as it is, we have to study, e.g., racism and sexism in the labor movement, racism, classism, and eurocentrism in the Women's movement, sexism in Nationalist movements, etc. Racism and patriarchy are not reducible to class, and gender, race, and class "are not parallel social structures" (Harding). The young Asian women activists I know who are working in their communities on issues like "massage parlors" and sex-tourism know who Samuel Gompers was and how he promoted buying the union label so to "preserve the white over the Coolie way of life." So when you promote the AFL-CIO as the vehicle for their liberation be prepared to answer a few questions. And are we going to dismiss as "divisive" Black female student activists who have read Angela Davis on the history of the US Women's movement and "Third World" feminist critiques of Western feminism or who simply SPEAK FROM THEIR OWN LIFE EXPERIENCE when they raise issues of race privilege and racism in a discussion of the gender studies curriculum on campus? There's a problem with insisting on one kind of oppression being the most fundamental or the most important. People who are victims of one type of exploitation or oppression may benefit from another kind. We have to be against all kinds.
Apologies for long-windedness, preaching to the choir, beating a dead horse, being a bore, being dense, or any other violations of list or life etiquette.
Mat Forstater