Why are we in this mess?

“The history of all hitherto existing society is the history of class struggles” – the opening words of the Communist Manifesto highlights the fact that there has always been a subjugated class (slaves, peasants, workers) and a higher elite, which has opposed their interests (slave-owners, aristocracy, bosses).

The Communist Manifesto was written in 1848 at the dawn of the Industrial Revolution, which transformed economies – the mass of the population moved into cities for the first time, workers congregated together in factories as mass production took the place of traditional craftsmanship. This led to the emergence of a working class for the first time and the beginnings of socialist parties – making it possible for the working class to take over the running of society.

Looked at in terms of two opposing classes and the tension between them, economics begins to make sense. Workers struggle against oppression, while bosses fight to maximise their profits. The interests of the two are incompatible.

Marx describes this process as “surplus value”. For him, goods are valued according to the labour involved in their production. Companies take away some of our labour value – whether this is indirectly in terms of services, or directly by manufacturing goods. In return, we get a proportion of this as wages. Workers struggle through trade unions and may take strike action in order to get more pay. Meanwhile, the company seeks to maximise its profit margins. The film, The Corporation, gives a good description of how individual companies operate under capitalism – as psychopaths – devoid of human compassion, feeling or empathy and striving only to maximise their profits.

Because of this, capitalism is incapable of solving the problems of the world. It is incapable of co-operation on a global scale, incapable of planning to meet the problems of global warming, or of even finding enough resources to feed the world, or to provide clean, safe drinking water for all of us.

Capitalist economics, as Trotsky, said, creates within it the conditions for its own crisis – “capitalism is its own gravedigger”. However, there is no final crisis of capitalism, without a mass revolutionary movement to bring about socialism.

When capitalism cannot get rid of the surplus it creates, prices fall according to the law of supply and demand, and conditions are created for recession or even depression.

Eighty years ago, the Great Depression was caused by a perfect storm of forces – the stock market crash in the US, hyperinflation in Germany after the destruction of the workers’ movement, the collapse of banks, and a failure of harvests in the Dust bowl. Capitalism only emerged from this by using World War II to raze whole cities to the ground. The same process of imperialist resource-grabbing, of divide and rule (in the case of Nazi Germany taken to extremes), the naked preoccupation with nationalism and profit has led to violence, hatred and the loss of millions of lives.

Instead, socialists argue for workers’ co-operation internationally, for a planned, genuinely democratic economy where it ordinary people are in control over the means of production. We decide what our priorities are, how resources should be divided up, and we have a real involvement in decision-making. With the rule of profit gone, people are therefore able to enjoy the full fruits of their labour – a shorter working week, more leisure time and to rid themselves of the burden of poverty. We would be able to invest more resources into the economy in order to fully realise our human potential.

The present economic crash in 2008 was caused by speculation on sub-prime mortgages, with debts being consolidated and re-sold around different investors. There was a downturn in the economy, causing interests rates to be lowered, and so there was a boom of cheap credit. Loans were sold to people who simply could not afford the repayments. The system collapsed like a house of cards, or an elastic band that has been stretched way past its breaking point.

Any theory can be tested by how well it predicts actual events. Capitalist economists completely failed to predict the economic crash. Francis Fukuyama predicted “The End of History”, with the fall of the Eastern Bloc and the supposed world-dominance of neoliberalism. Gordon Brown said arrogantly that he had “abolished boom and bust”. However, in the pages of “Socialism Today”, we predicted that a crash would come sooner or later, that the bubble had to burst at some point, and that when it did the result would be disastrous for working people.

After the crash of 2008, house prices fell through the floor. No lenders were offering mortgages and banks had to be nationalised and bailed out to the tune of trillions of dollars worldwide. This goes to show that the money is there in society, it is just not spent where it is needed – on public services, or clean water, but on maintaining the status quo for big business, at any cost. Meanwhile the people at the bottom were left homeless.

In 2013, we are still not out of the woods. In an effort to reduce the debt, public services are slashed and privatised. However, post-1945, our national debt was much higher than it is now, at 240% of GDP. Yet we still managed to build council houses, found the welfare state, the NHS, and nationalise 20% of the country’s industry. All these gains were won by pressure from below – servicemen coming back from the front demanding change, a land fit for heroes. There remains massive potential for a huge fight back from the trade unions and community groups across the country – what is lacking is any leadership. Unlike 1945, Labour has shifted massively to the right, and refuses to countenance any alternative to cuts and austerity. We need to build that alternative.

However much workers gained through their struggles, capitalism will always come back for more. We get a few crumbs from the rich man;s table in good times, but in bad, there is no hesitation in cutting jobs and wages, even if this costs lives. Look at the rises in NHS waiting times and the increase in the number of deaths in our hospitals as the cuts bite.

We need to build a new parties to represent working people internationally. In Britain, TUSC is hopefully the genesis of a new workers’ party. The trade unions must break with Labour or be broken as they will lose members in their droves, either through disgust at the way they are treated by their leadership, or through job losses and privatisation. The Labour Party is undemocratic, and the Falkirk scandal, where Milliband threatened Unite with legal action for the crime backing its own (not even very left-wing) candidate, and getting working-class people to join Labour, proves that it is completely unfit for purpose.

Depressions can have a stunning effect on workers – they can keep their heads down, afraid of the sack, or grateful that they have a job at all. However, at some stage, there must be a mass fight back. The potential was shown on November 30th 2011, when 2 million workers took strike action. Across Southern Europe and North Africa, the fight back is already happening – people have no choice but to take to the streets and fight their own governments, who have nothing to offer but austerity.

The crying shame is the lack of a revolutionary leadership of these movements, capable of uniting struggles and putting forward a socialist programme to take power. Join the Socialist Party and the CWI and help us build that leadership.

Tags: , , , , , , , , ,

One Response to “Why are we in this mess?”

  1. zachary Says:

    I’d have to consult you right here. Which is not one thing I usually do! I enjoy looking at a post that will make people believe. Also, thank you for allowing me personally to opinion!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s


%d bloggers like this: