Chapter 1. Understanding the Crisis

Submitted by AWL on 5 May, 2009 - 2:18

A crisis of capitalism

“Business always appears almost excessively sound right on the eve of a crash,” wrote Karl Marx in the 1860s. “Business is always thoroughly sound and the campaign in full swing, until suddenly the debacle takes place.”
The economic crisis currently raging across the globe is a crisis of capitalism — an economic and social system which by its very nature generates crises. Capitalism has a self-expanding drive to produce more and more for ever greater profits, regardless of the consequences, be they human, ecological — or economic. Eventually it will always overshoot itself, producing more of some commodities than the market can absorb. It generates ‘bubbles’ whose bursting means the destruction of vast swathes of human wealth — until the conditions for a new economic upturn are established.
This phenomenon takes place in a variety of ways. A detailed analysis of the economics of the current crisis is not the subject of this pamphlet; what it is important to understand is that the process is built in to capitalism.
It is not an aberration, the result of an overgrown financial sector that can be lopped off leaving a healthy, rational social system in place, as some ‘left-wing’ ruling-class economists claim. The huge expansion of credit, underpinned by a vast web of financial institutions, has undoubtedly contributed to the depth of the crisis, by allowing capitalists to ‘lean further over the edge’ and thus fall further when they finally slip. But credit has always been integral to capitalism, and its growth in the last thirty years is linked to the globalisation of capitalist production and trade. Financial, industrial and service capital could not be disentangled even if it was rational to try.
For many millions of workers, young people and others across the world, capitalism’s credibility has taken a huge blow as it reveals starkly its fundamental irrationality. Many of those people will be starting to think about whether there is an alternative.

Class struggle will decide

If capitalism by its nature produces crises, then capitalists by their nature will seek to make the working class pay for them. Through wage curbs, job losses, repossessions, cuts in public services, and in a hundred other ways, the bosses are already passing the costs onto the working class and poor.
There is, however, nothing inevitable about them succeeding. Struggle will decide. In the 1930s, the labour movement was crushed in many countries. Yet in the USA, workers came out of the crisis of the 1930s with better wages and conditions and stronger union organisation than they had when they entered it, not because of the generosity of their rulers, but because during the 30s they organised to fight back — through demonstrations, strikes, factory occupations and other forms of militant action — and won.
If a crisis is a good time for capitalists to reorganise, it is also a good time for us to do the same. We can take advantage of capitalism’s convulsions, and the newfound contempt and revulsion which millions of workers feel for it, to stop the bosses’ attacks and go on the offensive against them. The upsurge at the end of 2008 of class battles in a whole series of countries — from the victory, after a fifteen-year battle, of workers fighting for union recognition at Tar Heel in North Carolina, the largest meat-packing plant in the world, to mass worker and student struggles in European countries including Ireland, Italy, France and Greece — shows the possibilities. So do struggles in Britain like the walk outs in engineering construction, workplace occupations including at Visteon car parts, and battles over pay and jobs on the railways and London Underground.

“Bosses’ socialism” versus workers’ socialism

The capitalist politicians who once shouted loudest in favour of “free markets” — boasting, for instance, about their deregulation of the financial sector — now accept hugely expanded state intervention in the economy. We have seen the government of George W Bush carry out the biggest nationalisations in history. The point is that the bosses’ representatives are intervening in the interests of their class; they want to manage the economic slump in the best way for capital and, for the most part, to return to “free markets” as soon as possible.
The banks that some governments have nationalised or part-nationalised have not stopped paying their executives huge salaries; they have not stopped sacking workers; and they have not stopped repossessing the homes and ruining the lives of working-class people. They are still under the control of their bosses, and will be returned to the private sector when it is judged viable.
Even before the recent wave of state interventions, the notion of “free markets” was misleading. For a long time now, the giant enterprises which dominate the economy have, to a great extent, been “socialised” — organised on a vast, society-wide basis, with huge numbers of people working collectively and cooperatively, but under the control and in the interests of the capitalists. When capitalist governments intervene as they have done in this crisis, they further socialise the economy’s losses in order to continue to privatise its gains.
Against this “socialism for the rich”, this “bosses’ socialism”, we want socialism worthy of the name — democratic control of the economy by and in the interests of society’s working-class majority, so that the social wealth workers produce can be used for the benefit of all, not a tiny elite of bosses and bankers.

We need a workers’ government

To win socialism the working class in every country will need to make a revolution — to carry out a clean sweep of the capitalists and replace the state that serves them with a democratic workers’ state. Yet as things stand in Britain and most countries, the big majority not only of the working class, but of the organised labour movement and even its left wing, are not yet prepared (in either sense of the word) to fight for that.
We will seek to convince them: but in common struggle, not just abstract argument. As working-class activists, we propose to all working-class activists and workers’ organisations who seriously want to defend our class in this crisis that we fight together, to rally the labour movement for the defence and extension of our rights. We propose rebuilding and overhauling our movement so that it is fit to fight.
We propose re-establishing independent working-class representation in politics, as the basis for a new working-class political party.
We propose that all these struggles, from the smallest up, should be shaped by the goal of winning a workers’ government — a government based on and accountable to a mass movement of the working class, which at a minimum does for us what the Tories and New Labour in office have done for the bosses and the rich. That is the point of this programme.

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