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The News Line: Editorial The Jubilee turns sour as capitalism crashes THE Jubilee ‘celebrations’ have turned out to be a petty, momentary diversion for sections of the middle class, away from the real drama of the death agony of the European Union and the world capitalist system, which is now taking place for all to see.

The rapid emergence of the most sordid side of the Jubilee, that it was based on slave labour and the degradation of young people, who slept under bridges, were paid nothing for their work, and were lured to London with the prospect that there was a chance of just three weeks’ work at the Olympics, hammers home the point that British capitalism is finished, that no number of circuses can save it, and that its ambition now is to be able to rival the most notorious slave labour states.

Meanwhile, it has emerged that the eurozone economy achieved zero growth in the first three months of 2012! There has also been no growth in the wider 27-nation EU in the same period.

Under crisis-hit capitalism, the productive forces have ceased to develop, and in fact are being destroyed, starting with their most important part, the working class itself, as the 50 per cent plus youth unemployment in Spain and Greece makes clear.

Eurozone members, Spain, the Netherlands, Portugal, Greece, Italy and Cyprus are now in slump, as is the non eurozone member, the UK.

Germany’s economy recorded growth of 0.5% in the first quarter of the year, while Italy’s contracted by 0.8% and Spain and Cyprus both contracted by 0.3%.

Now Moody’s Investors Service has thrown another hand grenade at the banks with its downgrading of the credit ratings of six German banks

Moody’s delayed its decision on the rating of Germany’s biggest bank, Deutsche Bank, stating that ‘Today’s rating actions are driven by the increased risk of further shocks emanating from the euro area debt crisis.’

Moody’s is convinced that the German banks will be hit as the debt crises of Greece, Spain, Portugal and Italy turn into a catastrophe for Europe.

The six German banking groups affected were Commerzbank, DekaBank, DZ Bank, Landesbank Baden-Wuerttemberg, Landesbank Hessen-Thueringen and Norddeutsche Landesbank.

In Austria, Moody’s downgraded the three biggest banks: Erste Group Bank, UniCredit Bank Austria and Raiffeisen Bank International.

The ratings agency said Austrian banks were also vulnerable to conditions in central and eastern Europe, and that the Austro-German banks will not be able to absorb further losses.

Meanwhile the shareholder advisory group Pirc has analysed the 2011 accounts of the UK’s five biggest banks to see how much they will write off as bad debt in the coming years.

The Royal Bank of Scotland was found to have £18bn of undeclared losses, HSBC £10bn, Barclays £6.7bn, Standard Chartered £3.6bn and Lloyds Banking Group £3.6bn.

No wonder Bank of England governor King, and Tory leader Cameron fear the euro crisis.

The real situation is just beginning to be revealed amidst cries for help emanating from Spain and Cyprus, which are rapidly running out of cash and need bailing out to the tune of at least 100bn euros.

Spain is begging for 40bn euros to pay its immediate bills while it requires more than 80bn euros to provide its banks with working capital.

In this situation, the proposals designed to stop taxpayers’ money being used to bail out failed banks, to be floated by the European Commission, are just for show, to try by just more words to postpone the biggest banking crash in history, leading directly to a chain of state bankruptcies.

It is clear that capitalism has no future. However it will not leave the scene voluntarily. It will have to be overthrown by socialist revolutions and replaced by a socialist planned economy to satisfy people’s needs.


 
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