THE capitalist class of Britain and Europe have been served with a warning that unless they act quickly to slash all public spending they face increased taxation on their massive profits.
The warning was issued by analysts at French multinational bank BNP Paribas, who said that spending on renewable energy – the transition to net zero – coupled with an ageing population would push up spending by nation states which could only be met by increasing the tax burden on companies and individuals.
What is worrying the bankers is that public spending, and the resultant increase in the national debt of advanced capitalist countries, is becoming unaffordable for the bosses and bankers who fear their profits will be eaten away by increased taxation.
Yesterday, the Daily Telegraph moaned that the UK tax-burden ‘is racing towards its highest level since the Second World War, with the fiscal watchdog predicting it will be equivalent to 37.7% of GDP by 2027 – 2028.’
Apart from increased state spending on net zero, which the Tories and Starmer’s Labour Party have already dumped, BNP Paribas identifies the ageing population as a main cause of increased public spending.
BNP Paribas chief economist Paul Hollingsworth said that an ageing population was among ‘very structural forces that present serious challenges to the public finances in the medium term.’
In other words, the elderly with their pensions, increased medical needs and the fact that they are ‘non-productive’ as far as capitalism is concerned, represent a major threat to the profits of the bosses.
The Office for Budget Responsibility (OBR) is estimating a steady increase in retirees in Britain as compared to those of a working age in the coming years leading Hollingsworth to say: ‘I think what we’ll be left with is a structurally higher level of spending than in the past, but against a backdrop of higher debt servicing costs than we’ve had previously.’
Hollingsworth concluded: ‘This means that there’ll have to be more prioritisation from governments. They won’t be able to spend on everything, there will have to be cut back on some areas.’
To put it bluntly, this means the working class can kiss goodbye to a free NHS, schools will be allowed to crumble at an even faster rate than at present, while all public spending will be slashed to the bone along with wages.
Hollingsworth had an equally blunt message for trade union leaders who cling to the belief that any future Labour government will act differently from the Tories, when he warned that the high cost of borrowing and a collapsing economy puts ‘a lot of constraints on whoever wins’ the next election.
British capitalism is bankrupt with a national debt of over £2.5 trillion – and growing by the day.
The interest repayments on this debt have soared, with the OBR estimating that the UK will spend over half a trillion pounds servicing the national debt in the coming years as interest rates are pushed to record levels by the Bank of England in a futile effort to curb inflation.
All this debt will be loaded on the backs of workers and pensioners as far as the bosses and bankers are concerned.
The TUC meeting in Liverpool this week have their heads in the sand, ignoring the crises tearing UK capitalism apart, and instead clinging to the hope a Labour government will rescue them from the responsibility of actually fighting for the working class.
Keir Starmer has made it clear that any future Labour government would abide by strict ‘fiscal rules’ and only spend what bankrupt British capitalism can afford – which is precisely nothing.
The TUC must not be allowed to carry on avoiding any fight against this Tory government and a British capitalist system that can only survive by carrying out a brutal class war on workers and their unions to smash the welfare state and drive millions into abject poverty.
The TUC leaders must be forced to immediately set a date for a general strike to bring down the Tories and bring in a workers’ government that will expropriate the bosses and bankers and go forward to take the power replacing bankrupt British capitalism with a socialist planned economy.
