‘THE ALARM BELLS ARE RINGING as the UK’s National Debt is expected to exceed £3 trillion for the first time, as early as September!
Public debt is currently ticking up at £7,500 a second, that is an extra £27m every hour or £650 million a day.
In the coming years, Britain’s debt burden is projected to rise above 96 per cent of GDP.
That is £42,000 per person in the UK. It was £6,000 for every person – adult and child – in 1997.
The Labour government is in a desperate crisis. Ken Rogoff a former chief economist at the IMF, believes that it is becoming increasingly likely that the UK will need an IMF bail-out, and that even the US may struggle to pay its bills!
Rogoff sees a glimmer of hope. He says that: ‘What might save us is that the UK might run into problems first. The UK is definitely in more trouble than the US because there isn’t a growth story in the UK.’
Investors are now fearful of where a Burnham Labour Premiership may take Britain. The Mayor of Greater Manchester wants more state control of public services and housing.
Olivier Blanchard, the French economist, says that he is ‘worried’ about rising primary deficits.
He says: ‘I think it may take at least a mini-fiscal crisis … to get some governments to do what they need to do.’
About the UK, Blanchard observes: ‘Combined with the failure to repair the finances after each crisis, this gives rise to fears that Britain is inexorably turning into another Argentina – a once rich nation that borrowed itself into disaster, with repeated defaults in its debts failure.’
He added: ‘Black Wednesday in the UK scared the British psyche. On September 16th 1992, the Bank of England ramped up interest rates in an effort to shore up the pound and keep the currency in the Exchange Rate Mechanism, the precursor to the euro.
‘Despite offering to raise rates to 15%, the attempt failed and officials were forced to let the pound tumble. A generation of homeowners were left fearing volatile borrowing costs, and the loss of their homes.
‘This effort failed, the currency crashed, the government backed out and a long recession ensued.’
The British economy is now heading for a crash, and all of the major capitalist states are threatened by the deepening crisis of the capitalist system and state bankruptcy.
There is only one way out, and that is for the working class in its trade unions to mobilise worldwide to put an end to the capitalist crisis, by putting an end to the bankrupt capitalist system.
Capitalism is in its death agony – its crisis is unresolvable. Its attempted way out is through preparing new wars and counter revolutions against the working class of the world. For the international working class, the issues are becoming clearer and clearer.
Workers of the world are facing a huge crisis as the bosses seek to resolve their profits crisis through savage wage cuts and massive unemployment.
Capitalism has reached the end of the road but it is hanging on desperately to try and drive the working class back and to keep its backward reactionary social system going.
In the period ahead, the working class must complete the victory of the world socialist revolution by building sections of the International Committee of the Fourth International worldwide to overthrow capitalism in Europe, America and Asia with socialist revolutions.
It must also encourage the workers of Russia, China and Eastern Europe to replace the ruling Stalinist bureaucracies with political revolutions.