THE BANK of England’s latest report, released on Thursday, has revealed the full extent of the catastrophic crisis of capitalism, now writhing around in its death agony.
The shocking BofE report states that capitalism is facing its ‘deepest recession since 1706’.
The report did not say that capitalism was facing its deepest recession since the worldwide economic banking collapse of 2007-8.
Neither did the report compare today’s crisis to the crash of October 1, 1987 under Thatcher, known as ‘Black Monday’.
Nor did it compare the crisis of today to the 1929 Wall Street Crash, which led to a decade of abject poverty ‘the Hungry Thirties’, the ‘Great Depression’ and the rise of fascism.
As far as the Bank of England is concerned, none of these three cataclysmic economic disasters can equal the dire state of world capitalism today and British capitalism in particular.
In fact, the history of capitalism is a history of economic collapses, wars, civil wars and, since the Paris Commune, socialist revolutions.
In 1706 capitalism had hardly got going. It was only some 50 years after the English bourgeois revolution. The Bank of England was only established as a private bank in 1694, so was only 12 years old. The country was still primarily agricultural – many of the innovations that drove the Industrial Revolution were still decades away. Capitalism was in its infancy.
In other words, what the Bank of England is really saying is that what we are facing today is the greatest crisis since capitalism began, in fact its death agony.
The economic impact report outlined how the coronavirus was ‘dramatically reducing jobs and incomes in the UK’.
The Bank predicts the following:
The UK economy will contract by 14%. Benefit claims will climb from 4% to 9%. Consumer spending will drop by 30% with the housing market grinding to a halt.
By 2020, the government will have borrowed more than all Labour governments put together, some £870 billion. It is the working class that will have to foot this bill, and more!
At the end of February 2020, the amount of money owed by the public sector to the private sector stood at approximately £1.8 trillion, which equates to 79.1% of gross domestic product (GDP).
The figures for the coronavirus are not compiled yet, so the £1.8tn national debt is set to soar. When the debt ratio reaches 100% of GDP, the state will be bankrupt!
For the Tories and big business to survive, they will have to claw back very penny of that debt out of the hide of the working class, sacking hundreds of thousands, slashing wages, axing pensions, sick pay, holiday pay, increasing hours, and driving up productivity. The working class has already suffered over ten years of austerity since the last crash, and they will resist being forced to pay again, but even more than last time, with a socialist revolution.
Rail workers, tube staff, bus drivers and teachers have already made their position crystal clear: ‘If they try and drive us back to work in unsafe conditions we will not go!’
In the middle stands the Labour Party, keen to join a national government with the Tories, to try and manage capitalism better, and the TUC bureaucrats, desperate to prevent a revolutionary eruption of the working class and already warning the ruling class that they will not be able to stop workers striking when the lockdown is lifted.
The working class requires the new and revolutionary leadership of the WRP and the Young Socialists. This must be built up rapidly in the days ahead inside the trade unions and amongst the masses of youth.
Workers must change their leaders and the trade unions must build Councils of Action to take over control of entire areas, and to halt the closure of major sections of industry with occupations.
Councils of Action must become an alternative government and must challenge the rule of the capitalist ruling class. Led by a revolutionary party, they will mobilise the masses for the socialist revolution to put an end to capitalism. The WRP and the Young Socialists must be built up rapidly to lead this struggle for workers power and socialism.