THE deepening world capitalist crisis is poised to see entire nation states defaulting, plunging their banks into an even more desperate crisis, deepening the worldwide slump, and sharpening the class war to the point of revolutionary explosions in the major capitalist states over which class is to pay for this historic crisis.
President Obama has reacted to the Standard & Poor warning – that the enormous US indebtedness is undermining its triple A credit rating, and threatening US capitalism with bankruptcy – by telling a Town Hall meeting in Virginia about his plans to reduce the deficit by $4 trillion over 12 years.
The Republicans, meanwhile, have pushed their budget programme through the House of Representatives. This cuts $4.3 trillion, and at the same time hands $4.2 trillion in tax cuts over to the rich!
They will manage this feat by privatising Medicare and slashing Medicaid, undoing Obama’s health reforms, and also by slashing millions of jobs, and severely curbing trade union rights, all in order to be able to throw tens of millions of the elderly, the working class, and the poor to the wolves.
Obama assures the bankers and bosses that he will deliver slashing cuts, including cuts in Medicare and Medicaid, that will deliver the required $4.3 trillion, to do the job.
He, after all, is the president that presided over the ‘rescue’ of GM, Ford and Chrysler. He delivered the goods through a temporary nationalisation of GM, mass sackings, over 100 plant closures and huge pay cuts, pension cuts and healthcare cuts.
His drive to match the Republicans cut for cut will force the trade union rank and file to demand a complete break with the Democrats and the establishment of a Labour Party to defend jobs, wages and healthcare through a struggle for socialism.
In the EU a trio of defaulters have already been identified in Greece, Ireland and Portugal, with the UK banks and government ready to join them as a a direct result of the dominoes falling.
This chain of economic catastrophe in the making has produced a record gold price of $1,500 an ounce.
In Greece, millions of workers are already demanding a default, ‘no pay’ policy, while the class struggle is now sharpening on a daily basis, with the entire Greek social democratic and Stalinist trade union bureaucracy unable to hold the working class back.
In several areas there are now what are being called ‘local Intifadas’ taking place where workers are fighting the police with petrol bombs and rocks to prevent their areas being degraded or road tolls imposed. The police are already demanding that they be withdrawn before they suffer fatalities.
The demand for an indefinite general strike to bring down Papandreou and the EU-IMF dictatorship over Greece by installing a workers and small farmers government is growing.
Moody’s has meanwhile downgraded the 80bn euros of Irish government debt to one level above junk status, with the British banks up to their necks in the junk.
Portugal has not as yet received any of its projected 80bn euros rescue money, but already there are very big stirrings in the country that the policy must be ‘no pay’ and that the IMF and the EU central bank will have to whistle for their money.
Behind Portugal is Spain, and behind Spain, Italy. There is no end to the chain of explosive charges that are set to explode in the foundations of the EU.
Meanwhile, the British bourgeoisie sets out to slash its budget savagely to put an end to the Welfare State and the NHS, while at the same time it gets deeper and deeper into the very expensive mire of its current Libyan, oil-stealing adventure.
What is being assembled, at great expense, is the most explosive revolutionary situation that has ever been seen, one that will put the French Revolution and its ‘terror’, and the Russian Revolution into the shade.
Make no mistake about it, there is only one way out of the death agony of the capitalist system and that is through building the Fourth International in every country to lead the world socialist revolution to its victory.