YESTERDAY at the Labour Party conference the leaders who not so long ago announced to the world that they had conquered the essential tendency of capitalism to go from boom to bust and vice versa were forced to admit that they were wrong.
Chancellor Darling, the Prime Minister’s right hand man when he was Chancellor, had to tell conference: ‘These are extraordinary, turbulent times. A crisis which has rocked the financial institutions around the world on top of huge rises in oil, food and commodity prices.’
He added that there had been: ‘A twin shock to the global economy which has hit every country in the world. A financial system which will never be the same.’
He even had to try to reveal the source of this transformation of the credit driven boom into a cash-starved slump, saying: ‘I want to use this speech today to explain what is happening and why.’
He continued: ‘Stock markets have fallen sharply. Some of the world’s biggest financial institutions have been brought to their knees. If you want one symbol of how the world has changed, it is a Republican Administration in America nationalising two of their biggest mortgage banks.’
He doesn’t realise that this shock symbol is only the semblance of the volcanic eruption that is already on the way – a socialist revolution – when all of the bosses and bankers are expropriated to terminate their backward and outdated social system and liberate humanity from it.
On the why of it all, he was even more vague, merely stating: ‘The reasons for this turmoil are complex.’
He did not want to blame capitalism itself, and the laws of its development for the crisis, since that road inexorably leads on to the need for a socialist revolution to replace capitalism with a more advanced socialist society.
In this vein he continued: ‘Now it’s easy to blame globalisation. But don’t forget, it has brought, and will bring, many benefits. More jobs in this country, cheaper goods in the shops,’ he alleged.
But beneath the international globaliser lies a little Englander, who is being forced out into the open by the first shocks of the capitalist crisis.
The source of the contagion turned out to be foreign – even Yankee.
He explained: ‘But with these big benefits come increased risks. Problems in one part of the world can quickly infect everywhere and everything else.
‘And we’ve seen this, in the past year. Mistakes and problems in the mortgages markets in the United States have spread right across the world, weakening financial institutions and the financial system, spreading into the wider economy.’
This is the source as far as he is concerned – the conduct of damned foreigners, aided by a few local spivs, short sellers, who jump on the bandwagon.
The solution to the crisis is even more difficult for him to grasp than its source.
He says: ‘It’s clear we have to put in place measures to stop problems being repeated. It is clearer than ever that markets can’t do this on their own.
‘Nor can individual governments . . .
‘And we need to strengthen global supervision.
‘The first priority is to stabilise the banking system. If we don’t, the whole world economy is at risk.’
So the solution is to strengthen global supervision, with presumably the US and UK imperialism doing the supervising, continuing the role pioneered by Bush and Blair of ‘reordering the world’. This is just imperialism continued.
But before this, the first priority is to stabilise the banking system. How is that to be done?
It is to be done by extending unlimited state aid to the banks, and by starving the working class to make this process possible.
Brown and Darling have insisted that the public sector must have its wages cut by imposing wage rises that are just a fraction of the inflation rate.
While they are doing this they have handed over £126bn to Northern Rock to help the bankers, and are sacking thousands of Northern Rock workers and repossessing many thousands of workers’ homes. To further strengthen the banks, they have merged HBOS-LloydsTSB, knowing that 40,000 workers will be sacked and a thousand branches closed.
Now they have announced that a further £100bn is to be handed over to the banks. This will have to be paid for by workers wage cuts and job losses.
The Brown government is a bankers not a workers government. The trade unions must bring it down and in its place bring in a workers government.