DUBAI’S ‘debt repayment’ postponement for six months has brought renewed havoc to European, Asian and North American stock markets.
They have all been reminded that the crisis of capitalism is world wide and that they have not felt the last of its hammer blows.
If the oil-rich Middle East cannot repay its debts to the already crisis-hit international banks then what hope is there, reason the former stock market kings.
Prime Minister Gordon Brown, however, described the fall in the markets as just a ‘setback . . . not on the scale of previous problems’. He delivered what may well become his famous last words: ‘The world financial system is stronger now and able to deal with the problems that arise.’
This thesis was delivered just days after the government and the Bank of England governor had to admit that in October and November 2008 the Bank of England gave a £61bn secret loan to prevent the collapse of the Royal Bank of Scotland and HBOS banks, following the fall of Lehman Brothers. The message from Dubai is that new bank crashes are on the way!
The Bank of England governor also admitted to the House of Commons Finance Committee that the prospect for the UK was rising inflation, at the same time as the government will be making savage cuts in public spending to prevent a sudden collapse of the pound sterling.
The essence of the crisis is that it is sharpening the class struggle and driving forward world revolution. The ruling class intends to make the working class pay the full bill for the crisis. The working class, especially its youth, is learning that it can only really defend its gains by overthrowing the bourgeoisie on a world scale and bringing in socialism.
In Sri Lanka, the Rajapakse regime – which bankrupted itself with its war to smash the Tamil people – has now broken apart under the pressure of the crisis. The regime has split because the rising inflation has driven the working class, both Sinhala and Tamil, forward to fight for wage rises and to defend their jobs. The cost of living in Sri Lanka is now so steep that workers have turned down 22 per cent wage rise offers as completely inadequate.
In Russia, the Putin drive for Russia to become part of the world capitalist market has seen the Russian economy hit for six by the slump, with mass unemployment growing rapidly. Putin and the Stalinist bureaucracy are urging the privatisation of the state-owned sections of the economy while the working class is calling for the expropriation of the new bourgeoisie, the overthrow of the bureaucracy and the restoration of the USSR.
Throughout eastern Europe, the states where the Stalinist bureaucracy was overthrown are now deep in economic crisis, with the masses now beginning to understand that what was wrong with the deformed workers states was the rule of the Stalinist bureaucracy – not the fact that the bourgeoisie had been expropriated.
The working class throughout eastern Europe is beginning to take the revolutionary road.
It has been greatly influenced by the eruption of working class anger in Greece, where millions are marching against cuts and sackings. The rest of Europe, from Germany to France and the UK are not far behind.
Even in the USA, the collapse of the banks and the motor industry, and the way that millions of workers have lost their jobs to keep bankrupt capitalism going, is revolutionising the working class and driving forward the struggle for jobs and health care for all.
The world crisis is driving forward the world socialist revolution with seven league boots. The task of the hour is to build the Fourth International to lead this developing revolution to its victory.