‘We have been humbled by nature’ the Japanese ambassador to Britain said of the earthquake and subsequent tsunami that has devastated northern Japan with the tragic loss of life now estimated to be in excess of 10,000.
The ambassador could have added that international capitalism is set to be humbled by the economic tsunami that is beginning to sweep through the world economy following on from this massive disaster.
Japan is still the third largest economy in the world, behind America and China.
It accounts for over 7% of the world economy meaning that any drop in production will have a huge impact internationally.
And there is most certainly going to be a drop in production as some of the world’s largest manufacturers like Honda, Toyota, Nissan, Sony and Panasonic, to name just a few, have been forced to cease production completely.
Whole swathes of the once mighty Japanese manufacturing industry face total meltdown. The effect on the already fragile Japanese economy has been disastrous.
The Japanese stock market has slumped with share prices dropping by 6.2% on the Nikki index.
Japan already has the highest debt to GDP ratio in the major capitalist nations of 200% – in other words its debts exceed its income by that amount.
The economic fall-out of the earthquake and tsunami will unquestionably drive the Japanese economy into all out slump.
Already the capitalist class has made it clear that it will be workers and their families that will be footing the bill for the necessary reconstruction, with the government insisting that higher taxation will be required to stump up the billions of pounds required.
In London 2% was wiped off the share values of the FTSE 100 index, the equivalent of £30 billion, as the scale of the disaster became apparent.
Right in the firing line for economic collapse is the insurance wing of capitalism, with insurance companies facing losses estimated to be in the fifties of billions of pounds.
Another crippling blow for the financial sector.
Another long-term effect will be felt by workers and the mass of people throughout the world.
Analysts are predicting that the inevitable high demand for grain imports by Japan as a result of the disaster will drive up the price of food internationally.
The response of capitalism is always to seek to maximise profit at the cost of human suffering, witness the obvious glee of multinational construction companies at the prospect of juicy reconstruction contracts – paid for on the backs of the working class naturally.
While these parasites look to profit from human misery, the overall response of capitalism is to look on with horror as the natural disaster threatens to destabilise the entire world economy and plunge major countries even further into total slump.
For the working class the lessons of the tragic events are clear, capitalism is an outmoded, historically bankrupt system that not only cannot cope with natural disasters but instead enormously exacerbates them.
In the mad rush for a national energy supply source the Japanese capitalist class turned to a reliance on atomic energy after the oil crisis of 1974.
This led them to build – against the advice of scientists – nuclear power stations in a region that everyone knew was geologically unstable and where a major earthquake was not just a possibility but an absolute certainty.
This complete disregard for human life in the drive for profit is the characteristic of capitalism along with its determination that any crisis will be solved at the expense of the working class.
The lesson of the Japanese tragedy is that only the overthrow of capitalism and going forward to world socialism can advance humanity.
