TORY Chancellor Philip Hammond, speaking about the Brexit crisis from the World Economic Forum in Davos, said yesterday: ‘It is absolutely clear that if we don’t get a deal … there will be very significant disruption in the short term and a very significant hit to our economy in the medium to long term.’
He is peddling ‘project fear’ to the very end. However, the reality is the opposite – the European Union is in fact tearing itself apart. It is being broken up by the worldwide crisis of capitalism, and the revolutionary struggles of the European working class.
President of the European Central Bank, Mario Draghi, has warned: ‘The eurozone economy is slowing sharply and faces a series of major risks from global protectionism, threats to the post-war world order, Brexit, weak emerging markets and financial market volatility.’
At the World Economic Forum, the deep internal divisions between the EU states came out into the open, with EU leaders at each other’s throats over debt, economic collapses, austerity, and who or what is to blame for the accelerating economic and political crisis.
At a session of the WEF, Mark Rutte, the Dutch premier, launched a blistering attack against the Italian government, accusing the European Commission of failing in its duty to enforce austerity on Italy in reaction to its budget. He said the decision to let Italy off the hook for ‘violating the Stability Pact’ had ‘shattered trust’.
The EU Trade Commissioner Cecilia Malmstrom retorted: ‘We have not let Italy off the hook, absolutely not.’ The Polish leader, Morawiecki, then launched an attack on Ireland, saying that ‘certain countries in Europe’ were manipulating their tax systems ‘to the detriment of others’, to which the Irish Taoiseach Leo Varadkar insisted ‘all tax loopholes in Ireland have been closed’.
The European Union acts like a gang of thieves – when the robbery goes wrong, they fall out and turn on each other over who is to blame. They are driven by a deep-rooted fear. Fear of a working class across Europe which has had enough of EU bankers and bosses making them pay for their banking crashes with their jobs, housing, education and healthcare.
The ‘Yellow Vests’ uprising in France is demanding President Macron’s head while calling for ‘Frexit’. Demonstrations have spread to Belgium, the heart of the EU. The masses in Hungary are on the streets against the so-called ‘slave law’. Greece is in a state of permanent revolution, bankrupted by the EU, with fierce fighting between workers and riot police on the streets.
All of this is being driven by the razor sharp economic crisis, with a growing number of countries who are considered ‘state bankrupt’. These are countries whose national debt is over 100% of their Gross Domestic Product (GDP). Both France and Spain are just below the 100% threshold, with France’s debt at 97.7% of its GDP and Spain’s at 98.8%. Belgium’s debt is at 106.3%, Portugal 126.4%, Italy 133.4% and Greece at 180.4% of its GDP. It is bankrupt almost twice over!
Greece, however, is a relatively small economy compared to Italy. Italy’s banking sector is the eurozone’s third largest, following France and Germany. French banks are heavily exposed to Italian debt, with $392.6 billion owed to its banks. German banks meanwhile have an exposure of $162.3 billion to the Italians.
So when Italy goes down, Germany and France will be dragged down with it, the euro will crash and of course, since all that debt is processed here in the UK, the moment the euro crashes, the pound will go as well. People will go to their banks to find that their deposits have been lost!
In fact, when Parliament says it fears a ‘no-deal’ Brexit, it means that it fears that the UK masses will not only break with the EU but they will continue to expropriate the bosses and bankers to bring in socialism. This is why every section of the state has now gone into action to try to hold the masses back. The Queen, the MI6 chiefs and the army bosses are now urging the politicians to shut up, and the masses to calm down, be reasonable, and above all to respect the capitalist order.
However, it is too late for all that. The working class will see Brexit through and ally itself with the workers of Europe to bring down the EU and bring in the Socialist United States of Europe.