ON MONDAY night, 400 leading figures from the world of high finance and corporate business gathered at the Mansion House in London to hear speeches from Andrew Bailey, governor of the Bank of England, and Tory Chancellor Jeremy Hunt outlining their plans to save British capitalism from total collapse.
All Bailey could offer was yet another pledge to bring inflation down, saying that it is ‘crucial that we see the job through’ of bringing the inflation rate down to 2%.
Bailey told his audience: ‘It is crucial that we see the job through, meet the mandate to return inflation to its 2% target, and provide the environment of price stability in which the UK economy can thrive.’
Bailey highlighted what he claimed is the real enemy driving inflation, namely workers’ wages, saying: ‘Both price and wage increases at the current level are not consistent with the inflation target.’
Of course, controlling prices is unthinkable for the Bank or the Tories – the only plan Bailey and the Tories have is to constantly strive to drive down the wages of the working and middle classes.
The means to achieve this crucial necessity of getting inflation back to the 2% target is for the Bank to continually drive up the interest rate, with some analysts confidently predicting it will reach 7% in the near future.
The base interest rate set by the Bank is now at 5% following 13 increases in the past 18 months. Prior to these dramatic increases, the interest rate had been at near-zero levels for 12 years.
Driving up interest rates has only one aim, to make people spend less on food, clothing and other necessities as they struggle with huge increases in the cost of rents, mortgages and debt repayments.
It also spells the end of all those thousands of ‘zombie’ companies that exist entirely on debt, with the deliberate aim of creating an army of unemployed that the Bank and Tories believe is vital in suppressing the wages of those still in jobs.
This policy of near-zero rates, along with pumping billions of pounds of worthless money into the economy to prop up the banks after the 2008 world banking crash, has accelerated the development of a capitalist economy that existed solely through massive debt.
It is this unprecedented regime by all the central banks of money printing and cheap debt that has fuelled the explosive inflationary spiral strangling the UK economy, not any wage increases won by workers.
Figures released on Monday showed real wages are falling by 1.7% a year across the board while public sector pay is falling even faster at 3.1%.
Even the nominal gains in the average pay increases recorded in the UK are driven by massive increases in the wages awarded to the top 10% of UK earners, mainly the chief executives and bosses in the financial sector.
The working class is not responsible for the inflationary crisis and economic collapse, but the ruling class is determined that workers and their families must pay the price and accept being driven into abject poverty to save a capitalist system in its death agony.
The working class will never passively accept this as its fate, and they have clearly shown their determination to fight for wages and defend their hard-won rights.
The same cannot be said of the leaders of the TUC.
In response to these Mansion House speeches, TUC general secretary Paul Nowak made the pathetic plea for the Tories to come up with a ‘credible economic plan for boosting growth, jobs and pay’ completely ignoring the Tories’ only plan – to wage class war on workers and their unions.
Those trade union leaders who refuse to fight must be removed.
Workers must demand an immediate recall of the TUC general council to replace all those who oppose mobilising the full strength of the working class with a new leadership that is prepared to organise a general strike to bring down the Tories and go forward to a workers’ government and socialism.
Only the WRP and Young Socialists fight for this policy and programme – join today to rapidly build up the revolutionary leadership required to put an end to bankrupt capitalism and bring in a socialist society.
