INTERNATIONAL Monetary Fund’s (IMF) managing director Kristalina Georgieva said yesterday: ‘We anticipate the worst economic fallout since the Great Depression.’
‘Just three months ago, we expected positive per capita income growth in over 160 of our member countries in 2020,’ she said. ‘Today, that number has been turned on its head: we now project that over 170 countries will experience negative per capita income growth this year.’
Georgieva’s apocalyptic prediction is in fact an underestimation of the intense crisis of capitalism, and that crisis has only just got going. This is the death agony of capitalism, where the coronavirus has exposed the inherent weakness of an entire system drowning in hundreds of trillions of dollars of debt.
Before this current crisis, global debt stood at $255 trillion, over 322% of GDP. In other words, the capitalist world is bankrupt more than three times over!
The latest American job figures released on Thursday are truly shocking and of great significance. Another 6.61 million applied for unemployment benefits in the last week, bringing the total to about 16.8 million during the coronavirus pandemic’s economic shutdown. That is 16.8 million applying for unemployment benefit in the last three weeks alone!
What this signifies is the end of lies put out by President Trump that he is ‘making America great again’. It was only in February that the papers were full of a ‘US record-breaking streak of job creation’ with the Bureau of Labor Statistics announcing that the unemployment rate ‘remained at a 50-year low of 3.6%’.
But the capitalist madness continues. Yesterday, Wall Street’s S&P 500 shares index rose by 12% for this week as the US central bank announced $2.3 trillion more stimulus measures to ‘support the economy’. Gold prices hit a seven-year high.
‘It looks like the Fed are on a mission to blow holes in every dam that stops the flow of credit. And it sure sounds like they have plenty more dynamite if needed,’ said Stephen Innes, global chief market strategist at Axicorp. In fact, capitalism is hurtling towards the precipice at massive speed and, if allowed, will carry humanity into an abyss that will make the 1930s seem pleasant.
The European Union, meanwhile, is anything but unified. The EU is breaking up, with national interests dominating and the EU’s economic crisis going from disaster to catastrophe.
Italy’s prime minister, Giuseppe Conte, warned on Thursday that the existence of the bloc was at stake. Italians have been left to die in their thousands by an EU which offers little assistance.
The Bank of France warned that the French economy ‘is on course for its deepest economic collapse since the Second World War’. Meanwhile, the German economy is forecast to plummet by a massive 9.8 per cent in the April to June quarter, in what would be its biggest fall since records began in 1970.
And the British ruling class are in the deepest crisis of the lot! The entire economy has been brought to a grinding halt with the majority of the country out of work.
The government is to borrow billions of pounds from its emergency Bank of England overdraft arrangement to finance the fight against Covid-19. The government will draw money from the Bank’s ‘ways and means’ facility which it has not used since the 2007/8 global financial crisis.
It is clear that the only way the UK working class is going to get any sort of future is to get rid of this bankrupt capitalist system and take the power.
The Tories are suffering from an acute leadership crisis. They are now reaching out to form a national government with the new Labour right-wing leader Starmer, who has assembled a Blairite-style cabinet.
Labour traitors are to join hands with the Tories to step up their war against the working class! The crisis of leadership of the working class has never been sharper.
This is why the building of the Workers Revolutionary Party and sections of the International Committee of the Fourth International worldwide has never been more urgent. This is the only way forward! We must organise the victory of the world socialist revolution.