THE London and New York stock markets were in free fall yesterday, losing hundreds of points, with tens of billions of dollars and pounds lost in the crash.
Bank shares were also collapsing with HBOS and Barclays leading the way with 19% and 14% falls in their respective share prices.
The pound fell to $1.55, a truly massive collapse from its high point price against the dollar of $2.08.
This means that further rate cuts will touch off a run on the pound and risk a truly massive inflation and ultra high interest rates.
There has already been a staggering fall in production with the publication of official figures showing a 0.5 per cent fall in the output of the UK economy between July and September.
All this has created a massively rising unemployment.
At the same time the Opec oil cartel has announced a cut in oil production of 1.5m barrels per day, a move set to drive oil prices up again and the cost of living with it.
To rub salt into the wound of the capitalist crisis, the so called architect of the last 20 year inflationary boom, Greenspan the ex-head of the US federal Reserve Bank, admitted publicly that he had the wrong model of the capitalist system in mind when he calculated that the bankers would be compelled to regulate themselves, and thus prevent another 1929 crash.
He said that the crisis had left him ‘in a state of shocked disbelief’.
He was asked ‘were you wrong?’ and replied: ‘Partially – I made a mistake in presuming that the self-interest of organisations, specifically banks, is such that they were best capable of protecting shareholders equity in the firms. I discovered a flaw in the model that I perceived is the critical functioning structure that defines how the world works.’
Only the Marxists know how the world of capitalism works, and what drives it into crisis and collapses despite the subjective intentions of all concerned.
Now, the working class has to deal with the capitalist crisis, to defend its jobs, wages, pensions and basic rights which are going to be ripped to shreds by the bosses and the bankers as they unload the crisis onto the backs of the working class via their Brown government.
The working class must defend its interests as boldly and as ruthlessly as Brown and Darling are defending the interests of the bankers and the bosses.
What not to do is being clearly exhibited by the trade union leaders who are in 100 per cent support of Brown and his government, and must be swept aside.
The GMB leaders have just agreed to £50 a week wage cuts and short time working for JCB workers ‘to save 350 jobs’.
This will just encourage the bosses to carry on and do their worst. There are no other jobs to go to.
Every job must be defended, there must be no wage cuts or sackings. The trade unions must occupy factories and Mail Centres that are threatened with sackings or closure and demand that they be nationalised.
If it is good enough for the bosses and bankers then it is good enough for the workers.
Likewise the leaders of the CWU are running as fast as they can from the struggle with the Labour government to defend the Post Office and the Royal Mail.
They halted the battle to defend the conditions of service of their members and refused to defend the industry’s final salary pensions scheme.
Now they are fiddling while hundreds of Post Offices and dozens of Mail Centres are being put under notice of closure.
The attempt to close Mail Centres and post offices must be met with occupations and national strike action. The CWU must demand the support of the entire trade union movement to win this fight.
That means bringing down the Brown government and bringing in a workers government and socialism. There’s no way we are being dragged back to the hungry 30s. Take action now. Join the WRP today.
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