US and world economic crisis deepens as PM Johnson decides to give up his ‘war to defeat coronavirus!’

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THE CORONAVIRUS crisis is smashing up the US and world capitalist economy at a tremendous rate.

The latest casualty is the electric car firm Tesla which has been ordered to keep its main plant in the US closed, as the State of California grapples with a serious coronavirus outbreak.

Chief executive Elon Musk had told staff that ‘limited’ production would resume on Friday at the Fremont factory, only for Alameda County to intervene to say that this could lead to a spike in coronavirus cases and there could be no production.

Nearly 9,500 cases of the virus have been reported in the San Francisco Bay Area, along with 342 virus-related deaths, and all but ‘basic operations’ have been suspended at the plant because of ‘shelter in place’ orders, enacted in the county. The factory employs more than 10,000 workers, and makes about 415,000 vehicles every year.

California’s government has eased some restrictions around the state this week, allowing businesses to resume operations but Bay Area counties, including Alameda, have issued their own criteria for businesses to reopen, which take precedence.

‘Tesla has been informed that it must not reopen,’ Alameda County said in a statement. ‘We welcome Tesla’s proactive work on a reopening plan, so that once they fit the criteria to reopen, they can do so in a way that protects their employees and the community at large.’

The refusal to allow Tesla to resume production at Fremont comes as Tesla has suspended operations at its plant in the Chinese city of Shanghai. It had previously closed the factory as a temporary measure when the virus was at its peak in China. The company reported a net profit in the first three months of this year, and its stock has risen to nearly $820 (£669).

Billionaire Tesla boss Elon Musk now says he will move the electric carmaker’s headquarters out of California. ‘Tesla will now move its HQ and future programmes to Texas/Nevada immediately,’ the CEO tweeted, adding that the company was filing a lawsuit against Alameda County. According to figures from Johns Hopkins University, 2,632 people in California have died with coronavirus.

In Alameda County, all but essential businesses must remain shut until the end of May. Musk has continually voiced his opposition to these ‘fascist’ lockdown measures, tweeting ‘FREE AMERICA NOW!’

Meanwhile, the US unemployment rate has risen to 14.7%, with 20.5 million jobs lost in April, and another 14 million jobs lost since then, as the coronavirus pandemic devastates the US and world economy. The crash in the US economy has been rapid and devastating. Just two months ago, the unemployment rate was at 3.5%, a 50-year low.

‘It is historically unprecedented,’ said economist Erica Groshen, former head of the government’s Bureau of Labour Statistics. ‘We have put our economy into a medically induced coma in order to heal it from the pandemic … and that has led to the most precipitous loss of jobs seen in any of the modern data. Even a temporary lay-off can turn into a permanent one if the business doesn’t survive or if the business has to change its business model so dramatically that it needs different numbers or a different kind of worker,’ Groshen said.

This economic crisis of the capitalist system is now international with the Bank of England warning of the most devastating UK slump since 1706, while Germany and Holland refuse to share the EU’s mounting debt.

Meanwhile, shale oil has collapsed and the US oil wealth is being put into storage. ‘The scale of the challenge cannot be overstated,’ said Robert Alster, head of investment services at wealth manager Close Brothers Asset Management. In fact, the worldwide capitalist system is breaking apart.

In the UK, the Johnson government has surrendered to the virus and ended its limited war with it in favour of live and let live so as to force the working class back to work, where it can be super-exploited to wipe out the massive UK capitalist and bankers debt.

However, the working class in the UK, as in the USA and the EU will not submit to the boss class and their political instruments and servants, both Tory and Labour in the UK, and Democrat and Republican in the USA.

Instead, the workers will strike out for socialism, to put an end to the worldwide debacle of the capitalist system and replace it with a worldwide socialist planned economy that exists solely to satisfy the needs of the people. This worldwide socialist revolution is the only way out of the world crisis of capitalism for the working people of the world.