The US economy is at the centre of the worldwide capitalist economic crisis.
It is in slump, with major industries, such as the motor car industry, being broken up, with scores of plant closures and tens of thousands of redundancies, with the bosses saying that they can no longer afford their wage, health care and retirement costs.
At the same time house prices have slumped, along with the homebuilding sector of the economy.
Under the impact of the slump unemployment is growing, and wages are falling while productivity has been driven up, angering tens of millions of workers.
The US bosses are hitting out savagely at trade unions, while the Bush administration has rushed through a measure that will categorise up to 40 million workers as ‘supervisors’ and, under US law, unable to join trade unions.
Meanwhile, the US trade deficit reached $716 billion for 2005 and in the first eight months of 2006 reached almost $800 billion.
The US budget deficit reached $554 billion for 2005 and is still heading upwards, while the National Debt is now at $8 trillion, fuelled by the massive expenditures on the war in Iraq, which the developing economic crisis forced the US ruling class to undertake to try to secure oil supplies.
The war itself has led to a fantastic inflation in oil and metal prices that has hit the US economy hard.
Both the US government and the US bosses are bankrupt. What is keeping the US afloat is the fact that Chinese and Japanese banks underwrite the government deficit by buying US treasury bonds.
What has prevented a collapse of the dollar are the 16 US interest rises, one after the other, which have also made the purchasing of US treasury bonds profitable.
It is right at the point where the contradictions of this crisis are reaching the point of explosive transformation, with the Bush presidency undermined and staggering, that the US stock market has been inflated to new and even dizzier heights, breaking through the 12,000 point barrier for the first time in the history of Wall Street.
US capitalism is reeling, hit by economic collapse at home, trade war abroad, and staring military defeat in the face in Iraq.
Wall Street will not be able to defy the law of gravity. The higher it flies, the bigger the crash that is underway, that will devastate the entire world economy. The collapse of the US market has meanwhile exacerbated the crisis of the world capitalist economy which depends on the US market for the sale of its commodities.
The slump, the trade wars and the war in Iraq have been accompanied by massive attacks on the German, French, Italian, and British working classes by capitalist governments seeking to save their respective capitalist economies through cutting workers’ wages, deregulating and privatising economies, and smashing welfare states.
The poorer EU states such as Greece are in a permanent state of mass strike actions by every section of workers, as the ruling class seeks to secure its position in the EU by pauperising the working class, the middle class and the small farmers.
Meanwhile, inspired by the struggle of the Iraqi masses, the workers of Venezuela and Bolivia have struck blows at US imperialism and nationalised their national resources, setting an example which the whole of Latin America will follow.
The defeat being suffered by the US and the UK in Iraq has also emboldened the Iranian and Lebanese masses, and encouraged North Korea to take measures to secure its defences, however great the threats of US imperialism.
The world crisis of capitalism is driving forward the world socialist revolution, in which the workers of the major capitalist states are in alliance with the revolutionary peoples of the Middle East, and the world.
What is called for, to lead this developing world revolution to victory to smash capitalism and world imperialism, is the building of sections of the International Committee of the Fourth International in all of the major centres of the world struggle, from Iraq to the USA.