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Che fare n.69 April - May 2008

The economic, social and political earthquake announced by the mortgage crisis can and must be made the starting point of a new proletarian movement!

Workers are looking with increasing apprehension at the black clouds looming over the world economy as a result of the mortgage crisis in the United States. What is happening? What can we expect?

The roots of the mortgage crisis 

One of the characteristics of capitalism is that its economic slumps are the fruit of the developments preceding them – and this time is no different. We are not only referring to the period 2003-2007, during which gross world product increased by almost one-third, but also to the last 25 years. During this time, the world’s labour market has more or less doubled, and its agricultural and industrial production has more than doubled, while the countries in the ex-field of “real socialism” and newly independent countries have been integrated and, successfully or disastrously, integrated themselves to the full in the unified world market. This expansion of the world market has simultaneously been the cause and effect of even more extensive and relentless capitalist accumulation in Asia, Russia and the major oil exporting countries, and not without some misgivings in the Euro-American heart of the West.

This renewed accumulation has been fuelled by three factors.

The first has been the introduction of a series of technological innovations that have increased productivity, reduced intercontinental transport costs, and accelerated and integrated the exchange of information to such an extent that, for the first time in history, it is possible for a factory to have its various departments located anywhere on the planet.

The second has been the transfer of a growing mass of foreign direct investments (FDI) to a number of countries in the south of the world, particularly Asia, where investors have gained access to an army of hundreds of millions of workers in exchange for rock-bottom wages – a real goose laying real golden eggs! China has been in the very front of the queue: FDIs there increased from 6-7 billion dollars in the early 1990s, to 60 billion in 2006. In addition to causing the formidable redislocation of Western industrial production to the East and some parts of the South, this process has drastically lowered production costs in industry, agriculture, and more recently in the “services” – a result that has also been aided by the arrival of tens of millions of “coloured” immigrant workers in the United States and Europe.

The third has been the exponential rise in indebtedness throughout the world, above all in the United States, where the colossal debts of the state at home and abroad have added to those of American families (which reached record levels in 2005, when the average debt per family was equal to 128% of its income) and American industrial and financial enterprises.

The first two factors have added a mass of profits (which have grown more rapidly than production) to increase planetary output further, while the third has ensured a ready market for the enormous quantities of industrial and consumer goods spewing from the mouth of the volcano of globalised production. The continuity of the renewed capitalist accumulation that started in the second half of the 1980s therefore depended not only on maintaining low production costs indefinitely by means of minimal labour costs, but also on being able to control the process of general indebtedness.

The aim of the financial “revolution” that has taken place in this period has in fact been that of guiding and controlling this world process of capitalist accumulation by continuously extending the limit beyond which there can only be a new and gigantic crisis of overproduction. How? By increasing the efficiency of capital’s exploitation of labour on a global scale. By intensifying competition between the workers of the North and South, as well as within their respective worlds. By imposing the tyranny of the market on both private and state-run “economic players”. By accelerating the realignment of the ill-disciplined. By pushing wage earners to increase their debts by offering them the bait of (initially) easy credit facilities and then forcing them – in “exchange” – to work ever more intensely.

The more that this seemed to lead to (also politically) exhilarating results, such as the complete collapse of “real socialism”, the stabilisation of Deng’s “market socialism” in China, and the generalisation of liberalist policies even to “left-wing” parties and governments, the more the old and new international financial institutions indulged in euphorically gambling on their own futures and the future of capitalism by producing and exchanging an endless plethora of juridical title-deeds to the labour (and added-labour) of future generations of the world’s proletariat. And by doing so, they have also fed speculation and generated multiple financial bubbles because, instead of masses of real profits, what they have been furiously exchanging on the world market are mountains of expectations concerning future profits and, increasingly, present (socialised) debts.

However, this mechanism began skipping a beat as it started to run out of its one of its principal fuels: the progressive devaluation of the globalised labour force. For some years now, the workers in the United States have been finding it increasingly difficult to sustain the heavier and prolonged working hours they had accepted for 25 years and, at the same time, wages in China, Latin America and Eastern Europe have stabilised or started to increase, thus halting the diminution of the prices of consumer goods imported into the USA. The combination of these two changes has made it impossible for an increasing number of American families to repay the instalments on the debts they contracted in order to buy their houses and furniture – and this has led to a chain reaction of other destabilising effects.

What now?

The chain reaction of set in motion by the mortgage crisis

We are now seeing attempts to govern this crisis. The USA and other Western countries are engaged in a series of tightrope-walking acrobatics. They have to get the bankrupt financial enterprises off the stage and bring on a new cast of leading players in the shape of major bankers and financiers capable of driving continued accumulation and guiding the further centralisation of industrial capital; they have to involve OPEC and China in this rescue operation in order to get them to take their share of the responsibility for managing the world economy; and they have to build protectionist barriers in order to defend the market shares of “their own” multinational companies. The great capitalist powers need to do all of this so as to limit the damage cause to themselves and offload the rest onto smaller fry, catch their breath, and prepare themselves for their own “final cure”.

This is based on three medicines: an abrupt devaluation of the world’s labour force; the new and very extensive expropriation of the peasants in Latin America, Africa and Asia; and the submission of the capitalist development of China (as well as that of Iran, Venezuela and Russia) to the total dominion of the West. This cannot be done without setting under way an acute planetary-wide conflict between classes and nations, for which the imperialist powers are not yet prepared. They are torn between opposite drives: they have to strike violently against their own working classes, but they also need their agreement and mobilisation in order to be able to further the defence and extension of their share of exploited labour in Asia, Latin America and Africa also on a military level.

How can they resolve such a similar contradiction?

The card that imperialism is readying itself to play can be seen in the programmes of the remaining candidates for the presidency of the USA (McCain, Hillary Clinton and Obama): the idea is to channel the discontent of Western workers against the China and Islam by promising them that crushing the “Muslim-Confucian” axis will at least reduce the leap backward in living and working conditions that capitalism in crisis (and what a crisis!) is once again reserving for the proletariat. Preparing for this regimentation and armouring of Western societies is the fundamental counter-measure being readied by imperialist leaders, the Federal Reserve, the European Bank, and the heads of world capitalism – and it will lead to new wars of oppression aimed at carving up the world market.

Imperialist capital has had recourse to a number of such wars as spontaneous market mechanisms filled its sails over the last 25 years. The invisible hand of the market would never have prevailed over the resistance of the oppressed and exploited peoples of the Balkans and Iraq without the iron fist of the Pentagon and NATO, and it is not difficult to see how vital the same iron fist will be in the near future to the aristocracy of managers, rentiers, generals, state directors and information magnates that dominate the world!

However the financial crisis develops – whether it explodes “immediately” in all of its devastating power or not – workers and proletarians will find themselves heavily attacked at all levels because (ever and increasingly rich) capitalists have once again proved themselves incapable of guaranteeing the existence of the wage slaves whose sweat has made them fat.

The exploited will have no alternative but to defend themselves and fight, as can already be seen in China, Russia, Poland, Abu Dhabi, Iran, South Africa, and the proletarianised countrysides of Mexico, Brazil, India and Zimbabwe. It is true that our army is still disorganised and much still has to be done in order to unite it, but it is certainly not manned by ghosts.

The looming global crisis calls upon it to globalise and centralise its own struggle, resistance and class organisation. Not only to defend itself from the coming dismissals, poverty and draconian measures, or the ruinous conflicts of autocthonous or immigrant workers from the North and South of the world, but also in order to relaunch with force the prospect of socialism. The increasingly anti-social and anti-natural functioning of capitalism is more than ever placing the alternative between authentic socialism and capitalist barbarianism at the centre of world history and politics, as well as at the centre of the international class struggle.

Yes. The economic, social and political earthquake heralded by the mortgage crisis can and must become the starting point for a revolutionary proletarian movement that, like the phoenix, is reborn from its own ashes. In order to prepare the ground, a vanguard worthy of the name must dare, dare and dare again to challenge the spirit of the times and resume the Marxist critique of capitalism, taking it to its logical conclusion, purifying it of its horrendous Stalinist misinterpretations, reconfirming it in the light of the characteristics of globalised capitalism, and relaunching it as the basis of an authentically revolutionary policy.

   Che fare n.69 April - May 2008

Italian translation

Internationalist Communist Organization

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