Capitalism around the globe is in crisis.
Recession grips much of the world. In the last quarter of 2012 the US economy went backwards. Unemployment, officially at 7.8%, is, according to some analysts, as high as 12%. Real wages are at their lowest level in decades. Nearly 50 million Americans are on food stamps while the millionaires and billionaires get richer and richer.
Unemployment in the Eurozone is almost 12%. It is over 25% in Spain and Greece. Youth unemployment in those two countries is over 50% and almost 25% across the Eurozone.
The capitalist class has no answers. Austerity has failed to turn the European economies around, instead it has pushed them into deeper recessions. Across the Eurozone real Gross Domestic Product fell by 0.3% in 2012.
The Greek economy has been in free fall since 2009 falling over 25% since 2008. The British economy shrank 0.3% in the last 3 months of 2012. Spain’s last year fell 1.4% and Italy’s 2.3%.
Obviously while Australia’s situation is not the same as Europe’s, unemployment here is officially at 5.4% and growth is running at around 3%, according to Roy Morgan the real rate of unemployment and underemployment in Australia in 2011 was 16.8%. Youth unemployment is on some figures much more than 20% and in some parts of Australia such as inner Western Sydney it is over 50%. Australia is not a part of Europe but it is part of the global economy. As the Chinese economy flattens, in addition to the economic woes of Europe and the US, the Australian economy will slow down in response. Predictions are that unemployment will pass 6% sometime after the 14 September election.
These economic crises are crises of profitability. Marx argued that the very way production is organised under capitalism – more and more investment in capital relative to workers – produces a tendency for the rate of profit to fall. Only a massive destruction of value, or increased working hours, or savage attacks on living standards and jobs can restore profit rates in much of the developed world. The human misery this has and will spread in many developed countries is an indictment of capitalism.
It is not just the economy in crisis though. As extreme weather events increase in scope and intensity, as the Great Barrier Reef is threatened by mining in Queensland, as predictions for global warming of between four and six degrees Celsius by 2100 are validated, the key to addressing climate change is capital itself. Mickey Mouse solutions like carbon taxes and ‘real action plans’ do nothing to address the threat to humanity from climate change induced by blind profit chasing. The drive for short term profit overrides the long term viability of human life on the planet.
There is an alternative – a society organised democratically to satisfy human needs. A society that can only come about by workers setting up their own democratic institutions to decide what to produce not for profit but to address our needs as human beings. That might sound like a pipe dream in Australia at the moment with very few strikes and revolutionary socialists on the margins of political debate and discourse.
However the strikes and demonstrations across Europe right now and the rise of the radical left wing party SYRIZA in Greece to almost win government give a glimpse of the power of workers to change society and radically transform it.
The magnificent revolutions in the Middle East and North Africa that overthrew or are overthrowing the dictatorships largely supported by Western powers, have laid the groundwork for the next stage of the revolution, that is, socialist revolution. In Egypt that second stage of the revolution is beginning to unfold as the ruling Muslim Brotherhood shows itself unable to improve the living standards of its people. Workers in Egypt are beginning to demand better wages, more jobs and the freedom to organise, demonstrate and strike.
Stalinism is not socialism. The rise of Stalin represented the defeat of revolution. Mao and Castro are not socialists either, representing radical third world nationalist movements parading under the cloak of socialism.