Speaker: Andy Kilmister
Tuesday 16th June 7.30pm, Bennetts Bar, Bennetts Hill, Birmingham City Centre
“…..the commercial crises….. by their periodical return, put the existence of the entire bourgeois society on its trial, each time more threateningly. In these crises, a great part not only of the existing products, but also of the previously created productive forces, are periodically destroyed. In these crises, there breaks out an epidemic that, in all earlier epochs, would have seemed an absurdity – the epidemic of over-production.”
Karl Marx 1848
The last few weeks have seen an increasing number of media reports of the `green shoots of economic recovery’ coupled with statements by financial analysts that the worst of the recession may soon be over – or may indeed already have passed.
Socialist Resistance has never taken the view that the current crisis is just about the weaknesses of the banks following the sub-prime debacle in the USA.
The financial turbulence that became apparent in August 2007 and then worsened dramatically in the autumn of 2008 is just one aspect of a broader process. This process involves the unravelling of many of the institutional frame-works that have governed the international economy since the mid -1980s and have laid the basis for neo-liberal politics. Economic growth in the last three decades has depended not just on rising debt but also on cheap commodity prices and ecological devastation within a context of global capital flows and imperialist exploitation. All of this is now thrown into question.
But the retreat of the most immediate threats of financial collapse and the temporary stabilisation of the banking sector does mark the end of a particular phase of the crisis and provides an opportunity for socialists to analyse the turmoil of the last year and to discuss likely developments in the future. We hope our new book Socialists and the Capitalist Recession will be a good basis for doing this.
In understanding what is happening to the economy at present Marx’s theories of crisis provide an invaluable starting point. The key dilemmas and tensions which lie at the centre of the current recession can be traced back to the themes highlighted by Marx over a century ago. This talk will look at three of them:
- Where will the demand come from to ensure economic growth and prevent mass unemployment, after the collapse of the housing bubble and debt-fuelled consumption? In societies like the USA and Britain, with massive inequalities and stagnating wages, how can ordinary people continue to afford to maintain consumption? What will be the impact of the current rise in government borrowing and the threat of higher taxes and public expenditure cuts to come?
- Are we heading for an era of global economic instability? Will increased demand from countries like China and India make up for slower growth in the USA and Europe? Will the dollar and euro maintain their values? What lies behind the fall in the pound?
- What is happening to profitability both in the financial and industrial sectors? Who is gaining and who is losing from the crisis and who will bear the future costs? How can capitalism deal with the mass of speculative investment left over from the boom?
Of course the outcome of the current crisis will not depend only on the background of global economic developments or on the strategies of employers and governments. More important than these will be the responses of workers and ordinary people to the attacks on living standards which the recession will bring. But in building campaigns and struggles to withstand these attacks we need to analyse what is happening in the economy and make predictions about what is coming next. This talk is intended to contribute to just such a discussion.
Part 1:
Part 2:
