“For us now there is no minimum programme, no maximum programme; socialism is one and the same, that is the minimum we have to achieve today.” (Rosa Luxemburg, Foundation Congress of the Spartakusbund)

It was not so long ago that the free play of the market was commonly considered to be the non plus ultra of economic regulation. This is a view of things that has been made to look completely ridiculous by the recent roller-coaster ride in the stock exchanges. Worldwide, rescue packages worth billions and state savings guarantees have had to be brought in to ward off a total collapse of the global financial system. Nevertheless, the full scope of the financial crisis and its effects on the real economy are still not yet discernable. It is only certain that economic growth will take a further hit and a deep recession is inevitable. Certainly, one can try and explain the present distortions in the financial markets according to the prevalent feelings of anger and propagandistic clichés. According to these, essentially, the “avarice” and the “striving for maximum profits” of individual speculators has led to the present misery, so that the State is now required, to avert the worst through stronger regulation. But “avarice” and the “striving for maximum profits” have, however, always been characteristic of the being of capitalism. The so-called “free market economy” is not a welfare institution. In a system based on competition and commodity production, the maximalisation of profit simply belongs to the basis of society.

Fictitious Capital is the Mother of all that’s Remarkable

The only question is: how did the financial markets become such a dominant factor in the world economy? How did it come about that more profit can apparently be made through short-term money deals than through directly productive investments?

The epidemic of financial speculation was an expression of the crisis of the capitalist accumulation system which began to take hold at the start of the 1970s. As compensation for the profit rate, capital relied on the restructuring of the production process (for example by the introduction of micro-electronics) and a massive increase in the rate of exploitation. At the same time, in recent decades, wealth created by wage-labour was shifted to the financial sphere where, in a miraculous fashion, money “works” (without, however, creating real value) and the shoots of speculation came forth. This attempt by capitalism to meet its crisis by the creation of fictitious sources of profit, secured a few of the super-rich considerable gains, but, in the long-term, led to growing indebtedness, enormous speculative bubbles and increasing instability. Today, we can see the results. Nevertheless, in comparison with previous financial crises (Mexico 1994, South-East Asia 1997, Russia 1998 and Argentina 2001), the present crisis is neither regionally nor temporally limited. It broke out in the USA, the centre of global capitalism and has penetrated every corner of the system. Against this background, the chances of success of the various state rescue packages are more than questionable.

A New Spiral of Attacks

Certainly, there is no shortage of comedy in the way that, after years of neo-liberal self-confidence, now suddenly the state is called upon to restore “belief” in the markets.

But the crocodile tears and pathetic incantations with which the state “confidence-building” packages are inaugurated do not change their class character by an iota. It counts as self-evident that they must sooner or later be financed by tax revenue (i.e., state-organised wage theft).

They are thus nothing other than gigantic redistribution programmes in favour of the banks and the owners of capital. After years of wage sacrifice and social cuts, we stand once more before a new spiral of attacks. The first estimates start from the assumption that hundreds of thousands of jobs are threatened. Further wage cuts and the deregulation of working conditions are also planned just as is the cutting of social services. Inflation and increased raw material and energy prices will push living costs even higher and sharpen the hunger and misery of millions of people across the globe. Despite all the high-sounding discourse about the avoidable blessings of globalisation, the crisis is sharpening in the context of growing imperialist tensions between competing national states. The continuing massacre in Afghanistan and Iraq, the threats of war against Iran, just like the most recent military conflict between Russia and Georgia, show once again that a permanent state of being at arms and war have become the current instrument of imperialist politics.

Socialism or Barbarism!

War and crisis are not natural catastrophes, but the result of a social system which is becoming ever more irrational. Capitalism cannot be gradually improved, nor essentially changed or even managed in a way compatible with human dignity. Only a society oriented towards the satisfaction of needs can solve the problems threatening humanity’s existence.

In the face of the fact of the crisis, the unions and official left’s demands and programmes for “real regulation of the finance markets” and/or “meaningful conjunctural and employment measures” are built on sand. With all their sometime radical rhetoric, they remain chained to what is necessary for capitalism, and in this way they are nothing more and nothing less than the ideological lubricant with which potential struggles are to be domesticated and brought under the state. Even now, the unions with their hurried patriotism have already notified their wage restraint in the next round of wage negotiations. In the same way, the so-called “Left” Party misses no opportunity to prove its citizen’s responsibility, by backing wage and social cuts. False friends are sometimes the worst enemies. The defence of our interests demands a political break with all those ideologies, programmes and political currents which wish to “reconcile” the interests of the workers with those of the bourgeoisie, or to subject the former to the latter, whether this is done in the name of the “nation”, the “social partnership” or “economic logic”. The presently intruding crisis shows once again that capitalism has nothing more to offer us, except for more exploitation, poverty and war. Only in a radical break with the logic of capital realization, on the basis of proletarian self-organisation and with a clear internationalist socialist perspective, will it be possible to prepare the end of this system.

From our German sister organisation, the Gruppe Internationaler Socialistinnen