Spinning on the edge of a black hole

THE TORY party conference in Manchester this week is being heavily overshadowed by the gathering global economic storm that is making nonsense of all their policies, predictions and promises — promises that they would never follow Gordon Brown’s example and increase the budget deficit by bailing out failing banks.

Those banks are about to crash again and all George Osborne can do is to exhort his minions to “stand together and we’ll weather the storm” — when clearly it is very unlikely they will.

Will Cameron meekly bail out the banks again, as Brown did? Or will he sit back while cash machines run out of money and while money to pay wages and salaries throughout the country runs out?

Prime Minister David Cameron is under heavy pressure from the party’s backwoods section to pull out of the European Union as quickly as possible but Cameron is refusing a referendum on the issue.

The truth, as pointed out by independent market trader Alessio Rastani last week, that many of those who have bankrolled Cameron from the banking sector will be welcoming the coming stock market chaos. These are the conditions that allow them to make most money for themselves.

Osborne has told his followers there will be no tax cuts in the short term. It is a right-wing capitalist mantra that tax cuts are the way to stimulate the economy out of a crisis and that businessmen would use the extra money to invest in growth.

Recently a Congresswoman in America complained on Jon Stewart’s Daily Show that tax cuts “no longer” work. “Even if you abolish all their taxes altogether they’ll still go to China to get their things made because it’s cheaper. We just can’t compete with China.”

It is ironic that China, a country with a socialist government, is able to out-compete all the capitalist countries and still give its population a rising standard of living and a rising social wage.

It never occurs to the capitalists to put more money in the hands of the working classes — who would definitely spend some of it in their local high streets.

But even this tactic will not be as effective as with previous recessions and slumps because of the massive extent of working class consumer debt.

This crisis is different to other capitalist crises because it should have happened a decade ago, according to the normal boom and bust cycle of capitalism.

Gordon Brown, as Chancellor of the Exchequer in Britain at the time, along with his counterparts in other leading capitalist nations, succeeded in postponing the crisis by keeping markets going by pressuring workers to go deep into debt and spend money they had yet to earn.

Personal debt in leading capitalist countries is still at phenomenal levels. And when and if workers did get a little extra money many would use it to pay off as much debt as they can — debt that has had them chained to exhausting working hours, depression, anxiety and damaged family life.

In other words they would hand this money straight back to the bankers — who would inevitably ensure it ends up in their own pockets. Only a small proportion would be spent on the high streets. It will take capitalism much, much longer to crawl out of this crisis than any other.

It is likely that the Greek government will default on its debts and doubtful that the rescue package will have much effect. The rescue money will be going straight into the hands of corrupt bankers and politicians who, like Rastani, are delighted with their country’s desperate situation because it allows them to make even more money.

The only thing worrying them is how much longer their population will be willing to put up with the draconian cuts being inflicted on their living standards and wellbeing as part of the conditions of the bail-out. Because the Greek communist party, the KKE, has another plan for Greece, a plan for a socialist system that will throw out the bankers and their puppets in the government, using whatever force is needed, and hand control of the country to the organised working class.

Ultimately this is the only real fear that the bankers and the Rastanis have. They know that eventually their insatiable greed will provoke a political reaction among those they are robbing and cheating.

And, even though they deny it and refuse to speak about it, they know that just as inevitable as capitalist crises is the ultimate victory of socialism over capitalism.