Writingspress statementsPUBLIC DEBT CRISIS WORSENS GLOBAL DEPRESSION AND FURTHER...

PUBLIC DEBT CRISIS WORSENS GLOBAL DEPRESSION AND FURTHER INFLAMES PEOPLES’ RESISTANCE

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By Prof. Jose Maria Sison
Chairperson
International League of Peoples’ Struggle
22 August 2011

The top officials of the IMF and World Bank, corporate moguls, the bourgeois politicians, the experts and media pundits admit the gravity of the ongoing public debt crisis in the US and in the Euro zone and warn of a new recession on the false assumption that there was an economic recovery in 2010 from the financial meltdown in 2008. The current tumbling of the stock markets on a global scale one week after another calls attention to the much-worsened crisis.

Indeed, the current public debt crisis is grave and marks a new phase in the worsening of the already protracted crisis of global capitalism. There has been no recovery from a continuing global depression and not merely from a recession since 2008. The admission of gravity among the big bourgeois rulers is more than anything else a signal for a further squeeze on the people, especially in the form of austerity measures, supposedly in order to reduce public deficits and avoid or lessen inflation that printing of money (quantitative easing) would engender.

On both sides of the Atlantic, the financial oligarchy and the monopoly bourgeoisie cling to the neoliberal dogma that they are the creators of wealth and jobs and as such they must have all the opportunities to accumulate capital and make profits, enjoy tax cutbacks and all kinds of state support. Thus, the state has practically no leeway to avoid incurring more deficits and raising the level of public debt because the capacity of the working people and the middle classes to carry the tax burden is reduced by high rates of unemployment and rising prices of commodities that they consume.

Together with their political agents in the state, the monopoly bourgeoisie and financial oligarchy prevaricate and prate that the public deficits that have resulted in unsustainable public debt have been due to big social spending by government. They obfuscate and conceal the huge amounts of tax cutbacks for the corporations and the most wealthy individuals, the overpriced supply contracts and other supports for corporations, the trillions of dollars for the wars of aggression and likewise the trillions of dollars to bail out the big banks and corporations culpable for the hightech and housing bubbles and their bursting.

Since the adoption and enforcement of the neoliberal policy of imperialist globalization 30 years ago, the monopoly bourgeoisie and the financial oligarchy have maximized at an accelerated rate their profits by pressing down the incomes of the working people in the real economy. They have used finance capital and the financial markets to override in vain the ever recurrent and worsening crisis of overproduction. They have used fictitious capital to overvalue assets and draw bigger profits in cycles of boom and bust. They have cut back on government social spending and eroded social benefits. They have privatized public resources. And they have been quick to make privatize profits and to socialize their losses.

The monopoly bourgeoisie and financial oligarchy have bankrupted their own states and are now pushing them to carry out austerity measures at the further expense of the working people . Social services, including education, medical care, low-rent housing, unemployment relief, pensions and public sector employment are being cut back at a time that the rate of unemployment is rising and the prices of basic commodities are soaring. The youth suffer the highest rates of unemployment and are being pushed by the circumstances to rebel.

At any rate, the public deficits and consequently the public debt continue to mount because of the continuing tax exemption privileges of corporations and the most wealthy and because of the mass unemployment and the concomitant reduction of direct and indirect taxes paid by the people. The increasing aggressiveness of imperialism is also continuing to divert huge amounts of public resources to military production, military force build up and wars of aggression.

Stubbornly clinging to the neoliberal dogma, the monopoly bourgeoisie and financial oligarchy and their political agents always assert under the slogan of the free market that economic recovery must be left completely to the initiative of the businessmen and that the state must not take any initiative to stimulate and generate production and employment without transferring the public funds first to the private corporations for their labor cost-saving and profit-making purposes.

Under the current circumstances, there is no end in sight for the economic and financial crisis afflicting both the developed and under developed countries. The depressed growth rates in the developed countries mean lower demand for the raw material and semi-manufacture exports from the underdeveloped countries. Even those countries much vaunted for high growth rates, like China, India and Brazil, are seeing their growth rates being pressed down.

The general conditions of global depression have spread and deepened on an unprecedented scale because for more than three decades already the puppet rulers of the underdeveloped countries have mimicked the developed countries in carryimg out liberalization, privatization and deregulation. Worst of all, they in general have accepted the de-nationalization and de-industrialization of their economies.

Economic crisis breeds social unrest and inflames the people’s resistance. The world today is like a boiling cauldron. The revolutionary armed struggles in a number of countries are reinvigorated by the mass protests against the crisis and are inspiring the people in other countries to wage armed revolution. People’s uprisings have swept North Africa and the Middle East against deeply entrenched autocratic regimes. General strikes and mass protests of various types have arisen in France, Spain, Greece, Ireland, Portugal and the United Kingdom. More are expected to arise soon.

Economic crisis breeds fascism and war. In an attempt to distract the people from the root causes of the crisis and the need for class struggle, the exploiters and oppressors whip up chauvinism, racism, religious bigotry, fascism and war hysteria. The most reactionary forces in the imperialist countries consider war production and the launching of aggressive wars as a way of unifying the nation, stimulating the economy and expanding the sources of raw materials, markets, fields of investments and spheres of influence.

The anti-imperialist and democratic forces that are developing in the course of the people’s struggle against the escalating levels of exploitation and oppression are becoming increasingly aware of the need to strengthen themselves, to prepare themselves for turning the imperialist war to a revolutionary civil war and to aim for socialism as the replacement of monopoly capitalism.###

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