The Communist Party rejects the notion that the current economic and financial crisis is primarily the result of so-called ‘sub-prime’ mortgage lending to high-risk homebuyers in the USA.
While US corporate greed and war expenditure helped precipitate a credit crisis, the New Labor government and the financial monopolies in the City of London cannot escape responsibility for their policies.
In order to serve the interests of big business and its market system, they have subjected almost all sections of the British economy—including the public sector—to rule by finance capital and the City.
While manufacturing industry has been run down or sold off to overseas transnational corporations, the public services and public utilities have been privatized or otherwise used as a source of super-profits for British and foreign monopolies.
Because the real value of wages, benefits and pensions has been held down, millions of people have resorted to credit based on inflated house prices to try to maintain and improve their standards of living.
In the deregulated City, banks and financial institutions have utilized credit and other transactions to erect an enormous edifice of ‘fictitious capital’ based on financial instruments, which bear no relation to the real value being produced in the real economy. On the basis of such artificial business, together with the fleecing of the public sector and the general public, they embarked upon an unrestrained orgy of profiteering.
The resulting bubble of personal, government and corporate debt maintained demand in the British economy long enough for Gordon Brown to proclaim the end of ‘boom and bust’. Now that the bubble has burst, the economic cycle is reasserting itself at the same time as the money market and financial institutions are losing confidence and credibility.
The continuous pumping of credit into the financial markets is inflationary and will reduce both wages and the social wage in the interests of monopoly profits. So also will the state taking on bad credit and converting it into tax liabilities.
The Communist Party therefore insists that a Left-Wing Program is vital to combat capitalist crisis, based on the following specific policies:
• No public subsidies to rescue private shareholders from the anarchy, greed and chaos of their own system.
• Government intervention to prevent mass redundancies including the takeover of failing building societies to protect jobs and stop house repossessions.
• Switch the public money being pumped into the money market, wars and Trident to taking utilities into public ownership and to a massive program of public sector house building.
• Rebuild a powerful public sector in the banking industry through a policy of nationalization, to supply credit and investment to industry while retaining ownership.
• Impose a wealth tax on the super rich and a windfall tax on energy, banking and supermarket monopoly profits.
• Freeze gas and electricity prices at their January 2008 levels and take the gas, electricity and oil industries back into public ownership.
Britain’s Communists call upon the labor and progressive movements to step up the fight for substantial increases in wages, benefits and pensions to ensure that the capitalists—and not the working class—pay for this crisis.
The depth of this crisis demands mass action to break the domination of the City and finance capital over our economy, to sweep away the neo-liberal politicians leading all the major political parties and to reassert the struggle for socialism as the only alternative to capitalist chaos.