Capitalism is incapable of offering a decent and dignified existence to workers and the poor, yet provides unimaginable luxury for the elite. While billions struggle to find enough to eat, the billionaires dine like royalty. The necessities of life are increasingly unattainable, yet capitalist governments plough billions into instruments of death. To quote Marx, these are the economics of the madhouse.
In recent weeks, we have described how rising inflation, brutal energy bills and a deepening housing crisis are bearing down on the working class in one country after another. And yet the rich, untroubled by a few extra coins spent here and there on food and gas, have been celebrating the end of pandemic restrictions with a spot of retail therapy.
Based on its current performance, the global luxury goods market is expected to increase from $349.1 billion USD in 2022 to $419 billion USD in 2027. For instance, the megarich are feeding a booming market in private aviation. According to Darren Banham, chief executive of Discovery Jets: “I’ve been in the private jet market for the last 10 years, and on the aviation commercial side for 22, and I’ve never seen the private-jet business like this.”
Celebrities like Drake, Taylor Swift and Kylie Jenner have lately come under fire for regularly taking flights that last as little as 20 minutes, emit huge amounts of carbon into the atmosphere, while mere mortals can barely afford to fill their cars with petrol. Such high-end flyers enjoy amenities like complimentary ground transportation, luxury slippers, expensive toothpaste, and even separate planes for their pets. NetJets and XO, companies selling fractional ownership of private planes starting at $240,000 a year, say they accommodate pet pigs, cats, birds and lizards.
And the biggest spenders are not confined to advanced capitalist countries. India was battered by the pandemic, and is responsible for 33 percent of the people newly plunged into extreme poverty worldwide in the past two years. But at the same time, as Business Today reports:
“Rich Indians are on a spending spree. What began last year as revenge spending – as the pandemic gradually came under control and lockdowns were lifted – has now turned into a strong trend with Indians splurging on sprawling residences, lavish holidays, jewellery, watches, fine dining and more.”
The number of so-called ‘ultra high net-worth individuals’ in India (with fortunes exceeding $30 billion USD) has leapt by 11 percent between 2020 and 2021, and is expected to grow by 39 percent by 2026. Their expensive tastes have helped brands like Vuitton, Hennessy, and Moet & Chandon amass profits of £8.6 billion from the Indian market in the first half of 2022, up 34 percent on the same period a year ago. While the rich splash on sports cars and guzzle champagne, the situation for the vast majority of workers and poor is rapidly decaying.
The war in Ukraine had an immediate impact on the global food market. Food price hikes helped push over 70 million people into food poverty in the last 12 months. In Africa (which once sourced 44 percent of its wheat from Russia and Ukraine), 278 million people – a fifth of the total population – went hungry in 2021, an increase of 50 million people since 2019. The total is projected to rise to 310 million by 2030.
But while multitudes starve, a parasitic minority reap a bonanza. According to a report by IPES Food, speculation on food futures drove an “obscene” £4 billion increase in trading revenues for the world’s top five investment banks after Russia’s invasion in February, exacerbating the rise in world hunger by helping to drive up the cost of food even further. The rich are literally stealing bread from the mouths of the poor.
Even in the advanced capitalist countries, the impact of food inflation is both acute and uneven. Wealthy households don’t really notice the cost of basic foodstuffs like bread and pasta going up in price, but it makes a big difference to working-class and poor families.
A recent study found that people in the US, on average, believe the cost of food has gone up by around 23 percent: nearly 10 points higher than the real baseline inflation figure. In the same study, 64 percent of consumers described having difficulty covering unexpected expenses, 31 percent have been skipping meals or trimming back on meal sizes, and 18 percent report not getting enough to eat in the past 12 months.
In Britain, millions are becoming grimly accustomed to choosing between heating and eating. The cost of energy is sky high (as we have discussed at length), and grocery inflation reached a record high of 13.9 percent in September, with the average household facing a £643 jump in their annual grocery bill. Some people are choosing to boil rather than fry their food, and turn off their fridges and freezers to keep costs down.
Others simply go without. Hunger levels have more than doubled since the start of the year, with 10 million adults and 4 million children unable to eat regular meals in September. A TUC report has found that 1 in 7 British people have been skipping meals. Victoria, a single mother on low income interviewed by the Guardian, explained how she gives up opportunities to eat to make sure her children don’t go hungry:
“Most people don’t know what hunger is. They think: ‘Oh, it’s easy not having the odd meal.’ They don’t know about the hollow feeling in your tummy, the aches and pains in your joints, the mental fog, the sense your forehead is going to implode. The hungrier you are, the more you think about it. There are times when I would do anything – anything – for a meal.”
There are reports of charities in London having to top up people’s travel cards so they can afford to visit food banks. One busy food bank in South London saw the number of visits climb from 530 adults with 183 dependants in August last year, to 843 adults with 372 dependants this August. A recent viral video showed a dinner lady in Manchester breaking down in tears after admitting she is regularly forced to turn children away at lunchtime because their parents have not been able to pay for their meals:
“Just before the summer holidays, when the cost of living crisis really started kicking off, I just noticed I was spending as much time taking food away from children as serving it,” she said.
“They just look at you like ‘well, what am I going to eat?’... “I can’t give you anything, I’m sorry’. “It’s getting to the point where I don’t think I can be doing this job anymore,” she added. “I didn’t take the job on to starve children.”
Perhaps it will be of some comfort to learn that a bit of starvation might actually be good for them! At least, according to the right-wing Telegraph newspaper. A recent lifestyle article, with the headline, “Why we would all benefit from feeling the odd hunger pang”, presents exciting new research showing the many health benefits of “giving our bodies a break from food.” The mouthpieces of the British ruling class have officially outdone Marie Antoinette, declaring: “let them eat nothing.”
The Telegraph’s health advice is apparently not heeded by British politicians, who last year threw out 2.6 million dinners, after taxpayers forked out £17 million to subsidise bars and restaurants in the House of Commons. The MPs’ menu in parliament, generously supported by the public purse, includes such sumptuous dishes as double-cooked pork belly and braised shoulder, golden raisin risole, celeriac and Colston Bassett dauphinoise, savoy cabbage, conference pear gel and calvados sauce. Managing the affairs of capitalism must work up quite the appetite!
Some of the more far-sighted bourgeois recognise the danger of the widening inequality in British society. A recent article by the Financial Times offers a stark warning to the government:
“There comes a point where making the poor poorer becomes a false economy – and I think we have reached it… Roughly three-quarters of working-age benefits are spent in one of three ways: income top-ups for workers with low earnings; housing benefit to help people pay the rent; and disability, sickness and incapacity benefits for people who are unwell. In other words, the size of the welfare bill is the consequence of Britain’s deep-rooted problems with low pay, high housing costs and poor health.”
And when it comes to people literally being unable to afford the basics, given high inflation and stagnant wages, the Tory Party chairman Jake Berry has the following, helpful advice: “People know when they get their bills, they can either cut their consumption or get higher salaries or higher wages, and go out there and get that new job.” Of course! Why didn’t we think of that?
A recent report found that 330,000 excess deaths in Britain can be directly attributed to austerity policies, with people dying prematurely from ill-health, poor nutrition and housing, and social isolation. Now another round of austerity is rushing towards us, ready to wreak further havoc on the lives of workers and the poor.
A £70 billion hole currently exists in the public finances, which will have to be filled, either through raising taxes (which will see companies pushing the losses onto the public through raising prices), cutting public services, or (most likely) both.
People can only tolerate so much. Already, workers are gearing up for battle, with a wave of strikes underway against attacks on pay and living standards. The profound crisis of capitalism, combined with the most incompetent political leadership in living memory, is preparing an avalanche of class struggle. Fat cats take heed.
War: terribly profitable
While capitalism is failing to provide people with the means to sustain their lives, it is investing billions in a variety of means to end them, all in the name of defending ‘democracy’ against ‘Russian aggression’. The US has provided over $15 billion USD in military assistance to Ukraine since the start of the year, while EU countries have collectively committed over €200 billion to additional defence spending. This is all money that will never go to schools, hospitals and housing, but will instead pour into the pockets of arms manufacturers.
All the largest defence companies have seen their share prices go up since Russia’s invasion of Ukraine, by 35 percent for Thales, 32 percent for BAE Systems, 14 percent for Lockheed Martin and 63 percent for AeroVironment. Lockheed Martin has so far shipped 16 of its M142 High Mobility Artillery Rocket Systems (HIMAR) to Ukraine, at the cost of $3.8 million USD per launch platform and around $100,000 USD per rocket. Rheinmetall, a German manufacturer of tanks and artillery is expecting its sales to grow by up to 25 percent in 2022 and 2023. And the German government has said it will buy 35 F-35 fighter jets, also made by Lockheed Martin, with an estimated lifetime cost of $1.6 trillion USD.
These merchants of death often have a direct line to governments. For instance, a recent investigation by openDemocracy revealed that 50 paid employees of global arms companies work inside the UK’s Ministry of Defence, including nine staffers on long-term secondment from Britain’s biggest weapons manufacturer, BAE. This company has sold £15 billion worth of weapons to Saudi Arabia since the start of its brutal war on Yemen. So much for arming the forces of democracy.
Capitalism: doomed to death?
Before his descent into renegancy, Karl Kautsky wrote about how, in the Roman Republic’s dying days, the slaveowning ruling class indulged in ever-more outrageous displays of wealth, even as poverty ran rampant around them, oblivious to the fact they were hastening their own fate:
“Colossal wealth poured into Rome for the sole purpose of increasing pleasure; rich pleasure-loving rakes reeled from party to party, throwing their surplus wealth around by handfuls, since by themselves they were unable to spend it all. Many artists and men of learning received substantial sums from patrons like Maecenas; huge buildings sprang up, whose tremendous size and artistic balance we still admire; the whole world seemed to sweat riches at every pore – and yet this society was already doomed to death.”
Today, we find capitalism in the same position. We are faced with a contradictory situation where the amount of wealth created has never been greater, but more people than ever are struggling to survive. The rich hoard vast fortunes as the masses endure grinding hardship, and this visible inequality is stirring up an ocean of white-hot anger and resentment.
Meanwhile, the representatives of the ruling class have seldom been so venal, corrupt, and stupid as today. They are utterly removed from the lives of ordinary people; blind and deaf to their misery, stoking the flames of anger by flaunting their wealth while telling the poor to make sacrifices for the ‘greater good’. And the more intelligent capitalists can only despair as the pillars of society crumble around their ears. They are powerless to do anything, because the system itself is in an irreversible state of decline.
Rosa Luxemburg explained that only two roads are available to humanity: socialism or barbarism. As the gulf widens between them and us, the battle to determine which course we will take falls to the working class, who must fight to bring down this senile system and build a socialist society, before it is too late.
Only the revolutionary ideas of Marxism are capable of offering a way forward. We invite you to join us in this fight: there is no greater cause.