The US has just suffered the steepest decline in economic growth ever - from a breakneck pace of 4.1% annually in the years 1998-2000 to a negative 1.1% in the third quarter of 2001. But now most capitalist economists forecast the US is on course for what they characterise as a V-shaped recovery, and along with it, the end of the world recession of 2001-02. Our Economics Correspondent Michael Roberts looks at this theory.
On Wednesday March 6, President Bush imposed tariffs as high as 30% on most steel imports coming to the US from Asia and Europe. This will hit European steel makers hard, especially in Britain where there is a slump already in the steel industry. In periods of capitalist economic downturn, national interests predominate over international. Bush is supposedly a supporter of the "free market". But the Wall Street Journal called the tariff "perhaps the most dramatically protectionist step of any president in decades."
They think it's all over. The capitalist media is saying that the world capitalist economy, led by the US is recovering fast. Indeed, they say, there was no economic recession or downturn at all - or if there was, it was hardly noticeable. Michael Roberts investigates the truth of this idea.
Our economics correspondent Michael Roberts looks at the UK Finance Minister, Gordon Brown's budget, which was announced last week. He is going to raise taxes in order to spend more on the health service. But as he has no intention of changing the fundamental nature of the economy, a better health service must come from the pockets of the hardest-working labour force in Europe.
Our economics correspondent Michael Roberts looks at the British economy and the real situation facing workers in Britain today, which is somewhat different to the rosy picture painted by Tony Blair and his spin doctors.
The capitalist pundits are worried that the US and world capitalist economy is not recovering as they expected. Stock markets around the world are plummeting, investment spending is unusually weak and consumer spending unusually strong. This current capitalist economic cycle has no precedent in the whole post-war period. Yet this pattern has at least one ominous parallel before the second world war: the US economy of 1926-29.
In the six months to June 30, the US stock market had its biggest fall since 1970, down 14%. Following Enron, we have the WorldCom fiasco, which threatens to be the biggest bankruptcy in world history. Corporate executives lived off the fat of the boom, but now the tide has ebbed, the nasty rocks of failure, corruption and thievery are being revealed.
This article deals with the scandalous so-called "Private Finance Initiative" in Britain. This process allows private companies to be involved in the building and running of what were formerly public services, such as hospitals, railways, and even schools. Mick Brooks shows quite clearly that the only people to benefit from PFI have been the fat cat capitalists who run the private firms.
After all the talk of an economic revival in the USA, the headlines are now dominated by an epidemic of financial scandals, steep falls on the stock markets, waning confidence and increasing uncertainty. In spite of attempts by the media to present all this as purely a question of a few "bad corporations" the nervousness on the stock markets is in reality the manifestation of a far deeper crisis that expresses itself in extreme instability at every level - economic, social, political and military - on a world scale.
On Saturday, the Financial Times, a leading bourgeois publication, contained a prominent article entitled "Full Marx". Given the current crisis unfolding under their noses, bourgeois academics are once again forced to recognise the important contribution of Marx's analysis of capitalism.