Economy

This article, written for Socialist Appeal, was published a matter of days before Bitcoin's value collapsed by half overnight. This catastrophic downturn proves everything we have written about Bitcoin and how it reflects of the general crisis of capitalism.

The news of heavy fraud and corruption in two of South Africa’s biggest monopolies has thrown the big capitalists into turmoil. The scandals, which broke out almost simultaneously, involve two global behemoths, Naspers and Steinhof, and implicate some of the very biggest tycoons in the country, such as Christo Wiese, Markus Jooste and Koos Bekker.

British capitalism is clearly in a parlous state. The miserable spurt of growth of a few years ago has completely run out of steam, leaving the UK in a disastrous position. All the economic forecasts from the top institutions for the coming period have been downgraded from those of a year ago.

The lack of any major announcements in this year’s budget, delivered on 22 November by the chancellor, Philip Hammond, reflects the insoluble web of contradictions that now entangles the Tory government.

Rob Sewell looks at the damning condemnations against the capitalist system being uttered by none other than the capitalists themselves. By examining the ominous warnings of the Financial Times - a key bourgeois mouthpiece - Rob explains that even the capitalists see the writing on the wall...

Just when Theresa May and the Tories would have been hoping for some respite after a dismal conference period, the OBR (Office for Budget Responsibility) has sent a shockwave through British political and business circles. In its annual “Forecast Evaluation Report” (FER), published this month, the OBR downgraded the UK’s economic outlook, having revealed that both GDP and productivity growth had consistently fallen short of OBR predictions over the last two years.

A recent study on tax evasion and inequality carried out by a group of Scandinavian economic researchers reveals just how big a part of the upper 0.01%’s fortunes is hidden in foreign bank accounts. On this basis, the study finds that inequality is probably far higher than originally assumed. This clearly shows how the capitalist system has reached a dead end. These contradictions can only be solved through socialist revolution.

 "Today, in numerous areas, from automation to green energy to information technology, we are seeing a validation of Marx's assertion: that society's productive forces at a certain stage come into conflict with the way in which society is organised. These "economic singularities", as Adam Booth discusses, demonstrate clearly that the system has broken."

 

Universal basic income (or UBI), an unconditional payment to all citizens, has become part of the economic zeitgeist in recent times, embraced by advocates on both the Left and the Right as a solution to the symptoms and sores of the crisis-ridden capitalist system.

It is said that a man standing on the edge of cliff does not reason. Today’s global economy is full of cliffs, one of the steepest being the Silicon Valley tech sector, and the men peering over it can be heard chattering nervously about . . . an impending stampede of unicorns. Those uninitiated in the Orwellian parlance of Silicon Valley and its venture capitalist circles could easily mistake such talk for the absurd ravings of a lunatic. But this term has come to describe the primary danger threatening to devastate the tech sector in a cataclysmic repetition of the 1999 dot-com bubble.

The following draft document was discussed at the World Congress of the International Marxist Tendency in July 2016. The main aim of the document is to define the main economic, social and political trends in the world today and to develop a perspective for the class struggle in the next period. The document was originally drafted in October 2015. [You can read the final version of the document, which was passed at the congress here as

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The latest in a series of annual reports from Oxfam, detailing the level of economic inequality in our world, is a striking example of Marx’s prediction that capitalism concentrates wealth in fewer and fewer hands. 

Global markets gave fallen 7.1% since January 1st, their worst start since 1970. George Soros, the renowned business magnate, says the situation developing in China reminds him of the period prior to the banking crisis of 2008. Former US treasury secretary Larry Summers has said, “The global risk to domestic performance in the US, Europe and many emerging markets is as great as any time I can remember.”

The arrival of the smart-phone application Uber has thrown the taxi industry into a state of disarray. First launched in June 2009 in San Francisco, the application has spread rapidly and today finds itself in over 300 cities in approximately 58 countries. While it offers many advantages over traditional taxis, including lower rates, it is having serious effects on the living conditions of taxi drivers. 

The International Monetary Fund has been forced, not only to repeatedly downgrade its growth forecasts, but to now predict a fall in World GDP in dollar terms, the first since 2009. This is a reflection of the crisis-ridden world we are in.