08) FROM SUPERPROFITS TO MEGACRISIS?

(The following article is from the August 1-31, 2008, issue of People's Voice, Canada's leading communist newspaper. Articles can be reprinted free if the source is credited. Subscription rates in Canada: $25/year, or $12 low income rate; for U.S. readers - $25 US per year; other overseas readers - $25 US or $35 CDN per year. Send to: People's Voice, c/o PV Business Manager, 133 Herkimer St., Unit 502, Hamilton, ON, L8P 2H3.)

People's Voice Editorial, August 1-31, 2008

Pop quiz! Guess the source of this viewpoint on the world's major capitalist state: "Primordial fear will be slow to set in as everyone still believes in the Goldilocks (read Pollyanna) future. Millions of Americans will undergo cutbacks in salary, others will lose jobs.... Foreclosures and bankruptcies will reach all-time records. Overproduced, overconsumed luxury items will hit the market, each competing in price-dropping to find the bottom first. The mutual plotting society within the financials and world banking will exhaust all efforts at propping up an unsustainable false picture of the economy. When they crack, CRASH! Then the markets will revert to a barbaric equilibrium. Tremendous wealth will be destroyed across all spectrums of society."

     A Marxist pamphlet? Hardly. It's from a January 2008 article in the London Financial Times. All signs indicate that the U.S. economy is wobbling closer to crisis. From early 2004 until mid-2007, for example, the seven big Wall Street investment banks made $250 billion in profits. Since then, they have written off $107 billion, but still paid $32 billion in executive bonuses. In spite of the "stimulus package" adopted by Congress, the U.S. economy has lost half a million jobs in the past year, yet the rich get richer every day, their greed fuelling the impending disaster.

     Closely tied to the U.S., our country will not escape. Already, overall Canadian economic growth is minimal, all increases in disposable income go to the wealthy, unemployment and personal debt loads are sneaking higher, and housing starts are falling. While working people suffer from skyrocketing fuel prices, the big energy monopolies reap tens of billions in windfall profits.

     Hold onto your hats. Capitalist crisis is about to make a comeback, and it won't be a pretty sight.