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17 September 2008

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Recession, Banking Crisis, Inflation, Pay Freeze, Wars...

It's time to fight back!

Unison Local Government strike 16-17 July in London, photo Paul Mattsson

Unison Local Government strike 16-17 July in London, photo Paul Mattsson

Shockwaves spread globally as two of the biggest multinational banks collapsed - Lehman Brothers and Merrill Lynch - and a third could follow. As stock markets tumbled, the value of pensions and savings of a large number of ordinary people were brought down too. Many thousands of banking workers are losing their jobs, including 5,000 this week in Britain.

Dave Nellist, Socialist Party councillor, Coventry

The British bosses' union, the CBI, has joined various international organisations in predicting that the British economy will sink into recession in the second half of this year. So much for Gordon Brown having 'abolished boom and bust'. As the three main political parties begin their conferences, few people expect any of them, Labour, Liberal Democrat or Tory, to provide answers to the economic tsunami facing millions of families.

The CBI believes that the recession will be "mild". But what is mild for the CBI fat cats could be traumatic for millions of ordinary people. David Blanchflower, of the Bank of England's monetary policy committee, warned that 60,000 workers a month could lose their jobs. House repossessions, already up by 24% in the first half of this year, could escalate as redundancies and short-time working hit family budgets already suffering from fuel and food price rises.

Unison Local Government strike 16-17 July in London, photo Paul Mattsson

Unison Local Government strike 16-17 July in London, photo Paul Mattsson

Millions of public sector workers face direct cuts in their living standards as their wages are not being increased enough to compensate for price rises. Price comparison website uSwitch reckons that the disposable income of the typical household has shrunk by 15% in the last year.

The housing crisis still has a great distance to go. According to Nationwide's chief executive, 2.5 million homeowners (one in five) will see the value of their home fall below the outstanding balance on their mortgage in the next year - negative equity. Even more gloomy predictions are circulating in the City of London, of negative equity hitting almost four million households.

The timid and inadequate measures from Gordon Brown will do nothing to solve a housing crisis of that magnitude. Rising repossessions, greater negative equity and the dire shortage of affordable, particularly rented, housing will be virtually untouched by Labour's proposal of a 1 billion "rescue package".

The paucity of Labour's plans compared to the scale of the crisis, is shown by recent figures from UK property value website, Zoopla, that estimates that the value of the country's housing stock has fallen over the last nine months by 1 billion each and every day!

American writer Gore Vidal once spoke of the USA as a country which has "free enterprise for the poor and socialism for the rich". New Labour's Britain, with cuts in welfare whilst billions of pounds prop up financial institutions like Northern Rock (not to protect people with mortgages - but the rich with shares in the wider banking system), fits Vidal's description just as well.

Workers need their own independent party, to challenge this rotten economic system. The Socialist Party is campaigning for such a party, and also for a fundamental change in society to eliminate capitalism's wars and recessions for ever.

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Finance appeal

The coronavirus crisis has laid bare the class character of society in numerous ways. It is making clear to many that it is the working class that keeps society running, not the CEOs of major corporations.

The results of austerity have been graphically demonstrated as public services strain to cope with the crisis.

The government has now ripped up its 'austerity' mantra and turned to policies that not long ago were denounced as socialist. But after the corona crisis, it will try to make the working class pay for it, by trying to claw back what has been given.

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In The Socialist 17 September 2008:

Credit crunch

It's time to fight back!

Socialist Party editorial

Capitalist crisis - Karl Marx was right


No to racism: Yes to decent jobs, homes & services!

Socialist Party campaigns

Socialist candidate gains 40% of vote, stuns Usdaw leaders

Conflict in Georgia - independent position needed

Brown's feeble fuel package

Labour Party conference protest

Protest at war and occupation

Welcome to the real Manchester

Fighting city needs a fighting party

Panicky MPs turn on Labour

Privatisation and closure

No to post office closures

Protesters tackle Metro privatisation

Socialist Party feature

Middle East: End imperialist aggression!

Socialist Party workplace news

London bus strike: "Showing them our power"

Pickets cheer in West London

Ford workers meet to defend jobs

Journalists win union recognition victory

2008 Trades Union Congress: Pressure from below begins to show

Swansea rail workers fighting for a living wage


International socialist news and analysis

Interview with Cindy Sheehan: "Some kind of populist uprising needs to happen"

Scotland: Tactical questions for local government pay battle

Socialist Party review

'Bob Marley' reviewed by Jason Toynbee


Home   |   The Socialist 17 September 2008   |   Join the Socialist Party

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Related links:

Banking crisis:

triangleBarclays finally charged for having hands in till

triangleLessons of the 'N30' 2011 pension strike

triangleWaltham Forest Socialist Party: The banking crisis

triangleRotten greedy banks still threaten crisis


triangleWorld capitalism's terrified strategists abandon austerity - for now

triangleUnder the microscope

triangleCapitalist crisis and Corona: Johnson's budget for the bosses

triangleWhat lies behind the US-China trade war?


triangleHousing activists storm rental firm's offices

triangleLondon housing crisis: vote TUSC to fight back

triangleThe Socialist Inbox


triangleEssex: Why I'm standing for TUSC

triangleLiverpool hustings - only TUSC has a strategy to take on the Tories


triangleTories whip up division over Brexit

Article dated 17 September 2008

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Protesting in  Leeds as part of  a Socialist Students day of action on the education funding crisis. 21st April 2021

Protesting in Leeds as part of a Socialist Students day of action on the education funding crisis. 21st April 2021

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