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Economy
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How often are we told that Free Enterprise (their words not ours) work best because it encourages free competition? The truth is very different.
Europe faces a protracted period of austerity, with major
contractions in output, consumption and employment. The crisis has
started with the smaller, more vulnerable economies like Greece,
Portugal and Ireland. But the others will follow, starting with
Britain. 
What has the banking crisis cost us all? Andrew Haldane of the Bank of
England has tried to work it all out in a paper called ‘The $100
billion question’.
In
the second part of his article, Alan Woods looks at the dire economic
situation the European Union faces. He also analyses the effects of the
European crisis on the world economy.
Goldman
Sachs has been accused of fraud and is up before the American Securities
and
Exchange Commission. What is coming out from all this are the clever
tricks of
the trade, i.e. how to make money from money - without actually
investing in the
real economy - and in the process “advise” people on how to lose their
money
while making the likes of Goldman Sachs very rich... until it all
crashes of
course.
Monopolisation of big
business is endemic to the capitalist system. Big business has become
wealthier and more powerful today than ever before.The revolving doors between government and industry has ensured the
continued domination of big business over parliament and state. Capitalist economists constantly argue that
privately run industry driven by pursuit of profit is the best way for
an economy to function. But, even a cursory look at the world around us
tells a very different story. Far from being efficient, capitalism is
riddled with contradictions and crisis. You could write multiple
volumes, as Karl Marx did, on the inadequacies of capitalism, but here,
in this limited space, we shall deal with just a few.
When the economy was booming the euro was seen as a source of strength
for those countries that had adopted the new currency. Now it is
transforming into its opposite, as the crisis in Greece demonstrates.
The Marxists warned about this long ago.
Greece, like all the other capitalist
countries afflicted by the recession, is running a big deficit on its
government budget. Tax revenues have
collapsed and more benefits are having to be paid out to the unemployed.
Deficits for the European Union countries as a whole tripled from 2.3% to 6.9%
from 2008 to 2009 because of the slump.
Milions of workers came out on strike in defence of their pensions. This was the biggest such action for decades. The fight goes on!
