“We are all Keynesians now.” So said Richard Nixon, the Republican and former President of the USA, in 1971. Forty years later, it seems that John Maynard Keynes is back in fashion, especially amongst the leaders of the British Labour movement. The reformist leaderships of the Labour Party and the trade unions cling to the Keynesian idea that the economy can simply be “stimulated” back in growing. But as the Marxists have explained before, the current economic crisis is not just part of some boom-and-slump, but is an organic crisis of capitalism, and growth cannot simply be created at will.
Earlier this year, it was announced by the Office of National Statistics (ONS) that inflation had risen from November to December, with the Consumer Prices Index going up from 3.3% to 3.7% and the Retail Prices Index (PRI) – which includes housing costs such as mortgage interest payments and council tax – rising from 4.7% to 4.8%. Inflation was persistently high throughout 2010, with an average RPI of 4.6% - the highest since 1991.