Economy

Economists, with outstanding exceptions such as Marx, have usually set out to glorify capitalism. They tend to conclude that it will automatically produce full employment and increasing prosperity – so long as nobody messes about with its workings. That is the outlook of monetarism. But Marxists believe that Keynesianism doesn’t work either. It doesn’t work because capitalism can’t be made to work. The problem of capitalism in crisis is not just a matter of inadequate demand - of markets - it’s a problem of profitable markets.

Meghnad Desai has published a book, Marx’s Revenge in which he poses a fundamental question for Marxists – could capitalism go on for ever? The short answer to this is that capitalism will last until such time as it is overthrown through socialist revolution, conscious action by millions of people. So the question needs to be reformulated: is socialism on the agenda? If capitalism is a flawed system, as we argue, then it will offer endless opportunities for its overthrow. Desai, on the other hand, seems to argue that a crisis-free future is possible for capitalism. Talk of socialism is therefore premature. Mick Brooks argues the case for socialism in the

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The world economy is being sustained by US consumer spending and Chinese manufacturing. US consumer spending is based on the illusion of growing property values, but these cannot keep going up forever. The property bubble in the US will burst and when it does it will have devastating effects on the whole of the world economy.

House price increases are slowing down in Britain. In June in London prices actually fell. This is the beginning of the end of the house price bubble and it will be very painful for many families who have borrowed on the basis of the increased equity in their property. It will have a knock-on effect on the whole economy as spending is already slowing.

Over the past couple of years the U.S. economy has gained some momentum and avoided slipping back into recession, but this was based on the increased squeezing of the U.S. and world working class, not job growth or significant investment in productive capacity. Even if the U.S. economy miraculously takes off in the second half of 2005, the damage has already been done for millions of working Americans.

Behind all the optimistic talk about the health of world capitalism from Bush, Blair etc, the more serious analysts are worried. In its semi-annual report, the Organization for Economic Cooperation and Development announced that it is cutting its forecasts for all leading economies. It may not happen this year, but the huge imbalance in the world economy is going to crack.

In the 1980s there was a debate within the Marxist tendency about productive and unproductive labour. Here we provide a contribution to that debate by Mick Brooks. Although this is archive material, we believe it will help today’s generation to better understand capitalism in order to overthrow it.

As the Chinese bureaucracy pushes the economy of China more and more along the capitalist road, more contradictions are appearing. The more the economy is integrated into the world market the more it will be prone to all the ups and downs of world capitalism. A serious slowdown on a world scale will have devastating effects.

In 1916 in the midst of the First World War Lenin produced a Marxist masterpiece, entitled “Imperialism, the Highest Stage of Capitalism”. With US imperialism extending its domination over the whole of the world, this book is more relevant than ever. Eighty years after Lenin’s death we publish an appraisal of this classic work.

Who produces the wealth and who gains most from its production? In a pamphlet written 97 years ago, John Wheatley described an imaginary court case, with a coalmaster, a landowner and several others being charged with “having conspired together and robbed an old miner, Dick McGonnagle." Its basic class analysis remains valid for workers today as they are still being robbed.

Henry Ford had a mythical reputation as a “people's capitalist”, a man who was smart enough to design a car that ordinary workers could afford, and a boss who paid his workers enough to buy Ford cars. Nothing could be further from the truth! The great lesson of labour relations at Ford's from its beginning is that every improvement for the workers was gained through bitter and unremitting struggle. By Mick Brooks

Paying particular attention to the US, European and Chinese economies, Michael Roberts analyses the real state of the world economy. As we head into the Christmas season, things are not looking so merry for world capitalism.

The news that Kerry has conceded defeat has just come through. We will publish a full analysis of the US election results tomorrow. In the meantime we are publishing this article which looks at the state of the US economy and traces its long term decline. Whether Bush or Kerry had won it would not have made a fundamental difference. They both defend US imperialism. They could not come out with fundamentally different policies for they are tied to the same basic economic interests. In fact the extreme similarity between the two explains why Kerry could not defeat Bush. Any policy based on the US economy as it is today means one thing: an attack on the living standards of American...

Over the summer, world stock markets trod water. Indeed, the movement up or down in share prices was the smallest since 1979. That tells us that investors in capitalism are really unsure whether the world economy is set for sustained growth (as their political leaders tell them it is) or not.