[These are extracts from the international situation and international work report presented to the Revolutionary Socialist Party Congress, December 18-20, 2010.]

The capitalist economic crisis is the most important feature of the world political situation today. It’s the deepest crisis since the Great Depression. It’s affected the whole world. It’s centred on, and began with, the dominant imperialist power, the USA. It’s long lasting and has led to huge attacks on working people, with increasing joblessness, misery, cutbacks in services and poverty.

I want to look at the current and likely impact of the crisis on the consciousness of the working class, and all its ramifications. What cracks have been occurring in the capitalist facade, and what further unravelling can we expect in the illusions about the system as a result of this crisis?

There’s a major contradiction: we have a deep capitalist economic crisis, with the fragility and inequities of the system increasingly exposed, yet there’s a relatively low level of working class rebellion, and so far there’s been very little growth of anti-capitalist, revolutionary parties.

This reflects the decades of working class quiescence and misleadership in advanced capitalist countries. The aristocracy of labour has been bought off through some crumbs from imperialist super-profits, and time and again the working class has been consciously betrayed.

There’s been a historical divergence for more than a century between the level of struggle in imperialist countries and in the Third World. Capitalism in 1917 broke at a weak link, and subsequent revolutions have been in colonial and semi-colonial countries. That’s resulted in many difficulties, distortions and defeats. But are we seeing signs of future changes?

Capitalist economic crisis

All capitalist economic crises are of interest to Marxists. They’re not unexpected; they’re regular, a function of the capitalist economic system. This crisis, however, is especially interesting and has wide-ranging consequences.

It threatened the capitalist global financial system, which was not far from meltdown. As it was, some of the biggest financial institutions folded; others were saved only by state intervention, benefiting from huge handouts of public money. In Europe now, some of the weakest capitalist states have faced financial collapse. Iceland was first. Then Greece. Now Ireland. The bankers and big bourgeoisie are now seriously worried about Portugal, Spain and Italy, and even Britain!

This global crisis also registers a potential change in the world economic order. We’ve been aware of the gradual economic build-up of China and other Asian economies. These countries are still underdeveloped, but with the big populations, now carrying out a huge proportion of the world’s manufacturing. Holding huge amounts in US bonds, they are challenging the US on many levels. The global economic crisis threw US imperialism’s problems into sharper focus.

Why did the crisis happen? Capitalist propagandists are flat out trying to mislead the masses, to obscure the underlying causes and contradictions of capitalism.

Was it a result of deregulation? Certainly, within their system they’ll have to find ways to tighten up. Can it be blamed on “mistakes”, greed or even crimes of individual capitalists? Certainly there was a lot of that.

But the underlying cause was overproduction, the classic problem of capitalism analysed by Karl Marx. Rather than the actions of rogue traders or poor regulation, the 2008 credit crisis was the result of the feverish boom based on the overproduction of commodities (in this particular case, homes) and the desperate search of “excess” capital for speculative profit.

Ramifications

Some of the main ramifications of this crisis have been:

• across-the-board capitalist assaults on workers’ wages, jobs, conditions, pensions and social services;
• a widening gap between rich and poor (capitalists ensure that they don’t suffer);
• some fight backs by workers, though not yet meeting the need;
• the further demise of social democracy;
• no cutback in imperialist militarism – if anything, an increase of militarism and provocations;
• a turning point in the decline of US imperialist power;
• an increasing exposure of the capitalist system, through the failure of the market as god, and through WikiLeaks.

Assaults on the working class

The assaults on the working class have been across the board and worldwide, affecting most of the advanced capitalist countries. Australia will not be spared either, though mineral exports to Asia have largely cushioned us so far.

This will be the “new normal” that the ruling class intends imposing, as Barry Sheppard wrote in his column in the latest issue of Direct Action. The US ruling class for many decades conceded US workers a living standard above most of the world; that’s over.

Some recent articles by Marxist philosopher Slavoj Zizek have been very sharp and pertinent, emphasising the key features arising from the capitalist crisis. In an article titled “What is the Left to Do?” in CounterPunch (October 15-17, 2010) he wrote:

“One thing is clear. After decades of the welfare state, when cutbacks were relatively limited and came with the promise that things would soon return to normal, we are now entering a period in which a kind of economic state of emergency is becoming permanent: turning into a constant, a way of life. It brings with it the threat of far more savage austerity measures, cuts in benefits, diminishing health and education services and more precarious employment…

“The utopia here is not a radical change of the system, but the idea that one can maintain a welfare state within the system. Here, again, one should not miss the grain of truth in the countervailing argument: if we remain within the confines of the global capitalist system, then measures to wring further sums from workers, students and pensioners are, effectively, necessary.”

That is, assaults on workers are logical, within capitalism. Workers’ logic has to be: break with capitalism!

What reactions have there been so far to the “new normal” austerity that capitalism is trying to impose on the working class? There have been some good battles in some countries, but not enough anywhere yet to stop the assault. Europe has seen big mobilisations and strikes in response to assaults on workers’ wages and conditions. France has stood out, with a more sustained campaign against Sarkozy’s cuts and pension “reforms”.

The demonstrations in southern Europe have been big, but so far not ongoing. In Spain a general strike involved 10 million workers. In Portugal the general strike at the end of November was extensive. Greece has had eight general strikes this year.

Particularly interesting was the London student demonstration of 50,000, and the spontaneous occupation of the Tory headquarters at Millbank. There have been continuing demonstrations and occupations against the university fees hike. There have been brave battles with the police, in the face of vicious attacks, horse charges, kettling – showing that youth can still fight.

Demise of the centre-left/social democrats

One clear ramification of the capitalist crisis and the assault on the working class is the continuing decline of the centre-left/social democrats. They were never an answer, but now it’s even clearer that they are part of the problem. Around the world, it has made no difference whether it’s a conservative government, or labour, social democratic, “centre-left” or Democrat taking responsibility for the cuts and austerity drives.

They’ve been implementing neo-liberal attacks now for decades. They are now the implementers of the bosses’ austerity offensive. They’re competing for the right to run capitalism, and get the jobs and the perks. There’s not a skerrick of “reform” left. Even the actions they might organise when in opposition are totally cynical, with electoral goals.

Wikileaks

The Wikileaks revelations happen at a very important time. It’s a turning point for US imperialism: capitalist economic crisis, declining US economy, still with its power, but it sees the threats. What response is likely from Washington? The ultimate threat is war. But there’ll also be increasing repression, lies and censorship.

Wikileaks has breached the capitalist wall of lies and cover-ups:

• firstly the exposures of their dirty secrets about the wars in Iraq and Afghanistan;
• secondly the huge swathe of embarrassing US diplomatic cables;
• still to come are revelations about a major US banking institution.

The frenzied response from imperialism and its most slavish agents clearly shows it has rattled them.

Wikileaks was founded four years ago on simple, basic principles: the right to information, openness and justice – principles that seem eminently justifiable. Assange and his group see their role as bringing down the secretive conspiracies that rule us. They haven’t so far indicated a clear class understanding of capitalism, but they have incensed the ruling class. The ruling class sees what it threatens – the system.

Some of the ruling class and some imperialist governments would like to kill off the internet, certainly severely censor it, but it’s gone too far already. They need the internet for capitalism now. So they’re unable to close down Wikileaks; they would have to shut down the internet. By mid-December, there were 2174 Wikileaks mirror sites and 100,000 “insurance policies” had been loaded, ready to spread all the unedited leaks.

The support of Wikileaks and Julian Assange after the threats and attacks following the start of the release of the US diplomatic cables has been phenomenal:

• There were 1.2 million “likes” on the Facebook site by December 11.
• Various petitions reached figures of a million quickly.
• The Melbourne-run website WL Central had received 1.9 million hits per day as interest in the diplomatic cables spiked.
• Getup raised $250,000 in 14 hours for ads in major dailies around the world.
• Sizeable demonstrations were organised in many cities at short notice.
• Some polls indicate 90% support, including Liberals, democrats and now a letter from most of the big bourgeois media!

If Assange were jailed or assassinated, all the exposures would continue. And the anger at imperialism and the exposure of the capitalist system around the world would intensify.

Exposure of capitalist system

Each assault exposes imperialist governments (exposing Labor yet again, if more were needed)and capitalist companies – Amazon, Paypal, Visa, Mastercard – and it’s our task to bring that out further. And there are still some 249,000 US diplomatic cables to go through!

Are we coming to the end of a period? Cast your mind back over the last few decades: the collapse of the Soviet Union, imperialist triumphalism, boasts that they “won the Cold War”, the “end of history”, Thatcher’s TINA, “there is no alternative”, the era of neo-liberalism, where the market solves everything.

Then, normal capitalist functioning resumes; the boom and bust economy, an economic crisis, a big one, kicks in! Huge assaults on workers’ rights and conditions, rising gaps between rich and poor, permanent wars, declining US imperialist omnipotence. Then Wikileaks. The ideological facade starts to fall away.

The global capitalist economic crisis and its ramifications are an ever-growing and significant development for Marxists everywhere. We’re in a period where the contradictions of capitalism are being increasingly brought out, a period of potential radicalisation. So in fighting against every assault on our jobs, wages, rights and social conditions, remember our enemy, capitalism, and remember what’s needed, socialism. We need to find ways to expose the fundamental problems of the capitalist system, find ways to take the struggle further.

Nature of the period

The contradictory situation was pointed out by Slavoj Zizek, assessing this “new period” in his article in New Left Review 64, July-August 2010, A Permanent Economic Emergency:

“There is no lack of anti-capitalists today. We are even witnessing an overload of critiques of capitalism’s horrors: newspaper investigations, TV reports and best-selling books abound on companies polluting our environment, corrupt bankers who continue to get fat bonuses while their firms are saved by public money, sweatshops where children work overtime. There is, however, a catch to all this criticism, ruthless as it may appear: what is as a rule not questioned is the liberal-democratic framework within which these excesses should be fought. The goal, explicit or implied, is to regulate capitalism – through the pressure of the media, parliamentary inquiries, harsher laws, honest police investigations – but never to question the liberal-democratic institutional mechanisms of the bourgeois state of law. This remains the sacred cow.”

A revolutionary solution is needed. Recent developments mark the end of any possible illusions in social democracy, Labor or “New Labour”, Obama or Democrats as a real alternative, as anything but outfits propping up capitalism. It’s another illustration of the crisis of revolutionary leadership, which our movement has been conscious of for the whole of our existence.

But we know that things can change very quickly. And looking at the Third World, where the revolutionary contradictions and revolutionary responses have been clearer than within the imperialist world for most of the 20th century, the political situation looks far less quiescent.

Welcome the crisis

Although our wages, jobs, social services and pensions are being hit, and will be hit harder, those who understand that capitalism is the problem should be welcoming the crisis.

“The best indicator of the left’s lack of trust in itself today is its fear of crisis”, wrote Zizek. “A true left takes a crisis seriously, without illusions. Its basic insight is that, although crises are painful and dangerous, they are inevitable, and that they are the terrain on which battles have to be waged and won. Which is why today, more than ever, Mao Zedong’s old motto is pertinent: ‘Everything under heaven is in utter chaos; the situation is excellent.’”

There are continuing wars, militarism, imperialist bases, lies, torture, corruption. Capitalism is in deep economic crisis, with a widening gap between rich and poor. So is this world capitalist economic crisis cause for pessimism or optimism?

In the short term, taking a narrow, non-dialectical view, I can understand some pessimism, but it should be combined with a wider international and historical view, and combined with anger. Look what’s happening around the world. They’re bailing out the banks, making even greater profits for the rich, making the working class pay, blaming workers for capitalism’s problems and attacking our wages, jobs and services. The crisis exposes the root causes of our problems: capitalism, the system.

There is a changing consciousness, despite all their power, naked and subtle, their control of the media, their ideological control through Hollywood, churches, schools.

But it’s not total. Truth leaks out – for example all the Wikileaks releases. There’s a heart-warming healthy cynicism and suspicion by ordinary people. There’s still majority opposition to the invasion of Afghanistan, despite bipartisan support by Labor and Liberal, Labour and Conservative, Democrat and Republican.

Environmental crisis

The threat to the future of human civilisation and even life on the planet posed by the environmental crisis is another challenge to world capitalism. For many decades, socialists and others have been warning of the environmental danger that capitalism poses to the Earth. Now this dire threat is widely recognised by all but a few “sceptics”. Climate change, brought about by the capitalists’ reckless drive for private profits, has to be reversed, but capitalism cannot do it. Socialism is ever more urgently needed to save the planet. The failure of the Copenhagen talkfest brings this home to more people; more are waking up, and there are increasing exposes of capitalism’s contradictions.

At the Cancun climate talks, Bolivian President Evo Morales reiterated calls for radical cuts in greenhouse gases by advanced capitalist nations. “There are two ways: either capitalism dies or Mother Earth dies”, he stated.

From one viewpoint, it’s terrible times for revolutionary socialists. Over the last few decades there have been major defeats and retreats for the working class and its organisations: the collapse of the Soviet Union, the restoration of capitalism in China, the decline and disunity of revolutionary socialist parties.

But, paradoxically, it’s also a period of great potential. Capitalism is in global crisis, increasingly exposed. Social democratic parties and governments have moved further to the right, lessening their possibility of misleading workers’ upsurges.

The revolution in global communications based on the internet has been used by some to become billionaires, but it also enables workers and opponents of capitalism to communicate and spread their ideas and calls for action more efficiently than ever before.

Revolutionary parties are needed to lead the fight back against the warmongering and attacks of capitalism. Situations can turn around quickly. In times of capitalist crisis, there’s the real likelihood of workers and youth radicalising, the possibility of revolutionary socialist parties being built rapidly.

Now is certainly not the time for playing down the issues, for looking for soft issues, for promoting false solutions such as “broad parties” or other retreats from the necessary task of building revolutionary parties. Revolutionary organisations will be rewarded for telling it like it is.

All of us who are aware of the crisis, who open their eyes to the injustice, the irrationality of capitalism, the greed and aggression of imperialism, need to build such parties now.