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Socialist Challenge 11 September 1982 page 10 proune day отасthat dav week shall Send us some Put us in a good position to reSocialist Challenge is doing a don't forget Steve Faulkner Tine most heroic Socialist Challenge. TWO WEEKS ago, with the Tories rejoicing over falling interest rates and proclaiming yet again - that an upturn was just around the corner, Socialist Challenge said the changes heralded a worse slump.
In the heady days of postwar boom this would have been greeted as a proIrON dogmatic Marxist. But we live in a changing world and week Denis Healey joined with us in forecasting a world banking crisis.
Now, however, Ine Financial Times has gone a bit further: it asks if the world has ended. 'There is still small but well-informed school of thought, mainly of financial rather than economic analysts, ll says 'wno sa) with some confidence that it has.
'Recovery is nowhere in sight, goes on.
and that is interest rates are falling.
hasn't the IMF 'cured' the slump? The FT quotes disgruntled I reasury official: "The answer that everyone must become more competitive everyone else.
Monetarism only works when it is applied to country, use it to boost its bankers at the expense of others whilst smashing up working class as to make industry more competitive. But when all ine capilansts try to ao il we end up at square one WILl seventees milion It's a bit of a problem. You see, capitalism Is a competitive system Now, dogmatic Marxists have a solution to this problem: a planned economy. But though Margaret Thatcher has been friendly with the Russians of late, are about to endorse the Communist Manifesto The slump is a product of capitalist competition on an international scale.
This has profound implications for socialist strategy. For thirty years the West has maintained a LUl. capitalism's boom, limitations, despite by surrendering overall control of financial and military matters America. America became the cop and the world's bank banker But bankrupt and the can't even deal with the riots in America's own backyard.
Moreover, America has paid an important price Her rivals such as West Germany, and above all Japan — the only country whose economy is now reviving have built up their domestic industry to LIC point challenges American industrial and technological supremacy. Dollar These second-line racketeers no longer trust the mighty dollar because • rightly they GONE believe the underlying strength of the American economy can back the has ended Competition between blocks of national capital has resurfaced vengeance, and almost every major conflict in th vorid todav has a bearin the struggle between these blocks of capital.
The first and most obvious sign has, been the growing trend towards trade war. American demands for import restrictions on steel from Europe are being met blow with threats of counter-restrictions ine curopeans.
Now, according to the theorists of the Alternative Economic Strategy, import controls ought to lay the basis for world expansion. Strange to say, the result has been falling demand for steel on both sides of the Atlantic, falland Haraoe. twist to the spiral of the slump.
The second effect has been differentiated response to the third world revolt. Thatcher and Reagan conspire to smash the 'communist threat' in because their two ruling classes engage in the same kind of — piracy.
The German and tren ch, who specialised in fraud whilst their senior partners cornered the market in mugging, took a more 'civilised' attitude in Fraud calls for the confidence the victim which is ditticult to win 1 your cosh is too visible.
third and most spectacular effect of inter-imperialist competition row over Russian pipeline. 'Wounded by a friend' says Thatcher that is, stabbed in the back by a fellow thug.
Thatcher's committment to the war for civilisation did not quite extend Kamikaze assault by left of British industry, who are heavily involved in trad with the Eastern bloc and would like to trade more.
There has been just the slightest suggestion that Americas approach sanctions which says OK American grain but not European turbines might be motivated by the self-interest of the American wheat grower rather than a tactical dif terence on now to preserve democratic values.
Just to rub the point in the Economist has dubbed the 'mercantilist'. Mercantillism. in case vou didn't know, was primitive economic theory subscrib. ea to by ignorant feudal monarchs. It is a precursor or morelarsm. OUR SACRE. ly more sensible.
Interimperialist competition is having an equally dangerous effect on the world banking system. As we canned LWO weeks ago, monetarism did not cause the supply of money to dry up internationally. Bankers who could lend American industrialists went orgy of speculative lending to the third world countries.
This Denentled the banking sector of those countries WILO highly developed banks, at the expense of the third world countries, at mes expense dustrialists of those countries, and to the advantage of multinationals who set up branch plants in third WOTO financed with loans from the world banking system Monetarism, which was most strongly backed by the two banking tions • America and • Bri tain — cut two ways. Bank profits surged. British 'invisible income' financial and commercial operations CROU accounts for over half BriBanks The banks alone earned £3.5 bn year, But lending by DaNK provided an outlet for capital expons technologically most advanced nations. The dollar and the pound paid. Mexico and Argentina, for German car plants.
British and American tinanciers choice between catastrophe and disaster they demand stiff restrictions on the international money supply, third number of countries will default. According to the Financial Times, during the Thirties over 70 percent Latin countries defaulted.
the Economist says Argentina is 'drifting into nyperspace only does threaten tremendous crisis of contidence in the banks which are lending to these countries; it also calls for such drastic attacks on the peoples of these countries that the prospect of a revolutionary upheaval, or of a nationalist and antireaction, becomes a very serious If, on the other hand, the banks respond as they have done by 'creating' LICW money Iloating loans Westerr an alternative danger looms.
money can be created for Mexico then not Germany? Why France? Why should these capitalists be forced suffer because the American and bourgeoisie have failed to sort out their economies and smash up their working classes?
demand of the continental bougeoisies is tor money supply SO they benefit. Once again the Brandt report is being dusted off. pathetic, 'alms to the third hypocritical goes up INLO European this means recycled Credi European multinationals!' it Brandt and Healev had the slightest real concern TO. the dependent coun tries it would be arms for.
America loses both ways. Reagan is therefore driven political strongarm tactics. Thatcher has to decide whether Love me romeaner or the strongarmer.
Faced with this awful dilemma, the Financial Times reduced whimpering platitudes combined with desperate cynicism. 'When will the world end?' it asks, and gives the stirring reply 'no We take a differen view: we don't wane te world to end don't to make it socialist to stop it ending But then, we are only dogmatic Marxists - and who believes dogmatic Marxists in this day anc age?
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