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Lisbon, 3 September 2011
Speech by Seán Edwards, National Executive Committee, CPI
First of all I would like to thank the Portuguese Communist Party for the invitation to attend and speak at this important meeting as part of the Avante Festival.
The workers’ movement in Europe is now facing unprecedented challenges. The much-heralded recovery from the 2007/08 economic crisis has proved short-lived, and the policies pursued by the Obama administration of quantitative easing and the European Union’s continuing attempts to prop up a collapsing financial system have been shown not to provide any long-term solution. The cyclical crisis is becoming more complex, with the period between boom and slum now almost indiscernible. The deepening crisis is exposing as never before the fact that monopoly capitalism has long passed its sell-by date and is in deep, possibly terminal, decline.
The political establishments in Dublin, Brussels and Berlin or across the Atlantic have no answers nor solutions other than to continue to undermine and roll back workers’ rights, wages, and working conditions. We now face the prospect of growing mass unemployment, mass poverty, and the repossession of family homes.
Currently, the crisis in the EU is centred on the euro and the permanent structural debt that has been imposed by the dominant central powers on the countries of the periphery. This debt-bondage bears a striking resemblance to the conditions imposed on former colonies by the imperialist powers. It enables the creditor-states to dictate the most minute details of economic policy on the debtors and to supervise its implementation, in their own interest. This is resulting in a massive transfer of wealth from the periphery, in particular from workers in the periphery.
It has not, however insulated the central powers from the crisis as they struggle to save the euro.
As history shows us, and as Milton Friedman proclaimed, a crisis provides an opportunity for the ruling classes to drive back working people, to take back economic and social advance that workers gained through decades of struggle. This is true in current conditions as we witness the dominant forces within the institutions of the EU, the Commission and the European Central Bank and within member-states wishing to use the crisis to deepen the EU’s control over national budgetary strategies and fiscal policies. We have heard right-wing Irish politicians and economists, for example, advocating the issuing of euro-bonds, which would necessarily entail even greater control from the centre.
Their strategy is to strengthen the economic and political power of monopoly capitalism, in particular of German monopoly capital. If they succeed, their strategy can and will weaken substantially the people’s ability to effect political and economic change at the national level, thereby further subverting democracy and taking another major step in the construction of a corporate European state across national boundaries.
While it is clear is that there is a deep economic crisis of the system. What is also clear at this time is that ideologically it is still able to maintain a deep reserve of political and cultural influence upon the minds of working people.
The Irish crisis arose out of the need of European finance capital to find an outlet for the vast amount of surplus profit on its hands. The Irish banks became willing agents, fuelling an orgy of speculation, not only in Ireland but throughout the European Union. Ireland became the fifth-largest lender in the world to Italy, Greece and Portugal and seventh-largest lender in the world to Spain, exposing Irish banks—and now the Irish people—to debts of €5.1 billion to Portugal, €25.3 billion to Spain, €40.9 billion to Italy, and €7.8 billion to Greece.
Currently what the Irish establishment, in agreement with the EU/ECM/IMF, calls Irish sovereign debt stands at €150 billion. It is further estimated that the growing mortgage crisis could take a further €40 billion to solve—that is, if the state takes action to prevents tens of thousands of home-owners losing their homes. This could bring the state’s indebtedness to close on €200 billion—and that does not take into account interest rates and the growing cost of borrowing to service this massive debt.
Throughout the developed capitalist system there continue to be vast sums of money swilling about, with no productive avenues for investment open to them, because of the persisting deep crisis of oversupply and the stagnation in the productive economy. The monopolies and the imperialist states are looking more desperately than ever for new areas of investment, hence their greed for privatising public services and national resources, hence also their drive to reconquer the world’s resources—Libyan oil, for example. The drive to war is inherent in the capitalist system; it is exacerbated by the present crisis.
The Irish Government pathetically follows the orders coming from the European Union. The strategy of austerity is not designed to rejuvenate the economy but instead to squeeze enough capital from working people to transfer to finance houses to try and shore up the system’s last investment avenue: finance.
The Irish Government, like other governments, is making working people, the poor and the sick pay the price for a system that is now caught in a downward spiral of irreconcilable contradictions. They do not have any choice, other than to impose this strategy, as it is their system that they are struggling to save.
In the interests of the working class and working people in general, we argue that there can be no lasting solution to the systemic structural crisis. But, rather as the crisis has presented greater scope for monopoly capitalism to attack us, it also provides us with the opportunity, and confronts us with the necessity, of engaging in a deeper ideological struggle.
This is a political and ideological weakness of the system of their hegemonic control. They cannot convince working people of the justice of this unbearable, unpayable and odious debt. Working people, even those with no experience of political organisation, have expressed their anger and frustration that saving the banks and financial houses has become the absolute priority of governments, above all human considerations. It is up to us to find the way to turn this anger and frustration into action. So far in Ireland the economic crisis has not created a political crisis, but it has the potential to do so, to weaken the political and ideological hold of bourgeois, individualist thinking on the minds of working people.
That is why our party adopted from the very beginning the demand for repudiation of this debt imposed upon the Irish people. We proposed that the banks which had gambled their way into bankruptcy should not be rescued but should be replaced by a national development bank, and let the European financiers take the consequences. It is the view of the CPI that the only way forward is through repudiation of this debt. It is not owned by the people, nor is it our responsibility. To repudiate it is to assert our national sovereignty and the sovereignty of the people above all else.
Why say “repudiate” rather than “default”? To default would continue to place the obligation upon the Irish people to pay some or all of this corporate debt. Default would allow the European Union and international finance houses to determine the terms and conditions of a restructuring of the debt. Debt is so central to the consumption strategy of monopoly capitalism that its very financialisation has become its weakness.
There are many obstacles to be overcome for the left and workers’ movement to take the lead in the struggle which could attack the weakest link in the imperialist chain of control. The struggle is national, insofar as it is the basis from which the working class can struggle to take power; it is anti-imperialist, as it directly confronts state monopoly capital; it is democratic in content, because it is mobilising the people to defend their interests and national democracy and brings the class nature of bourgeois society into stark relief.
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