• 26 jul 2022

    Everything indicates that the forecast of a possible global recession may be confirmed

Everything indicates that the forecast of a possible global recession may be confirmed

Who pays and suffers are the exploited. Prepare the fight now!

Masses 668, Editorial, July 10th, 2022

The International Monetary Fund lowers its expectations of world economic growth for 2022, and assesses that there is a possibility of recession in 2023. It means that the largest economies, the United States and Europe, will have important drops. The gloomy forecasts were accompanied by the sharp drop in the price of oil and the misalignment of currencies against the dollar.

The inflation that hit the United States forced the Federal Reserve – Central Bank – to increase the interest rate from 1.5% to 1.75%. The increase of 0.75% is the largest recorded since 1994. This was the response of the US economic authorities to the increase in the consumer index of 8.61%, accumulated in one year. Also, in this case, there was the biggest increase in inflation since 1981.

The rise in interest rates in the United States affects the whole world. It results in an increase in public debts, mainly in backward and semi-colonial countries. The high interest rates affect the indebtedness of the population and the investments of capitalist sectors. Europe is suffering from the slowdown in manufacturing production and the weakening of the services sector.

The inflationary explosion and the fiscal measures of the Central Banks reach more widely and deeply the existence conditions of  the masses. The result has been the projection of world misery and hunger. It is absolutely confirmed that the war in Ukraine has contributed to a great extent in anticipating and aggravating the general crisis of capitalism.

The economic-financial measures imposed by the United States and allies to Russia hit the oil and gas system, whose destabilization is underway. The fact that Ukraine and Russia are two major exporters of agricultural products inevitably affected world supplies and boosted inflationary tendencies, which had been emerging long before the conflagration. Imperialism, which provoked the war by attracting Ukraine to join NATO, certainly had in its calculations that a new period of destruction of productive forces on a European and world scale would open.

The working class begins to open its eyes to the immediate consequences and the future of its conditions of existence. The strikes of rail, subway and air workers gave, in England, France and Spain, the first signs of resistance. The Norwegian government had to intervene quickly to resolve the oil workers’ strike, which, if prolonged, would only increase the energy sector’s problems.

In Latin America, the discontent and disquiet of salaried workers and peasants is visible. The indigenous uprising in Ecuador and the miners’ strike in Chile also signaled the general apprehension of the masses, beset by unemployment, underemployment, wage reduction, liquidation of labor rights and the undermining of basic health, education and housing conditions. The huge demonstration of the unemployed in Buenos Aires, Argentina, is another sign of the fighting tendencies of the oppressed that tend to emerge and strengthen the class struggle of the suffering masses against the capitalists, their governments and imperialism.

It is within this framework that Russia advanced in the conquest of a military position in the strategic region of Donbass and NATO held the Madrid Summit. Both events foreshadow the worsening of the world crisis. There will be no agreement that results in pacification between the United States and Russia, and that guarantees Ukraine’s self-determination. The decisions of the Madrid Summit were precisely in the opposite direction to peace. They lead to a military escalation that brings to mind the pre-war world situation.

The United States will further strengthen the presence of its Armed Forces in Europe. NATO will tighten its siege on Russia, and will extend its range of action to Asia, turned against China. Finland and Sweden joined the organization. NATO members were committed to contributing 2% of GDP to militarily and administratively reinforce this armed wing mounted by the United States, driven by the Cold War strategy against the Union of Soviet Socialist Republics (USSR). It was not enough to disintegrate it with the invaluable help of the Stalinist bureaucracy. It was not enough to encourage and provoke a huge division between the former Soviet republics, to the point of leading Russia to intervene militarily in Ukraine.

Imperialism, driven by the world disintegration of capitalism, needs to make Russia and China into its semi-colonies, as are India, Brazil, Mexico and the vast majority of oppressed and plundered nations. Thus, it will be able to control the immense natural wealth of Russia and the other former Soviet republics. All of Eastern Europe became vassal states of the European powers and the United States. This historical regression brings to light the destructive tendencies of exhausted and declining capitalism, as well as the significance and decisive importance of the world crisis of the leadership of the proletariat.

As a revolutionary flame, the international campaign of the Liaison Committee for the Reconstruction of the IV International* rises. Events are proving the value and precision of the banners: end of the war, dismantling of NATO and US military bases in Europe, revocation of economic-financial measures against Russia; self-determination, integrality and withdrawal of Russian troops from Ukraine. Under these banners, fight for Finland and Sweden not to join NATO! Only the working class organized in the field of political independence and united around its own interests and program can defeat the military offensive of the United States, its allies and NATO. Only in this way is it possible for Ukraine to win its right to self-determination. Only with the program of the proletarian revolution and the strategy of Marxist internationalism is it possible to overcome barbarism and reconstitute the transition from capitalism to socialism. This must be the north of the class-conscious vanguard.

*English translation for “Comitê de Enlace pela Reconstrução da IV Internacional” – CERQUI