Workers' Fight workplace bulletin editorials, 26 February 2013

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Workers' Fight workplace bulletin editorials
26 February 2013

Last week Cameron's and Osborne's chickens came home to roost. After all the hot air they had devoted to celebrating how much their austerity policy was boosting the economy's "strength", while deriding the "other" embattled EU countries, the credit agency Moody's downgraded their government's credit rating.

In fact it went down to the level of most rich countries, where it really belonged, anyway. Ironically, though, five countries in the Eurozone, so often demonized by the ConDems, still retain the much cherished AAA credit rating - proof, if it was needed, that neither the pound sterling, nor the Union Jack, are reliable protection against the whims of financial markets.

Parasitical banks, compliant politicians

This downgrading means that the ConDems' City masters have now decided that their policies aren't working, after all. Indeed, credit rating agencies like Moody's only conceal the long arm of the big international banks which rule the roost on financial markets - including the main British banks.

These are the very same banks which live off the interest paid on loans - whether by the government or by the rest of us. Ironically, these banks have been making a killing out of the government's deficit, while at the same time "punishing" it for not reducing this deficit quickly enough - or so the official story goes, as told by Osborne.

But is this the real issue behind this downgrading? It's not as if the banks were worried about the size of the government's public debt, or about its willingness to meet interest payments. In fact, they can and have made enormous profits out of the public debt of countries which were on the verge of bankruptcy - like Greece - and Britain is far from Greece's situation. The bottom line, as the bankers know, is that mainstream politicians are only in office to serve the interests of the system and they wouldn't dream of throwing a spanner in the works of capitalist finance by refusing to meet their bills to the banks, whatever the cost to the population.

So what is the real issue? In a society based on private property, in which every socially useful operation requires funding of some sort, the banks do play a necessary role to oil the cogs of the system. But the way in which they use this role to get their cut on every investment and expenditure, is totally parasitical. And their aim is to ensure that this parasitical flow of profits remains as large as possible.

A warning before the April budget

This is why Moody's itself pointed to the shrinking economy as a major reason for its move. Of course it's not that the banks are concerned about the real level of employment which, despite the ConDems' massaged figures, is going down. But the less consumption and investment - private or public - there is in the economy, the less profit there is from lending money. And the banks want something to be done about this.

More than anything else, therefore, this downgrading is a warning to the ConDems that they have to act to boost the economy - or rather, to create more opportunities for the banks to make more profit out of the economy. In passing, it should be mentioned that this warning doesn't come out of the blue. Bosses' organisations like the CBI have been complaining for a long time that the ConDems' cuts in big public investments were denting their business.

Of course, one can expect the ConDems to use this downgrading as a pretext to turn the screw of austerity even more in next month's budget. Osborne has already started doing this.

But even if he introduces new public investment - as Labour is demanding - he will just tell us that, to "reduce the deficit" and avoid a further credit downgrading, this will have to be "cost-neutral", paid for by even more cuts in the welfare and social budgets - that is, by the poorest.

And, contrary to Labour's claims, this public investment won't necessarily mean more jobs: just like Osborne's fraudulent "record employment" today, it will mean more low-paid, casual jobs from which no-one can make a living!

Meanwhile, share prices on the stock market will carry on riding a wave of optimism. Already, shares in the City have regained their pre-crisis level and mega-deals to buy big companies have no difficulty in attracting tens of billions of pounds from speculators.

It's not as if the capitalist class was short of cash. On the contrary, the system is awash with money. It's just that, rather than using their wealth to invest, the capitalists want public funds - that is, the rest of us - to do it for them. Should the working class let them get away with it?