Workers' Fight workplace bulletin editorials, 14 July 2008

Last Friday, the City entered what experts call a "bear market". This means that the FTSE100, which reflects share price levels for the 100 largest companies, is down by over 20% from its last peak, in October 2007. In fact, the fall is even more abrupt for the largest 250 companies, whose shares fell by an average 32% over the past year.

For decades, share prices have been going through ups and downs, due to the speculation of the tiny layer of individuals and companies which are rich enough to make profits out of this monkey money. Overall, however, share prices went up over that period. This was not due to the skill of speculators, who do nothing other than bet on their monkey money, but to on-going attacks against workers' conditions. There seemed to be no limit to the rise in company profits. Just by squeezing always more labour out of workers, the capitalists thought they could increase their profits while making minimal investment.

Today, this exploitative castle of cards is crumbling. With the credit crisis, the majority of speculators do not believe in the "healthy fundamentals" of the economy that Darling keeps preaching to us about. They have been betting against their own system and this is what has brought the stock market down.

But why should the ups and down of the share betting shop be of any importance to us? Why should we, who produce all the value in this society, be affected by the speculation of parasites who produce nothing? The present crisis may dent (marginally!) the wealth of some capitalists. But neither the credit squeeze nor the fall of share prices has affected the ability of the working class to use its labour to provide for all the needs of society and produce new wealth.

The only obstacle to this is the profit system itself. The tens of thousands of redundancies underway in the construction and related industries expose the madness of this system. When hundreds of thousands of working class families need decent, affordable housing, those who could build it are pushed onto the junk pile!

Capitalism and its profit-driven madness has long passed its sell-by date. We need a society which is organised to cater for the needs of all, not one which is organised to satisfy the parasitic greed of a few!

For months we were told that if food bills were soaring, it was due to world market price hikes. This was so convenient: neither us, nor the supermarket giants could do anything about it, and all that was left for us to do was to foot the bill!

That speculators have flooded food markets with their spare capital, after the housing bubble burst, is unquestionable. Hundreds of billions of pounds were shifted to these markets for speculative purposes, thereby pushing prices up - just as happened with oil. The question is, however, whether the prices which British food giants pay for their supplies have increased in the same proportion? In fact, they have not!

An illustration of this has just been provided by Britain's 2nd largest food and retail giant, Associated British Foods (ABF).

ABF has just increased the price of one of its loaves of packaged bread by 12%, following a previous 13% increase this year. It also released its sales figures for the past 4 months. Overall, compared to 2007, its sales are 24% up in value. But for its food divisions, the figure is 42% - more than twice the average increase in food prices on the world market, meaning that ABF used the opportunity to increase its profit margins!

ABF is not an isolated case. The gas and oil giants play the same game. The headline "world price of oil", which the media quote ad nauseum as the cause of all ills, gives them an ideal pretext to push prices up - and their profit margins up, into the bargain. The working class ends up being caught between the speculators and the companies, both hiding behind the artificial impact of speculation in order to boost their profits. But this does not mean our only option is to let our living standards sink.

We may not be able to stop the speculation on food and oil markets nor to stop the profiteering of ABF and its like. But we should remember that, one way or another, all the capitalists, their politicians and their state are together in this game. They are collectively responsible for the cut in our living standards and they collectively benefit from it. It is only right that they should pay for it, with wage increases which are in line with the real increase in the cost of living that we face!