By Eoin Dawson,
For years now workers have been told by right-wing politicians and economists that we need to tighten our belts whilst waxing lyrically about “green shoots of recovery”. They have applauded themselves more recently for recreating the same “conditions for growth” which actually led to the financial crisis, by regenerating property bubbles and forcing workers to take wage cuts, racking up unaffordable personal debts just to make ends meet.
The richest 1% dominates the world
A recent report from the Credit Suisse Research Institute gives a breakdown of who has harvested the fruit borne by these “green shoots”. It will come as no surprise to working class people the world over that it is not us. The super-wealthy have been accumulating billions while ordinary people continue to suffer under austerity regimes globally. In fact the world’s richest 1% own almost half the worlds wealth. This tiny group of individuals has the wealth needed to fuel a real economic recovery and employ millions of people currently languishing on the dole. At the other end, two thirds of the world’s population own just 3% of global wealth!
Not only are the super-rich still accumulating wealth and refusing to invest, but they rub salt into the wound by continuing to avoid paying taxes by any means at their disposal. This is what capitalism offers – recession for ordinary people and wealth far beyond their needs for a tiny few.
Capitalism cannot deliver for the 99%
This is an inherent flaw at the heart of capitalism. The exploitation of workers required to maximise profits undermines the ability of ordinary people to buy back the goods they make. While there is an abundant supply of goods, with workers wages cut back and fewer people at work, demand for goods has fallen. For example, in the US 70% of economic activity comes from consumer spending, yet the super-wealthy continue to reduce spending power through wage cuts and public spending cuts, carried out on their behalf by their austerity governments. According to the Credit Suisse report, the US has the world’s highest concentration of “ultra-high net worth” individuals, with a personal fortune in excess of $50 trillion.
Wealthy capitalists tell us to work hard – that we have the opportunity to be as wealthy as they are if we simply make the most of the opportunities their system offers us. This couldn’t be farther from the truth. The reality is that for the vastest majority of people, no matter how hard they work, it is impossible for the us to accumulate even a fraction of wealth of the ruling class. The super rich control the means of accumulating wealth as well as the political system.
Organise to fight austerity and capitalism
In the 1950’s the top tax rate for the richest individuals was 91% – a time when the economy grew in the post-war boom. Now we’re told that taxing the rich and redistributing this massive wealth would somehow slow the economy. In the past, workers won higher wages from organising militant action against bosses. This increased spending power actually helped fuel the economy.
Credit Suisse forecasts that global wealth will increase by 40% in the coming period, however if the current trend holds only a tiny fraction of that wealth will be left to share out amongst the vast majority of ordinary people. The capitalist system benefits only a tiny minority whilst exploiting the rest of humanity. It’s clear that this unsustainable system of unfettered greed cannot simply be reformed through progressive taxation and legislation though. It must be removed completely and replaced with a planned, socialist system with democratic workers control, where exploitation is made redundant and the looting of workers labour is ended for good.