The recession means that the production of surplus value, total profits, has diminished. This means that fewer resources exist from which to pay for state expenditure. This forces the state to cut spending, increase taxes and borrowing. Borrowing is a form of future taxation with a difference. Interest must be paid which amounts to an addition to future taxation. This constitutes a further deduction from total profits which further adversely affects investment conditions. This tends to bring about a downwards spiral. Consequently the European economies are forced to further contract in order to reproduce the conditions for recovery. Spending cuts, taxation and borrowing must be further increased.
The state extracts from the economy revenue through taxation. Much of the 'state's revenue is used to fund the military, the police and prisons but apart from those co-ercive oppressive roles capitalist society would collapse if the state did not provide social services, apppropriate to its needs. This social expenditure ultimately serve the interests of the capitalist class as a whole. The maintenance of transport, the management of water and sewage, the education of the working class etc. Many of these services are necessary to provide the infrastructure necessary if capital is to function - if it is to sustain and develop itself. Workers need to be available and goods need to be transported and distributed. Otherwise the market for commodities, instead of expanding, contracts and even collapses.
Some of the tax revenue deducted from the economy is also invested in industry. State-run companies are driven by the profit motive. They seek to produce surplus value at the expense of the working class.This involves the state in the purchase of labour power for use in the production process. Surplus value is generated through the exploitation of labour power. In this way there is no essential difference between workers employed by the state who function as productive workers and the workers employed by private capital. State revenue that fails to contribute to the sustenance of capitalism constitutes mere waste. It serves no useful purpose neither economically, ideologically nor culturally. Revenue that funds waste constitutes a useless deduction from the value created by a capitalist economy. It is in capitalism's ultimate interest to prevent the growth of waste. However it is not always easy to identify waste. Because of its nature capitalism's social relations tend to produce waste -- inordinate amounts of it.
Social partnerships being advanced by "labour" parties in various European countries are merely a means to restrain wages and force workers to work more intensively, making workers pay for the economic depression. Each only differ as to how to make them pay. Their aim is to weaken the ability to organise and fight.
Capitalism has failed us. We need a new way. Strikes and demonstrations are merely a first stage, albeit a necessary step towards the overthrow of capitalism. Our real goal is a social revolution, the destruction of the power of capitalism.
To-day we face great crises both in society and in the natural world. Today we are witnessing poverty, hunger and devastating wars, as well as enormous environmental destruction and damage. Capitalism, guided by no higher aim than to make higher profits, is steadily destroying the world. Although the general public acknowledges the fact that we are facing grave problems, it has been unable to recognise possible solutions. Widespread political confusion exists in present-day society in which it is difficult to single out alternatives to the present social system. Capitalist apologists with their propaganda have managed to present capitalism as natural, eternal and unevitable. Today the Left are more concerned with how to function within the existing system, instead of constituting a fundamental challenge to it. Indeed, much that passes for radical today find their expression in oxymoronic notions like “market socialism” or the “welfare state.” The Left either discusses and proposes bourgeois solutions, or presents no solutions at all. The result has been a collection of contradictory positions. Resignation and cynicism are the prevailing moods. But confusion and disappointment should not lead to desperation and apathy. The need for a viable alternative to capitalism and its nation-states is more pressing than ever.
The Socialist Party puts forward a vision of a free and rational society in which ends exploitation while guaranteeing the general well-being of all people. We have the means necessary to confront and challenge capitalism and its state, and replace them. That power is the vote. The alternative to capitalism does not consist of people in the streets shouting slogans and carrying placards. Participants in the demonstrations raise a wide range of demands, and little attempt to unify them. Besides, most of the demands raised by the movement are remarkably reformist, like the widely discussed demands for the so-called Robin Hood tax. Chanting on the streets will just make one hoarse. Many fall into the trap of blaming the banks and adopt an anti-corporate rather than an explicitly anti-capitalist stance, citing the flaws of the multinational corporations, instead of placing the blame on capitalist system itself, as the cause of social problems. Their critique fails to recognise the need to move beyond a market economy based on unlimited growth, accumulation and profit. Demands for something concrete, and plans for making these demands a reality will eventually need to be made. In order to point to an alternative, a movement must have a practical substance: it must have organisational continuity and a conscious ideology that is able to clarify the alternative, explaining how it is possible to achieve it, and why it is worth fighting for. Given the centuries-long history of radical movements, it should be unnecessary to invent the wheel anew. Today’s radical movements should try to learn from and build on past ideas and experiences, not dismissing them as irrelevancies. There are no other means by which the people can decide the course of social development than demanding that power must reside in the hands of the people as a whole. Until we have this power, we will be left only to stand on the sidelines of society, fighting for rights and improvements within a system we know to be tyranny, and which will constantly undermine whatever gains we achieve.
Capitalism has had its day; it must be replaced by the socialist alternative. We must free ourselves of the belief that capitalism is natural and unstoppable, or that it is a system that can be reformed. People are fed up, and no longer too timid nor too defeated to speak out against the status quo, and for a different kind of society. Today's strikes and protests are the sparks of resistance. It is clear though that the people engaged in these actions are not certain of themselves or their aims, and that they do not have a concrete plan in mind. It is an important for socialists to try to give direction to the events. It is important that our political organisations mirror the society we would like to see. And organisations can only be built the old-fashioned way - by meeting, talking, and building solidarity. We should not petition the government but empower ourselves. John Holloway has said there is nothing special about being an anti-capitalist revolutionary, that, in fact, opposing capitalism is the everyday story of millions of people.
"That is what learning is. You suddenly understand something you’ve understood all your life, but in a new way." — Doris Lessing
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