Joseph Choonara

The crisis: over or just beginning?

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The post-election period will be dominated by the dire state of the British economy. While the political elite are desperate to make us pay for the crisis, they are also paralysed by the fear of a renewed recession precipitated by speculation against the pound. Joseph Choonara reports

The state of the economy will continue to mould British politics after the election. Economics will constrain the room for manoeuvre of the political elite, pressing them to drive through a series of attacks. It will also create the terrain on which workers will have to organise and resist. The prospects for the system are, then, of keen interest to those who wish to challenge it. After almost three years of chaos, what lies in store?

The divisive crisis

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Britain is likely to see some weak and fragile economic recovery in early 2010, but the crisis will continue to shape politics in the months ahead.

Recent data shows that 2009 saw the biggest contraction in the British economy in a single year since 1921.

The world economy is not in permanent slump. The major G20 economies, with the exception of Britain, moved out of recession by the third quarter of last year and China grew impressively in 2009. But the measures taken to escape from recession will shape what happens next.

Whatever happened to the 'Great Recession'?

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"Global Economic Recovery Is Growing, Says IMF." This Daily Mail headline was typical of the media's response to signs of economic recovery in August.

Marxists face two dangers when trying to assess the state of the economy. The first is to attempt to shoehorn the facts to fit with a preconceived account of crisis. The second is to simply accept at face value the analysis put forward by economists.

The figures for the second quarter of 2009 do show a low level of growth in Germany and France. Their GDPs (a measure of the total goods and services produced) rose by 0.3 percent. Japan's grew even faster and there are some indications that the US recession is bottoming out. However, the signs of recovery remain weak.

Darling's budget - the shape of cuts to come

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Alistair Darling is "Red All Over", wailed The Times. "Return Of Class War", screamed The Daily Telegraph.

Newspaper editors are presumably part of the 0.6 percent of the population who will be hit by the 50 percent top rate of income tax announced by the chancellor in his budget. But this measure should be put in context. When Labour last left office in 1979 the top rate was 83 percent.

The Financial Times (FT) was more realistic about Labour's budget. Behind the headlines and spin, it argued, were a record budget deficit and a prelude to a savage assault on the public sector.

Interview: David Harvey - Exploring the logic of capital

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Joseph Choonara spoke to acclaimed Marxist theoretician David Harvey about capitalism's current crisis and his online reading group of Karl Marx's Capital which shows the revival of interest in this work.

Some commentators view the current crisis as arising from problems in finance that then impinged on the wider economy; others see it as a result of issues that arose in production and then led to financial problems. How do you view it?

The Great Financial Crisis

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John Bellamy Foster and Fred Magdoff, Monthly Review Press; £10.95

Monthly Review (MR) has been a leading journal of the US left since 1949. In its pages writers such as Paul Baran, Paul Sweezy and Harry Magdoff set out a distinct analysis of capitalism as it existed after the Second World War. This short book collects several recent MR essays by John Bellamy Foster and Fred Magdoff, along with two original chapters, that continue this task - with particular reference to the current economic crisis.

The economic crisis deepens

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Joseph Choonara looks at a new phase of the economic crisis that could see whole countries go bankrupt.

The global economic crisis is entering a new phase. The first phase came as concerns over subprime mortgages and the "toxic" assets derived from them spread, leading to repeated attempts by central banks to "inject liquidity" into the financial system to prevent it seizing up.

The value of money

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How do the billions wiped off the stock market relate to the rest of the capitalist system? Joseph Choonara goes back to Karl Marx to explain.

Pity money. Over recent months it has been "injected" into markets, "destroyed" in financial meltdowns and stock market collapses; it has been "devalued" and "revalued" and passed along the increasingly unfathomable webs spun by capital.

Economic crisis: State of collapse

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The US government is frantically relieving banks of their "toxic assets". But even the huge amount of dollars used for the buyouts is unlikely to rescue a system which shows all the signs of further collapse

Last month the greatest financial crisis since 1929 swept through the system. As Socialist Review went to press, some commentators were assuring us that "the worst is now over". Those are words we have heard many times since the crisis began in autumn last year.

No such thing as a safe bet in the market

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In April the International Monetary Fund dubbed the growing economic crisis "the largest financial shock since the Great Depression", leading to a one in four chance of a full-blown global recession.

There is little doubt that the US economy is already contracting.

The immediate problem is a pool of bad debt, so-called "toxic waste", clogging up financial markets. The waste is a consequence of the scramble to lend money during the property boom of recent years. Arcane financial innovations, which saw debt parcelled out and gambled on by banks, hedge funds and corporations, ensured that the contagion from dodgy mortgages went global.

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