The following resolution was carried unanimously at our party’s ninth congress in October.
This congress notes the words of Friedrich Engels in 1876 in his brilliant work Anti-Dühring: “Since 1825, when the first general crisis broke out, the whole industrial and commercial world, production and exchange … are thrown out of joint every ten years.” Engels added that during these crises, “Commerce comes to a grinding halt, the markets are saturated, a multitude of products accumulates, credit and cash vanish, factories are closed, bankruptcies follow in quick succession, the mass of workers are bereft of the means of subsistence because they have produced too much of the means of subsistence.”
This sums up the essence of capitalist crisis: “The workers are in want of the means of subsistence because they have produced too much of the means of subsistence.” (Emphasis added)
In times gone by, people starved because of the insufficiency of the means of subsistence. Now people die because they have produced too much of the means of subsistence.
All around us is the spectacle of saturated markets, rising unemployment, collapsing giants of finance capital, cascading corporate bankruptcies, a shrinking global economy, contracting world trade, ever-increasing misery and destitution heaped upon scores of millions of workers across the globe, and predatory wars waged by imperialism against the oppressed peoples that have claimed the lives of hundreds of thousands of innocent people.
Congress further notes that confining ourselves to the last two-and-a-half decades, it has been a period of almost unbroken crises of overproduction. The present industrial, commercial and banking crisis is a continuation, only much more virulent in its intensity, of the crisis of overproduction that appeared in the middle of 1997 in the form of a currency collapse in the far east, beginning with Thailand and spreading like wildfire to Indonesia, Malaysia, the Philippines and south Korea before jumping continents a year later to Russia, and then on to the USA and Europe, wreaking havoc in its train, causing big business failures, throwing millions of workers out of their jobs, and helping to sharpen interimperialist contradictions.
By the end of August 1998, following and in response to Russia’s default on its debt obligations, world stock markets took a pasting. After the near collapse of Long-Term Capital Management (LTCM), one of the largest hedge funds in the USA, Philip Coggan of the Financial Times felt obliged to write: “The market is feeling as battered as wartime Berlin at the hands of the Red Army. At times this week, it has seemed as if the entire Red Army had been marching on the stock market.” (Red army sings the blues, 3-4 October 1998)
A mere two years later came the bursting of the dotcom bubble, with the Nasdaq stock exchange plunging from its peak of more than 5,000 in the spring of 2000 to 1,725 by 12 April 2001.
With a quarter of US production capacity lying idle, companies embarked on a programme of aggressive job cuts. Global industrial production fell at an annual rate of 6 percent in the first half of 2001. Overproduction overwhelmed one sector after another.
After a short recovery, a crash in the property market in the summer of 2007 left millions of house owners buried in a mountain of debt and several institutions badly burnt.
The resultant impoverishment of the masses undermined consumer spending, bringing the post-2002 recovery to a juddering halt and ushering in yet another recession, only more horrendous, for, the “last cause of real crises always remains the poverty and restricted consumption of the masses as compared to the tendency of capitalist production to develop productive forces as if only the absolute power of consumption of the entire society would be their limit”. (Marx, Capital Vol 3, Chapter 30)
This congress believes that the 2007/8 crisis was remarkable for the fact that it was accompanied by the near collapse of the entire banking system in the US, Britain and a number of other countries. Following the collapse of Lehman Brothers, financial institutions across the world faced losses to the tune of $4,400bn. The crisis of overproduction, and the resultant financial crisis, mutually reinforced each other, with the market capitalisation of banks plummeting to an unprecedented degree. This in turn forced governments, particularly those of the USA and Britain, to acquire huge stakes in some of their largest banks, robbing state treasuries and taxpayers to transfer huge funds to private banks. The result was a dramatic rise in budget deficits and national debt, which forced governments to raise taxes, hand in hand with making cuts in public services and imposing draconian austerity upon the masses.
That slump dealt a devastating blow to market fundamentalism, arousing great anger amongst the masses, with late-night comedians in the US calling for the public execution of bankers, and even respectable bourgeois economists and commentators characterising the bank bailouts, to the tune of hundreds of billions of dollars, as robbery of the people.
Congress notes that the latest downward lurch of the deepening crisis occurred in February 2020, and that the subsequent bailout of big businesses, which would not have otherwise been tolerated by the masses, was carried out under the cover of ‘Covid measures’.
The crisis of imperialism is on the one hand propelling various imperialist countries to wage wars for domination against the oppressed countries and is, on the other hand, serving to intensify interimperialist contradictions to a new pitch.
Congress once more confirms that capitalism is inextricably bound up with crises of overproduction and with war. Neither crises in industry nor wars in politics can be eliminated without the overthrow of capitalism. The productive forces of modern industry long ago outgrew the capitalist mode of deploying them.
Only the proletariat, through the seizure of state power, the transformation of the socialised means of production into public property, and the organisation of “socialised production upon a predetermined plan” can free the means of production from their character as capital and thus rid society of the periodically-recurring crises of overproduction and imperialist wars.
“To accomplish this act of universal emancipation,” in the words of Engels, “is the historical mission of the modern proletariat. To thoroughly comprehend the historical conditions and thus the very nature of this act, to impart to the now oppressed proletarian class a full knowledge of the conditions and the meaning of the momentous act it is called upon to accomplish – this is the task of the theoretical expression of the proletarian movement, scientific socialism.” (Anti-Dühring, Chapter 24)
This is the message that must permeate the working-class movement.
Not for decades has there been such an opportunity as we now have to build a truly proletarian, anti-imperialist, revolutionary movement capable of giving direction to the all-too-likely spontaneous movement of the masses against the ravages of capitalism. The time is ripe because the never-ending crisis of overproduction, in combination with never-ending imperialist wars, have undermined the legitimacy of capitalism, while the credibility of Marxism-Leninism, of communism, is on the rise.
It is time to spread far and wide the message among the working class that crises of overproduction are systemic to capitalism; that they recur because of the inherent contradiction ‘between socialised production and capitalist appropriation’. It is this contradiction which, during the crises, ‘ends in a violent explosion’; it is this contradiction which constitutes the motive force behind the drive to war.
This congress believes that only the proletariat, through the overthrow of capitalism, is capable of rescuing humanity from the scourge of these two evils.
This congress resolves:
1. To popularise the understanding that crisis and war are inherent to the capitalist system and cannot be escaped while that system remains.
2. To bring to workers an understanding of their historic role as the class that will bring about the end of the capitalist system and go on to build a new socialist society.