Mar 31, 2009

The Economic Crisis: Who's Responsible?

It would be easy to pin the blame for the economic meltdown on a few greedy individuals. It's true that a handful of global billionaires and gigantic transnational corporations have artificially inflated and manipulated the values of real estate, high tech, stocks, commodities, even national currencies. "Bubble capitalism" has reaped enormous fortunes for the ultra-rich, while billions of working people and the poor ended up deeper in debt.

The neoliberal policies of right-wing governments made matters worse, through privatization, deregulation, tax cuts for the rich, and social program cuts. They claimed these neoliberal policies would increase everyone's wealth. Instead, the gap between the rich and working people has widened to staggering proportions, and labour and democratic rights are under increasing attack.

Capitalism always heads towards crises. Individual capitalists and corporations, competing for higher profits, seek to maximize their return on investment by cutting labour costs; this process always cuts spending power, leaving working people without the necessary income to purchase the goods and service with produce. Through history, this cycle results in frequent economic crashes, followed by recoveries. Every time, workers pay the price, while the bosses end up richer.

About the Author: Progress Books is a publisher of communist and socialist books in Canada like the Communist Manifesto.