By Ed Dalton and Larisa Shepitko

The economic crisis deepening in the world today has been predicted; the bill has been in the mail for some time. It is far easier to be taken in by the narrative of the imperialist ruling class and their media than to grapple with the fact that even the bourgeois economists have been predicting a severe economic crisis hitting in 2020, even worse than the one in 2008.

Chinese social imperialism has taken the worst hit, but it would be superficial to credit COVID-19 for the downturn. In reality the Chinese economy has been on a slowdown, in fact the slowest it has been in over 30 years. Of course the shutdowns and decline in consumer purchasing power related to the virus makes matters worse, it is in no way the cause of the crisis. Capitalists will seek any devil possible to blame for their own system’s inability to do anything other than stumble from crisis to crisis. To make matter worse, this is not the first time the ruling class has attempted to shift the blame to biological and “natural” causes.

Those not suffering from short-term memory can recall the imperialists quickly acting to distract the masses from the 2008 crisis in 2009 with “Swine Flu” or H1N1. It was later revealed to be no more severe than the yearly seasonal flu. Like elections, there are those who will fall for the same tricks year after year, even though they have been previously burned. This is not to argue that COVID-19 is not a problem, or a major health concern, but to insist that it is not the cause of all life’s misery–imperialism is.

The imperialist class is not deterred by public health in the pursuit of profit. They make their way across the globe watching people die of curable diseases and extracting profit at any human cost. It is a fallacy to suggest that they are willing to resign themselves to financial ruin due to a virus that is, at its weakest completely without symptoms and at it’s worse fatal to elderly people with preexisting medical conditions. Imperialism was not born of benevolence and it will not perish to benevolence.

Across the globe, working people are losing their jobs and their employment prospects at a staggering rate. As we watch the rapid onset of an economic depression it is evident that it is the working class that has been made the sacrificial lamb even though it is largely the imperialists who habitually jet-set around world for leisure and business spreading viruses along the way. Most working people do not make regular trips around the world, and cannot even fathom such trips. Many workers seldom leave their city or state due to their financial limitation.

Furthermore, while the ruling class will maintain that pandemics are indiscriminate, nothing is so equal under capitalism—they always fall the heaviest on the working class and the masses of the world. Imperialism is unable to deal with its economic crisis, or to fully deal with the health crises which accompany them inevitably. Profit-driven health industry is not able to pay its staff adequately or provide them with the equipment needed to treat major health concerns and the general population cannot often afford the treatment anyway, hence illness spreads socially.

It is only the wealthy and better off who can afford to “self-isolate” and it is in their interests to do so. The anti-social culture of the petty-bourgeois is a luxury in itself. They have created an entire market within the tech industry that caters to their desire to opt out of everyday social interactions. They often can work from home given the right set-up. And in this new age of overburdened food and grocery delivery services cannot be at the beckoning call, they buy their goods in bulk, leaving little to pick through for those who cannot afford such large purchases. The masses of worker’s lives are reliant on social interactions. We work together, live together and share the same struggle.

It is more than ever in the interests of the ruling classes for working people to follow their lead, and grow nervous to be around one another and avoid socializing, especially when the working people truly have nothing to lose but their chains.

The man-made economic crisis has been awarded insurance against mass rebellion by the sickness they impose upon the people and the fear the people are inundated with by the sensational bourgeois media.

Likewise, “social-distancing” is not a sustainable option, such a precaution is only useful if everyone could afford to do it, at least until a vaccine is made affordable and available, which will take years and still cost more than most can afford. Proving the whole thing a ruse, to pacify the public and prevent uprising in response to the depression and the virus which only makes the depression more difficult. Regarding the isolationist approach, the World Health Organization Collaborating Center for Disease Modeling, along with other bourgeois organizations have admitted the limitations of such a response, “The main challenge of this approach is that Non Pharmaceutical Interventions (and drugs, if available) need to be maintained – at least intermittently – for as long as the virus is circulating in the human population, or until a vaccine becomes available.” They continue, “In the case of COVID-19, it will be at least a 12-18 months before a vaccine is available. Furthermore, there is no guarantee that initial vaccines will have high efficacy.”

Each time the imperialists peddle a distraction or provide a scapegoat they get more and more effective, making resistance and rebellion more and more necessary. Announcing a “pandemic” is in the interests of the imperialists only, otherwise they would not make such declarations. It offers them the golden excuse to put the general population of their cities, which are the big prison, into aggravated segregation, to stave off any would-be prison riots which would go beyond their control. They cannot even stomach the thought of another “Occupy Wall Street” with its vague and eclectic demands, which were a direct result of the 2008 crisis, and with worse crisis, they are correct to fear a more militant and aggressive response.

Instead of pandering to “wash your hands” populist rhetoric, revolutionaries have the obligation to seriously look this crisis in the face and organize the frustration and fear of the masses into revolutionary action.

Reaction has already made the best use of COVID-19, it has increased its latitude, stands poised for immigration shut downs, and massive restrictions on democracy.

Some revolutionaries in the US on the other hand spend their time telling one another about hand-washing, proving themselves more and more to be underqualified to integrate among the masses and prepare for the coming unrest. This further proves the fact that while we live in revolutionary times, we lack quality revolutionary leadership. The only conclusion is to struggle to provide revolutionary leadership, to answer the real questions of the people, and to face every crisis with combative resistance.

We provide the following unofficial translation of an article from the revolutionary Brazilian newspaper A Nova Democracia, which provides a better analysis than any American resource.

World economy heading for depression: coronavirus hides the crisis of imperialism

JAILSON DE SOUZA

Industrial production and financial market stock exchanges collapsed in early March in practically the world. The trigger, as the world press monopoly advertises, is the expansion of the coronavirus. However, it is actually the crisis of relative capital overproduction.

Coronavirus alone could not have such an impact on the world economy. The reason for the interruption of the reproduction of capital is capital itself. The Crítica da Economia portal, citing newspapers from the reaction itself, noted that the coronavirus is now less lethal than the flu. “Internal data from the World Health Organization (WHO) show that, in this year of 2020, the popular flu of the season ( seasonal flu ) has already caused many more fatalities (76,537 deaths) than the new coronavirus (2,812 deaths); that is, our familiar daily flu has killed 2,720% more people than the mysterious new coronavirus ”.

The main affected by the pandemic and overproduction is Chinese social-imperialism. Several regions of the country are in quarantine and some industries, according to news published by world press monopolies, have closed their activities completely. The paralysis of production consequently affects the orders of the trades and the consumption of the families, causing fall in the prices and damage to the Chinese capitalists and the others. However, even before the epidemic, in the second quarter of 2019, the Chinese economy had already had the slowest pace in almost three decades. Proof that the virus is not the cause of the crisis; it only worsens it, capital itself being the cause of the crisis.

Smartphone production is expected to drop at least 12% in the first quarter of 2020 compared to the same period in 2019, according to a report by the analyst firm Trendforce. This will be the worst result of the branch’s production in five years for the first quarter.

Other similar branches, such as the production of notebooks, monitors, televisions, etc. they should also suffer a reduction in production in millions of units.

IMPERIALISM BREEDS CHAOS AND DISORDER

Large international monopolies have already issued warnings about declines in the profit mass. [rate of profit to fall]

Apple, for example, said it will not reach its target revenue target for the first quarter and attributed this to the coronavirus.

MasterCard, United Airlines, Toyota, Danone and other monopolies have issued similar warnings.

Petrobras, in Brazil, said that it will have difficulties in the first quarter due to the drop in the international price of oil, driven by competition between Russia and Saudi Arabia and by the drop in industrial demand.

On 12/03 alone, Petrobras shares fell by 19.1%

Industries installed in Brazil, such as the LG factory in Tatuapé (SP) and Samsung and Motorola, in Campinas, stopped production due to the lack of electronic components from China, such as chips, integrated circuits and other parts.

According to the Brazilian Association of the Electrical and Electronic Industry (Abinee), half of the companies reported having problems receiving the inputs and components from Chinese social-imperialism.

Other local monopolies are already feeling the crisis. Gol, for example, had a 29.3% drop in its shares on the Bovespa (B3). Latam, in turn, reduced aircraft circulation by 30% due to low demand.

The Bolsonaro / generals government is already discussing a “relief package”, with generous tax exemption, while ignoring the fact that the popular masses are subject to a great worsening in their living conditions.

The international price of other important commodities for Brazilian bureaucratic capitalism is also in free fall. Soy, which represents more than 30% of exports to China, is one of the commodities with a sharp drop in prices, together with iron ore (21% of exports).

OVERPRODUCTION CRISIS

The occurrence of coronavirus is just a fact that aggravates the economy. However, behind this fact there is already a relative overproduction of latent capital.

The crisis of relative overproduction of capital occurs when the production of capital exceeds too much the consumption capacity of society defined, ultimately, by the contradiction between the social character of production and the capitalist appropriation of the product.

To get a sense, unemployment in the USA reached a record low: 3.5% unemployment in October 2019, which was practically equivalent to “full employment”. It was the lowest index in the last 50 years, driven by the decrease in interest rates, which drives credit for production. However, in October, the creation of new jobs in the industry decreased for the first time in six months, although production grew by 1.1% in November. It is a huge increase in global production, which grows disproportionately to the increase in global consumption capacity. The overproduction crisis is the inevitable consequence. Proof of this is that all economists predict that the Yankee economy will slow down in the short term, that is, it will not find markets to continue its expansion.

Showing signs of this already on March 12, the New York Stock Exchange (Dow Jones) had a sharp drop of 8.4%.

This, however, is not a trend only in the USA. In Japan, specifically, GDP fell by 6.3% in the October-December 2019 quarter. Germany, one of the most powerful economies, collapsed its industrial production by 7% last year (before the coronavirus). The fall in the real economy is what determines the fall in the stock market.

As a reflex, on March 12, important exchanges in the world (London, Paris and Frankfurt) had violent falls: 10.8%, 12.28% and 12.24%, respectively.

B3, in Brazil, came to lose 14.4% just on that day. In just over a month, comparing the period between the last historical high and 12/03, the fall is 40%, much worse than that of the 2008 crisis.

For the peoples, the crisis will bring massive unemployment, great wage fall, longer working hours and other problems. This will push large masses into the struggle and can open a period of radicalization of the spontaneous and conscious class struggle.