Link to this page: https://www.socialistparty.org.uk/issue/203/8479
Capitalism's destructive "logic"
Stop The Jobs Slaughter
SIGNS THAT a worldwide recession is becoming closer gathered last week when the US Federal Reserve (the "Fed") cut US interest rates for the fourth time in four months.
This followed reports that Cisco Systems, which provides most of the hardware for the worldwide web, has seen sales collapse by 30% in the last quarter.
Cisco's problems are typical of those of the whole IT sector now the new technology bubble has burst with a rapid fall in its massively over-valued share prices.
The US ruling class knows that the world's largest economy is rapidly deteriorating. But most serious pro-capitalist economists, who are belatedly seeing the scale of the economy's problems, fear that the Fed's cut won't stave off the developing recession in the US and worldwide.
British workers will be amongst those that suffer as the giant multinationals try and offload the global economy's problems on to workers.
Thousands of workers in the telecommunications industry are threatened with losing their jobs.
Mobile phone company Motorola plans to shut its plant in Bathgate, Scotland, which would destroy 3,200 jobs. Phillips aims to cut 7,000 jobs, Marconi 3,000. Ericsson says it will shed 15,000 jobs this year.
As the Socialist Party and the CWI have long argued, the fundamental problem facing the US economy is one of over-production and over-capacity. There are too many goods being produced on the world market to retain profitability.
The capitalists' response is to cut investment, run down existing stocks and ultimately close factories and lay off workers as Motorola are doing in Scotland.
Cuts in interest rates won't deter the capitalists from this course of action - to try and overcome this fundamental contradiction in the global economy.
The Socialist Party though, will oppose every job loss. Over recent decades these multinationals have made millions of pounds profit at workers' expense, often with the help of taxpayers' money in the form of government grants.
If companies like Motorola try to close factories, these plants should be nationalised under workers' control to secure these jobs.
Capitalism cannot guarantee jobs at a decent standard of living. If we want to stop these factory closures and job losses arising from the destructive logic of the capitalist market, fight alongside the Socialist Party for a socialist society, where production is planned to meet people's needs not to build the capitalists' profits.
In The Socialist 27 April 2001: