Britons have been promised salvation in a “higher wage, lower welfare, lower tax society”. This is austerity rebranded, another cover story for looting the nation and enriching the elite. Debt peonage in a corporate state is what the future really holds for most people.

Here’s Tom Bailey:

People aged 17-24 are facing a financial crisis. The latest warning from the charity Citizens Advice attributes the growing number of young people in debt with increased dependency on high-interest pay-day loans. Seems our youth are being forced to take out loans to keep up with the rising costs of their financial obligations; food on the table, roof overhead, smartphone contract, etc.As I write this I’m sat in London, in a £6500 a year off-the-books bedsit-box-room with mice and damp that I pay for in cash. And after a £400 deposit and no receipt, I feel I’m earning my stripes for the financially fucked generation of Britons aptly dubbed; ‘generation rent’.

Tom says a promised increase in the minimum wage to £7.20 will be swallowed by soaring housing costs. By 2020 workers in London will have to borrow an additional £6 000 just to pay the rent. The government’s offer to provide apprenticeships to 3 million young people from low-income backgrounds to improve skills and wages is a scam.

Delve a little deeper and you realise these ‘new’ apprenticeship schemes offer no future prospects, equate to no more value than 5 GCSEs and that less than 3% are equivalent to A-levels. They ultimately boil down to 2 years cheap labour in the same pre-determined, pre-allocated, proletariat employment positions the working class have been bred for since time immemorial. Minimum wage.

Threats to cut the pay of ‘junior doctors’ – provoking the first doctors strike in four decades – show the high-wage economy is a complete fraud. Dr Tomasz Pierscionek says:

Doctors and others within the NHS are increasingly seeing the link between the attacks on the national health care system and the wider austerity programme being implemented by Cameron’s government. However, due to the logic of capitalism in crisis and the levels of austerity required, the Tories have no option but to attack the NHS and its staff. As a result, in the coming weeks, Cameron and co. are likely to up the ante with their spin, supported by the most reactionary elements of the media, whose attacks against doctors will become even more vitriolic and ridiculous.

Privatising the NHS is simply part of the process of asset-stripping the state so that parasites can profit. But says investigative journalist Graham Vanbergen, nobody does it better than George Osborne, the current chancellor.

He is set on being the chancellor who sold the nation’s family silver – what’s left of it. By the end of this year alone, Osborne will have sold nearly £60 billion of national assets built up over generations in just six years and by 2020, Osborne will have largely completed his task. In ten years during Blair, privatisation was all but halted with a total sale of just £2.8 billion. Osborne by contrast will sell at least £100 billion by the next election and that does not include the sale of property or land, more than any chancellor, including during the entirety of the Thatcher years…The NHS has effectively been abolished now that the government have severed that vital link between contributions made by the public through their salaries and the legal commitment to provide free health care via the Health Act. The result, George Osborne withheld £30 billion in the National Insurance fund from the NHS starving it of much needed money. In the meantime, the NHS saw a staggering 500% rise of deals signed just last year handed over to private firms with the government misleading the public on the scale and pace of changes.

Georgie doesn’t intend to stop there. He’s also committed to “making further major cuts to corporation tax to give us the lowest rate of any major economy in the world” while continuing to slash spending on welfare and social security.  Here’s geographer Danny Dorling:

The rich are getting richer. By 2014 the combined wealth of the 1000 richest people in the UK had risen to £519 billion, a 55% rise in just 4 years. And these were the same four years in which most of the people in the UK became poorer, in which food banks became normal, in which evictions arose and life expectancy for elderly women fell. Just spreading that rise over every family in the UK would have made each over £6000 better off… A year later in 2015 the wealth of the richest 1000 families had grown again by £28 billion in little more than a year… They doubled their money in just 6 years…If this trend continues the UK will become a place where the majority of people will pay most of their future income in rent to the rich.

Inequality is not just a British issue.The latest Oxfam inequality report confirms what most people suspect. Wealth isn’t trickling down. Its gushing upwards ever faster; 40% up for the rich and 41% down for the poor since 2010. One percent of humanity is now wealthier than the other 99%. Some 60 individuals at the top own more than the 3.6 billion people at the bottom.

Sharon Beder notes this elite is more than the sum of its wealth.
Rather it is a transnational corporate class made up of top corporate executives wielding power founded in the giant institutions they command together with individuals and families who have derived great wealth from business enterprises. This transnational corporate class organises and runs the business coalitions where common goals and strategies are worked out; coordinates the public relations specialists, think tanks and media outlets that manipulate public opinion; sets the agendas for policy groups; guides their policy recommendations onto government agendas; fills executive positions in successive government administrations and as government advisors; and thereby ensures public policy outcomes that are conducive to the business interests they favour. In this way governments are intimately connected with this business power elite.

Four years ago a team of Swiss systems theorists unpicked the share ownerships linking 43 000 transnational corporations. They found that 147 corporations controlled 40 percent of the network. Just 1300 companies accounted for 80 percent of global revenue. And financial corporations like Goldman Sachs, JP Morgan and Barclays rule the roost and determine the fate of humanity.

Professor John McMurtry says:

The new law of human evolution is that people are required to compete for more money and commodities for themselves as “necessary to survive”, with the borderless system de-regulated and structured to increasingly impoverish the great majority while multiplying the wealth of the rich. The facts are now long in. Corporate globalization is not only out of control. It is eating the world alive at all levels towards cumulative collapse of organic, social and ecological life organization. Global competition means, in fact, the majority’s life means and security keep falling as the environment is looted and polluted on ever larger scales of depredation. Yet only “more growth” of this system is imagined as a solution. The system is clinically insane

Michael Hudson says:.

Western economies have entered a fatal phase change. Debt service exceeds the economic surplus, leading to shrinkage…It is even stifling the industrial economy, “post-industrializing” it in the West by destroying domestic consumer markets for output that employees produce… Foreclosure time has arrived, reducing debt-strapped populations, “financialized” industrial companies, cities, states, and entire national governments from Ireland to Greece to debt peonage…The great economic fiction of our time is that all debts can be paid—if only countries submit to enough austerity, impoverish their labor force, close down enough industry, and let banks foreclose on enough factories—and while they are at it, cut back social security, health care, and social spending across the board. This is class warfare waged by finance against the rest of the economy

There is every reason to believe we are reaching the endgame. For almost four decades, rising inequality has been accompanied by a persistent increase in overall debt and steadily declining economic growth. Professor Wolfgang Streeck, director at the Max Planck Institute for the Study of Societies, says there is mounting evidence that these are mutually reinforcing trends reflecting a protracted and inexorable process of decay. He notes the following:

  • The crash of 2008 was only the latest in a long sequence of political and economic crises since the end of postwar prosperity in the mid-1970s.
  • The financial industry is back in the business of leeching the real economy after being bailed out with cheap cash, created out of thin air, by friendly central banks.
  • This flood of money has not jump-started economies. What little growth there is has been appropriated by the top one per cent of income earners—the lion’s share by a small fraction of them.
  • The political and financial elite know that pumping fiat money into the system to try to save capitalism cannot go on forever. Austerity is not an alternative, merely camouflage for plundering state assets and fleecing citizens in the interim.
  • Irrelevant governments happily look the other way as wealth flows upwards and democracy is reduced to ‘politainment’.
  • Societies are not living beyond their means. Growing public debt is largely due to the transfer of wealth to the rich through tax breaks and privatisation.
  • Democratic intervention in the market economy is blocked by client governments.The profit-dependent classes seek to to eliminate the threat of democracy completely.
  • Dominated by the financial sector the struggle for the last remaining profit opportunities becomes uglier by the day. Capitalism is now synonymous with fraud and corruption, a world of dirty tricks for ensuring the further enrichment of the already rich.
  • The US dollar (as the international reserve currency) gives America a free lunch and entrenches global financial anarchy.
  •  Capitalism has now more or less destroyed any agency that could stabilize it by limiting its excesses. It cannot contain its impulse to commodify people, money and nature itself into oblivion. It  cannot survive its victories.

Capitalism’s alibi – that private greed is redeemed by the public prosperity it creates – has fallen apart. Professor Streeck says capitalism has ceased to be a self-reproducing, sustainable, predictable and legitimate social order.

The image I have of the end of capitalism—an end that I believe is already under way—is one of a social system in chronic disrepair, for reasons of its own and regardless of the absence of a viable alternative. While we cannot know when and how exactly capitalism will disappear and what will succeed it, what matters is that no force is on hand that could be expected to reverse the three downward trends in economic growth, social equality and financial stability and end their mutual reinforcement. In contrast to the 1930s, there is today no political-economic formula on the horizon, left or right, that might provide capitalist societies with a coherent new regime of regulation. Social integration as well as system integration seem irreversibly damaged and set to deteriorate further. What is most likely to happen as time passes is a continuous accumulation of small and not-so-small dysfunctions; none necessarily deadly as such, but most beyond repair, all the more so as they become too many for individual address. In the process, the parts of the whole will fit together less and less; frictions of all kinds will multiply; unanticipated consequences will spread, along ever more obscure lines of causation. Uncertainty will proliferate; crises of every sort—of legitimacy, productivity or both—will follow each other in quick succession while predictability and governability will decline further (as they have for decades now). Eventually, the myriad provisional fixes devised for short-term crisis management will collapse under the weight of the daily disasters produced by a social order in profound, anomic disarray.

Even before that happens people will lose their life’s savings in the next derivatives collapse under new EU rules that allow bank losses to be imposed on depositors. The infrastructure is in place in the US for similar ‘bail-ins’. Capitalism has morphed into a protection racket but I suspect there is method in the madness.


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