Capitalists are still on strike, refusing to spend heightening the crisis

The Dow fell 520 points yesterday and there's more turmoil to come of that there's no doubt.  Crisis is built in to the capitalist economic system and increased globalization and increased interlinking of the economies of the world while offering up huge profits to some sections of the capitalist class also bring greater and more widespread crisis.

Since the financial collapse, the owners of capital have pretty much been on strike.  They don't throw money in to circulation for the fun of it and when there is doubt that it will return pregnant with surplus value they get very conservative and cautious about letting it go.  Right now, they are holding lots and lots of money.  The US press today reports that non-financial companies in the Standard and Poor's 500 stock index are holding more than $1trillion in cash and other investments up 53% in the last two years.

Microsoft is holding $58 billion, Google $39 billion, but holding cash doesn't mean that they are simply hoarding it, a capitalist, as Marx pointed out, is not a miser. Many of them are investing in gold which has driven up it's price astronomically as well as the cost of storing it while some companies "keep most of that money in government debt" says the Wall Street Journal.  What that actually means is that that after they appropriate the wealth human Labor power creates they lend it back to us.

"Spending cash now is risky" says one CEO complaining that US debt doesn't bring the best returns but it is "more important for us to preserve capital than get a high rate of return. In this environment its impossible to get a high rate of return without exposing the capital to risk.".  The financial crisis that is still continuing and threatens the death of the Euro, is really shaking these folks up and they are extremely wary.  The problem is that Capital expenditures are crucial to economic growth but by not hiring workers and in fact laying us off they are exacerbating the demand problem; workers can't spend what we don't have and if we don't buy, or consume the commodity as they say, the added value within it (Labor power the capitalist doesn't pay for and is the source of their profit) cannot be realized and the process repeated; capital accumulation is slowed or brought to halt.  Capital hates obstacles.

But the capitalist class are driven by the laws of the system to make decisions that increase the tendency toward further crisis. The historic integration of global markets over the last 25 years means that capitalist crisis is more globalized as opposed to being restricted to a certain nation or nations.  The crisis in the US economy will have devastating effects on China for example.  

Cabot Corp. the WSJ points out, is a chemical company that gets 80% of its revenue from overseas which at the moment gives it a bit of an advantage allowing it to go ahead with a $10 million expansion of a factory it has in Massachusetts.  Those of us that think protectionism (buy American) will solve our problems should take note.  As one country introduces measures to protect its industry, it's competitors in other countries will retaliate as they have historically except, as the CFO of Cabot says, "All these markets are very much interlinked" which will make the trade wars much more widespread and destructive.  

The plant in Massachusetts will shut down laying off workers there as many other industries will have to do as other countries introduce their protectionists measures.  It will simply mean that job losses will be shifted around, not eliminated. It will also increase division and competition between workers of different countries making global working class solidarity much more elusive and workers in any one country, including here in the US, cannot resolve this crisis in our favor without uniting with workers internationally and coordinating our activity.   Global working class unity in action is crucial to ensuring we have a future on this planet.

The economic crisis has had an impact of historical proportions on the confidence of the capitalist class in their system and the responses to it, from Cairo to London, Santiago to Athens, have ensured that capitalism will never be the same. We will see many more uprisings against the effects of a deteriorating global economic system.  Given the absence of a well organized global working class movement and the weakness of revolutionary leadership, the struggles ahead will not be pretty but confused and chaotic at times infused with elements of unneccesary violence and criminality.  But as in all struggles, political lessons will be learned and political tendencies will arise.

Countries like China and India where there are presently thousands of protests and social conflicts daily will not be exempt from the emerging working class movement.  And neither will the US.