Rescue of the Spanish Banking System
(«Proletarian»;Nr. 9; Winter 2012-2013)
The Spanish and international bourgeoisies promise the proletariat more exploitation, more suffering and misery in order to save their economy
This weekend the Spanish Minister of Economy, Luis de Guindos cynically stated that the intervention of the Eurogroup in the country’s financial sector is not a rescue, but only a loan on favorable terms; this loan, which should benefit the entire economy, will be graciously granted by the principal European economies in solidarity with a partner in danger. Of course, it is completely coincidental that this announcement came the day when the Spanish team played its first football match in the European Championships...
First of all it must be said that the terms granted by the European countries are more favorable than those obtained from the private financial sector (3% according to some sources, while the Spanish Treasury borrows for 10 years at 6%), but the reality is that the loan – called “a line of credit” with a straight face – is accompanied by a series of stringent requirements involving both the tax system (tax increases through an increase in the tax base in terms of direct taxes, and increases in indirect taxes) and the labor market (new labor code reforms to further reduce all measures even slightly favorable to the proletarians as regards dismissals, employment contracts, etc..), and in general to the social guarantees which still exist (pensions, unemployment benefits, etc..).
In addition, the finance ministers of countries involved in the rescue warned that they would pay particular attention to the macroeconomic indices of Spain, just as they do in regard to Greece, Ireland and Portugal, which, more than other countries have in practice transferred part of their national sovereignty in financial matters over to themoneylenders. In Spain as in any other country, the reactionary currents raise the flag of “sovereignty” against the dictates of the European Commission or of Germany and advocate a nationalist policy to defend national interests: it is just as anti-proletarian and class-collaborationist an orientation as the one of the so-called “left” which implores that the proletarians not be the only ones making sacrifices for the national interest.
Thus, the bailout offers nothing for free; the countries which have provided it are the main European imperialisms which are directly involved in the loan and the countries who, with the USA at their head and the IMF as their agent, participated in the definition of the plan, don’t rush to the aid of the Spanish bourgeoisie in a disinterested manner. In the capitalist world, competition between private enterprise owners just as between the nation states of the bourgeois fatherlands, is the demiurge which determines the conditions of existence of everyone. If the German and French bourgeoisie especially, but also the Americans, intervene in the Spanish economy it is because the level of interpenetration of super-developed capitalism existing on the planet is such that there are no economies isolated from the rest of the world and all depend on each other: an American or German company can have its financial assets in Treasury bills or Spanish Securities.
The comparatively great size of the Spanish financial system which dominates not only in Spain but also in Latin America, means that its bankruptcy might take others down with it including the euro and the inter-imperialist alliance which calls itself the European Union; the panic could impact the credit system heavily not only on the European level, but also globally, aggravating the recessional crisis that affects one country after another. The rescue of the Spanish banking system, even if limited in time, is actually a demonstration of the seriousness of the international economic crisis.
This bailout is undoubtedly a poisoned chalice for the Spanish bourgeoisie, which has no choice but to accept it,: the pressure exerted on it by other bourgeoisies leave it no other way out. But this rescue adds only a supplemental degree to the crisis which has been lashing the country for four years. Finance capital is the result of the merger in the imperialist epoch of industrial capital and bank capital, united to face the complexity engendered by capitalist competition. The development of finance capital which in Spain has grown from a precarious situation in the early 90s, to a level of significant importance in the world twenty years later, at its peak setting in motion a sum of bank loans equivalent to 102.6% of GDP. It is the result of strong productive development of the country starting in 1987, a development driven by an inordinate expansion of the real estate sector.
There is no financial development which is independent of production and the fall of the financial sector last year, which culminated with the call for the rescue last weekend, is the consequence of the fall in production in Spain: a 5% decline for the past 4 years. For thisreason, neither the rescue of the banking system nor a more extensive and longer-lasting intervention, or any measure which limits itself to transfers of funds to fill gaps in the economy, can produce any result as long as there is no resumption of production, and in this regard the IMF projects a GDP decline of 4.1% in 2012 and 1.6% in 2013 (if all goes “well”!), a decrease in 2 years of the same magnitude as that of the last 5 years.
As the Greek example has demonstrated to the bourgeoisie of all countries, the financial efforts to try to save the most critical situations of crisis in some countries cannot succeed if the general level of production does not begin to grow; but this will only be possible when the rate of profit, that the fierce competition between bourgeois brought tumbling down in free fall, recovers to sufficient levels. The bourgeois program to restore the rate of profit, is simple and unequivocal: to exponentially increasethe exploitation suffered by the proletariat, so that the surplus value extorted is large enough to make production profitable again. This is the meaning of the structural reforms, cuts and other “emergency” measures that proliferate today in all countries and which have thrown the proletarians of Greece or Portugal under conditions similar to those of the proletariat of the least developed capitalist countries .
The proletariat has not yet been able to offer any effective resistance to these measures (which are only the first),that will plunge it into a critical situation As long as it is paralyzed by the forces of collaboration between classes, of defense of the nation presented as a common interest with the bourgeoisie, of the defense in the final analysis of competition between workers, the proletariat cannot successfully defend its own class interests in the face of the deterioration of its living conditions. Political and trade union opportunism submit it to the needs of the bourgeoisie, confining proletarian unrest to democratic protests completely foreign to classist methods: strikes convened with previous notice and a solicitous respect for the minimum services are rendered ineffective, demonstrations are reduced to symbolic processions, so as not to offend the capitalist interests; the true proletarian struggle is thus completely wiped off the map.
In no country does the capitalist crisis have a peaceful solution!
The relentless competition that characterizes the economic, financial, political and diplomatic relations between the companies, trusts and states worldwide, does not disappear with the crisis, on the contrary it increases, impelling the most powerful imperialist centers to crush the weaker. Commercial and financial war that characterizes the life of capitalism can only increase the confrontations that will lead, sooner or later, to an open war. The capitalist solutions to the economic crisis can only prepare the conditions for more severe crises, up until war between the states, which can only be stopped by the proletarian revolution. Against war between the states, we must counter-pose war between the classes!
It is the proletariat which must emerge from its crisis, which must end its impotence, to organize its class struggle on a grand scale. Only with the resumption of the class struggle, not only for the objectives of immediate defense that exist today, but also for the establishment of its political class party, the internationalist and international communist party– the organ of the proletarian revolution – will it be possible to do away with crises, poverty and exploitation completely and replace capitalist society with the future society of the human species.
The capitalist crisis has no peaceful solution!
For the proletariat to extricate itself from its political and organizational crisis and resume the path of confrontation between the classes!
For the resumption of the proletarian class struggle! For the proletarian communist revolution!
For the reconstitution of the World Communist Party!
June 16th 2012
International Communist Party