Bankrupt capitalism dismantles the welfare state

Since the beginning of the year, several hundred thousand people have demonstrated in Russia against Government measures aimed at dismantling the existing benefits available to retired people, the sick, or certain state employees. The state will no longer provide free basic medicine and medical treatment, public transport or reductions in the price of phone calls or rents. In Germany, the period in which you can get unemployment pay has been cut from 36 months to 18 for the over 55s and to 12 for the rest; this at a time when unemployment has risen above 5 million.

On top of this, after the sixth week of sick leave in a year, social security will no longer pay and you will have to take out private insurance to cover it. At the same time contributions towards medical costs will be reduced. In Holland and Poland the governments are taking similar measures, following in the wake of the French and Austrian governments who, in 2003, ‘reformed’ the system of pension payments, adding several years to people’s working lives. The French government continues with its attacks on social protection, while the British government also intends to force more and more categories of workers to carry on toiling until they are 65 or even 70. In the US, the Bush administration is concocting a law aimed at transforming the present pension system. Measures have already been taken: extending working lives, lowering pensions, diverting a portion of wages into a state-run fund which will be invested in shares and treasury bonds – investments that could go up in smoke tomorrow given the risk of company closures and stock exchange crashes.

Never has the proletariat faced such brutal, massive and widespread attacks. Millions are under threat. In all the industrialised countries the welfare state is on the verge of collapse. It’s no longer possible to maintain the labour force. This is a clear expression of the bankruptcy of the system.

The economic crisis is laying bare all the contradictions of capitalism, and revealing the impossibility of finding a solution to them. Too many commodities are being produced; the world market is glutted. The bourgeoisie’s need to make profits in order to avoid bankruptcy is increasing rivalries between the main industrial countries. The result is an open economic war where the prize is to grab the markets from your rivals. This in turn leads to the desperate search to lower production costs. The only way to do this is to attack the working class. On the one hand the bourgeoisie is trying to raise productivity through speed-ups and increasing the flexibility of the labour force, so that it can get away with employing as few workers as possible. On the other hand it is carrying out a vast programme of ‘reforms’ – i.e. attacks on the social wage: pensions, unemployment benefits, medical benefits, sick pay, and so on. NO section of the working class is being spared – older or younger generation, at work or on the dole, public sector or private sector. The consequence of these attacks is a general degradation of living and working conditions for the whole international working class. The ferocious exploitation imposed on the workers leads to a general decline in health at the very time it becomes more difficult to get medical assistance; workers who have looked forward to a period of rest after years of wage slavery see these hopes threatened by the retirement age being raised and pension payments being lowered; younger workers face the problem of precarious employment, going from one job to the next with wage levels always being pulled downwards, all this interspersed by periods of unemployment on reduced benefits. Finding accommodation and putting something away for retirement becomes increasingly difficult.

The attacks are not going to stop there - they are going to get worse. This is why the working class has to become aware that the system is indeed bankrupt and that the solution lies not in reforms, or a change of government, but in a change in the very basis of society. Andre, 1/3/05