The International Economic Crisis and the Position of Greece (Eleni Mpellou 2009)
The International Economic Crisis and the Position of Greece - The Theses of KKE
Eleni Mpellou (Central Committee of the Greek Communist Party - KKE)
The international capitalist economy is going through a profound crisis characterized mainly by its extensive synchronization. It initially manifested itself in 2007 in the USA, in the construction sector, with the depreciation of capital in financial companies, due to the extensive circulation of investment derivatives in securitized precarious housing loans.
The danger of collapse of US financial giants -that hold powerful positions in the international market of money capital- caused a gradual and generalized large decrease of prices in the most important stock markets in the world. It was the “tip of the iceberg” in the manifestation of a generalized crisis of overproduction, overaccumulation of capital.
An optimistic version of the current data and assessments of the international economic organisations pinpoint 2010 as the year of the lowest point of recession. An increase of the number of unemployed by 25 million has already been registered and it is estimated that another 40 millions will be added by the end of the year.
In 2009, the Gross World Product is expected to shrink by 1,7% according to the World Bank and by 2,75% according to the OECD. The latter estimates that the international trade will shrink by 13,2% in 2009.
The International Monetary Fund estimates the depreciation of money capital to 4,1 trillion dollars since the manifestation of the crisis.
The outbreak of the economic crisis in Greece
In the Greek economy the crisis manifested itself with a slight delay compared to the rest of the euro-zone. It entered a phase of recession in 2009, while in 2008 the GDP expansion slowed down. The most significant element is that the industrial sector (Mining-quarrying sector, manufacturing sector, electricity, water supply, according to bourgeois statistics), that entered a phase of recession in 2005, shrank by 4% in 2007/2008.
In 2008, all branches of Manufacturing were in recession, except for the branch of Food industry (1,2% increase).
The crisis in the Manufacturing sector is reflected in the great decrease of industrial commodities (approximately by 7%).
The construction sector has sustained a large decrease (-9,4%).
During the period 2002-2008 there has been a tendency for significant production decreases in most of the basic agricultural products –with the exception of soft wheat, maize and peaches.
According to the data provided by Eurostat, the real agricultural income declined by -7,1% in 2008 due to a stagnation in the selling prices of producers and a large increase in the prices of industrial products.
According to Eurostat, the net agricultural income as a correlation of net value added in relation to the cost was reduced in 2008 to 80,1% compared to 2000 (=100).
In 2008 there was a large drop of prices in the Athens Stock Exchange. Its total market value (as a percentage of the GDP) was estimated, at the end of 2008, approximately at 1/3 of the respective value at the end of 2007 (December 2008: 28%, December 2007: 86%). A significant part of this drop was due to the mass withdrawal of foreign investors in October 2008.
Regardless of the phase of the crisis cycle, a particular feature of the Greek economy is its long-term sharpened and deficient fiscal condition. The slowdown in GDP growth -that accelerated during the second semester of 2008- worsened dramatically the terms of state borrowing.
The latest assessments predict a 1% decline in GDP in 2009. The extent of the recession in the Greek economy will certainly depend on the course of the crisis:
a. In Balkan countries, where important investments have been made by companies based in Greece. This concerns economies with high capitalist growth rates, such as Romania with a 7,7% growth in 2008 and a prediction of a -1,8% decline in 2009, or Bulgaria with a 4,4% growth in 2008 and a prediction of a -1% decline in 2009.
b. In international trade, large part of which is carried out through maritime transport that constitutes a significant source of inflow.
c. In important European countries, such as Germany and Britain. These countries are the origin of a large part of the tourists who visit Greece, not only in absolute numbers, but also in overnight staying and earnings.
The effects of the high EU inflows compared to the industrial and agricultural shrinkage are contradictory. The above mentioned facts demonstrate that the outbreak of crisis in the Greek economy is going to be profound. Predictions are being made that it will last for 2 years. It will sharpen the existing social contradictions through the increase of unemployment, part-time employment and the extension of flexible working relations. According to bourgeois measurements, poverty has already increased, with a particular concentration (about ¼) among children up to 15 years of age, as well as people in the 18-24 age bracket.
Of course, the indices of poverty reflect solely a part of it; they do not reflect the fact that salaries and wages fall short of the incremental growth of GDP and productivity growth in a phase of extended reproduction in Greece.
The assessment of KKE ten years ago
In order to assess the current crisis and the predictions being made for an exit from the recession, both internationally and in Greece, we believe that it would be useful to mention our general assessment of the crisis that occurred ten years ago. We should also remind our forecast regarding the period that was to follow that crisis.
In 1998 another recession phase was in progress. It had started in the countries that until then were considered to be the “economic miracles” and were characterised as the “Asian tigers”; it had enveloped the economies of SE Asia, as well as Japan and countries in Latin America; with a slight time delay, it also manifested itself in the USA in 2000. Global gross product shrunk by 1%, while international capital flows for direct investments and international trade sustained a big reduction.
It was at that point that, for the first time after the victory of the counterrevolution in the USSR and the countries of socialist construction, circumspection was once again expressed regarding the robustness of capitalism; the bourgeois expressed concerns that at some point their policies might encounter difficulties in controlling the workers’ and people’s discontent–reaction to the consequences of the crisis.
The various theories on the causes of the crisis were part of the effort to control the situation from the point of view of the stability of capital’s power. These theories focused on the way that the stock markets functioned, emphasised the management-transparency of high-risk investment funds (Hedge Funds), the terms of IMF and World Bank lending to the states.
In other words, they focused on the apparent disfunctions in the sphere of the circulation of capital in its monetary form.
At that time KKE estimated that a crisis of overproduction, or else a crisis of over-accumulation of capital had occurred, as had happened previously, with the crisis of 1973 being the most characteristic example. We argued that it was a crisis of over-accumulation of capital, irrespective of its initial forms of expression.
In contrast to bourgeois disputes - starting from the IMF itself- concerning the management measures necessary for a speeding-up of the exit from the recession or an alleged possibility for the prevention of a recession in the US and the other capitalist countries, KKE had predicted that, in one way or the other, the exit from the recession, the recovery, even the passage to a new upward course of expanded capitalist reproduction would lead to the outbreak of a new crisis of overaccumulation, deeper and more synchronized than the previous one.
In addition KKE had warned that the working conditions, the wages and the life conditions of the working class in these countries would not improve, but, on the contrary, that they would deteriorate even in the phase of capitalist growth.
This forecast was based on the fact that the shares in the world capitalist production and market were changing to the benefit of new developing capitalist economies with large domestic populations and still very cheap labour force. The counterrevolutionary overthrows, the opportunist erosion and crisis of the communist movement and in general the retreat of the labour movement, as well as the assimilation of trade union organisations to the capitalist system, have also contributed in a similar direction.
Thus, under conditions of expanded capitalist reproduction the tendency for the workers’ income to fall prevailed, in parallel with an increase in the rate of exploitation.
This tendency took on the character of unified strategic choices. In the EU for instance these choices were codified in the Lisbon strategy that promotes the restriction of workers’ and pensioners’ rights in order to meet the goal of the so-called “reduction of the labour cost” in the EU market.
In the period that followed, the first ten years of the 21st century, new buyouts and mergers took place; the international interweaving of capital moved on further, the international capitalist competition and the formation of more or less cohesive regional alliances and unions intensified.
The tendency towards changes among the unevenly developing capitalist economies strengthened. This leads to the overthrow of the balance of forces in the international capitalist market that was formed 70 years ago. At the same time, this tendency was expressed through new state and interstate demands for changes in the international agreements and co-operations, for instance in the WTO agreements, in the composition of the IMF and World Bank boards, in the composition of international foreign exchange reserves, in the currency being used in the trade of industrial materials and in the expansion of the G7.
During the previous cycle of the international capitalist crisis these developments were only dimly visible. However, during the current cycle they have become an irreversible tendency. It is on this ground that the new cycle of the international economic capitalist crisis, which is in progress, developed; it started in the USA, spread to the Euro-zone -maybe more deeply- and envelopes at the same time Great Britain, Japan, Russia, Turkey and countries of Latin America. For the time being, it impacts China and India via a reduction of growth rates.
Assessments of KKE for the current economic world crisis
It is expected that the current recession will be of longer duration than the previous one and that the passage into a new phase of revitalisation and growth will be more anaemic. More important, however, are the predictions that we can make about the position of the working class and of hired labourers in general, as well as of the larger part of self-employed, during the phase of recovery from the recession.
We consider that the same tendency of deterioration that was manifested during the two previous decades will continue and sharpen, unless there is a visible ideological-political and organizational revitalization of the international communist movement, an emancipation of the trade union movement from the government and employer-led trade-unionism, its disengagement from EU mechanisms of manipulation (ex. ESC etc.), an ideological-political emancipation of wider working forces from the deceiving influence exerted by the so-called social-democracy, through old or new political formations.
The inner contradictions of capitalism and the international capitalist competition have reached a level where the working class, the salaried laborers that approach it in terms of income and living standards and the lower sectors of the middle strata can slow down the deterioration of their position only if they counterattack, if they avoid any political traps of compromise, consensus, acceptance of an allegedly necessary “class collaboration” for the confrontation of the crisis.
The labour, trade-union movement looses its features as a movement that struggles for wages, working hours etc. when its leading organs such as the Greek General Confederation of Labour (GSEE) reach agreements with the Federation of Greek Enterprises and Industries (SEB) for a joint confrontation of the crisis.
The labour and popular movement can and should regroup its forces with a clear anti-imperialist, anti-monopoly orientation, an anti-capitalist orientation. It must utilise in every country any rift, any vacillation in the bourgeois governance, with a corresponding ideological-political orientation and organisational readiness.
We estimate that, when the next crisis cycle reaches its peak, when the next phase of recession arrives, bourgeois administration will encounter greater difficulties, it will be faced with successive unstable governments, the disagreements within the EU will sharpen and the ideological defence of the capitalist system will be profoundly shaken.
With a bit of creative fantasy, but a fantasy based on scientific analysis, we can say that we are heading towards a new 1929, or a new 1937.
These predictions are also being made by bourgeois analysts, by imperialist centres of strategic studies at state or interstate level.
The special role of social democracy in rescuing the system
In order to safeguard the system liberals and social-democrats, from Sarcozy and Obama to Braun and Lothar Bisky are promising a “humane, healthy capitalism”.
International social-democracy is exhibiting significant activity. It focuses on the effort to put the blame for the crisis solely on “neo-liberalism”, on the allegedly ineffective proportions between market and regulation at state, regional and international level.
International social democracy is expending a lot of time in order to convince the working and popular masses that it has elaborated a new recipe. It argues that it has found the correct proportion between those policies (subsidies, tax cuts, etc) that promote the concentration and centralization of capital, the support of monopolies and the policies that control the irregularities of the market through one or several state-owned banks or through the nationalization of certain enterprises in industry and transportation that find themselves in financial strains. The notions of “green economy” and “better distribution” constitute the essential complements to this effort.
Within the field of social-democracy, that is within that current that labels as “democratic socialism” the domination of monopolies alongside with the co-existence of state-owned enterprises, new political formations, such as the European Left Party (ELP), have emerged. They argue that they have discovered –more effectively than previous parties- the right balance between “market” and “regulation”, between “private” and “state” capital. In addition, they argue that in order for this recipe to be more effective the contradictions within the EU should be eliminated through the strengthening of its structures and the formation of an EU-wide administration.
In fact, they are adjusting the old social democratic line of reforms to the current reality in the EU. In the position of the state monopoly – servant of the private monopolies – they place a European-wide interstate monopoly; above the nation-state governmental administration they place a strong interstate administration, allegedly capable of expressing the general interests in the EU, solving the contradictions between its member-states.
They present themselves as “more catholic than the Pope”, providing a “left” socialist alibi to the strengthening of the existing repressive mechanisms and the emergence of new ones.
Their special role consists in the refurbishment of social-democracy in order to serve the system more effectively. They serve the ideological manipulation as they spread the illusion of a EU in favour of the people, of a pro-people administration on the ground of the economic domination of the monopolies.
Unevenness and contradictions within EU are inevitable
The current economic crisis in the Euro-zone has admittedly sharpened the contradictions between the member-states, even within its hard core. This was predictable according to KKE’s assessments and projections.
Despite the interweaving of capitals, despite the common strategy against the working class, the nation-state remains the organ that guarantees the economic dominance of monopolies and serves the concentration and centralization of capital in competition with similar processes in other member-states of the EU.
Capitalist unevenness exists both during the phase of expanded reproduction, as well as during the recession phase. It is manifested at the general level of production, at the labour productivity levels, at the proportions between sectors, at salaries and wages, at the exports and imports of commodities as percentages in the GDP, at the outflow and inflow of capital.
This unevenness is reflected in the fiscal situation of each state, in the different sizes of public debt and deficits, in the differential lending rates of the states, as established by the international market according to the position of every state in the Euro-zone, as well as in the international imperialist system.
It is this unevenness that makes the formation of a common fiscal policy impossible, even under the conditions of a recession. It has been illustrated in the different proposals (for example, between Germany and Great Britain) regarding the measures and policy packages required for the management of the crisis. It has also been expressed in the formation of interest rates above those of the European Central Bank.
The different views regarding the Stability Pact, whether it will lean more towards fiscal flexibility or towards monetary stability, express the different needs of the member-states, not a lack of bodies for an EU-wide administration or the excessive powers of the European Central Bank, as is claimed by the ELP and SYN/SYRIZA.
Under current conditions of recession the unevenness has been manifested in the Greek economy more sharply than in previous phases. Long-lasting problems, such as the public debt, trade deficit and the long-term stagnation of manufacturing industry, are intensifying.
The tendency towards a change in the correlation of forces in the international market
The intensification of uneven development is of course a generalized phenomenon within the EU and in the international imperialist system.
The general characteristic of capital depreciation during the crisis does not manifest itself proportionally in all states, sectors and enterprises (private or share capital).
Thus, both recession and the subsequent phases of stabilization and recovery bring about reshufflings in the correlation of forces between the various enterprises, sectors and national economies.
However, important changes and shuffles are often being prepared over a longer time period that encompasses more than one cycle of economic crisis.
The current crisis crystallizes the changes in the correlation of forces that have been brewing-up during the last 30 years, through approximately 3 crisis cycles affecting most of the advanced capitalist economies. These changes have been accelerated during the last decade.
In the period 1980-2008, the tendency for a reduction of the US, Euro-zone and Japan’s shares in the Gross World Product (GWP) has become dominant. In contrast, China’s share has increased (440% increase in the period 1980-2007) and China reached the third position after the Euro-zone as a whole. In addition, India’s and Russia’s shares in the GWP have also increased (110% in the period 1980-2007 for India and 19,3 % in the period 2000-2007 for Russia).
The Euro-zone share has been steadily declining in the period 2000-2007 (by 12,8 %), as has Greece’s share (by 24%, approximately double the percentage loss relative to the Euro-zone average). The tendency towards the worsening of their shares continues in 2008 and 2009 for the USA, Euro-zone (including Greece) and Japan.
The same tendencies are reflected in the percentage shares in the world capital inflows/outflows for direct investments, though with some diversifications; namely, in the period 1980-2006, China, Russia, and India saw their shares in inflows and outflows growing (with fluctuations), while the USA saw its shares decreasing. Japan maintains its share in outflows while the Euro-zone increases its share both in inflows and outflows, holding the first position internationally. In the period 1980-2006, the Greek share in inflows decreased (from 1,22 to 0,41%) while its share in outflows increased (from 0% in 1990 to 0,34% in 2006). During this period Greece becomes, therefore, a net exporter of capital.
The shares in the world imports and exports constitute another important index. In the period 1980-2007 the following tendencies are noted:
The USA had a loss in its share of exports (from 11,1% in 1980 to 8,41% in 2007), as did Japan (from 6,42% to 5,13%). The Euro-zone almost maintained its share, with fluctuations, retaining its first position (1980: 30,75%, 1990: 35,05%, 2007: 29,19%). Nevertheless, the 6% reduction in its share during the period 1990-2007 should not be underestimated. Greece saw a loss in its share (1980: 0,25%, 2007: 0,17%).
China’s shares have exhibited a spectacular increase by 890% (1980: 0,89%, 2007: 8,81%), taking the second position, ahead of the USA.
Russia and India also have rising shares in exports, but these are still quite small (in 2007 Russia : 2,57% and India :1,05%).
The following tendencies are observed in the shares of world imports:
The Euro-zone holds first position in the imports’ share with a downward tendency (1980: 34,28%, 2007: 28%). Greece remains at the same level with certain fluctuations (1980: 0,51%, 2007: 0,53%). Japan’s share has declined (1980: 6,81, 2007: 4, 41%), while that of the US has grown, with the USA holding the second position in imports. Likewise, China’s share has increased and it now occupies the third position internationally. Furthermore, Russia and India record a limited increase in their shares.
Reshufflings are also taking place among private or enterprise capitals. According to the list of the 1000 richest individuals in Britain, published in the weekly edition of the “Sunday Times”, half of the top ten in the list have increased their wealth in the midst of the crisis by 1,054 billion euros (by 43%), while the other half have faced a shrinkage of their wealth by 33, 738 billion euros (-242%).
Under conditions of a recession, while the number of loss-making companies is increasing, there still exist enterprises that are accumulating profits, either at reduced or even at increasing rates. In the later category we can include, for example, the German enterprise Siemens which, in the first trimester of 2009, showed profits of 1,01 billion euros, compared to its first trimester of 2008 profits of 412 million euros (a 145% increase), with a 5% sales increase on an annual basis.
Similar phenomena also apply to the Greek economy. The profits of the 8 major banks (National, Alpha, Eurobank, Pireaus, Cyprus, Marfin, Agricultural Bank of Greece, Emporiki) during the first trimester of 2009 are estimated at 610 million euros, compared to 1,195.9 million euros during the first trimester of 2008, that is a 50% decrease.
Reshuffling of shares is also taking place within subsectors of the economy, such as in air transport, among the Olympic Airways and the Aegean Airlines. These reshufflings are also being promoted through acquisitions, such as those made, for example, by the Marfin Group (Vivartia and Olympic Airways) and through new mergers of financial enterprises that are being prepared in Greece.
This trend is obvious in the international market, particularly in those sectors where the crisis of overproduction was initially manifested, such as the automotive industry.
It is thus that a new cycle of centralisation of capital, that has depreciated during the recession phase, is being prepared, in order for it to enter a phase of self-increase through the production process, the process of exploitation of labour power.
The exit from the recession is being made with the goal of attaining additional profit through the conquest of new markets. Competition increases, old regulations are being put into question and new ones are being established, even by taking advantage of conditions created by imperialist wars.
These tendencies can be codified as follows:
The USA remain the primary force in the Gross World Product, but with a deterioration in all other indices.
The rise of China is impressive, although it is stll lagging behind in overall (per capita) productivity.
The competitive position of the commodities of the Euro-zone has improved (instead the position of Greece has deteriorated). The position of China has improved dramatically, while, on the contrary, the deterioration of the competitive position of the USA and Japan has become apparent.
The competitive position of India and Russia remains low though with a tendency towards improvement.
The position of Greece is exhibiting a more contradictory outlook. On the one hand, its share in the GWP is decreasing and its position with regards to exports is deteriorating, characterized mainly by a relatively lower share than its share in the GWP, while, on the other hand, the position it holds in the outflow of capital has improved.
The index “net international investment position” (sum of Direct Investments, Portfolio Investments, Derivatives, other investments, Exchange Reserves) remains negative for Greece, at 183,944 million euros in 2008, though it declines as percentage of the GDP (2006: -83,6%, 2007: -94%, 2008: -75,7%).
In combination with the progress of other economic indices already mentioned, we can conclude that during the period of its incorporation into the EEC –and particularly within the Euro-zone- the Greek economy has sustained losses with regards to the competitive position of domestic industrial production (mainly of Manufacturing), but, at the same time, it has exhibited an increase of capital accumulation and its export in the form of direct investments.
We must note at this point that among the thousand magnates with economic activity in Great Britain are included 10 Greeks, 4 of whom are among the first 100 (D.Leventis, M. Laimos, F.Niarchos, St. Hatziioannou).
These data confirm the assessment of the 18th Congress of KKE that the Greek economy holds an intermediate position in the international imperialist system, maintaining the same –penultimate position- in the Euro-zone, though with an enhanced position in the Balkan market.
On certain bourgeois interpretations of the crisis
All of this uneven and contradictory capitalist development in Greece, in the EU, in the USA and internationally has no relationship whatsoever to the theories concerning “casino-capitalism”, “over-consumption”, etc.
It is a theory that lays the blame for the crisis and for the slump in industrial production on the financial system. In the best case scenario, it blames the existing structures and regulations of the financial system at an international level, among which are included the IMF, the World Bank, the organisations (practically enterprises) ranking the credit-worthiness of state institutions – Credit Rating Agencies (CRA’s).
The isolation of parasitic phenomena and their characterization as either “casino – capitalism’ or as distortions in the financial system at an international level is, at least, a case of oversimplification – if not an outright deception.
It is not by chance that the Bretton – Woods Agreements collapsed during the 1971-1973 crisis.
The decay and the parasitism (e.g. the fact that in 2008 economic derivatives internationally were equivalent to 976% of the international gross product) is a product of capitalist development at its monopoly stage, a product of shareholder ownership of the means of production, a product of the merger of industrial and banking capital; that is of finance capital. This is the basis for the existence of fictitious capital (e.g. the known “toxic bonds”) or the fictitious stock-exchange prices of industrial and commercial capital. This is the basis of parasitism.
It is not a surprising phenomenon that the over-accumulation of capital makes its appearance through the financial companies that function as a center for the accumulation of all unused income (of capitalists and of working people) and its transformation into capital.
The tendency towards over-production and over-accumulation of capital is within the very nature of capitalism, as is the tendency towards an expansion of fictitious capital and the obligatory cessation of over-production and the devaluation of capital.
Credit pushes towards over-production and over-accumulation of capital, until the inevitable moment when over-production or expanded capitalist production comes to a halt. It will be interrupted when it has been pushed to its extremes and when the consequences of the anarchy and decay (fictitious capital) of capitalist production, the contradiction between capital and labour power will have intensified.
On the “over-consumption distortion” of capitalist development
Certain theorists project the need for a “new model” for the Greek economy. They assert that the extremely rapid development of Greece during the period 2000-2008, according to UN standard-of-living indices (Greece was in 24th place out of 175), was the result of an over-consumption and over-indebtedness of the state, of households and businesses. They claim that this “model” has exhausted its potential, while a new model will be necessarily more controlled, more productive, more austere. The statements made by the Chairman of the Bank of Greece are in the same vein.
This viewpoint consciously attempts to revamp capitalism in peoples’ consciousness. The direct dependence on the banking system (mortgages, consumer loans, and credit cards) and the so-called “over-indebtedness” (and not “over-consumption”) are characteristics of developed capitalism. This is evident if we look at the over-indebtedness in the USA, which has taken the form of a mass use of plastic money.
The theory of over-consumption, or reversely that of under-consumption, disregards the motive of capitalist production which is profit, the appropriation of surplus value and not the production of use-values for the satisfaction of social needs. It conceals the fact that initially the anarchy and unevenness are expressed among the capitalists themselves who buy and sell to each other commodities which are then used in capitalist production, as well as the fact that the anarchy is expressed between the branches of industrial production.
The anarchy and unevenness of capitalist reproduction are first and foremost expressed, on the one hand, in the exchanges between capitalists within the category of production of means of production and, on the other hand, in the exchanges between the former and those capitalists engaged in the production of means of direct consumption.
At a secondary level, the anarchy is expressed in the sphere of the circulation of commodities of direct consumption, in the portion that concerns the exchange between the consumer and the businessman. That is, it is only secondarily that it is expressed as a weakness in consumer spending of the working class income, whose aggravation is of course directly related to the degree of exploitation.
During the crisis the expanded capitalist reproduction is abruptly curtailed.
It is through the recession that a partial and temporary restoration of the extreme disproportions is effected, in order to begin a new cycle of the anarchic expanded capitalist reproduction.
Summing up on the crisis
What is occuring today, that is the devaluation of capital in whatever form (commercial, financial) and the devaluation of labour power (as a commodity), has occurred repeatedly in the past, with its first appearance at the beginnings of the 19th century; it will again occur in the future as long as capitalism exists.
The inevitability of crises is found within capitalism’s DNA: it is found within the contradictory commodity character of capitalist production, in its anarchy and unevenness, in the tendency to initially achieve a supplementary capitalist profit through the introduction of new, more productive machinery, as well as through the export of industrial capital to countries with cheap labour power. These factors sharpen the capital – labour power contradiction, the contradiction between the social character of production and the private appropriation of its products, due to private ownership over the means of production. It is the hunt for supplementary profit that determines the tendency for the rate of profit to fall.
The capitalist economy entails a motive to push capitalist reproduction to its extremes, to accumulate immense profits, that is to give a monetary speculative form to the appropriation of surplus value from the working class. It means that these immense profits, expressed in different forms of capital, particularly in the sphere of its circulation (mutual funds, bonds, stocks in financial institutions and financial fund companies for capital management, Hedge Funds), in order to be reproduced as capital, as a self-increasing value, must re-enter the production process: must suck up new unpaid labour, like a vampire, must transform it into a commodity, which through its sale will be expressed as new profit.
The necessity of social ownership and central planning
Fronts of struggle
The source of the crisis can be dried up only with the abolition of capitalist ownership, with the extinction of the anarchy of capitalist production, with the central planning of a proportional expanded reproduction, having as its goal the production of use values for the ever-increasing satisfaction of social needs.
It is only on the basis of socialist industry that the distribution of labour force, of the means and materials of production, of social wealth can be changed. That agricultural cooperative production can be supported, that money can lose its substance as the form of value, and as a means of distributing surplus value, that the speculative character of the Central Bank can be abolished.
This is the future; the people’s, socialist economy, the real alternative to capitalist barbarity.
This present-day necessity is denigrated, either directly from liberal bourgeois forces, or indirectly from self-styled “democratic socialist” forces, distorting and maligning its first historic expression in the Soviet Union.
However, it is a historical fact that during the 1930s there existed two worlds: the capitalist one that was wrought by competition and crisis, and the socialist one that was characterized not only by impressive rates of industrial production, but, more importantly, by impressive rates of development in social prosperity.
The historically confirmed truth is that social ownership and central planning were defeated when the class struggle did not have the knowledge and the strength to proceed towards the extinction of all forms of private property, of all sources of private accumulation of wealth.
Due to its positions regarding the different course of social production and organization of society, KKE is accused of deferring the satisfaction of the immediate needs of the working people to socialism.
It is a conscious lie of the bourgeois and opportunist parties.
KKE was, is and will continue to be firm in its support of the rights and demands of the working people, of the youth, of the pensioners, with consistency between its words and its deeds, because it has a shining compass, a strategic course.
It is for this reason that it is able to consistently defend the right to full-time, stable work, the socially-guaranteed protection of the unemployed, of maternity, of working higher education students, the trade union rights, farmers’ incomes, the rights of small business owners, of immigrants and political refugees, the exclusively-public free education, healthcare, pensions, the protection of the environment, the struggle against the anti-popular consequences stemming from Greece’s accession into the EU and NATO.
The political empowerment of KKE means the strengthening of a force which can struggle for rights, a force of resistance against the new anti-worker – anti- people attacks by the employers and the government, as well as a force to wrest new gains, a force for workers’ and people’s interests today and in the future.
 Eurostat Statistics in focus, 18/2009.
 Report by the Governor of the Bank of Greece for 2008, p.36.
 Source: Bank of Greece, p.67.
 Report by the Governor of the Bank of Greece, p. 157.