One of the main ideological themes used by the dominant class during the 1990s, in order to maintain its ideological domination over society, was the supposed economic health and prosperity of its system. According to this fable, following the recession of 1990-91, the American economy enjoyed the longest period of recovery in history. For some years capitalist acolytes even declared that, thanks to the new communication technologies, their system had arrived at an era of permanent prosperity, and that the so-called "business cycle" had been definitively surpassed.
Then, in 1997-98, the explosion of the once exemplary economies of the East Asian "tigers" and "dragons" sent shock waves across the globe. Tales of capitalism's imminent collapse and an open world recession filled the media. Nevertheless, the main capitalist countries-with the exception of Japan-managed to stay out of recession for a couple more years giving some continued credence to the tale of a booming capitalism.
Today there is no more chatter about the wonders of the "new economy" energized by the "internet revolution." It seems so long ago that Bill Clinton bragged: "America's economy is the healthiest in a generation and the strongest in the world." By all accounts, world capitalism is experiencing once again a new fall into the abyss of its chronic economic crisis. All the major economies of the world are officially in open recession or just limping by.
At the center of this new downfall of world capitalism is the American economy-by far the biggest in the world. In the summer of 2001, after months of warnings about a possible economic slowdown, the bourgeoisie suddenly recognized that its economy had been in recession since March of that year. Skyrocketing unemployment and the wave of corporate bankruptcies made it impossible for the bourgeoisie to continue preaching the fiction of a healthy economy, even though by its own account, the economy had still not qualified for an official recession, which the economists define as two consecutive quarters of negative growth. Then in the winter of 2001-02, the bourgeoisie suddenly had a change of heart, and magically the recession was officially over as a new myth was born: the US economy has just gone through its shortest and mildest recession in history!
However, no amount of optimism and economic manipulation can hide the severity of the recession that the US is currently experiencing. Even the normally deceiving economic indices that the bourgeoisie uses to evaluate the state of its system don't leave much room to brag about the health of the economy. There are so many black spots that some economists are talking of the dangers of a "double dip recession". For instance:
However most of these "economic indices" say little of the impact of the crisis in the working class and other non-exploiters strata, which are really as always bearing the brunt of the economic difficulties of the bourgeoisie. By the bourgeoisie own account "the recession that began in March 2001 has reduced the earnings of millions of Americans -Census Bureau annual report on income and poverty NY Times 9/250-." Of course not every body is suffering the same because while the working class has seen its salaries decline "the gap between rich and poor (has) continued to grow -ibd-."
This document also says that the number of so-called poor Americans rose last year to 32.9 million, an increase of 1.3 millions, reaching 11.7 percent of the total population of the country.
Marxist revolutionaries have repeatedly insisted that so-called recessions are not just a bump in the road of an otherwise healthy economic system, the downturn of the so-called "business cycle." For us, recessions today are nothing more than a particular moment-one more step into the abyss-of the chronic economic crisis of overproduction that a decadent capitalist system, unable to create sufficiently solvent markets for its products, is condemned to suffer. Moreover, coming in the wake of all the propaganda of the 1990s about the "exuberant American economy", this recession is quite important. In particular, it lays bare the feeble basis upon which the prosperity of that decade was built: the stock market speculation; the explosion of personal debt in order to stimulate a consumer binge that allowed overproduction to be hidden to some extent; and the corporate debt that financed a spree of investments in communication technology that have proven to be, to a good degree, useless; being but the most obvious examples of the palliative measures that the bourgeoisie has been forced to adopt.
The stock market bubble: a symbol of the veritable "casino-economy" that characterizes, not the health of capitalism, but its total bankruptcy.
Despite all the talk of "recovery" the fact is that all of the bourgeoisie's attempts to invent various "medicines" with which to revive its economy have been largely ineffectual. Despite the Federal Reserve having lowered its prime interest rate to historic lows, there has not been a revival of the credit market. The effects of the "shot in the arm" given to the economy by the Bush administration's engineered tax cuts, have been, in the long-term, inconsequential. Further, the effects of the rise of military spending necessary to prosecute its "war without end," have yet to hit the economy with their full force.
ES, February 2003.