Herwig Lerouge – Belgium

Thank you for inviting me to speak on the 25th Prague Theoretic-Political Conference


We experience dramatic historic moments. Not because of the election of Barak Obama as US president, but because, after decades of deception by triumphant neo-liberalism, the deep problems of the world capitalist system appear very clearly today.

The vast majority of the world population have never stopped suffering from poverty and exploitation. But today they are pushed into even greater difficulties by the economic and financial crisis which is the worst since the Great Depression of the 1930s.

The current events prove once more the inevitability of crisis under capitalism. They also prove that all efforts made by imperialism to secure its profits have only created the conditions for even greater problems. There can never be true socioeconomic development or equity for the people under the capitalist system.

This crisis has begun in the early seventies of last century. There has been a generalized growth slowdown of the global capitalist system since then. Monopoly capital has since been seeking to maintain its profits by forcing greater trade and investment liberalization on the neo-colonies. “Neo-liberal” globalization, misrepresenting monopoly capitalism as “free market” capitalism, has given the monopoly bourgeoisie and the giant corporations all the opportunities to raise capital resources, make profits without restrictions and get big tax cuts supposedly to develop the economy and generate jobs.

The imperialist states headed by the US, have launched an unrelenting attack on the hard won rights of the working class to job security, trade union organization and social benefits. Wage levels have been pushed down. Full-time regular jobs have been replaced to a great extent by part-time jobs. Indirect wages as may be in the form of social insurance, medical insurance, educational benefits and social services have been cut back or cut off. The real incomes of the working class have relentlessly fallen. They have given the multinational banks and firms of the monopoly bourgeoisie all the opportunities to accumulate capital and reap profits through the liberalization of investments and trade, the privatization of state functions and assets, the deregulation at the expense of the working people, women, children and the environment.

In Europe a wave of privatisation and liberalisation was triggered by the European Commission since the beginning of the eighties. All Western Europe’s governments, including social-democrats and even with participation of some former Communist parties, sold public assets to transnational companies on an unprecedented scale. Telecoms, that in 1986, contributed to the amount of 65 billion euros to the income of the EU states, were modernised and then privatised. The postal market, which means 88 billions euros was liberalised, with immense losses of jobs, social advantages and wage cuts. In Germany alone, between 1992 and 2006, Deutsche Post AG has reduced its work force from 306 000 to 150 000.

The OCDE estimates that “between 1984 and 2000 companies were privatised representing a value of 563 billion euros”. In France, where the opposition was the strongest, the socialist-communist coalition government in the nineties privatised companies worth 36,6 bilions of euros, exactly the same amount as did the right wing governments.

Through the Maastricht Treaty with its cuts in social, educational and other public expenses, through the Lisbon agenda, with its proliferation of part time and flexible jobs, through liberalisation and privatisations, the final balance of the neo- liberal policy since the eighties has been a massive transfer from wage generated income to capital generated income. The part of the wages in the total revenue of EU-15 countries has been sinking since 1975. In 2006 it was at a historical low point of 57,8 percent.

So from decade to decade, the crisis of overproduction has become worse, with the problems of unemployment and inflation growing and the growth rates actually stagnant. The trick to conceal the economic problems has been to increase the money supply and make credit easy for the giant corporations and for the consumers in the huge American market. The US has lived off the people of the world by abusing confidence in the US dollar as global currency. It has gone into industrial decline by heavily importing consumer goods from East Asia. It has incurred trade deficits and has become the world’s biggest debtor. It has also gone into heavy budgetary deficits and domestic debt by rapidly increasing expenditures for military production contracts and global deployment of military forces, especially in Iraq and Afghanistan.

Today, not only the US federal government, but also the giant corporations and the households are unable to pay their debts and are the major factor in the current financial crisis afflicting not only the US economy but the entire world economy.

Today shows that capitalism’s basic crisis of overproduction is intractable and has even been exacerbated by this “globalization” offensive. The economic dispossession of large parts of humanity further constricted opportunities for investments which in turn further accentuated the glut of finance capital. The financial crisis, which is the worst since the Great Depression, is leading to economic depression on a world scale.

Global capitalism is fundamentally limited in how it deals with the crisis because this is rooted in the system’s basic contradiction between private profit and social production, and in the resulting crisis of overproduction.

This brings great opportunities for communist parties all over the world.

Of course this crisis does not automatically create a revolutionary situation. We shouldn’t overstimate the comprehension, even among vanguard sectors of the working class, of the basic mechanisms of the crisis. But today, the is an openness that multiplies our possibilities for conquering larger parts of the working people in a situation where capitalism, that seemed unquestionable, is now under fire. The previsions made by the Marxist theoreticians in the 19th century are being fulfilled with almost prophetic precision. The capitalist system, trapped in its own internal logic and its own contradictions, increases its conflicts in an inevitable way. To each remedy used by the system there is a new sharpening of the problems it tries to solve.

The fact that in Germany, there are now studygroups on Marx’ Capital in 35 universities, is one of the examples of the opportunities we should grasp.

Today we can expose the basic illness of capitalism. And we must do it against the prophets of false solutions like the neo-Keynesian New Deal-type fiscal stimulus, financial support and “reforming” the global financial regulation. These solutions will fail because the problem is not merely about financial excesses. It goes much deeper.

We cannot do like the “European Left Party”, that presents the crisis as the result of the casino capitalism. The problem is, they say, that “for 30 years the global financial market has been “freed” from any political control – and led to a conjunction of crises.

With questioning one moment the global capitalist frame of the European Union, they propose an alternative capitalist policy to “ the deflationary policies that have undermined the international financial and credit system. They call for a democratic and social Europe (without even mentioning the basic problem of private ownership of the means of production and the necessity of socialisation of these means and of creating a totally different state). They spread the illusion that they will, within the framework of a deepening imperialist competition, their Europe, I quote, “will be able to work out new principles that allow for the creation of employment and a fair welfare system”.

Of course, we draw up a program to protect the purchasing power, the savings, the homes, the pensions, the social allowances of the working people and their jobs. We call the Unions to oppose measures that tend to put the burden of the crisis ont the backs of the working people.

We have to take advantage of the situation to put as soon as possible an end to the European Union programs of Lissabon agenda, Flexicurity strategy, Lisbon Treaty, and we do.

We take advantage of the situation to reinforce the struggle against the EU liberalisation and privatisation plans of railways, postal office etc…

But we also expose where the real responsabilities lie. Those who have built immense fortunes speculating with people’s savings, profiting from tax cuts and reductions of social contributions are the ones to pay today.

We reinforce the struggle to reduce military spendings and to call back all troops fighting abroad with Nato.

We are looking also for ways to introduce the conscience that socialism is needed, a society where the means of production are in the hands of the people and planned in the interest of the vast majority and not of quick gains for a few.

We have launched a campaign to oppose putting public money in saving private banks where the same capital groups that caused all these problems keep control. We put forward the real democratic nationalisation of those banks and a public bank that does not live from speculation, capital evasion, plundering of the state budget and the savings of ordinary people. We propagate real public control on such banks, not by bourgeois politicians but by elected representatives of the working people such as the unions. Real public control that means also the abilition of banking secrecy. There may be no confusion of interests. In the board nobody may have (or have had) links with the private financial sector. They must not be paid more than three times the average wage.

We don’t present this as socialism but is seems to be a advantageous way to discuss about another concept of society, with real people’s control and other basic principles.

Comrades ,

this crisis will have consequences on a scale that we cannot foresee completely. It will cause massive unemployment, loss of billions of savings for alle people, pensioners who have been forced to rely on private pensions to survive, drive millions from their homes, cause more hunger all over the world, change the economic balance of power in the world, push imperialists that fear to lose their domination to military agression on an unprecedented scale. It will show the real hideous face of imperialism to hundreds of millions of people that never expected to end in such situation.

The ranks of the oppressed working people that can be mobilised have broadened.

The times are changing, as I said, not only for Obama, but als for us. We must assume our vanguard role in organising class struggle but also place the demand of socialism as a part of the immediate programme.

In the present situation, it seems to be very important, that among communists, we exchange experience in the analysis of the crisis, in drawing up common programs that address the direct needs of the working people as well as advantageous tactics to promote socialism on a larger scale, but also in the study of the historical experience of the salvation of capitalism by social-democracy in the twentieth century. It is, as a new social democracy is developing on the ruins of the old social liberal socialist parties, more than ever necessary to create or consolidate in every country real independent communist parties, and the lessons of the Twentieth Century are more than useful to help us work out a correct strategy.

We must urgently advance in the consolidation of the coordination of an independent international communist movement.

We are experiencing practical international cooperation on a small regional lever with the German, Dutch and Luxemburg Communist party. We had three conferences and some common declarations especially on the Lisbon Agenda and the Flexicurity program of the EU. This cooperation has also proven very useful to develop international cooperation and solidarity in class struggle situations like the menace of closing down Volkswagen factory in Brussels, the Steel industry in Luxemburg, Germany and Belgium. We have also been able to react in common at the occasion of the so called nationalisation of Fortis bank which was a bank that was active in three of our countries. We held a well attended press conference in Luxemburg to propose an alternative to this pseudo-nationalisation.

But we are also convinced, and we are dedicated to promote the coordination, on a larger scale, of a real independent communist movement. I must say that your Prague Conferences, have so far been a great contribution to this goal, and I hope they will continue to do so in the future.

Thank you