Translated "Avante!" article by Jorge Cadima, member of the International Department
History tells that, shortly before the great 1789 French Revolution, when queen Marie Antoinette was told the Paris starved people were demonstrating in the streets, begging for bread, she answered :” if they have no bread, they can eat brioches”. Marie Antoinette’s spirit is back, within the great capital and governments at their service, lounges.
The very same days, Socrates’ government announced its most recent blow on the Portuguese people - in order to “calm down the markets” which were “concerned about the national budget deficit - the Irish government announced the increase of about 6 thousand million Euro on the Irish bankrupt banks’ support subsidies(in the Irish Times,10.09.30). As a result, the Irish budget deficit, will be, this year, “some stunning 32% from the economic production [GIP], the highest European value since World War II”, (in Associated Press, 10.10.01). The Irish banks are being rewarded for having “ to have strongly become indebted together with foreign creditors and invested the money in the overheated Irish housing markets - and after having tried to conceal the real damages’ dimension when the global crisis, within credit, busted the housing bubble“ , (in Associated Press, 10.10.01). How did the “markets” and their servile attendants react to the announcement of the monumental budget hole, in result of the cheating, in a country whose GIP fell 10% in 2009 and unemployment has achieved 13.8%? According to the Irish Times, (10.09. 30), the Fitch rating agency declared the government had “won time to produce a tax reform for the next 4 years” and held the annotation (AA-) unaltered. Olli Rehn, the European commissaire for the economy, declared “ to strongly support the manner how the [Irish] Finance minister dealt with the issue”. And Joaquim Almunia, the European commissaire for competition, “ greeted the statement […], declaring it brings light”. Therefore, its not from any budget hole the markets become enervated and need to be “calmed down”. When they are suckling from the State’s maxi-source, they remain tame.
The need to “calm down” the markets will come, fatal as destiny, when its time to cut on salaries, increase taxes on the people, play new budget cuts on the State’s social functions. Which are already being prepared by the Irish government: “ We have already considered the social welfare laws, the retirement laws. We ought to look in’sto all those issues”, the minister of Finance stated, on announcing the preparation of a new “austerity” package, (in Bloomberg, 10.10.11).
A IMF’s report on Global Financial Stability ( telegraph.co.uk, 10.10.05), states that: “ governments ought to inject new liquidity in banks - particularly in Spain, Germany and the USA”. Obliging, European commissaire Almunia declared he would extend the exceptional support bank, industry and trade system measures: “ we are not at the moment ,in the conditions to go back to the normal system. We know there are still some institutions…which need this state’s aid through public capital injections”, (in the Financial Times, 10.10.05). All this, despite the well-known profits in the last months. And, as the European Central Bank president adverted (euobserved.com,10.10.01), never think of taxing financial transactions: “there are economic, financial…[…] and technical disadvantages“. As for the people, they can eat brioches.
But the world capitalist system is creaking in all directions. Paul Volcker, the Federal Reserve former president talking in a symposium, in 10.09.23, stated that “the financial system has broken down. We used this expression at the end of 2008 and unfortunately, I still think it is accurate to use that word”. K.Rogoff, the IMF’s former economist-in-chief, said “ The Greek bankruptcy is inevitable. There are 95% of presuppositions of Spain ending up in bankruptcy. Hungry is at brink of disaster.. Things will worsen is East Europe. Many countries will be bankrupt. Many countries in the Euro zone, would better go on a sabbatical leave, on what concerns the Euro, for a year. USA’s situation is very concerning”( in Der Spiegel, 10.10.04).
As its known, the people of Paris, in 1789,with no bread nor brioches, worked out the problem in other ways. The same happened in Russia, 93 years ago. There are always solutions, whenever the dominant classes can only offer poverty and war.