There have been some truly astonishing reactions to the economic chaos that hit world markets this week.
US leaders have rushed to assure the world that the overall US economy is fine. Jeff Randall of the Daily Telegraph is one of many arguing that the collapse of Lehman brothers, the fourth biggest investment bank in the US, demonstrates that capitalism is working.
But this is not just a financial crisis. Neither is it simply a problem caused by lack of regulation.
This is a crisis of the system – of capitalism.
While some companies continue to report obscene levels of profits, in reality profit rates across the system have never been restored to the level of the 1950s and 1960s.
In recent years this was masked by a speculative bubble. But as it became increasingly clear that all was not well, panic set in and financiers pulled the rug on investments that had once seemed sound.
Despite their assurances, there is clearly panic running through the US ruling class.
George Bush’s government spent billions to bail out financial institutions such as Bear Stearns and to nationalise Freddie Mac and Fannie Mae. They are letting Lehman Brothers go to the wall because if they keep spending billions the Federal Reserve risks going bust.
The stark truth is that is no one knows where this economic crisis is going or which other financial giant will fall next. But we do know that those who run this system will try to ensure that it is not the chief executives, bankers or government ministers that will pay the price.
Yet these are the very people who have presided over a casino economy in which some of the key players have finally gone bust.
The idea that the British economy can somehow escape this crisis, a lie peddled until recently by Gordon Brown and Alistair Darling, is laughable. Britain has one of the most “liberal” unregulated economies in the world.
New Labour used to proudly boast that the City was the leading global financial market. It is now massively exposed to the bad debts and bankruptcies seen in Monday’s slump.
Britain has always had an internationalised economy with major investments in the US. So it is little surprise there are lurid headlines warning that unemployment might swell by 500,000 in the coming weeks and months.
Redundancies are increasing in Britain – rising 16 percent between April and June this year. Repossessions in the same period were up 24 percent on the previous year.
Meanwhile fuel and energy prices soar as the government tells us to swallow below-inflation pay rises. Millions fear what lies ahead for them and their families.
Many people also understand that economic chaos breeds political crisis which can inflame conflicts such as the recent war in the Caucasus.
Yet all we hear from politicians and media pundits is that there is no alternative to the free market, despite the fact it has created this mess.
In response we need urgently to say that there is an alternative – socialism – based on planning, with workers deciding what is produced and invested rather than City bankers.
At the same time we need to fan every possible flame of resistance because the bottom line for us is that we must not pay for their crisis.
As well as a windfall tax on the profits of the energy companies, we need to fight to tax the rich, to cut arms expenditure and much more.
These are the first steps in fighting for a world where people really do come first, not profits.