It is a mantra of our rulers that you can’t buck the market. And proof seemingly came this week as the global bond markets turned on Ireland with a vengeance, pushing up the rate of interest at which the government must borrow to finance its debts.
While politicians differed on what shape a bailout of the Irish banks should take, it was agreed by all sides that that the market had to be followed.
“The market” is, in reality, the rich people who control the wealth of the world.
As Bill Gross, head of the world’s biggest bond fund, said earlier this year, his clients were in markets to make money and he was not paid to feel sorry for people or countries.
European Union (EU) officials are now putting increasing pressure on the Irish government to accept aid from their bailout fund.
This emergency fund has nothing to do with kindness, and everything to do with the prospect that the Irish debt crisis will infect the whole eurozone.
Banks and bond holders worry more countries will default without the bailout—creating a domino effect that will see Portugal default, followed by Italy and Spain.
Any bailout simply gives more money to the banks. The beneficiaries of the Greek bailout in May were German and French bankers, not Greek workers. The same is set to happen again in the Irish case.
Two years on from the financial meltdown and repeated bailouts of the banks we are again being told that we have to rescue the financial system.
The trillions that have been thrown at the bankers have not rescued the economy but simply led to bankrupted countries and austerity cuts aimed at ordinary people.
The EU’s emergency fund would allow Ireland to borrow at a lower interest rate. But further austerity would be a precondition of any financial aid—so ordinary people in Ireland would suffer more.
And it wouldn’t be guaranteed to make much difference—Greece’s position is no different six months after it was bailed out. That is because the latest financial crisis is one of the capitalist system as a whole.
Those who run that system will try to ensure that it is not the chief executives, bankers or government ministers that will pay the price.
We urgently need to say that there is an alternative, where workers decide 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.
We don’t simply need to buck the market. We need to replace it with a system organised for need not profit—socialism.