Cooking the Books 1

Out of control

  Some people are looking to China as the motor that will pull world capitalism out of its current slump. This ignores the fact that China’s double-digit rates of growth were led by exports, in large part to America and Europe. When these parts of the world entered the slump China, too, was affected. As the Times reported last year (17 October):

“In the northern Chinese port of Quinhuandao, a dark mountain formed by nearly nine million tonnes of surplus coal soars from the dockside. By the end of the next week, the famous storage area – a dirty barometer of Chinese industrial demand – could be completely full of unwanted fossil fuel . . . [T]hose swelling piles of surplus coal, which is used for most of China’s electricity generation, indicate falls in demand for energy, a key measure of economic activity.”

  I n response the Chinese government decided to try to spend its way out. Some 4 trillion (a million million) yuan of stimulus money was injected into the economy, mainly in the form of lending by the State banks. But things didn’t turn out as planned. Most of the money was used to expand productive capacity without regard for the chances of selling the extra output (though some seems to have gone to fund a property and stock exchange bubble). In an article headlined “Beijing moves to halt growth juggernaut as supply starts to run away from demand” (1 October), Times Asia business correspondent, Leo Lewis, reported:

“China's State Council calculates that the impact of this year's 140 billion yuan (£13 billion) investment spree in steel mills will be to lift overall national production capacity some 40 per cent above the country's entire annual demand. The same dynamics reportedly apply to cement ( . . .) The astronomical levels of corporate investment, warn senior economists, place the booming Chinese economy at increased risk of a sudden collapse in growth.”

  So, the brakes are being applied:

“The Government of China has launched an attack on overcapacity in its heavy industries with a series of stinging curbs on new factories, smelting plants and port-building projects. (…) In the absence of such controls, said the statement from the Chinese Cabinet, ‘it will be hard to prevent vicious market competition and to increase economic benefits, and this could result in facility closures, layoffs and increases in banks' bad assets.’”

  It’s the same old story of headlong capitalist expansion, financed in this case by government funding, leading in the end to overcapacity and overproduction in relation to market demand. The Chinese government’s attempt to spend its way out of the slump is risking the very thing they were trying to overcome: “a sudden collapse in growth”.

  Which goes to show that governments can’t control the way capitalism works and that, if they try, the chances are they’ll make things worse. Capitalism is an uncontrollable economic system that gets its way in the end, one way or the other.
Tiny Tips


  Who would have thought a wee little packet of fake bloodcould threaten to unravel an entire culture. But so great is the threat of the “Artificial Virginity Hymen” -- a kit that helps women fake their virginity -- that prominent Egyptian conservatives are calling for an all-out ban. Not only that, they are also demanding the exile of anyone who traffics it.
http://tinyurl.com/ybwa2vp

  “What creationists believe about human origins we
get from the Bible,” said David Menton an acclaimed
anatomist and also a creationist. “The creation of the
world takes place on page one of the Bible. If you
throw out the first page of the Bible you might as well
throw out the whole thing. If you can’t live with the first
page then pitch out the remaining thousand pages.”
http://tinyurl.com/yelwnvm

  The gap between wealthiest 10 percent and the rest
of America is worse than at any time on record. Two thirds of all income gains from 2002-7 went to the
top 1 percent. The Walton family alone is worth more
than the bottom 100 million Americans combined.
Wal-Mart is a major player in the “dead peasants
insurance” game; it’s alleged that dead peasant
insurance payouts are used for executive bonuses:
http://tinyurl.com/yh3p25r

  Amnesty International has highlighted a case of a man facing execution in Texas. The human rights group has revealed a Texas man faces execution after jurors at his trial consulted the Bible when deliberating his fate:
http://tinyurl.com/yzctplu

  Israel is making preparations to carry out
military attacks in Iran after December, a French
magazine reported overnight Wednesday:
http://tinyurl.com/yjkf8mj

  That Haiti needs the attention cannot be overstated.
Unemployment hovers at around 70 percent, experts
say, and over half of the population lives in extreme
poverty. Violence broke out in June as students
demanded an increase in the minimum wage to $5
from $1.75 — which were daily rates, not hourly
ones. Haiti’s extremely low labor costs, comparable
to those in Bangladesh, make it so appealing:
http://tinyurl.com/y9mnxpw

  When the Berlin Wall crumbled, East Germans
imagined a life of freedom where consumer goods
were abundant and hardships would fade. Ten years
later, a remarkable 51% say they were happier with
communism. About the same time a new Russian
proverb was born: “Everything the Communists said
about Communism was a lie, but everything they
said about Capitalism turned out to be the truth.”
http://tinyurl.com/yek2lgm

  We are fast approaching the time of the next great battle over evolution. The Neo-creationists will be corporations, and they will argue that they could not possibly be descended from human beings...The rape case of Jamie Leigh Jones was just a logical step forward in the long-standing Republican effort
to lock Americans out of the nation’s courthouses, an effort undertaken on behalf of corporate supremacy. A woman is gang-raped by her fellow employees at government contractor KBR. The company says her contract prohibits her from seeking justice in court.
http://tinyurl.com/yk33ans




Contents
Features


  • The fall of “communism”: Why so peaceful?   
    • Twenty years ago the Berlin Wall came down, symbolising the collapse of state capitalism in Eastern Europe.
     
  • The Myth of Soviet “Socialism” 
    • Vladimir Sirotin from Russia explains how that country was never socialist.

  • Workers State? Pull the other one 
    • How could anyone have seriously argued that the workers ruled in Russia?

  • Joining the killing machine 
    • The campaign to win the young to war has come a long way from the ‘Your Country Needs You’ poster with the pointing finger of Kitchener used in the ‘First Great War’.

  • Afghanistan – lying about dying
    •  The pressure to misinterpret the deaths, as the bodies come back, as
    nobly purifying is a cynically orchestrated propaganda exercise intended
    to justify the war.
    Regulars
    Editorial
    Socialism was never tried

    Letters

     Contact Details
    Meetings

     Cooking the Books 1
    Out of control

    Cooking the Books 2
    Free is cheaper?

    Cartoons
    The Irate Itinerant

    Free Lunch


    Pathfinders
    Gullibility travels
    Material World

    Pieces Together

    Tiny Tips

    Book Reviews
    Che Guevara; Voodoo Histories;
    Trouble with Capitalism; Enough

    50 Years Ago
    The Darwin Centenary

    Greasy Pole
    TV Debates

    Voice from the Back
    Hunger Amidst Plenty; A
    Horrendous Future; Hypocricy In
    The City and more.







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    Socialist Standard Online edition                              November 2009