by John Foster, published by the Economic Committee of the Communist Party. Third edition.

This pamphlet was first published in May 2008—nine months after the onset of the financial problems sparked by the US subprime crisis and the failure of Northern Rock but four months before the crisis had reached its acute stage with the failure of Lehman Brothers and the threat of bankruptcy across the entire sector. The consequent financial earthquake had twin epicentres in New York and London and triggered smaller but dramatic collapses in Ireland, Iceland, Belgium and the Netherlands. A serious and deepening world recession resulted.

Pamphlet Size

This pamphlet’s compares Britain’s economy with those of other major economies and seeks to explain why Britain’s is so much weaker. It argues that its decline since the 1970s can only be understood politically in terms of specific government interventions in favour of banking and finance capital. It also looks more generally at the evolution of relationships between the state and economy in the period of monopoly capital and the applies this analysis to Britain. It argues that only by understanding how our ruling class rules, and the specific compromises and alliances it has made, is it possible to explain the policies that led to the current crisis. It examines the immediate origins of the crisis. It argues that the government’s response so far has been on the terms set by British finance capital and that this will have seriously adverse consequences both for the economy overall and for the living standards of working people. Finally it sets out the alternative policies needed to redevelop the economy and protect the livelihoods of future generations.