![]() ![]() In Europe, the equivalent number is 7.5%. Similar numbers have also been seen in the USA, with prices jumping by 8.5% in March compared to 12 months earlier. And forecasters are predicting that this number could peak at over 10% later this year. Thus the purchasing power of wages has decreased.Įven where workers are able to win higher pay, this is generally lagging behind increases in rents and bills, leading to a decline in real household incomes.Īt the time of writing, the headline figure for UK inflation has soared to 9%, the highest level in four decades. Like the feverish symptoms of a hospital patient, inflation is a symptom of a sick system.Ī post shared by Wellred Books the world, the scourge of inflation is striking fear into the hearts of the working class and the ruling class alike.įor workers, rising prices across the board – from energy, to housing, to transport, to food – are leading to a cost-of-living catastrophe.īy definition, inflation means the devaluation of a currency money buying fewer goods and services than before. Inflation is caused by a concatenation of factors in this anarchic, chaotic system that is capitalism. This is because, as Adam Booth explains, inflation cannot be controlled by simply loosening or tightening the money supply. And, as we predicted, despite the fact that some factors feeding into inflation – like supply chain chaos – have eased up, these monetarist measures have failed to bring inflation under control. ![]() ![]() Since it was written, events have confirmed our analysis.Īs expected, central banks have begun substantially hiking interest rates to levels not seen since the 2008 crisis. This article was written for issue 38 of the In Defence of Marxism theoretical magazine this summer. This article asks: what conjunction of factors lie behind the present stage in capitalism’s crisis? What really causes inflation? And what effect will inflation – and the ruling class’ attempts to curb inflation – have on the class struggle? It is clear that we have entered a new chapter in the crisis of world capitalism, which the strategists of capital themselves are at a loss to explain. After decades of low inflation and rock-bottom interest rates, economies throughout the world are now facing a spectre unseen since the 1970s: rising inflation levels combined with the beginnings of another recession. ![]()
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