Why Marxians are getting excited about the credit crisis

Are we all doomed?

Karl Marx knew a thing or two. Only six years after Charles Darwin published “The Origin of Species” Marx had worked out that capitalism needed two things to be fit to survive; growth and debt. Profits could only be created if someone, somewhere, borrowed money.

This dependency on debt meant that capitalism, viewed from a Marxist perspective, was doomed to periodic crises as human nature couldn’t self-limit. Credit binges would erupt from time to time, threatening the edifice of debt-fuelled consumption. More to the point each crisis would become larger and larger until, one day, capitalism would implode and the social economy would take its rightful place.

And so it has been since Marx first published “Das Kapital” in 1867: debt has accumulated in the corporate sector, the private sector and, most controversially, at the heart of western governments. Even the United States, supposed to be that most arch of capitalist economies, has racked up debts equal to its national income and now its annual interest bill is rising at an alarming rate.  We in the UK are not immune: soon our fourth largest government expenditure will be the interest we pay on our government debt.

As a Marxian you might even regard this phenomenon with some glee; the crisis of capitalism has passed from the private domain, through the banking system into our central banks and now is gathering within our government finances.  The conspiratorial nature of Marxist analysis even has it that Big Finance bullies government into borrowing, destructively transferring wealth from citizens to capitalists. This paradoxical behavior leads to the conclusion that the biggest enemy of capitalism is not the working classes but capitalism itself.

So Marx would have it that the third wave of the current crisis will be that a well-known national government will renege on its interest payments; someone is going to default as the jargon goes. The logical response would be to start reducing your debts and this is at the heart of those who see austerity as a social cost worth paying to stabilize national finances. But controlling national finances comes with a social cost. Witness the 27 per cent unemployment in Spain and the rioting on the streets of Europe.

So far politicians have tried to appease the markets at the expense of the people. This has worked for a time but now, with their survival instincts at full the throttle, the pressure is rising to change course. The IMF has told the UK coalition government to loosen the girdle it has placed around public finances whilst the first statement by the new Italian Prime Minister Enrico Letta has been to reverse some of the tax increases meant to control Italy’s chronic debts. Last week Spain decided to take the brakes off deficit reduction and Greece is heading in the direction of requiring another round of forgiveness and do I really have to mention Cyprus? Trouble is brewing at the heart of government finances – marx my words Karl might say….

A bust of Marx. Photograph: Getty Images

Head of Fixed Income and Macro, Old Mutual Global Investors

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The section on climate change has already disappeared from the White House website

As soon as Trump was president, the page on climate change started showing an error message.

Melting sea ice, sad photographs of polar bears, scientists' warnings on the Guardian homepage. . . these days, it's hard to avoid the question of climate change. This mole's anxiety levels are rising faster than the sea (and that, unfortunately, is saying something).

But there is one place you can go for a bit of respite: the White House website.

Now that Donald Trump is president of the United States, we can all scroll through the online home of the highest office in the land without any niggling worries about that troublesome old man-made existential threat. That's because the minute that Trump finished his inauguration speech, the White House website's page about climate change went offline.

Here's what the page looked like on January 1st:

And here's what it looks like now that Donald Trump is president:

The perfect summary of Trump's attitude to global warming.

Now, the only references to climate on the website is Trump's promise to repeal "burdensome regulations on our energy industry", such as, er. . . the Climate Action Plan.

This mole tries to avoid dramatics, but really: are we all doomed?

I'm a mole, innit.