We welcome readers letters on any topic. Letters over 400 words may be cut for space wasons Write to Socialist Outlook. PO Box 1109. London N4 2UU. email: [email protected] Socialist Outlook mistakenly sugests that the US economy's "bub le of the last five years has burst (US Economy: the bubble has burst, Feb 2001) However, by making a serious attempt to relate the movements in the L'S economy to the attempts by the ruling class to drive up the productivity of labour. Andy Kilmister's article represents a mato? adrance on the approach of the SWP and SP abo also foresee a As a metaphor for an economy;, a bursting bubbie is always an unwise one. A bubble does not As a metaphor for the US coonomi: it is quite misleading. The US economy will almost certainly be larger in a year's time than it is now.
Most economists agree that the growing US economy will hiccup this year. In the first balf, the economy will not grow. In the second half, as in the year as whole, the economy will grow.
This is certain to be slower growth than the 1950s and 1960s, when there was a unique combina tion of European reconstruction, cold war mobilisation and the global modernisation of industry:
On a global scale. howerer, the world economy in 2001 looks set to grow faster than the one percent to one and a half percent annual growth capitalism has normally Only a few years ago, comrades in the SP, SWP and ISG also foresaw a deep recession. It did not bappen. They mistook stock market and currency instability for a crisis in there was only one way out: a world slump.
This was not the approach of Marx: what would he say today? Karl Marx, whose law of the falling rate of profit these comrades believed themselves to be using.
Marx presented his law of the falling rate of profit in the context of technological change leading to increasing productivity:
Increasing capitalist accumula. tion does tend to reduce the rate of profit gradually.
However, Marx also outlined a number of influences that can counter this law including increas. ing productivity, cheaper labour, cheaper constant capital, unemployment and foreign trade.
Due to the past gains and the social weight of the working class has not been able to exhaust these However, as Henri Wilno ourlined in November's "Internationa Viewpoint, productivity has grown Even in Europe, the rate of profit has risen to high levels since the mid-1980s.
Duncan Chapel South London.