A highly flammable issue, inflation has returned with full force in the public
debate. Virtually forgotten in France after two decades of monetary stability, itis a complex phenomenon that reveals considerable inequalities and the mostfundamental flaws in capitalism. Decryption. ---- For once, economic and socialnews has been brought to the public eye by the rise in prices that we see daily.So of course, strictly speaking, it is difficult to say whether we are reallyexperiencing a significant inflationary phenomenon (see box): certain prices,such as gas prices, are increasing while others are falling.Result: the index which synthesizes consumer prices has seen a fairly moderateincrease. Does this mean that rising prices are a false problem? Let's try toclarify this.Inflation is not the same for everyoneThe magnitude of the price increases we are experiencing in recent months mayappear relatively harmless in terms of very high inflation rates that stillprevailed at the end of the XX th century: easily increased the price of 2 to 3%per year the 1990s, and from 3 to 13% in the 1980s. But the very weak growth andthe austerity policies of the last decades have accustomed us to minimalinflation rates, of the order of 1% per year, to such an extent that specialistsfeared a deflationary phenomenon.In other words, the 2.6% increase recorded between January and October 2021 isconsiderable in comparison. The phenomenon seems even more important abroad: inthe United States, we are witnessing a price increase of 5.3% for the month ofOctober alone.How to understand this phenomenon? First element, we are witnessing shortages ofraw materials such as semiconductors, agricultural products or constructionmaterials. These shortages are not unrelated to the massive " major works "stimulus plans that have been announced on the side of China and the UnitedStates. Clearly more ambitious than the measures taken in Europe, these plansconstitute a powerful shock in demand which tends to polarize the flow ofmaterials in the direction of these two powers. In general, the measures aimed atstabilizing capitalism which are implemented on a world scale tend to limit oreven cancel the foreseeable rise in unemployment, to make companies solvent andto increase public orders.The pandemic and in particular the confinements have led to an increase or adecrease in demand in certain sectors. Where services related to tourism andcatering have experienced a sharp fall, computer hardware has exploded. However,it is not clear that these developments will last once the crisis has passed.All these elements contribute to an increase in prices in construction, energy,foodstuffs and consumer goods in particular. It is easy to see that suchincreases are experienced very unequally according to social class.Between the budget of a popular family and that of a bourgeois family, food andfuel do not weigh in equal proportions. The smaller the budget, the more basicgoods and services represent a significant part of the expenditure.The observation being made, what are the measures taken by the state apparatus?The famous " inflation allowance " of 100 euros widely distributed by thegovernment promotes the effect of announcing a round figure. But it will fail tooffset the devastating effects of rising prices on the poorest households, ifever it is passed by parliament. The partial freeze on energy prices was decidedtoo late to limit the damage. In a context where the indexation of wages andpensions to prices has been largely abandoned, much more is needed.A balancing act with tied handsThere is a significant risk that the European (ECB) and United States (FED)central banks will be tempted to cut off the credit tap by raising key interestrates. It should be remembered that despite more daring policies carried outsince the 2008 crisis, the only mission officially entrusted to the ECB is thefight against inflation.However, increasing interest rates would lead to a decrease in the money supplyin circulation and therefore to a slowdown in private investment, promoting adrop in growth and employment. The relatively generous budgetary measurescurrently being taken are themselves time bombs: financed by public debt, theywill justify an even more brutal return to austerity policies once the pandemichas been brought under control.As we can see, this rise in prices manifests one of the most fundamentalcontradictions of capitalism. Prices and money, these purely human inventionsbased on convention and trust, can get out of hand when no one has a fundamentalinterest in them. Like Frankenstein's creature, the logics of capitalism escapetheir masters. In the absence of conscious coordination between production andconsumption, the economy is doomed to erratic or even catastrophic fluctuations.Faced with this problem, budgetary and monetary policies are stronglyconstrained, at least if we refuse to take the money where it is, that is to sayfrom the pockets of big capital. As such, the state has voluntarily tied itshands in privatizing the energy sector. As central as it is, the state is not theall-powerful actor it claims to be in order to establish its legitimacy. Subjectto the interests of the big capitalists, it pursues policies that are sometimesinsufficient, sometimes crude, which lead to a considerable waste of resources.Certainly, fiscal stimulus is better than nothing: Keynesian policies have savedthe life of capitalism time and time again, by dampening the anger of the workingclasses. But sooner or later we will have to see the insurmountable limits ofthis logic. Only democratic planning, led by the working people themselves, canovercome it. The economy is our creation, it must be in our hands.Mathis (UCL Grand-Paris sud)https://www.unioncommunistelibertaire.org/?Hausse-des-prix-et-capitalisme-en-roue-libre_________________________________________A - I N F O S N E W S S E R V I C EBy, For, and About AnarchistsSend news reports to A-infos-en mailing listA-infos-en@ainfos.ca
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