Crisis of Government Revenue

Necessity for New Pro-Social Direction for the Economy

The current methods to claim government revenue have hit a roadblock. Two issues emphasize the difficulties:

1) The global monopolies that dominate the economy refuse to allow governments to claim revenue directly from the economy, from the production of goods and services. Instead, they demand that governments tax individuals and use that public money in various pay-the-rich schemes to entice private monopolies and their wealthy owners to commit their accumulated social wealth in attempts to enlarge their private wealth within the economy.

2) Those same monopolies refuse to pay in a normal exchange the value they receive from the country’s public services and infrastructure. Instead of receiving payment from the monopolies in equal exchange for the human and material transferred-value they consume, the infrastructure projects and public service enterprises, such as those in education and health care, must seek investment and operational funds from general taxation revenue mostly paid by individuals.

The result from these two issues is a crisis that can only be resolved with a major restructuring and new pro-social direction for the economy, which restricts monopoly right and puts the public interest and actual producers in control of the socialized economy with the well-being of the people as the main aim.

The serious problem surrounding public expenditures and sources of revenue began early in the twentieth century with the rise to power of the global monopolies, which united the industrial and financial sectors into dominate global companies. The monopolies organized the modern economy and state to suit their pursuit of worldwide empires. They required the use of an increasingly complex state to supply educated and healthy workers, public infrastructure, greatly expanded police security forces, and large standing armies equipped with weapons of mass destruction to defend and expand their global empires, suppress the working class and occupied populations, repel competitors and wage increasingly expensive and destructive wars such as WWI.

The monopolies faced the problem of raising public funds for state enterprises, public services, infrastructure, police forces and standing armies without directly claiming those funds from the economy, specifically from their own particular operations. They also refused to pay for in a proper exchange the value produced by state enterprises, public services and infrastructure when consumed in their operations.

The problem became even more profound for the monopolies with the consolidation of the Soviet Union, the first nation-building project and state led by the working class. The working class state introduced comprehensive and free public health care, public education and other social programs to raise the living standard of workers and peasants and defend their rights, in particular the rights of women and girls. In spite of the low level of industrial mass production and agriculture inherited by the workers and peasants in Russia, Ukraine and other members of the Union of Soviet Socialist Republics, the advanced social programs the communist nation-building project organized for the people stood in stark contrast to the “fend for yourself” imperialist states dominated by the private monopolies.

The victory of the people’s forces in the anti-fascist Second World War struck terror into the dark souls of those in control of the imperialist system of states now dominated by the U.S. and British monopolies. To protect their narrow private interests and control from a demanding and rebellious working class flush with victory over fascism, the ruling capitalist elite fashioned a welfare state and social contract with organized workers, which included an expansion of social programs and labour laws bringing class struggle for better wages and working conditions within a controlled legal framework. They formed a cartel system of party politics and governance to keep the working class from organizing democratic renewal and the empowerment of the people.

Even while demobilizing millions of soldiers after WWII, the U.S.-led imperialist system of states organized NATO and escalated spending on nuclear warfare and other weaponry to threaten the Soviet Union and expand their occupied territories beginning with the war against the Korean people, then into Vietnam, and on and on trampling people’s rights throughout the world. All this has required, and continues to demand, huge amounts of public revenue to finance the imperialist state.

The destruction of the first nation-building project of the working class in the Soviet Union quickly accelerated in the 1960s, when the leadership refused to revolutionize the relations of production in keeping with the rapid developments in the forces of production. This led to its disintegration into social-imperialism and ultimate collapse in 1989.

U.S. imperialism has become the sole superpower and engages in continual hot and cold predatory wars with the rest of the world. The internal contradictions of the capitalist economy, especially with productivity and its downward pressure on rates of profit, have continued to deepen with recurring economic crises becoming more severe and long-lasting.

The monopolies and their political representatives are campaigning to destroy much of the welfare state and social contract under the hoax of austerity. They are campaigning,  to raise revenue for their imperialist state and empire-building with yet more individual taxation on the working class of all incomes, and small business.

Adapted from TML

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