The Current Global Crisis and Lessons from President Kwame Nkrumah

The widely recognized global economic crisis must be seen as a failure in capitalism. This failure is not a temporary setback or a minor flaw, but a realization that capitalism is “organized crime”, unethical behavior, and systematic domination by a small clique, that owns and controls the major multinational corporations and mega-banks, to maximize their profits. There is no limit on the profit motive of capitalism. Where is the boundary between justifiable profits and GREED? THERE IS NONE!!

The current crisis has been linked to the creation of financial derivatives based on an overextended, speculative housing market. What this means is that the owners and controllers of banking and financial institutions legalized a range of risky investment options built on top of an overpriced housing market. With the downturn of the housing market, those banks, corporations, retirement funds, and individual investors now suffer financial losses or even economic ruin!

Some see capitalism as the only economic reality. They place the blame on a few greedy individuals and are very careful not to fault capitalism as a whole. ‘The problem can be corrected by adding more government regulation.’ These supporters of capitalism view capitalism as viable, claiming capitalism has flexibility, an ability to respond to crisis and rebound. The reality is quite different.

Capitalism was built on the theft of land, natural resources and labor from Africa (chattel slavery). In Imperialism the Highest Stage of Capitalism, Lenin points to the rise of the financial sector as the major capitalist sector in manipulating and exploiting the people. President Kwame Nkrumah had the foresight to understand and articulate how neo-colonialism would take the place of colonialism and extend the exploitation of Africa. This exploitation is the last phase of imperialist exploitation. Once African People reorganize to end the exploitation of African’s immense natural resources and refuse to allow Africa to be the dumping ground for overproduction, incompetent consultants and the toxic waste from capitalism, the primary external source of capitalist profits will be inaccessible.

This year is the 100 anniversary of the birth of President Kwame Nkrumah. He posed the solution to our predicament years ago in the closing paragraph of his classic work Class Struggle in Africa. He stated “The total liberation and unification of Africa under an All-African socialist government must be the primary objective of all Black revolutionaries throughout the world. It is an objective which, when achieved, will bring about the fulfillment of the aspirations of Africans and people of African descent everywhere. It will at the same time advance the triumph of the international socialist revolution, and the onward progress toward world communism, under which, every society is ordered on the principle of – from each according to his ability, to each according to his needs.”

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The Sources of Global Economic Crisis
1) Overproduction – too many SUVs, too many condominiums, too many new office buildings, etc.
2) Overextended financial sector – risky financial products, too much credit that is uncollectable from credit cards, house mortgages, corporate debt to foreign debt.

With multinational corporations moving production overseas to reduce the cost of paying workers, the USA has become de-industrialized, relying more and more on the financial sector for profits. By the 1990’s GM made more financing the purchase of cars than manufacturing cars. At the end of 2007 GMAC Finance claimed $249 billion in assets with 15 million customers over 40 countries. (see www.gmacfs.com)

The financial sector extended way beyond the traditional bank loans and stock market, creating legal gambling on a wide range of financial instruments - from the Futures market (gambling on the future price of everything from stocks to orange juice) to the most exotic Credit Default Swaps (CDS) (contracts based on little or no real assets). Toward the end of 2008 outstanding CDS exceeded the World GDP! (Fortune, Oct. 13, 2008)

Credit Default Swaps Outstanding = $54.6 Trillion
WORLD GDP = $54.3 Trillion
Combined value of:
All stock on NYSE + USA GDP + Total USA National Debt = $50.5 Trillion

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To extract more profits from underdeveloped and developing countries, the imperialist countries led by the USA have enacted ‘neoliberal financial reform’ that centers on eliminating national influence and control over financial markets. The results are capital flight; currency and financial instability and crisis; economic stagnation; compromised national autonomy; and aggravation in the disparities in power and wealth (Monthly Review, vol.53, #11)

In Neo-Colonialism: The Last Stage of Imperialism p.259, Nkrumah points out “The foreign firms that exploit our resources long ago saw the strength to be gained from acting on a Pan-African scale. By means of interlocking directorships, cross-shareholdings and other devices, groups of apparently different companies have formed, in fact, one enormous capitalist monopoly. The only effective way to challenge this economic empire and to recover possession of our heritage, is for us also to act on a Pan-African basis, through a Union Government.”

To expand, capitalism used racism to justify national oppression. It was racism that justified the theft of the Americas and Australia from the indigenous people. The same racism was used to enslave African people and partition Africa under the Berlin Conference in 1884-1885. European colonizers used racism to maintain Apartheid in South Africa until 1994. Imperialism used racism to create Israel and maintain Apartheid in occupied Palestine today. England and her destructive children – USA, Australia, New Zealand and Canada employ racism in a relentless assault on Zimbabwe’s Land reclamation process (reclaiming land stolen by white settler families). In all these cases of national oppression, race is an ideological tool for capitalist policies that enrich the handful of super-wealthy. President Nkrumah was clear on the solution.

“It is only the ending of capitalism, colonialism, imperialism and neocolonialism and the attainment of world communism that can provide the conditions under which the race question can finally be abolished and eliminated.” (p. 29, Class Struggle in Africa)

“When Africa becomes economically free and politically united, the monopolists will come face to face with their own working class in their own countries, and a new struggle will arise within which the liquidation and collapse of imperialism will be complete.”(p. 256 Neo-Colonialism) The ‘monopolists’ (primarily from USA and Europe) will no longer extract super-profits from the exploitation of African people and African natural resources. The increase in tension has the potential of unleashing another world war.

Nkrumah points out “If world war is not to occur it must be prevented by positive action. This positive action is within the power of the peoples of those areas of the world which now suffer under neo-colonialism but it is only within their power if they act at once, with resolution and in unity”. (p. 259 Neo-Colonialism)

In 2004, the All-African People’s Revolutionary Party initiated a call for positive action highlighting the need to cancel all IMF/imperialist banking debt; cease foreign military ventures in Africa; and extend the just land reclamation process across Africa. In this 100th year since the birth of President Kwame Nkrumah, we must take lessons from his writings and reinvigorate the CALL FOR POSITIVE ACTION.

WE ENCOURAGE ALL JUSTICE LOVING PEOPLE TO STUDY & ORGANIZE WITHIN A POLITICAL PARTY WORKING FOR THE PEOPLE