Mar 19, 2007
Last year the fantastic sum of 5.4 trillion dollars was spent worldwide in what are called Mergers and Acquisitions. This new record illustrates the absurd and parasitical character of capitalism. This sum represents around $900 for every person on the planet, in a world where more than a billion people live on under a dollar a day!
A merger or acquisition is when one company buys up another, with or without the others’ consent. Even if capitalists, journalists or politicians call it “investment,” it has nothing to do with constructing new buildings and putting in new equipment. In a merger and acquisition, only the owners of the bought-up business change. The ever-more-gigantic sums spent by the purchaser don’t at all increase production or raise the productivity of labor. While buying up their competitors at a high price, these companies don’t create one new factory or add one new job. Most often, these mergers are an excuse to cut back on workers and demand concessions out of the workers of both the new and acquired companies who are “lucky” enough to keep their jobs. This is what happened repeatedly in the steel industry as one mill after another was bought up.
For years, capitalism has more and more resembled a gigantic Monopoly game, where businesses don’t bet on a growing market. Because they have a lot more profits than they know what to do with, they consecrate these profits to purely financial operations. Economists call these mountains of money, which businesses hold instead of reinvesting in production, “war chests.” But the war which flows from this loot is the war that the bourgeoisie wages against the standard of living and working conditions of the working class.
On the basis of profits which never stop growing, the sums devoted to real investment diminish continually in relation to the amounts wasted in all sorts of sterile financial operations ... which are actually risky for the stability of the system itself.
The defenders of the capitalist system justify the exploitation of workers by explaining that “profits today are investments tomorrow and jobs the day after.” But for a long time now, the reality of the capitalist system is that the profits of the day before yesterday have been the financial operations of yesterday and the layoffs of today.