2006 – a year of big changes
Fighting back against the millionaires’ system
AT THE beginning of a new year, Socialist Party general secretary
PETER TAAFFE looks back on the significant developments in 2005 and
looks forward to the challenges that lie ahead for socialists in 2006.
THE PAST year has shown clearly the incapacity of capitalism – a
system based on the millionaires rather than the social needs of the
millions – to deliver to the peoples of the world an advance in living
standards, peace or equality. This was symbolised by the reaction of all
capitalist governments to the natural disasters of the Asian tsunami,
the South Asian earthquake and the hurricanes, particularly Katrina,
which swept through the Americas.
Despite the colossal outpouring of mass support worldwide for the
victims of these tragedies, as well as the huge amounts of cash
generated to help them, hundreds of thousands of victims rot in squatter
camps or huddle on freezing mountainsides with hardly a blanket to
protect them from the bitter winter elements. Their suffering is a
monument to a blighted system. It will take years to eradicate the
legacy of these events on the basis of rotten capitalism.
Contrast the lack of preparation, the inaction, inefficiency and
corruption to the actions of Cuba, where the hurricanes’ effects were
mitigated through the voluntary movement of a million people before the
hurricane struck. One system is unplanned and based on the interests of
the propertied classes. The other, although unfortunately not a
democratic workers’ state, still has the outline of a planned economy,
which makes it possible to lessen the impact of natural disasters.
In Iraq, another example of a failed regime, US imperialism has sunk
in the last year even further into a sectarian and bloody abyss. The
"stench of Vietnam", as one commentator expressed it, hangs heavily over
the Bush administration.
For 25 years, right-wing Republicans in the US have striven to
reassert the presidency’s ‘executive authority’. This was shattered by
the American people’s reaction following the first-ever foreign defeat
of US military forces, the ‘Vietnam syndrome’. Bush used 9/11 to
partially re-establish this ‘authority’. Now that has completely
dissipated with the death of 2,100 US military personnel and upwards of
30,000 wounded, many of them seriously.
Neither the 15 December elections nor Bush’s so-called ‘plan for
victory’ in Iraq can rescue this doomed ‘mission’. 60% of the US
population now considers that it was ‘wrong’ and a ‘mistake’ to invade
Iraq. Bush’s rating in the polls has plunged to support in the 40-45%
range.
Previous ‘hawks’, like the Democrat John Murtha and the Republican
‘establishment’, such as Brent Scowcroft, are attacking Bush for
dragging the US into this ‘quagmire’. If half a million US troops in
Vietnam, supported by one and half million soldiers, sailors and aircrew
in neighbouring bases and countries, could not win in Vietnam, what
chance does a force of 160,000 US troops have of avoiding defeat in
Iraq?
The ‘de-Americanisation’, read ‘Iraqification’ – handing ‘security’
to Iraqi military forces – has the same chance of success as ‘Vietnamisation’
35 years ago, precisely zero. The present Iraqi forces, where they are
not ‘ghost battalions’ – existing on paper so corrupt officers can
receive payment for non-existent troops – are sectarian death squads
inflicting a reign of terror on ordinary Shias, Sunnis and Kurds.
Bush’s nightmare
ON THE other hand, the ‘asymmetrical stakes’ – what the US gains or
loses in Iraq – are higher than in Vietnam. Iraq is the world’s third
largest oil producer with massive untapped reserves – 90% of the country
has not even been tapped for oil – so it is critical for world
capitalism and particularly the US in this era of ‘energy insecurity’.
However, there is no way out, no coherent strategy, to hand that
would allow the US to neatly disengage from this nightmare. In fact,
because of the importance of oil in Iraq, the US, even if it formally
‘withdraws’ will retain a sizeable military presence, perhaps 100,000
troops, in bases from which it could intervene in the country and the
region.
Some US strategists imagine that if Iraq breaks up then they could
forge an alliance with the oil-producing areas dominated by the Shias in
the south and the Kurds in the north, against the ‘oil-less’ Sunnis.
This, however, would be in the context of the balkanisation, the
break-up, of Iraq on sectarian religious and ethnic lines. But this
could lead to the centrifugal disintegration of neighbouring states and
unleash an ethnic conflict, which would rage for years, throughout the
Middle East.
On top of this, Hurricane Katrina has broken the political levee
which previously shored up Bush’s domestic position. It lifted the lid
on the brutal race and, particularly, the class realities of US
capitalism. A discernible growth of class feeling is the political
result of Bush’s attacks on the working class and the poor, reinforced
by Katrina. This led to the defeat of Schwarzenegger’s anti-trade union
referendum in California and resistance to the Washington regime’s
shameless pandering to the appetites of the rich.
The workers at Delphi, General Motors and Ford face cutbacks on
pension rights and mass redundancies while the billionaires who really
rule the US and sustain Bush have their snouts even further into the
financial trough which constitutes capitalism today.
One commentator has pointed out: "The gap between Mr Rich and Mr and
Ms Average [in the US] is 311 times as great in the age of [Bill] Gates
[owner of Microsoft] as it was in the age of Rockefeller [John
Rockefeller, a late 19th/early 20th century oil magnate – eds] and
historians call that the ‘age of the robber barons’." Gates’s wealth
increases by $50 million a day while almost half the people of the world
have to survive on less than $2 a day.
Rich and poor
THIS IS the picture not just in the US but throughout world
capitalism. Capitalist commentators were taken aback by the recent riots
in France. The French movement was mass rage, an inchoate cry of
despair, at the oppression, denial of basic human rights such as a job
and racism. The banlieux, the working-class suburbs, are now synonymous
with the regions of the excluded poor.
However, the real surprise is that these riots had not taken place
before and in many more countries than just France, even in whole
regions, given the searing, unprecedented disparity between rich and
poor.
For instance, the Balkans – an area of recent ethnic conflict fuelled
by poverty which has not gone away – is now described as a ‘suburb’ of
‘rich Europe’. A process of ‘re-ruralisation’, urban dwellers returning
from poverty-stricken cities to the countryside in order to scratch out
a living, is under way in this region.
Could anything testify more to capitalism’s bankruptcy? We were told
15 years ago after the collapse of the Berlin Wall, that capitalism
offered a glittering future to the peoples of this area, as well as
Eastern Europe and the former Soviet Union. Yet only 40% of Serbia’s
population bothered to vote in recent elections.
And this takes place during a boom which is characterised by slow,
niggardly economic increases but that also sees the rise of poverty,
which is woven into the very fabric of capitalist society. Most growth
is in the pockets of big business and not in the share going to the
working class or the poor.
The US economy, for instance, may be growing in real terms at 2.5% or
3% but the average ‘median’ income of the US family has declined in the
last 20 years. Bush, while being compelled to increase expenditure in
the wake of Katrina, still attacks Medicare, Medicaid and the social
security system, which are relied on by the poor in the US.
‘Race to the bottom’
IF THE US economy inches ahead in the next year or two, it will be
because of the investment boom in China, creating huge productive
potential through new factories, and a ‘consumer boom’ in the US
sustained by low interest rates. The cost of this will be, however, a
huge increase in an already record trade deficit. This could balloon to
7% of US gross domestic product by the year 2007.
The US government’s budget deficit, the difference between what
Washington spends and what it gets in income, is covered by foreign
investors continuing to buy ‘dollar assets’, US government Treasury
bonds, paper money.
How long this will go on against the background of the widening of
the ‘twin deficits’ is another question. At a certain stage foreign
investors could pull the plug and a repetition, only on a much wider
scale, of the 1997 financial meltdown in Asia could take place. Even if
this does not happen for a time, the future for the working class will
not at all become easier on the basis of ‘modern’ neo-liberal
capitalism.
Notwithstanding Gordon Brown’s claims to the contrary, capitalism is
involved in a ‘race to the bottom’, a ruthless wage-cutting exercise by
different groups of bosses as to who will pay the lowest wages to the
working class.
Isn’t this the essence of the Irish Ferries dispute, where low-paid
Eastern European workers were smuggled on to the ships to replace
‘highly-paid’ Irish workers? The Socialist Party in Ireland took a
prominent role through its MP Joe Higgins in alerting the Irish labour
movement to what was happening and calling for a 24-hour general strike.
Pushed from below, the Irish trade union leaders were compelled to
ratify partial action on Friday, 9 December, when 40,000 marched in
Dublin and thousands more in other Irish cities. This is in anticipation
of how the working class will react to the whip of neo-liberalism, which
the capitalists will continue to use unless they are stopped by mass
industrial action, accompanied by determined efforts to re-establish a
viable political voice for the working class.
Class struggle
IN THE past year, Britain has glimpsed what the threat of strike
action can accomplish. Before the election and afterwards, the
determination of five million public-sector workers to reject attacks on
their pensions was sufficient to force the government into a partial
retreat. Present pension arrangements for three million workers were
upheld.
Unfortunately, this was linked to a change in the conditions for new
starters (see explanation of the agreements in previous issues of the
socialist). The public-sector unions must begin an immediate struggle to
change this in the next year. The employers, through their mouthpiece
the Confederation of British Industry, expect, on the contrary, greater
attacks and more ‘concessions’ to their members than we have witnessed
up to now.
From British capitalism’s point of view, the underlying position of
their system demands this. The slowdown of the economy, probably to a
12-year low, is now admitted by Gordon Brown, who has seen the wheels
begin to come off his much extolled economic chariot. The British
economic boom has been sustained, like in the US, by consumer spending.
That also is heading south. Growth has been halved with Brown
expecting the economy to grow by less than 2% in 2005 – he predicted
3.5% in his pre-election budget nine months ago. Manufacturing industry
is on course to lose about 100,000 jobs in 2005 with employment in this
sector expected to fall below three million this year.
Brown claims that his past measures helped to lessen the burden and
scale of poverty, particularly through increased public expenditure. But
in the eight years he has been chancellor, the overall percentage of
gross domestic product taken by the public sector is "below the
proportion in most years of the Thatcher and Major governments" [William
Keegan, The Observer].
It was around 48% in the middle-Thatcher years and around 40% in the
middle-Major years. Yet in the financial year 2004-5 – when public
expenditure was supposed to be ‘ripping’ ahead – it was 41.4%!
Implacable against working-class demands for increases in wages, Brown
has tried to ‘balance’ this by increasing corporation tax on oil
companies. But given the cash cow which oil companies are today, because
of the trebling of oil prices, his measures merely trim the fingernails
of big business.
New mass workers’ party
NEITHER OF the other two major capitalist parties offers anything
substantially different. Tory Chairman Frances Maude has suggested that
the Tories could go into a coalition government with the Liberal
Democrats in the event of a hung parliament after the next general
election. On the other hand, Cameron ‘generously’ offers to help Blair
out in supporting his education ‘counter-revolution’ even if he does not
have enough votes from his own backbenches.
The Cameron-led Tory party and the Liberal Democrats are both signed
up to New Labour’s neo-liberal agenda. Verbal jousting in the House of
Commons is merely a faade to cover this fact. Indeed, Guardian
journalists have suggested that before the advent of Cameron, New Labour
strategists feared the complete collapse of the Tory party. This would
have taken away Blair’s ‘fear threat’ that opposition to him and his
policies would open the door to the ‘even worse’ Tories.
New Labour’s utter degeneration under Blair was underlined by former
Tory leader Michael Howard’s last speech in parliament. He taunted Blair
with his "scathingly embarrassing reminder" of Blair’s boast: "I have
taken from my party everything they thought they believed in. I have
stripped them of their core beliefs. What keeps it together is power."
The New Labour government is not in power but ‘in office’. The real
power is big business, which determines the policies of any government
which remains within the framework of the capitalist system. But Blair’s
statement showed there should be no illusions now about the capitalist
character of this government and the party which raised it to power.
It is time to create the conditions for a new mass workers’ party!
This is a central task for the Socialist Party in the next year. Tens of
thousands if not millions are looking for a socialist pole of attraction
to fight capitalism and all the parties that represent it. This, and the
need to strengthen working-class people’s resistance to all attempts to
take back past gains, is a vital aspect of the Socialist Party’s work in
the coming period.
This winter promises to be one of ‘discontent’ as will the next year
as a whole. Events have already demonstrated the drawbacks of the
capitalist system on a world scale. A growing mood of anti-capitalism
exists. This has now been strengthened by a layer of workers and young
people seeking a socialist solution.
The next few years promise to be the most interesting period from a
socialist and working-class point of view for some 20 years.
