Historical framework: the phase of capitalist decomposition
1) Thirty years ago, the ICC highlighted the fact that the capitalist system had entered the final phase of its period of decadence, that of decomposition. This analysis was based on a number of empirical facts, but at the same time it provided a framework for understanding these facts: "In this situation, where society's two decisive - and antagonistic - classes confront each other without either being able to impose its own definitive response, history nonetheless does not just come to a stop. Still less for capitalism than for preceding social forms, is a ‘freeze’" or a ‘stagnation’ of social life possible. As crisis-ridden capitalism's contradictions can only get deeper, the bourgeoisie's inability to offer the slightest perspective for society as a whole, and the proletariat's inability, for the moment, openly to set forward its own historic perspective, can only lead to a situation of generalised decomposition. Capitalism is rotting on its feet." ("Decomposition, the final phase of the decadence of capitalism", Point 4, International Review No. 62)
Our analysis took care to clarify the two meanings of the term "decomposition"; on the one hand, it applies to a phenomenon that affects society, particularly in the period of decadence of capitalism and, on the other hand, it designates a particular historical phase of the latter, its ultimate phase:
"... it is vital to highlight the fundamental distinction between the elements of decomposition which have infected capitalism since the beginning of the century [the 20th century] and the generalised decomposition which is infecting the system today, and which can only get worse. Here again, quite apart from the strictly quantitative aspect, the phenomenon of social decomposition has today reached such a breadth and depth that it has taken on a new and unique quality, revealing decadent capitalism's entry into a new and final phase of its history: the phase where decomposition becomes a decisive, if not the decisive factor in social evolution." (Ibid., Point 2)
It is mainly this last point, the fact that decomposition tends to become the decisive factor in the evolution of society, and therefore of all the components of the world situation - an idea that is by no means shared by the other groups of the communist left - that constitutes the major thrust of this resolution.
2) The May 1990 theses on decomposition highlight a whole series of characteristics in the evolution of society resulting from the entry of capitalism into this ultimate phase of its existence. The report adopted by the 22nd Congress noted the worsening of all these characteristics, such as:
- "the proliferation of famines in the ‘Third World’ countries…;
- the transformation of the ‘Third World’ into a vast slum, where hundreds of millions of human beings survive like rats in the sewers;
- the development of the same phenomenon in the heart of the major cities in the ‘advanced’ countries, … ;
- the recent proliferation of ‘accidental’ catastrophes (…) the increasingly devastating effects, on the human, social, and economic levels, of ’natural’ disasters …;
- the degradation of the environment, which is reaching staggering dimensions" (Theses on decomposition, pt. 7)
The report on decomposition to the 22nd Congress of the ICC also highlighted the confirmation and aggravation of the political and ideological manifestations of decomposition as identified in 1990:
- "the incredible corruption, which grows and prospers, of the political apparatus (...);
- the development of terrorism, or the seizure of hostages, as methods of warfare between states, to the detriment of the "laws" that capitalism established in the past to ‘regulate’ the conflicts between different ruling class factions;
- the constant increase in criminality, insecurity, and urban violence, (...);
- the development of nihilism, despair, and suicide amongst young people … and of the hatred and xenophobia (...);
- the tidal waves of drug addiction, which have now become a mass phenomenon and a powerful element in the corruption of states and financial organisms (...);
- the profusion of sects, the renewal of the religious spirit including in the advanced countries, the rejection of rational, coherent thought (...);
- the invasion of the same media by the spectacle of violence, horror, blood, massacres, (...);
- the vacuity and venality of all ‘artistic’ production: literature, music, painting, architecture (...);
-’every man for himself’, marginalisation, the atomization of the individual, the destruction of family relationships, the exclusion of old people from social life” (Theses on decomposition, pt. 8).
The report of the 22nd Congress focused in particular on the development of a phenomenon already noted in 1990 (and which had played a major role in ICC's awareness of the entry of decadent capitalism into the phase of decomposition): the use of terrorism in imperialist conflicts. The report noted that: "The quantitative and qualitative growth of the place of terrorism has taken a decisive step (...) with the attack on the Twin Towers (...) It was subsequently confirmed with the attacks in Madrid in 2004 and London in 2005 (...), the establishment of Daesh in 2013-14 (...), the attacks in France in 2015-16, Belgium and Germany in 2016". The report also noted, in connection with these attacks and as a characteristic expression of the decomposition of society, the spread of radical Islamism, which, while initially inspired by Shia (with the establishment in 1979 of the mullahs' regime in Iran), became essentially the result of the Sunni movement from 1996 onwards, with the capture of Kabul by the Taliban and, even more so, after the overthrow of Saddam Hussein's regime in Iraq by American troops.
3) In addition to confirming the trends already identified in the 1990 theses, the report adopted by the 22nd Congress noted the emergence of two new phenomena resulting from the continuation of decomposition and destined to play a major role in the political life of many countries:
- a dramatic increase in migration flows from 2012 onwards, culminating in 2015, and coming mainly from the war-torn Middle East, particularly following the "Arab spring" of 2011;
- the continued rise of populism in most European countries and also in the world's leading power with the election of Donald Trump in November 2016.
Massive population displacements are not a phenomenon specific to the phase of decomposition. However, they are now acquiring a dimension that makes them a singular element of this decomposition, both in terms of their current causes (notably the chaos of war that reigns in the countries of origin) and their political consequences in the countries of destination. In particular, the massive arrival of refugees in European countries has been a prime basis for the populist wave developing in Europe, although this wave began to rise long before (especially in a country like France with the rise of the National Front).
4) In fact, over the past twenty years, populist parties have seen the number of votes polled in favour of them triple in Europe (from 7% to 25%), with strong increases following the 2008 financial crisis and the 2015 migration crisis. In about ten countries, these parties participate in the government or parliamentary majority: Poland, Hungary, the Czech Republic, Slovakia, Bulgaria, Austria, Denmark, Norway, Switzerland and Italy. Moreover, even when populist groups are not involved in government, they have a significant influence on the political life of the bourgeoisie. Three examples can be given:
- in Germany, it was the electoral rise of the AfD that considerably weakened Angela Merkel, forcing her to give up the leadership of her party;
- in France, "Man of Destiny” Macron, an apostle of a "New World", although he managed to win a large victory over Marine Le Pen in the 2017 elections, has in no way succeeded in reducing the influence of the latter's party, which in the polls is hot on the heels of his own party, the République en Marche, which claims to be both of the "right and left" with political personnel on both sides (for example, a Prime Minister from the Right and a Minister of the Interior from the Socialist Party);
- in Great Britain, the traditionally most skilful bourgeoisie in the world has been giving us for more than a year the spectacle of deep distress resulting from its inability to manage the "Brexit" imposed on it by the populist currents.
Whether the populist currents are in government or simply disrupting the classic political game, they do not correspond to a rational option for the management of national capital nor therefore to a deliberate card played by the dominant sectors of the bourgeois class which, particularly through its media, is constantly denouncing these currents. What the rise of populism actually expresses is the aggravation of a phenomenon already announced in the 1990 theses: "Amongst the major characteristics of capitalist society's decomposition, we should emphasize the bourgeoisie's growing difficulty in controlling the evolution of the political situation" (Item 9). A phenomenon clearly noted in the report of the 22nd Congress: "What must be stressed in the current situation is the full confirmation of this aspect that we identified 25 years ago: the trend towards a growing loss of control by the ruling class over its political apparatus.”
The rise of populism is an expression, in the current circumstances, of the bourgeoisie's increasing loss of control over the workings of society, resulting fundamentally from what lies at the heart of its decomposition, the inability of the two fundamental classes of society to provide a response to the insoluble crisis into which the capitalist economy is sinking. In other words, decomposition is fundamentally the result of impotence on the part of the ruling class, an impotence that is rooted in its inability to overcome this crisis in its mode of production and that increasingly tends to affect its political apparatus.
Among the current causes of the populist wave are the main manifestations of social decomposition: the rise of despair, nihilism, violence, xenophobia, associated with a growing rejection of the "elites" (the "rich", politicians, technocrats) and in a situation where the working class is unable to present, even in an embryonic way, an alternative. It is obviously possible, either because it will itself have demonstrated its own powerlessness and corruption, or because a renewal of workers' struggles will cut the ground under its feet, that populism will lose its influence in the future. On the other hand, it cannot in any way call into question the historical tendency of society to sink into decomposition, nor the various manifestations of it, including the increasing loss of control by the bourgeoisie of its political game. And this has consequences not only for the domestic policy of each state but also for all relations between states and imperialist configurations.
The historic course – a paradigm change
5) In 1989-90, in the face of the dislocation of the Eastern bloc, we analysed this unprecedented historical phenomenon - the collapse of an entire imperialist bloc in the absence of a generalised military confrontation - as the first major manifestation of the period of decomposition. At the same time, we examined the new configuration of the world that resulted from this historic event:
“The disappearance of the Russian imperialist gendarme, and that to come of the American gendarme as far as its one-time ‘partners’ are concerned, opens the door to the unleashing of a whole series of more local rivalries. For the moment, these rivalries and confrontations cannot degenerate into a world war (even supposing that the proletariat were no longer capable of putting up a resistance). (…) Up to now, during the period of decadence, such a situation where the various imperialist antagonisms are dispersed, where the world (or at least its decisive zones) is not divided up between two blocs, has never lasted long. The disappearance of the two major imperialist constellations which emerged from World War II brings with it the tendency towards the recomposition of two new blocs. Such a situation, however, is not yet on the agenda (…) This is all the more true in that the tendency towards a new share-out of the planet between two military blocs is countered, and may even be definitively compromised, by the increasingly profound and widespread decomposition of capitalist society, which we have already pointed out (…)
Given the world bourgeoisie's loss of control over the situation, it is not certain that its dominant sectors will today be capable of enforcing the discipline and coordination necessary for the reconstitution of military blocs.” (“After the collapse of the Eastern bloc, destabilization and chaos”, International Review No. 61)
Thus, 1989 marks a fundamental change in the general dynamics of capitalist society:
- Before that date, the balance of power between the classes was the determining factor in this dynamic: it was on this balance of forces that the outcome of the exacerbation of the contradictions of capitalism depended: either the unleashing of the world war, or the development of class struggle with the overthrow of capitalism as the perspective.
- After that date, this dynamic is no longer determined by the balance of forces between classes. Whatever the balance of forces, world war is no longer on the agenda, but capitalism will continue to sink into decay.
6) In the paradigm that dominated most of the 20th century, the notion of a "historical course" defined the outcome of a historical trend: either world war or class confrontations; and once the proletariat had suffered a decisive defeat (as on the eve of 1914 or as a result of the revolutionary wave of 1917-23), world war became ineluctable. In the paradigm that defines the current situation (until two new imperialist blocs are reconstituted, which may never happen), it is quite possible that the proletariat will suffer a defeat so deep that it will definitively prevent it from recovering, but it is also possible that it will suffer a deep defeat without this having a decisive consequence for the general evolution of society. This is why the notion of "historical course" is no longer able to define the situation of the current world and the balance of forces between the bourgeoisie and the proletariat.
In a way, the current historical situation is similar to that of the 19th century. At that time:
- an increase in workers' struggles did not mean the prospect of a revolutionary period since proletarian revolution was not yet on the agenda, nor could it prevent a major war from breaking out (for example, the war between France and Prussia in 1870 when the power of the proletariat was rising with the development of the International Workingmen’s Association);
- a major defeat of the proletariat (such as the crushing of the Paris Commune) did not result in a new war.
That said, it is important to stress that the notion of "historical course" as used by the Italian Fraction in the 1930s and by the ICC between 1968 and 1989 was perfectly valid and constituted the fundamental framework for understanding the world situation. In no way can the fact that our organisation has had to take into account the new and unprecedented facts on this situation since 1989 be interpreted as a challenge to our analytical framework until that date.
7) As early as 1990, at the same time as we were seeing the disappearance of the imperialist blocs that had dominated the "Cold War", we insisted on the continuation, and even the aggravation, of military clashes:
“In the period of capitalist decadence, all states are imperialist, and take the necessary measures to satisfy their appetites: war economy, arms production, etc. We must state clearly that the deepening convulsions of the world economy can only sharpen the opposition between different states, including and increasingly on the military level. … For the moment, these rivalries and confrontations cannot degenerate into a world war. … However, with the disappearance of the discipline imposed by the two blocs, these conflicts are liable to become more frequent and more violent, especially of course in those areas where the proletariat is weakest.” (International Review No. 61, "After the collapse of the Eastern bloc, destabilisation and chaos")
“the present disappearance of imperialist blocs does not imply the slightest calling into question of imperialism's grip on social life. The fundamental difference lies in the fact that (…) the end of the blocs only opens the door to a still more barbaric, aberrant, and chaotic form of imperialism.” (International Review n°64, "Militarism and Decomposition")
Since then, the global situation has only confirmed this trend towards worsening chaos, as we observed a year ago:
“ … The development of decomposition has led to a bloody and chaotic unchaining of imperialism and militarism;
- the explosion of the tendency of each for himself has led to the rise of the imperialist ambitions of second and third level powers, as well as to the growing weakening of the USA’s dominant position in the world;
- The current situation is characterised by imperialist tensions all over the place and by a chaos that is less and less controllable; but above all, by its highly irrational and unpredictable character, linked to the impact of populist pressures, in particular to the fact that the world’s strongest power is led today by a populist president with temperamental reactions.” (International Review No. 161, "Analysis of Recent Developments in Imperialist Tensions, June 2018")
8) The Middle East, where the weakening of American leadership is most evident and where the Americans’ inability to engage too directly on the military level in Syria has left the field open to other imperialisms, offers a concentration of these historical trends:
- Russia has imposed itself as an essential power in the Syrian theatre thanks to its military force, in particular to preserve its naval bases in Tartus
- Iran, through its military victory to save its ally, the Assad regime, and by forging an Iraqi-Syrian land corridor directly linking Iran to the Mediterranean and the Lebanese Hezbollah, is the main beneficiary and has fulfilled its objective of taking the lead in this region, in particular by deploying troops outside its territory.
- Turkey, obsessed by the fear of the establishment of autonomous Kurdish zones that can only destabilise it, operates militarily in Syria.
- The military “victories” in Iraq and Syria against the Islamic State and the retention of Assad in power offer no prospect of stabilisation. In Iraq, the military defeat of the Islamic State did not eliminate the resentment of the former Sunni faction around Saddam Hussein that gave rise to it: the exercise of power for the first time by Shiites only further fuels it. In Syria, the regime's military victory does not mean the stabilisation or pacification of the shared Syrian space, which is subjected to the intervention of different imperialisms with competing interests.
- Russia and Iran are deeply divided over the future of the Syrian state and the presence of their military troops on its territory;
Neither Israel, hostile to the strengthening of Hezbollah in Lebanon and Syria, nor Saudi Arabia, can tolerate this Iranian advance; while Turkey cannot accept the excessive regional ambitions of its two rivals.
Nor can the United States and the West give up their ambitions in this strategic area of the world.
The centrifugal action of the various powers, small and large, whose divergent imperialist appetites constantly collide, only fuels the persistence of current conflicts, as in Yemen, as well as the prospect of future conflicts and the spread of chaos.
9) While, following the collapse of the USSR in 1989, Russia seemed doomed to play only a secondary power role, it is making a strong comeback to the imperialist level. A power in decline and lacking the economic capacity to sustain military competition with other major powers in the long term, it has demonstrated, through the restoration of its military capabilities since 2008, its very high military aggressiveness and its capacity to be a nuisance internationally:
- It has thus thwarted US “containment” (with the integration into NATO of its former Warsaw Pact allies) on the European continent with the annexation of Crimea in 2014, with the separatist amputation of Donbass breaking any possibility of making Ukraine a central part of the anti-Russian apparatus.
- It has taken advantage of America’s difficulties to push towards the Mediterranean: its military intervention in Syria has enabled it to strengthen its naval military presence in that country and in the eastern Mediterranean basin. Russia has also managed for the time being to make a rapprochement with Turkey, a NATO member, which is moving away from the American orbit.
Russia's current rapprochement with China on the basis of the rejection of American alliances in the Asian region has only a weak prospect of creating a long-term alliance given the divergent interests of the two states. However the instability of relations between the powers confers on Russia as a Eurasian state a new strategic importance in view of the place it can occupy in the containment of China.
10) Above all, the current situation is marked by China's rapid rise to power. The latter has the aim (by investing massively in new technological sectors, in artificial intelligence, etc) of establishing itself as the leading economic power by 2030-50 and acquiring by 2050 a "world-class army capable of winning victory in any modern war". The most visible manifestation of its ambitions is the launch since 2013 of the "new Silk Road" (creation of transport corridors at sea and on land, access to the European market and security of its trade routes) designed as a means of strengthening its economic presence but also as an instrument for developing its imperialist power in the world and in the long term, directly threatening American pre-eminence.
This rise of China is causing a general destabilisation of relations between powers, a serious strategic situation in which the dominant power, the United States, is trying to contain and block the threatening rise of China. The American response started by Obama taken on and amplified by Trump by other means - represents a turning point in American politics. The defence of its interests as a national state now means embracing the tendency towards every man for himself that dominates imperialist relations: the United States is moving from being the gendarme of the world order to being the main agent of every man for himself, of chaos, of questioning the world order established since 1945 under its auspices.
This "strategic battle for the new world order between the United States and China", which is being fought in all areas at once, further increases the uncertainty and unpredictability already embedded in the particularly complex, unstable and shifting situation of decomposition: this major conflict is forcing all states to reconsider their evolving imperialist options.
11) The stages of China's rise are inseparable from the history of the imperialist blocs and their disappearance in 1989: the position of the communist left affirming the "impossibility of any emergence of new industrialised nations" in the period of decadence and the condemnation of states "which failed to succeed in their ‘industrial take-off’ before the First World War to stagnate in underdevelopment, or to preserve a chronic backwardness compared to the countries that hold the upper hand" was valid in the period from 1914 to 1989. It was the straitjacket of the organisation of the world into two opposing imperialist blocs (permanent between 1945 and 1989) in preparation for the world war that prevented any major disruption of the hierarchy between powers. China's rise began with American aid rewarding its imperialist shift to the United States in 1972. It continued decisively after the disappearance of the blocs in 1989. China appears to be the main beneficiary of ‘globalisation’ following its accession to the WTO in 2001when it became the world's workshop and the recipient of Western relocations and investments, finally becoming the world's second largest economic power. It took the unprecedented circumstances of the historical period of decomposition to allow China to rise, without which it would not have happened.
China's power bears all the stigma of terminal capitalism: it is based on the over-exploitation of the proletarian labour force, the unbridled development of the war economy through the national programme of “military-civil fusion” and is accompanied by the catastrophic destruction of the environment, while national cohesion is based on the police control of the masses subjected to the political education of the One Party and the fierce repression of the populations of Uighur Muslims and Tibet. In fact, China is only a giant metastasis of the generalised militaristic cancer of the entire capitalist system: its military production is developing at a frenetic pace, its defence budget has increased six-fold in 20 years and has been ranked second in the world since 2010.
12) The establishment of the “New Silk Road” and China's gradual, persistent and long-term progress (the establishment of economic agreements or inter-state partnerships all over the world; with Italy, with its access to the port of Athens in the Mediterranean; in Latin America; with the creation of a military base in Djibouti - the gateway to its growing influence on the African continent) affects all states and upsets the existing balances.
In Asia, China has already changed the balance of imperialist forces to the detriment of the United States. However, it is not possible for it to automatically fill the “void” left by the decline of American leadership because of the domination of each for themselves in the imperialist sphere and the distrust that its power provokes. Significant imperialist tensions have crystallized in particular with:
- India, which denounces the creation of the Silk Road in its immediate vicinity (Pakistan, Burma, Sri Lanka) as a strategy of encirclement and an attack on its sovereignty, is undertaking a major programme to modernise its army and has almost doubled its budget since 2008.
- and Japan, which has the same desire to block it. Tokyo has begun to question its post World War II status limiting its legal and material capacity to use military force, and it directly supports regional states, diplomatically but also militarily, in order to confront China.
The hostility of these two states towards China is driving towards their convergence as well as their rapprochement with the United States. The latter have launched a four-party Japan-United States-Australia-India alliance that provides a framework for diplomatic, but also military, rapprochement between the various states opposed to China's rise.
In this phase of "catching up" with US power by China, it is trying to hide its hegemonic ambitions in order to avoid direct confrontation with its rival, which is harmful to its long-term plans, while the United States is taking the initiative now to block it and refocus most of its imperialist attention on the Indo-Pacific area.
13) Despite Trump's populism, despite disagreements within the American bourgeoisies on how to defend their leadership and divisions, particularly regarding Russia, the Trump administration adopts an imperialist policy in continuity and consistency with the fundamental imperialist interests of the American state. It is generally agreed among the majority sectors of the American bourgeoisie that it is vital to defend the USA’s rank as undisputed leading world power.
Faced with the Chinese challenge, the United States is undergoing a major transformation of its imperialist world strategy. This shift is based on the observation that the framework of "globalisation" has not guaranteed the United States' position but has if anything weakened it. The Trump administration's formalisation of the principle of defending only their interests as a national state and the imposition of profitable power relations as the main basis for relations with other states, confirms and draws implications from the failure of the policy of the last 25 years of fighting against the “every man for himself” tendency as a world policeman in defence of the world order inherited from 1945.
This turnaround by the United States is reflected in:
- its withdrawal from (or questioning of) international agreements and institutions that have become obstacles to their supremacy or contradictory to the current needs of American imperialism: withdrawal of the Paris Agreement on Climate Change, reduction of contributions to the UN and their withdrawal from UNESCO, the United Nations Human Rights Council, the Global Compact on Migrants and Refugees.
- the willingness to adapt NATO, the military alliance inherited from the blocs, which has lost much of its relevance in the current configuration of imperialist tensions, by imposing on the allies a greater financial responsibility for their protection and by revising the automatic character of the deployment of the American umbrella.
- the tendency to abandon multilateralism in favour of bilateral agreements (based on its military and economic strength) using the levers of economic blackmail, terror and the threat of the use of military brute force (such as atomic strikes against North Korea) to impose themselves.
- the trade war with China, largely with a view to denying China any possibility of gaining economic stature and developing strategic sectors that would allow it to directly challenge US hegemony.
- the questioning of multilateral arms control agreements (NIF and START) in order to maintain their technological lead and relaunch the arms race to exhaust America’s rivals (according to the proven strategy that led to the collapse of the USSR). The United States adopted in 2018 one of the highest military budgets in its history; it is relaunching its nuclear capabilities and is considering the creation of a sixth component of the US Army to “dominate space” to counter China's threats in the satellite field.
The vandalising behaviour of a Trump, who can denounce American international commitments overnight in defiance of established rules, represents a new and powerful factor of uncertainty, providing further impetus towards “each against all”. It is a further indication of the new stage in which capitalism is sinking further into barbarism and the abyss of untrammelled militarism.
14) The change in American strategy is noticeable in some of the main imperialist theatres:
- in the Middle East, the United States' stated objective towards Iran (and sanctions against it) is to destabilise and overthrow the regime by playing on its internal divisions. While seeking to continue its progressive military disengagement from the quagmire of Afghanistan and Syria, the United States now unilaterally relies on its allies in Israel and especially Saudi Arabia (by far the largest regional military power) as the backbone of its policy to contain Iran. In this perspective, they provide each of these two states and their respective leaders with the guarantees of unwavering support on all fronts to tighten their alliance (provision of state-of-the-art military equipment, Trump's support in the scandal of the assassination of the Saudis’ opponent Khashoggi, recognition of East Jerusalem as the capital of Israel and of Israeli sovereignty on the Syrian Golan Heights). The priority of containing Iran is accompanied by the prospect of abandoning the Oslo agreements, with its "two-state" solution (Israeli and Palestinian) to the Palestinian question. The cessation of US aid to the Palestinians and the PLO and the proposal for a “big deal” (the abandonment of any claim to the creation of a Palestinian state in exchange for considerable US economic aid) are aimed at trying to resolve the Palestinian bone of contention, which has been instrumentalised by all regional imperialisms against the United States, in order to facilitate de facto rapprochement between its Arab and Israeli allies.
- in Latin America, the United States is engaging in a counter-offensive to ensure better imperialist control in its traditional area of influence. Bolsonaro's rise to power in Brazil is not as such the result of a simple push of populism but results from a vast operation of American pressure on the Brazilian bourgeoisie, a strategy woven by the American state with the objective, now fulfilled, of bringing this state back into its imperialist fold. As a prelude to a comprehensive plan to overthrow the anti-American regimes of the "Troika of Tyranny" (Cuba, Venezuela and Nicaragua) we have seen the so-far abortive attempt to remove the Chavist/Maduro regime in Venezuela.
Washington, however, is clearly inflicting a setback on China, which had made Venezuela a political ally of choice for expanding its influence and has proved powerless to oppose American pressure. It is not impossible that this American offensive of imperialist reconquest of its Latin American backyard may inaugurate a more systematic offensive against China on other continents. For the time being, it raises the prospect of Venezuela's plunge into the chaos of a deadlocked clash between bourgeois factions, as well as an increased destabilisation of the entire South American zone.
15) The current general strengthening of imperialist tensions is reflected in the re-launch of the arms race and military technological supremacy not only where tensions are most apparent (in Asia and the Middle East) but for all states, all leading major powers. Everything indicates that a new stage is looming in inter-imperialist clashes and that the system sinking into military barbarism.
In this context, the EU (European Union) in relation to the international imperialist situation will continue to confront the tendency towards fragmentation as put forward in the Report on Imperialist tensions from June 2018 (International Review 161).
The economic crisis
16) On the economic level, since the beginning of 2018, the situation of capitalism has been marked by a sharp slowdown in world growth (from 4% in 2017 to 3.3% in 2019), which the bourgeoisie predicts will be worsening in 2019-20. This slowdown proved to be greater than expected in 2018, as the IMF had to reduce its forecasts for the next two years and is affecting virtually all parts of capitalism simultaneously: China, the United States and the Euro Zone. In 2019, 70% of the world economy has been slowing down, particularly in the ‘advanced’ countries (Germany, United Kingdom). Some of the emerging countries are already in recession (Brazil, Argentina, Turkey) while China, which has been slowing down since 2017 and is expected to grow by 6.2% in 2019, is experiencing its lowest growth figures in 30 years.
The value of most currencies in the emerging countries has weakened, sometimes considerably, as in Argentina and Turkey
At the end of 2018, world trade recorded zero growth, while Wall Street experienced in 2018 the largest stock market “corrections” in the last 30 years. Most indicators are flashing and point to the prospect of a new dive in the capitalist economy.
17) The capitalist class has no future to offer, its system has been condemned by history. Since the 1929 crisis, the first major crisis of the era of the decadence of capitalism, the bourgeoisie has not ceased to develop the intervention of the state to exercise general control over the economy. Increasingly faced with a narrowing of extra-capitalist markets, more and more threatened by generalised overproduction "capitalism has thus kept itself alive thanks to the conscious intervention of the bourgeoisie, which can no longer afford to rely on the invisible hand of the market. It is true that solutions also become part of the problem:
- the use of debt clearly accumulates huge problems for the future,
- the swelling of the state and the arms sector is generating appalling inflationary pressures.
Since the 1970s, these problems have led to different economic policies, alternating between ‘Keynesianism’ and ‘neoliberalism’, but since no policy can address the real causes of the crisis, no approach can achieve final victory. What is remarkable is the determination of the bourgeoisie to keep its economy moving at all costs and its ability to curb the tendency to collapse through gigantic debt." (16th international congress, Resolution on the international situation)
Produced by the contradictions of the decadence and historical impasse of the capitalist system, state capitalism implemented at the level of each national capital does not, however, obey a strict economic determinism; on the contrary, its action, essentially of a political nature, simultaneously integrates and combines the economic dimension with the social (how to face its class enemy according to the balance of forces between the classes) and imperialist dimensions (the need to maintain a huge armaments sector at the centre of any economic activity). Thus, state capitalism has experienced different phases and organisational modalities in the history of decadence.
18) In the 1980s, under the impetus of the major economic powers, such a new phase was inaugurated: that of "globalisation". In a first stage, it first took the form of Reaganomics, quickly followed by a second, which took advantage of the unprecedented historical situation of the fall of the Eastern bloc to extend and deepen a vast reorganisation of capitalist production on a global scale between 1990 and 2008.
Maintaining cooperation between states, using in particular the old structures of the Western bloc, and preserving a certain order in trade exchanges, were means of coping with the worsening crisis (the recessions of 1987 and 1991-93) but also with the first effects of decomposition, which, in the economic field, could thus be largely mitigated.
Following the EU's reference model of eliminating customs barriers between member states, the integration of many branches of world production has been strengthened by developing veritable chains of production on a global scale. By combining logistics, information technology and telecommunications, allowing economies of scale, the increased exploitation of the proletariat's labour power (through increased productivity, international competition, free movement of labour to impose lower wages), the submission of production to the financial logic of maximum profitability, world trade has continued to increase, even if less so, stimulating the world economy, providing a “second wind” that has extended the existence of the capitalist system.
19) The 2007-09 crash marked a step in the sinking of the capitalist system into its irreversible crisis: after four decades of recourse to credit and debt in order to counter the growing trend of overproduction, punctuated by ever deeper recessions and ever more limited recoveries, the 2009 recession was the most significant since the Great Depression. It was the massive intervention of the states and their central banks that saved the banking system from complete bankruptcy, racking up a huge public debt by buying back debts that could no longer be repaid.
Chinese capital, which has also been seriously affected by the crisis, has played an important role in the stabilisation of the world economy by applying plans to relaunch the economy in 2009, 2015 and 2019, based on massive state debts.
Not only have the causes of the 2007-2011 crisis not been resolved or overcome, but the severity and contradictions of the crisis have moved to a higher level: it is now the states themselves which are faced with the crushing burden of their debt (the “sovereign debt”), which further affects their ability to intervene to revive their respective national economies. “Debt has been used as way of supplementing the insufficiency of solvent markets but it can’t grow indefinitely as could be seen from the financial crisis which began in 2007. However, all the measures which can be taken to limit debt once again confront capitalism with its crisis of overproduction, and this in an international context which is in constant deterioration and which more and more limits its margin of manoeuvre” (International Situation Resolution, 20th ICC Congress).
20) The current development of the crisis through the increasing disruptions it causes in the organisation of production into a vast multilateral construction at the international level, unified by common rules, shows the limits of “globalization”. The ever-increasing need for unity (which has never meant anything other than the imposition of the law of the strongest on the weakest) due to the “trans-national” intertwining of highly segmented production country by country (in units fundamentally divided by competition where any product is designed here, assembled there with the help of elements produced elsewhere) comes up against the national nature of each capital, against the very limits of capitalism, which is irremediably divided into competing and rival nations. This is the maximum degree of unity that it is impossible for the bourgeois world to overcome. The deepening crisis (as well as the demands of imperialist rivalry) is putting multilateral institutions and mechanisms to a severe test.
This fact is illustrated by the current attitude of the two main powers competing for world hegemony:
- China has ensured its economic rise both by using the levers of WTO multilateralism while developing its own economic partnership policy (such as through the "New Silk Road" project aimed at counteracting the slowdown in its growth) without regard to environmental or "democratic" standards (a specific aspect of globalisation policy aimed at imposing Western standards and global competition between the beneficiaries and losers of globalisation). Ideologically, it challenges the Western liberal order that it considers to be in decline and since 2012 has been trying, through the creation of institutions (the Shanghai Organization, the Asian Development Bank...) to lay the foundations of an alternative competing international order, which the Western bourgeoisie describes as “illiberal”.
- The American state under the Trump administration (supported by a majority of the American bourgeoisie), considers itself the loser of "globalisation" (which it had originally initiated), its position as world leader having been eroded progressively by its rivals (mainly China, but also western powers like Germany). The policy of “America First” tends to bypass regulatory institutions (WTO, G7 and G20) which are increasingly unable to preserve America’s position (which had been their primary vocation) and to favour bilateral agreements that better defend its interests and the stability essential for conducting business.
21) The influence of decomposition is an additional destabilising factor. In particular, the development of populism further aggravates the deteriorating economic situation by introducing a factor of uncertainty and unpredictability in the face of the turmoil of the crisis. The coming to power of populist governments with unrealistic programmes for national capital, which weakens the functioning of the world economy and trade, is creating a mess, and raises the risk of weakening the means imposed by capitalism since 1945 to avoid any autarkic retreat into the national framework, encouraged by the uncontrolled contagion of the economic crisis. The mess of Brexit and the difficult exit of Britain from the EU provide another illustration: the inability of British ruling class parties to decide on the conditions for separation and the nature of future relations with the European Union, the uncertainties surrounding the "restoration" of borders, in particular between Northern Ireland and Eire, the uncertain future of a pro-European Scotland threatening to separate from the United Kingdom affect the English economy (by reducing the value of the pound) as well as that of its former EU partners, deprived of the long-term stability they need to regulate the economy.
The disagreements about economic policy in Britain, the US and elsewhere show that there are growing divisions not only between rival nations but also at home – divisions between “multilateralists” and “unilateralists”, but even within these two approaches (eg between “hard” and “soft” Brexiteers in the UK) Not only is there no longer any minimal consensus about economic policy even between the countries of the former western bloc – this question is also increasingly causing conflicts within the national bourgeoisies themselves.
22) The current accumulation of all these contradictions in the context of the advancing economic crisis, as well as the fragility of the monetary and financial system and the massive international indebtedness of states following 2008, open up a period of serious convulsions to come and once again place the capitalist system in front of the prospect of a new downward dive. However, it should not be forgotten that capitalism has certainly not definitively exhausted all the means it has to slow down its sinking into the crisis and to avoid uncontrolled situations, particularly in the central countries. The over-indebtedness of states, where an increased share of the national wealth produced must be allocated to servicing the debt, heavily affects national budgets and severely reduces their room for manoeuvre in the face of the crisis. Nevertheless, it is certain that this situation will not:
- end the policy of indebtedness, as the main palliative to the contradictions of the crisis of overproduction and a means of postponing the inevitable, at the cost of ever more serious future convulsions;
- put any brake on the mad arms race to which each state is irrevocably condemned. This is taking on a more manifestly irrational form with the growing weight of the war economy and the production of arms, the growing share of their GDP that will continue to be devoted to it (and which today is reaching its highest level since 1988, at the time of the confrontation between imperialist blocs).
23) Concerning the proletariat, these new convulsions can only result in even more serious attacks against its living and working conditions at all levels and in the whole world, in particular:
- by strengthening the exploitation of labour power by continuing to reduce wages and increase rates of exploitation and productivity in all sectors;
- by continuing to dismantle what remains of the welfare state (additional restrictions on the various benefit systems for the unemployed, social assistance and pension systems); and more generally by “softly” abandoning the financing of all forms of assistance or social support from the voluntary or semi-public sector;
- the reduction by states of the costs represented by education and health in the production and maintenance of the proletariat's labour power (and thus significant attacks against the proletarians in these public sectors);
- the aggravation and further development of precariousness as a means of imposing and enforcing the development of mass unemployment in all parts of the class.
- attacks camouflaged behind financial operations, such as negative interest rates which erode small saving accounts and pension schemes. And although the official rates of inflation for consumer goods are low in many countries, speculative bubbles have contributed to a veritable explosion of the cost of housing.
- the increase in the cost of living notably of taxes and the price of goods of prime necessity
Nevertheless, although the bourgeoisie in all countries is more and more compelled to strengthen its attacks against the working class, its margin of manoeuvre on the political level is by no means exhausted. We can be sure it will make use of every means to prevent the proletariat from replying on its own class terrain against the growing deterioration of its living conditions imposed by the convulsions of the world economy.