From the 20th of December to early January the economic and social chaos in Argentina was headline news. The economy went into free fall, the population took to the streets and five presidents came and went within as many weeks. These events expressed a spectacular worsening of the economic, social and political crisis in Argentina. This article seeks to analyse the main implications of this situation for the working class.

The Argentinean economy is totally bankrupt: it has been in recession for the last three years, and now the level of debt represents more than half of the GNP. Three quarters of export earnings are eaten up by simply paying the interest of the $150 billion foreign debt; unemployment affects half the active population. Argentina is a country which in the space of ten years has gone from hyperinflation to hyper-debt. After three years of recession and the “salvage” plan of 2000 the IMF refused, last November, to unblock billions of dollars that had been promised. Without this money to service its gigantic debt, the government imposed a “little bank holiday”: people could now only take out a maximum of 1000 pesos a month. Savings and wages were kidnapped by the state itself. After three years of recession, three years of galloping unemployment, poverty, job insecurity, after wages and pensions being cut month after month, people are now faced with their bank accounts being confiscated by the state. Everywhere, economists, experts, all sorts of hacks, are putting forward their analyses of Argentina’s particular misfortunes (seeing the cause in corruption, domination by US capital and similar symptoms). But whatever analysis it puts forward, the bourgeoisie’s “solution” is the same as always: to make the proletariat pay, to exploit it even more. Wherever similar economic disasters have taken place, be it South East Asia, Russia, Turkey or Mexico, such “new plans” have amounted to nothing more than the same old trick.

Argentina is no exception; rather it is a forerunner of what is going to happen throughout large areas of the world.

In Argentina’s case the IMF is doing all it can to avoid it contaminating neighbouring countries and even Europe. The IMF has made it very clear that it would be suicidal to provide the bottomless pit that is Argentina with new loans. Such actions would indeed only spread the disease of hyper-debt. Therefore, the only way to proceed is, as always, to squeeze the workers and non-exploiting classes even more.

At the same time, the IMF, as the representative of the western bourgeoisie, has to put up a wall against its particularly corrupt and arrogant Argentinean counter-parts. If in March 2001 there were three finance ministers within 10 days, now within the space of 15 days there have been 5 presidents one after the other! All of these have used every nuance of Peronism, from the comic populism of Rodriguez Saa who promised “the immediate stoppage of debt payments” this “to be followed by a million jobs”, to the dyed-in-the-wool populist Duhalde who was the Peronist candidate against De La Rua and who now criticises “all the stupid and corrupt who have got us into this mess” referring, amongst others, to his former buddy Menem.

The unpegging of the Peso from the Dollar

Along with the blocking of savings, the new government decided to unpeg the peso from the dollar, which means that two “floating” pesos are worth a dollar. This measure has been presented in a very demagogic way: it is necessary to stop the flight of capital; thus for those who want to buy dollars, 1 peso will still equal 1 dollar. On the other hand, in order to buy foreign goods, it will be necessary to use the “actual” peso, which is worth much less. The result of this for a population where pauperisation is already widespread is price increases for essential necessities. The “miracle worker” Cavallo (former Economics Minister) who invented “dollarisation” ten years ago in order to strangle hyperinflation, was brought back in to strangle hyper-debt. Now the self-same Cavallo can be thanked for the return of inflation and an increase in the cost of living, along with a freeze on wages. However, it is clear that today the situation is even worse. And, what is more important, the entire world economy is now in open recession.

The working class must not allow itself to be drowned by the other social layers

Over the last three years unemployment and insecurity has increased daily for the working class in Argentina. Today the degradation of its living conditions has gone into freefall.

But another aspect of the Argentinean crisis is the pauperisation of what the sociologists call the “middle class”, the pride of the Argentinean “nation”. By this they mean shopkeepers, small business people, the liberal professions (these petty bourgeois layers are often then thrown into the sociological mix with state employees, who are mainly workers). The “little bank holiday” of accounts was a serious blow for the Argentinean petty-bourgeoisie, which was already impoverished, bitter and desperate. The confiscation law has hit them with full force. Nevertheless, they have to be seen for what they are: the “middle class”, not the proletariat. The hunger riots, the looting of supermarkets and lorries transporting basic foodstuffs, the “cacerolazos” (the banging of saucepan lids as a sign of protest by demonstrators) have been clearly marked by the presence of these social layers. Most of these events have been called by their organisations: in Cordoba, the violent demonstrations were organised by the PME. In Buenos Aires, alongside the shopkeepers have been the lawyers who have led the demonstrations against the “corrupt judges” of the Supreme Court.

It’s true that the initial impetus behind the looting of supermarkets often came from the poorest strata in society, which included many proletarians. But in the first place such actions in themselves are not characteristic of the proletarian struggle, since instead of focussing on the collective appropriation of the means of production and distribution, they centre round the individual acquisition of consumer goods. In the second place, both the looting and the subsequent demonstrations came to be heavily dominated by the petty bourgeois elements, so that the workers could not affirm their independent demands and interests. The weight of the middle classes was symbolised in the loud displays of nationalist flag-waving on many of the demonstrations.

The working class in Argentina thus finds itself in a very difficult situation. Faced with an enormous attack on its living standards and a veritable social and political crisis, it has so far been unable to assert its own class interests or its confidence in itself as a distinct social force, and has been swept along by a growing tide of directionless anger.

The proletariat in Argentina is certainly one of the most combative in Latin America. Since 1968 there have been a number of upsurges of militancy. In 1969 workers in Cordoba - the second biggest city - took control of the city for several days. In the 1990’s and even in 2001 there have been general strikes involving hundreds of thousands of workers. And in the last year or so there has been a movement of unemployed workers in Argentina, which has seen assemblies of unemployed workers seeking to organise their struggle. These assemblies have also attracted employed workers. It also appears that prior to the December/January events there had been a growing number of strikes among numerous sectors.

However, despite this combativity the working class in Argentina has been unable to push back the attacks of the bourgeoisie. As well as suffering from the general blows against proletarian self-confidence inflicted by the campaigns against communism and the advancing decomposition of capitalist society, it has also had to battle against more specific ideologies: the democratic illusions inherited from the period of military dictatorship, the populist myths of Peronism, the poison of nationalism (the strength of which was demonstrated by the ability of the hated military junta to mobilise support for the absurd Malvinas adventure in 1982). The unions also have a strong ideological weight in the class. Whilst many workers don’t trust the main union, the CGT, which is run by the Peronist mafia, these state organs are still able to mobilise hundreds of thousands of workers in general strikes. Whilst democratic illusions may have been weakened by experience, with many workers now distrusting all bourgeois politicians, this distrust is being channelled into inter-classist protests about corruption, against the IMF etc.

The very serious nature of the difficulties facing the working class in Argentina is exemplified by a recent event. On Friday the 11th January 600 “piqueteros”, composed of a group of very combative workers and unemployed, gathered in front of the Buenos Aires Central Market to load crates of provisions into lorries in order to take them to workers’ neighbourhoods when they were attacked with sticks by a group of a thousand, underpaid, porters from the Central Market. They were chased into fields where many were beaten and seriously injured. This is not just an anecdote. As an Argentinean newspaper remarked “The confrontation between the exploited and the starving pathetically syntheses the foundations of the Argentinean crisis, the beating up of the “piqueteros”, in order to drive them away from the Central Market by a group of porters”. Here we have a tragic conflict between, on the one hand, the “piqueteros” who have dissipated their combativity in the blocking of roads and other radical actions without any result; and on the on the other hand, the porters manipulated by the Peronist unions as shock troops of Mafiosi politicians.

Today, faced with the situation of poverty which confronts it, the anger of the working class in Argentina is being dissipated amongst a morass of futureless social layers. To claim to help the working class by becoming over-excited about this movement and by uncritically applauding an inter-classist popular revolt, because it appears to be against the interests of the bourgeoisie, is to push the proletariat even further into the arms of the decomposing petty-bourgeoisie. This is precisely the role being played by the leftist groups inside and outside Argentina, particularly the Trotskyists who claim that there is already a revolutionary situation in Argentina (1).

It is only through developing its struggle on its own class terrain, affirming itself as an autonomous class with its own means of struggle - massive strikes and demonstrations around demands common to all the exploited - that it will be able to integrate into its own struggle the other social layers who are victims of poverty and capitalist austerity. And in the longer term, struggling on its own terrain is the only way that will allow the working class to put an end to its misery, through building a balance of force in its struggle that will allow it to overthrow capitalism on a world scale. Only the affirmation of its revolutionary perspective will enable the proletariat to build another society based not on exploitation and profit and the laws of the world market, but on the satisfaction of human need. And it is only in a world communist society that the distribution of the means of consumption will be effectively developed for the whole of humanity.

In this sense, revolutionaries have to be clear; their role is not to console their class, but to insist that it defends its own perspective and its own interests, to put it on guard against the dangers that menace it. In particular, the proletariat cannot allow itself to be lead astray by the inter-classist revolts and democratic illusions.

As we have always made clear, this revolutionary perspective depends essentially upon the development of the struggle of the most concentrated and experienced battalions of the world proletariat, and above all, those in the old Western Europe. Due to their long experience of the traps of the democratic state, of the parliamentary games and union manoeuvres, only the proletariat of the most industrialised countries can open the gates to the international generalisation of struggles and the ultimate overthrow of capitalism. It was in old Europe that capitalism was born and created its own gravedigger. It is in this part of the world that the proletarian giant will deliver the first decisive blows.

To openly acknowledge the difficulties facing our class has nothing to do with ‘Eurocentrism’ or ‘indifference’ towards the workers in the peripheral countries. We cannot hope to succeed against our enemy unless we make an honest appraisal of the strengths and weaknesses on our side of the class barricade.

PN 20.1.02

(1) The leftist and anarchist press has talked about the emergence of “popular assemblies” or “neighbourhood assemblies”, even of assemblies of delegates from these organs. We do not have enough material at our disposal to define the class nature of these organs. Certainly their territorial nature, in the present situation where the working class is finding it so hard to struggle independently, would make them highly vulnerable to the influence of non-proletarian strata, when they are not creations of the leftists pure and simple. But to claim, as the leftists do, that these are embryonic soviets, is to indulge in a false radicalism which serves to prevent the workers from measuring the true scale of the task in front of them.

The world capitalist economy is openly in crisis. Japan, the US and now Germany are officially in recession. The economic indicators are in the red. In 2002, the rate of growth in the 30 OECD countries will not go above 1%. The optimistic assurances of the experts about the recovery being just around the corner look more and more like whistling in the dark.

The reality is that working class living standards are in decline all over the world. Take the growth of unemployment. In the USA, 2 million jobs were lost in 2001. Huge new redundancy plans have been announced in the heart of the industrialised countries, in all sectors, from the car industry (eg, 60,000 at Fords USA) to aeronautics (eg the 6000 at Airbus, following the massive lay-offs in the wake of the September 11 attacks); from new technology (computers, mobile phones) to old industry (mines in Spain, steel in Germany) and services (the tens of thousands of jobs threatened in the post in Britain). Not to mention the collapse of the ‘internet economy’ where the speculative bubble burst some time ago. At the same time we are seeing the dismantling of welfare systems, as in the health service in France and Britain, or the brutal reductions in pensions in Germany and Italy. Flexibility, part-time and precarious jobs are being imposed in different forms in all countries. Since the summer of 2001, the adoption of the Euro has served as a pretext for raising the cost of living across Europe.

After going through three months of recession, Argentina’s dive into bankruptcy is a real pointer to the future that capitalism has in store for us. This country was formerly presented by the world bank as a model of economic improvement. Now the only way that the latest president Duhalde can get the loan he needs from the IMF is to promise another 100,000 redundancies. Not only are other Latin American states like Brazil and Chile teetering on the same brink, but the ‘tiger’ economies of South East Asia, which have already been through the 1997 crash, are facing new alarms. The bankruptcy of Argentina, like the collapse of the US energy giant Enron, are signs of the global bankruptcy of the capitalist system.

The fact that capitalism has no way out of its crisis transforms economic competition between nations into a spiral of military confrontations. Against the background of a saturated world market, the nation states of the world are hurled into conflicts in which strategic interests take over from the immediate hunt for profit. All countries, big and small, are caught up in the logic of imperialism, of accelerated military spending and of open or concealed conflicts with their rivals. Ever since World War One, capitalism has been in a permanent state of war; war has become inseparable from the survival of the capitalist mode of production. This has been shown to be more true than ever since the downfall of the Russian bloc, which was supposed to usher in a new era of world peace. In fact the resulting dissolution of the old bloc discipline has merely released the appetite of every imperialist power to pursue its own national interests and has multiplied the arenas of conflict.

The military intervention in Afghanistan, presented as a “war against terrorism”, is a concentrated expression of the contradictions of the system. It is being led by the world’s cop, the USA, in order to impose a disciplined world order that corresponds to its interests; but it succeeds only in spreading further chaos, in stirring up new conflicts. In Afghanistan itself, which is already in a state of utter ruin, fighting has already begun between the various factions who have been brought in to succeed the Taliban. The Afghanistan conflict has in turn helped to aggravate the rivalries between India and Pakistan, and between Israel and the Palestinians. Meanwhile Bush is talking about an “axis of evil” that includes Iran, Iraq and North Korea, all of whom could be future targets of the “war against terrorism”. US troops have also been sent to the Philippines to help the government crush the Islamic insurgents there. Bush has made it quite clear that the anti-terrorist crusade will go on indefinitely and will be aimed at all who give succour to the USA’s enemies. And these enemies, in the final analysis, also include the USA’s nominal allies. One of the key strategic aims of the Afghanistan war is to enable the US to put a block on any further European (and particularly German) advance towards the Middle East and Central Asia.

In all these conflicts, it is always the civil population, the exploited and the oppressed, who are the main victims � bombed, massacred, exiled, forced to beg for handouts in refugee camps where they face death through starvation, cold and disease. This plunge into the barbarity of war is the clearest of all expressions of the historic bankruptcy of a system which now threatens the very survival of the human race.

The social order which throws millions of workers onto the dole in the industrialised countries is the same social order which slaughters the civil populations in the weaker countries. This is why it’s so important for proletarians to understand this connection: by fighting against the devastating effects of the economic crisis, by affirming their own class interests, workers are also fighting against the roots of war and barbarism. By taking up the combat against job-cuts and wage-cuts, against the deterioration of its living and working conditions, the working class is laying the groundwork for a wider and deeper combat against the capitalist system and its deadly train of war and catastrophe.

WR 2.2.02

War today has become a permanent feature of daily life under capitalism the world over. Since the Gulf War, the world working class has again and again been confronted with the reality of war � numerous wars in Africa and Yugoslavia, the war in Kosovo, the Chechen war, the war in Afghanistan and now the war drive in India and Pakistan where two nations with nuclear weapons are at each others’ throats.

This reality of a war-racked decomposing capitalist system is indeed horrific. Without a historical, marxist framework it may fill one with despair. It is this historical materialist analysis of the reality of capitalism today that provides the key to understanding the wars and the crises ravaging the world capitalist system.

The wars, and the whole cycle of crises, wars, and reconstruction (First World War, Second World War, the setting up of blocs at Yalta), that have ravaged the capitalist system since the beginning of 20th century can only be understood in the framework of the onset of the decadence of this system since 1914. At the same time, the immediate framework in which the current wars are unfolding is defined by the collapse of the system of blocs at the end of the 1980s and the decomposition of the capitalist system. As we have repeatedly shown, the collapse of the Soviet bloc in 1989 in turn led to the collapse of the western bloc. This eliminated the discipline of blocs, which used to contain the uncontrolled eruption of conflicts among the smaller powers. The reality that has unfolded since then is best defined by ‘every man for himself’, where all powers, big or small, are out to satisfy their imperialist appetites at whatever cost. The great powers, including the world’s only superpower, the global gangster, the US, find it more and more difficult to contain these conflicts among the lesser gangsters.

The wars referred to earlier have been the product of this tendency of everyman for himself. The beating of the war drums between India and Pakistan, the war that is being prepared between them today, while rooted in their past, is unfolding in this global framework of spreading chaos, this tendency of everyman for himself.

The latest war drive between India and Pakistan

Since the December 13 terrorist attack on the Indian parliament, the Indian bourgeoisie has been clamouring for war against Pakistan. In the wake of this attack, all factions of the Indian bourgeoisie met in parliament on 18th Dec and declared their support for any military or diplomatic action, including war, the government might take, like the Americans, to ‘punish’ the ‘terrorists and their backers’.

Immediately after this, the Indian bourgeoisie started a campaign of war-mongering. The politicians started making statements to stir up war hysteria and the media started whipping up war frenzy through ‘patriotic’ reporting about preparations for war. This has been accompanied by a mobilisation for war all along the border. Nearly half a million soldiers have been moved to the border between India and Pakistan. This has been reciprocated by their Pakistani counterparts. Both states have moved their military machines to the borders.

Both India and Pakistan have moved civilian populations out of the border areas. They have been laying mines in the cornfields on the borders.

This sabre-rattling has been accompanied by a ‘diplomatic offensive’ by India, a game in which the Pakistani bourgeoisie is on a weaker wicket at this moment. The Indian bourgeoisie has recalled its ambassador from Pakistan. Each one has asked the other to cut diplomatic staff by 50% and has restricted the movement of diplomatic personnel to capital cities. Both have forbidden each other from the use of their air space for civilian flights and have cut all transport links. There is also talk of abrogating some old treaty � the ‘Indus Water Treaty’. At one level they have completed all preparations for war, with both armies standing face to face to start killing each other at any time.

“Either we live or you live”

On the surface all this is just a result of the December 13 attack on the Indian Parliament. But if it finally breaks out, this war won’t be the first between Pakistan and India. Since their birth in 1947, India and Pakistan have already fought four open wars (1948, 1965, 1971, and 1999) and have been on the brink of open war on a number of occasions. When not engaged in open war, they have been involved in ‘proxy wars’ as in Kashmir, or earlier in the Indian Punjab and in Karachi/Sindh.

The very birth of these two states is rooted in war. Their relation � in the minds of their ruling bourgeoisies � seems to be defined by a simple, deadly equation � “Either we live, or you live”. An equation that characterised the relations of the two blocs during the cold war and ended with the destruction of the Soviet bloc. The bourgeoisie in Pakistan speaks of “bleeding India to death by a thousand cuts” (daily war in Kashmir, Khalistan, elsewhere). And the Indian bourgeoisie often speak of the need for a “final war” with Pakistan, which alone will allow peace to prevail. This talk of “bleeding through a thousand cuts” and of a “final war”, in addition to expressing their mutual hatred, also expresses their respective strengths and strategic calculations.

Who carried out the December 13th attack?

Regarding the December 13 attack on the Indian Parliament in which 14 people were killed, the Indian bourgeoisie quickly decided and declared, as the Americans did after 11th Sept for Bin Laden, that these were carried out by Let and Jaish, the two Pakistani based terrorist groups, with the help of ISI, the Pakistani secret service. They demanded that Pakistan take action against these gangs. Simultaneously they started mobilising for war.

The claims of the Indian bourgeoisie about Let and Jaish have been accepted by the world bourgeoisie � the Americans and British banned them soon after India’s declarations. Under their pressure, Pakistan has also banned Let and Jaish and arrested their leaders.

On the surface the terrorist attack on India has not benefited the Pakistani bourgeoisie. It has in fact come in handy for the Indian bourgeoisie to put Pakistan in a corner. Yet it is possible that Let and Jaish carried it out with the connivance of dissident elements within the Pakistani state who thought a war between India and Pakistan would serve their interests. It is also possible that the Indian state itself allowed this attack to happen. In any case, it has been extremely successful in using it to put Pakistan on the mat. Even before this, the Indian state had strengthened its offensive in Kashmir. More people are now being killed everyday in Kashmir than at any recent time.

But a more concrete encouragement for the Indian bourgeoisie to go onto the offensive has been the turn of events in Afghanistan. For years the Taliban regime in Afghanistan acted as an extension of the Pakistani state. Pakistan used Taliban-ruled Afghanistan as a training centre, as a staging ground to fan separatist movements in Kashmir, but also in central Asia and Chechnya. Afghanistan was for Pakistan what it is now aimed to be for America � a conduit for the spread of its influence in Central Asia. Pakistani strategists used to say that control over Afghanistan gave Pakistan a strategic depth vis-a-vis India. This is one reason why the US has had to kick Pakistan to join the so-called coalition against terrorism and for the destruction of the Taliban regime.

The destruction of the Taliban has been a severe blow to Pakistan. It has relatively weakened its position and thrown the Pakistani bourgeoisie into disarray. It has fostered divisions within its ranks. The Indian bourgeoisie has taken advantage of this situation and accelerated its offensive against Pakistan.

Will war break out?

Left to itself, the Indian bourgeoisie would go to war. But this does not suit the interests of the only superpower, the US. It is engaged in its ‘war against terrorism’ in Afghanistan. Although the Taliban regime has been destroyed, America still needs Pakistani support, forced or willing, to achieve its strategic goals � completely destroying the Taliban, establishing a stable regime that is under its full control, using it to penetrate the Central Asian republics and to oversee the whole landmass around Afghanistan. Immediately, a war between India and Pakistan would jeopardise all this. It would compel the US to take sides and upset its long-term plan to dominate this whole area.

Also, the US is aware that given their deep-rooted hostility, and especially given the desperation of the Indian bourgeoisie, a war between India and Pakistan has the possibility of turning into a bigger conflagration. There is a risk that if war seriously endangers Pakistan, it will compel China to flex its muscles (China has already been expressing its ‘mounting worries’ about the tensions between India and Pakistan and there have been reports of Chinese troop movement on the Indo-China border). This would in turn compel the US to react.

Owning to all this, the US has been putting increasing pressure both on India and Pakistan � on India to ‘use restraint’, on Pakistan to take action against terrorists. In this the US has been joined by a plethora of ‘world leaders’ � Tony Blair, Chirac, Annan etc (although these ‘allies’ don’t hesitate to pursue their own national interests during their ‘peace’ initiatives). So far this pressure has been successful in holding back the two combatants. At this moment, it seems very likely that a war will not break out immediately in south Asia.

Even if ‘peace’ prevails for the moment and the imperialist interests of the global powers are successful in compelling India and Pakistan to disengage and demobilise, it will only be a temporary interlude. This won’t be only because of the legendary enmity of India and Pakistan, but because the very logic of capitalism is war.

The tasks of the working class

As part of its war preparations, the bourgeoisie has been trying to whip up national hatred and patriotic frenzy. But the working class has nothing to gain from this war, these imperialist conflicts of their rulers and exploiters. They must refuse to be taken in by the propaganda of the bourgeoisie. The working class can advance its interests only by developing its class struggle against its exploiters, and by establishing its class unity across national boundaries. The working class and its revolutionary vanguard, the communists, have no sides to choose. They oppose all sides in the war and call for worldwide unity of the working class, for the destruction of capitalism.

CI January 2002