The killing and maiming in the Middle East is continuing and escalating. The construction of the huge Israeli wall to keep Palestinians out is destroying the water supply to many people, and will also further damage the economy. It is just one dramatic step in the escalating cycle of violence. After the Israeli offensive against the Palestinian areas, including the near destruction of Jenin, the riposte was bloody and determined. Time and again suicide bombers have entered the towns and cities of Israel, exploding their bombs at bus stops and in restaurants or driving a car filled with explosives into a bus. Men and women going to work, teenagers returning from a trip to the countryside and children going to school have all been slaughtered. And each time Israel has replied in kind, occupying more Palestinian areas, using tanks and planes to shell towns and villages and killing people out looking for food in the mistaken belief that a curfew had ended. All the time it is workers and their families who pay the price, who are considered legitimate targets by both sides, who live in fear, and who struggle every day just to survive. This situation, however, is not some aberration, but is typical of war in this period. Civilian casualties are neither avoided nor accidental but are the main focus of the war.
The responsibility of the great powers
This escalation of the fighting has been matched by an increasingly open antagonism between the US and most major European powers over Washington’s call for the Palestinian leadership to be replaced and its refusal to have any further dealings with Yasser Arafat. This has not stopped them all prattling on about ‘peace’ and ‘conflict resolution’. The Oslo Accords and the Saudi proposals are still bandied about, while the US and the EU have murmured about possible new talks. All of these soothing sounds are meant to convince us of their concern and their commitment to peace and ending the bloodshed. Above all it is meant to preserve the lie that the barbarism that haunts every shattered refugee camp and every mangled bus has nothing to do with them, that it flows from the obtuse, irrational hatreds of those who dress babies as suicide bombers and who shoot children. Nothing could be further from the truth. The whole history of the region has been determined by the great powers. America has long been Israel’s protector, without whom the country would have been destroyed years ago, while the Palestinian ‘liberation’ struggle was a pawn of Russia’s imperialist ambitions during the Cold War. After 1989, Washington seemed able to impose the Pax Americana across the whole region, making overtures to the Palestinians while asserting tighter control over Israel. The latter however, in common with many other countries freed from the grip of the blocs, began to assert its own interests.
In the period since September 11, the US has mounted a global offensive, declaring a state of permanent war and stating that all who are not with it are against it. It has shown a determination to act on its own, as and when it sees fit. Its aim has not really been the so-called “axis of evil” but the rival great powers, in particular Germany, France and Britain, who have repeatedly struggled to assert their own interests and undermine the US. The message was driven home by the war in Afghanistan, during which the US made no pretence of needing any kind of international alliance. This was underlined through its deliberate humiliation of Britain, which, after posturing about its vital role and the professionalism of its military, was left chasing rumours and blowing up empty caves. The will to impose its massive military force without any assistance has been underlined again by Washington’s drive to go to war with Iraq, a war that would have the removal of Saddam Hussein at its heart. America has seized the initiative and, to date, has retained it. It has less need to win countries over since it has been able simply to impose its will on them. Behind this lies its overwhelming military superiority, which gives it the means to wage war around the globe on several fronts at one time. Its contempt for the international bodies that its rivals try to use to contain it was shown again at the start of July when it refused to recognise the new International Criminal Court.
Washington’s change of policy
In the Middle East the US has remained dominant throughout this period. Its major rivals have been unable to mount any real challenge. Arafat may be photographed welcoming various envoys from Europe, but it is always America that he watches and whose words make him respond. Israel still remains dependent on the US. American policy may have become more supportive of Israel’s harsh responses, but it is not Israel that dictates to America, despite the strength of the pro-Israel lobby in Washington. The parameters of the game continue to be defined by the US. On the one hand it continues to fund Israel and supply it with arms, on the other it still retains influence with the Palestinians, the CIA, for example, continuing to advise Arafat on possible ‘reforms’ to his police force.
However, the fact that America is the dominant force does not mean that it controls everything. The corrosive violence that has marred the area for so long continues to get worse and to spread. Arafat, who had been given some power on the basis of his ability to control the militants, has shown himself unable to contribute as America hoped when it gave him its backing.
These are the reasons why President Bush, in his policy speech on the Middle East on 24 June, called on the ‘Palestinian People’ “to elect new leaders, not compromised by terror” and why, a few days later, it was made clear that the US government would no longer have any official dealings with Arafat. By giving its backing to Israel the US is acting in continuity with its ‘anti-terrorist’ crusade - after all Al-Qaida and many similar gangs constantly refer to the situation of the Palestinians. It is also an admission that, whatever they say in their propaganda, there is no possibility of peace within capitalism, only a new stalemate, albeit at a higher level of violence.
However, Washington is no longer aiming for any appearance of a peace process. For all Bush may make pious calls for a Palestinian state in the future, the refusal to deal with Arafat is the refusal to deal with the Palestinians. Full stop. If not Arafat, which faction will they deal with? Hamas? The USA’s new aggressive policy is supporting the crushing, undermining and humiliation of the Palestinian forces that are the only potential clients of rival great powers wanting a foothold in the Middle East.
The American ruling class, like all ruling classes, is not concerned about the death or suffering of innocent people. Indeed, the terror that now hangs over the whole region serves its interests well.
America’s rivals try to fight back
The strength of the US in the Middle East has not prevented its main rivals from trying to undermine its efforts in the region. Leading politicians in France and Germany have openly criticised America’s apparent change of policy. The new French Foreign Minister said, “Only the Palestinians themselves can choose their leaders”, a view echoed by the German Foreign Minister. The Danish Prime Minister declared “We will not demand that Arafat or any other leader in the region is removed” (Guardian 26/6/02).
Britain has joined this criticism, Prime Minister Blair arguing “It is up to the Palestinians to choose their own leaders” (ibid). Cherie Blair said that the suicide bombers’ behviour was understandable because of their desperate situation. This was backed up by foreign secretary Straw a few days later saying much the same thing in more diplomatic language.
As the US has become more aggressive, more vocal in its criticism of Arafat and more tolerant of Israel’s retaliation, so a campaign has been built up on the theme of Bush’s ‘bad leadership’. The Guardian newspaper has been particularly prominent in this. In early June it took up the argument for a peace conference, calling on the US to support it since “unless the US becomes fully engaged, the process will never start” (Guardian, 6/6/02). It also declared that Bush’s speech “ends any remaining pretence of US impartiality” and concluded, “Mr Bush has ... set back the cause of peace. Forget Mr Arafat for a moment. Americans and Israelis also deserve better leaders” (Guardian 26/6/02).
This campaign shows the determination of the other great powers, Germany, Britain and France, to try and maintain a toehold on the region. But it also shows their present weakness. When the US and Israel are imposing their will with massive brute force, they bleat on about a ‘peace conference’ and ‘impartiality’; when Washington’s ally has massive military superiority, they are left trying to curry favour with a Palestinian leader who can only step outside his front door when given leave by his enemies.
The place of the working class
The working class has an interest in all of this. But it does not lie in the hypocritical ‘humanitarianism’ of the governments which have tears in their eyes and blood on their hands. Nor does it lie in the equally hypocritical calls on workers to take sides, to defend Palestinians against Israeli oppression or Israelis against Palestinian terrorism. In Britain it is mostly the former that is peddled by the left under the pretence that the Palestinian ‘liberation’ struggle is somehow progressive and ‘anti-imperialist’. This is nothing more than a trap set for workers who have begun to see through the lies about the good intentions of the ruling class. No. The interests of the working class are diametrically opposed to this. Where the ruling class calls on it to take sides its interests lie in uniting with fellow workers everywhere. Where the bourgeoisie want to obliterate the conflict between the classes, under the false unity of ‘humanity’, the interests of the working class lie in tearing this veil off, exposing the real class antagonism that dominates capitalist society and taking up the class struggle.
WR, 6/7/02
Earlier this year the American ruling class proudly announced the end to the post-September 11 recession it had only recently acknowledged. Very reluctantly, faced with worsening economic statistics, the US bourgeoisie admitted its economy had in fact been in recession since March of 2001. Nevertheless, soon after this sombre admission, the American bourgeoisie precipitously declared the end to the ‘shortest recession in American history’ and announced the beginnings of an economic recovery. Since then, we have seen corporate bankruptcies (including the continuing circus surrounding Enron, which, at the time, was the largest bankruptcy in US history), spiralling redundancies and stock market turbulence which clearly give the lie to health of the US ‘model’.
The impact has already spread through the stock markets of the world. This profound acceleration of the economic crisis of capitalism clearly stems directly from the very heart of the capitalist system, not from the peripheries. Previously the ruling class could say that different aspects of the crisis were expressions of the immaturity of the ‘tiger’ economies, of the difficulties of Russia adapting to ‘market forces’. Japan and other ‘unenlightened’ countries were admonished for their supposedly unique lack of ‘correct’ banking practices (i.e. correct accounting).
The continuing trouble on Wall Street, layoffs that never seem to stop and the American economy’s faltering international competitiveness has made all the pronouncements about the advantages of the ‘American way’ of managing capitalism sound ever more hollow and ridiculous. The WorldCom debacle was the final straw: the American bourgeoisie has had to admit that it may have been too hasty in concluding that the recession was in fact over. As for the boasts about the ‘American model’, there is embarrassed silence.
Furthermore, the damage inflicted by the scandal at WorldCom has precipitated a major crisis of confidence in Wall Street which has spread immediately to the other key international stock markets � London and Tokyo. The stock market index in London has fallen to a level lower than when Labour first took office, destroying billions of pounds worth of ‘value’. Although this value wiped off shares all around the world is ‘only’ paper value, it nonetheless has real effects both on the wider capitalist economy, and even directly on workers since it adds enormously to the problem of the funding of pensions schemes (in the next issue we will deal with this attack in more detail) and insurance policies.
The impact of the Enron and WorldCom accounting scandals on the bourgeoisie is not because the capitalists who speculate on these markets are morally outraged by the massive fraud carried out by WorldCom, rather, they are horrified by the prospect of yet more WorldComs, and even pillars of the ‘old economy’ such as IBM, declaring accountancy errors and exposing the cracks in the edifice of capitalism - an edifice that is held up by a mountainous scaffolding of debt. If new proposals being discussed in Europe for making accountancy practices more ‘transparent’ � i.e. proposals to reduce the amount of actual lying involved in the production of company accounts � were to be adopted, then billions more dollars would be wiped off the value of US companies in particular, because of their very widespread use of the financial technique of stock options.
This is not an expression of a merely contingent situation for capitalism, which can simply be overcome by belatedly instituting a new policy of ‘honesty’ in company reporting. The whole period of rapid ‘growth’ in the world economy � especially the US economy � during the nineties has, as the ICC has consistently pointed out, been built on sand. The implosion of the technology bubble was the first direct, open, confirmation of this. The present loss of confidence amongst the bourgeoisie in their own capital markets simply underlines the incredibly shallow, tenuous nature of all this supposed ‘growth’.
WorldCom, the second largest telecommunications provider in the US with extensive foreign operations, demonstrates - even more dramatically than Enron - the fragility of the current state of the capitalist economy. Recent revelations have shown that since January 2001, WorldCom has systematically hidden more than $3.8 billion in expenditures by classifying normal operating expenses as ‘capital expenditures’. This has allowed the company to spread these costs out over a number years and thus give the impression of making a healthy profit, while in reality it is currently saturated with more than $30 billion in debt. From a high, three years ago, of $64.50 per share, WorldCom stock now sells for less than a dollar. Should WorldCom file for bankruptcy protection, a move a number of analysts see as likely, it would surpass Enron as the largest bankruptcy in American history. As a result of this fiasco, workers have seen their retirement stock portfolios hammered as they are revealed for what they really are: worthless pieces of paper laying claim to fictitious wealth that never really existed.
In these circumstances, how can the bourgeoisie have confidence in the reporting of any of its companies? Lacking this confidence, how does the capitalist know what he is investing in when he hands over his money for shares? In the casino economy, as the ICC has dubbed it, money chases money, with ‘profits’ fuelled by endless speculation. While this underlying reality will not change, the Enron revelations followed so soon by the WorldCom affair, shows even the most hardened ‘bull market’ investor that the reality is simply a pack of cards, waiting to fall. And the bourgeoisie do not invest in order to lose their money.
At the time of the Enron revelations, the American bourgeoisie smoothly tried to play off the disaster as the workings of a few corrupt executives and hyped the need for closer government regulation of corporations. This time around the bourgeoisie has once again tried to play the ‘few corrupt businessmen’ card, promising criminal prosecution of those responsible. Nevertheless, what this ‘scandal’ really reveals is not the rapacious appetite of a few unscrupulous corporate bigwigs, but the utter rot of the capitalist economy after thirty years of open crisis, an economy in which the illusion of health has only been maintained through shrewd accounting manipulations, worthless speculation and ever growing oceans of debt. Already, the WorldCom revelations have been followed by accusations of accounting irregularities at Xerox that overstated company revenue by $6.4 billion. Thus, one of the supposed mainstays of the United States’ post-Second World War economic prosperity finds itself in deep trouble. In the coming period there will undoubtedly be more such ‘scandals’ as the crisis strains the ruling class’s ability to cover up the deepening crisis eating at its very heart.
As capitalism’s crisis intensifies and the working class is faced with accelerating attacks on its working and living conditions (WorldCom already plans to slash a fifth of its workforce, with more layoffs expected), workers must not be taken in by the bourgeoisie’s ‘anti-corruption’ propaganda. All this propaganda emanates from the capitalist state, which tries to give the impression that if it intervenes in the situation then the turmoil in the markets will be smoothed over. As even some capitalist commentators have observed, the state, far from being the least disposed to engage in the manipulation of figures, is at the leading edge of this practice � for instance the constant ‘redefinition’ of the unemployment figures in all countries. In Britain Labour has continued with this process in the same line as the Tories did. The US state tried to mask the reality of the current open recession until it could no longer avoid it. And, in all countries, the state is the biggest liar and manipulator of all.
Although the state must and will intervene in the situation because it is the final bastion of the bourgeoisie and responsible for keeping the economic crisis under some kind of control, in the final analysis, the bourgeoisie cannot stop the crisis, only slow it down. The present emergence of the crisis in an open way is the best evidence of this. It is this kind of open expression of the crisis at the heart of its system that the bourgeoisie has been struggling to avoid for the last ten years, even though it is fundamentally aware that conjuring tricks cannot work for ever. The key reason for this is that the bourgeoisie is aware of the impact this can have on the working class. The economic crisis � along with war � is a key factor in the long term potential for the development of working class consciousness, because it reveals the bankruptcy of the entire capitalist system.
HHP, 6/6/02.
In Argentina in the first five months of 2002 there have been more than 11,000 demonstrations as well as various others forms of mobilisation - rallies, hunger strikes, the blocking of main roads and workers’ strikes. In a very mixed social movement the working class has found it very difficult to defend its particular class interests, to struggle as an independent class when so many other social strata are acting in response to the austerity imposed by the economic crisis hitting the country.
In Germany, where there is open admission that the economy is in recession and official figures for the rising number of unemployed are over 4 million, there has recently been a wave of strikes. There has been a10-day strike in the engineering sector, others among banking staff, print workers, and in Deutsche Telekom. The most significant was a week-long national strike in the 950,000 strong construction industry, the first in the post-Second World war period. With 500,000 construction jobs lost since 1995 it is understandable that there is widespread discontent. Less than half of building workers are in the IG Bau construction union which started the strike initially only with Hamburg and Berlin. In the latter, on the first day, 8000 workers on 400 sites were involved. After 4 days the strike spread to all regions, ultimately involving 32,000 workers on 2800 sites. Even allowing for the role of the unions (set up on the British model by the German state after the war) there is no mistaking the current militancy in the working class in Germany.
In Britain in recent months there have also been a number of struggles simmering. December last year and January this saw strikes in job centres and benefit offices against the removal of safety screens. There has been a series of rail strikes. There was a two-day strike of college lecturers. In March there was a strike of 40,000 London teachers, the biggest in 30 years. In the public sector there has been a ballot on future action for 1.2 million local government workers, giving support for a strike on July 17. There was a strike in the British Museum against job cuts. There has been a demonstration of fire fighters, the biggest since their strike of 1977. There have been demonstrations against cuts by local councils. In the media there has been speculation about the possibility of a “summer of discontent”. Throughout the working class in Britain there is indeed an undercurrent of discontent, which breaks into various forms of action, limited, diverted or defused by the unions.
At the beginning of the year the TUC forecast that 150,000 jobs in manufacturing industry would go in 2002. This prediction hardly required rocket science as it is the continuation of a long-term trend - 400,000 jobs, 10% of the manufacturing workforce, have gone during the last three years. The pay deals in manufacturing in decline (low profits, low orders and fierce international competition on prices) are now at a level lower than any since 1980, when manufacturing was in the middle of its worst post-war slump. Meanwhile, although the so-called ‘service sector’ has bigger pay deals it’s often because of the lower starting point - the average annual wage for the thousands of call centre workers, for example, is £13,000.
On top of attacks on jobs and wages there are the attacks on pensions and the decline in the transport system and the health service. Although the Labour government tries to make out that things are improving, or that, at least, they are not as bad as they would have been under the Tories, there are in fact very real material reasons for the working class to struggle.
However, the unions and their left wing friends spend a great deal of time giving workers false goals to pursue. Take the example of nationalisation. Because of the state of rail and bus travel there have been calls for their renationalisation and for more public spending. With the health service there have been many denunciations of the different schemes for its financing (PFI, PPP etc) and demands that it be kept away from profit-making businesses. Against proposals to extend sales of public sector housing there has been a campaign to ‘defend council housing’. State control is presented as the solution to all social problems, real or imagined.
However, the working class’s experience of the capitalist state is unambiguous. The tendency for the state to increasingly intervene in all aspects of economic and social life has dominated the whole period of capitalist decadence since the First World War. The attacks against the working class have been managed by the very state that the left present as the workers’ saviour. Under the last Labour government, for example, British Leyland was declared bankrupt in 1975 and then nationalised with massive state intervention. Labour appointed Michael Edwardes to do the work required by the ruling class. After four years the workforce had been cut by 90,000. Under the Thatcher government the strike of steelworkers in 1980 was against proposals by state-run British Steel for up to 52,000 redundancies. In all the major miners’ strikes since nationalisation (1972, 1974, 1984-85) workers faced the state-controlled National Coal Board.
And yet, when the Post Office says that 40,000 jobs are under threat, with the possibility of another 17,000 to be cut on top of that, the left says that the main problem is the possibility of privatisation. As the capitalist state cuts jobs the left want workers to give their support to that very state.
That the unions can obstruct the development of workers’ struggles is not a well-kept secret. The left will often blame ‘right-wing leadership’, or say that unions should be more responsive to the ‘rank and file’. Recently a number of left-wingers have been installed in important union offices, and there are further significant union elections to come. As we showed in a recent article in WR 252 (“Unions turn left to derail the class struggle”) the change in union leadership has made no difference to the way that the unions have tried to isolate workers going into struggle.
A new twist has been added to this with recent manoeuvres in the civil servants’ union, the PCS. SWP member Mark Serwotka was elected general secretary, but, just days before retiring leader Barry Reamsbottom was due to go, the “Moderate” faction organised a national executive meeting at short notice. This meeting decided to keep Reamsbottom on for two years, and declared Serwotka’s election “unlawful”. Subsequently a court has declared the Moderates’ meeting to be “unconstitutional” and leftists of all persuasions have launched a campaign over the “coup against union democracy”.
This campaign is aimed at getting workers engaged in the mire of union politics, rather than in organising to defend their interests. Serwotka himself was aware that not everyone has a taste for union machinations, as he wrote in Socialist Worker (1/6/02) “Some people are so angry and disgusted that they say they’re going to resign from the union”. As the Right attacks Serwotka for being a Trotskyist, and the Left denounces the Right for being undemocratic, there are many false trails being laid for workers to follow.
The campaign is also tied up with the unions’ need to distance themselves from the Labour government. The GMB has cut funding to the Labour party, the RMT has withdrawn support from MPs who don’t agree with its policies, and now, in the PCS, a line is being drawn between the ‘moderate’ supporters of Blair and the advocates of a ‘strong, fighting’ union. The unions are posing as the means to oppose the attacks of capitalism.
Across the world the working class is showing that it is not just accepting the economic regime that the ruling class wants to impose. However, its struggles are still contained within the union framework, often drawn into support for the state through anti-privatisation and democratic campaigns. To develop its confidence and take the path towards the extension and self-organisation of its struggles the working class will have to confront all the manoeuvres of the bourgeoisie, from the Right to the Left
Car, 5/7/02.
Links
[1] https://en.internationalism.org/tag/5/58/palestine
[2] https://en.internationalism.org/tag/general-and-theoretical-questions/economic-crisis
[3] https://en.internationalism.org/tag/recent-and-ongoing/economic-crisis
[4] https://en.internationalism.org/tag/geographical/britain
[5] https://en.internationalism.org/tag/recent-and-ongoing/class-struggle