The revolutionary upsurge in North Africa and the Middle East is having a direct impact on the global crisis of capitalism.
Oil prices have surged as much as 6% since Monday, rising to their highest since the collapse of demand in the global crash of 2008. If this rise is maintained, it is certain to trigger a renewed slowdown in global production.
Oil companies in Libya are in the process of shutting down the 2% of the world’s production that come from the country. Western oil companies have suspended oil production and BP has started evacuating workers from Libya.
The Libyan mission to the UN is in disarray, the country’s generals are resigning along with many ministers. As in Egypt, the army is going over to the side of the revolution.
Every part of the transnational capitalist class – global corporations, capitalist governments, unaccountable global agencies – is watching events with a mounting horror. They were horrified by the revolution that brought Gadaffi to power in 1969, now they are horrified by the revolution that will end his rule.
Mostly they are desperate to find a way of halting the contagion of revolt against autocratic governments which have provided safe haven for the global oil corporations and built their family fortunes from the proceeds. Nervously they assess the risk of the infection spreading to Saudi Arabia, which is the source of close to 10% of current oil supplies.
Interviewed on Al Jazeera, a former UN official spoke for the capitalists. Now they don’t mind people having rights, they’re even in favour of them having the same “democratic”, “human” rights enjoyed by people in the West. But above all they want stability, they want to see investment, they want people to keep their jobs, they want to see economic growth. They fear a revolution that could end the for-profit system. They are wondering what they can do to stop it.
Any disruption in oil supplies increases the power of the Organisation of Petrol Exporting Countries (OPEC) consisting of Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates, and Venezuela. As of November 2010, OPEC members collectively hold 79% of world crude oil reserves and 44% of the world’s crude oil production, giving them major influence over the global market.
Juan Pablo Pérez Alfonso was a prominent Venezuelan diplomat, politician and lawyer primarily responsible for the inception and creation of OPEC. In 1975 he warned that “oil will bring us ruin… Oil is the Devil's excrement”. He wasn’t far off.
In the 1970s, the inflationary printing of dollars to buy its way out of a historic economic crisis forced the US to abandon the relationship between the paper currency and gold established in 1944. The value of the dollar crashed from $42 for an ounce of gold in 1971 to $800 in 1979. OPEC acted to defend the value of its commodity which was emerging as the essential, cheap and plentiful foundation of the post-war economy. The price of oil quadrupled by 1973.
Four decades later, the situation is very different.
Exponential growth – the global success story of credit-funded huge corporations pouring previously unimaginable torrents of products into the hands of debt-burdened consumers has ensured that the world’s oil is half gone.
Much of it has been used to transform agriculture from a system of food production by millions of small farmers to a global business controlled by small number of corporations whose hunger for profit puts food prices beyond the reach of billions.
Industrialised agribusiness like the rest of capitalist manufacturing is addicted to oil. The burning of oil to fuel the capitalist growth mania has brought the planet to the limits of its ability to sustain life. The revolutionary upheaval now under way brings the possibility of a different future. We have to grasp it.
Gerry Gold
Economics editor
23 February 2011
www.aworldtowin.net
Showing posts with label revolution. Show all posts
Showing posts with label revolution. Show all posts
Wednesday, 23 February 2011
Saturday, 5 February 2011
Take care when quoting Marx
Andrew's favourable post of Hugh Radice's Red Pepper article ends with this 'Time for an old, old slogan: workers of the world unite!'
As most may know this is a revised version of the last line of the Communist Manifesto, but in that document Marx and Engels propose more than uniting as a way forward. The last paragraph of the Manifesto reads in full, and it is particularly important as the wave of popular uprisings unfold in the Middle East:
In short, the Communists everywhere support every revolutionary movement against the existing social and political order of things.
In all these movements, they bring to the front, as the leading question in each, the property question, no matter what its degree of development at the time.
Finally, they labour everywhere for the union and agreement of the democratic parties of all countries.
The Communists disdain to conceal their views and aims. They openly declare that their ends can be attained only by the forcible overthrow of all existing social conditions. Let the ruling classes tremble at a Communistic revolution. The proletarians have nothing to lose but their chains. They have a world to win.
Working Men of All Countries, Unite!
But it is important to beware when people refer to Marx or even Keynes .....
Dogma gives Marx a bad name
The merit of veteran Financial Times writer and noted economist Samuel Brittan is that he is not a dogmatist. He may not have all the answers when it comes to today’s crisis. But Brittan believes that summoning the writings or reputations of dead economists to back a policy is hopelessly wrong.
Vince Cable, Liberal Democrat business secretary in the Coalition government, claimed in the January 17 issue of the New Statesman that “Keynes would be on our side”. Two economists promptly called this “foolhardy”. Others, says Brittan, too often cite Karl Marx to justify a view.
“What a reflection all this is on the would-be scientific standing of political economy,” says Brittan who served in Labour as well as Tory governments. He himself was taught by Milton Friedman, the father figure of the monetarist theories of the 1980s implemented by Thatcher and Reagan.
There is indeed no merit in citing what Keynes or Marx (or even Friedman) said at a certain point in history if the aim is to prop up a preconception about today’s world. As Brittan says: “Can one imagine physicists trying to advance their views by showing that they were implicit in some obscure passage in Einstein or Isaac Newton?”
This is true. But any half-decent physicist will know that a modern understanding of the material world would not be possible without the advances made by earlier scientists. Their theories are incorporated into modern physics – not simply rejected as old hat.
So it should be with Marx, a revolutionary communist as well as a political economist. Turning his ideas into a tenet, a dogma to be repeated on suitable occasions, was not the responsibility of bourgeois economists like Brittan. Principal blame for this rests with the Stalinist movement, particularly the bureaucracy of the former Soviet Union. They did this to Lenin too, taking a phrase here and a quotation there to provide a rationale for every twist and turn.
Brittan himself is not averse to throwing out the baby with the bathwater, declaring that if Marx were alive today he would be 193 years old and, therefore, no one could know what he would say. This is indisputable; and the likelihood of Marx returning is not even up for discussion.
What Marx left, however, was a legacy of a philosophical method, an approach to understanding constantly changing reality. Marx himself, in the afterword to the second German edition, could do no better than cite with approval a critical review of Capital in 1872:
The one thing which is of moment to Marx, is to find the law of the phenomena with whose investigation he is concerned; and not only is that law of moment to him, which governs these phenomena, in so far as they have a definite form and mutual connexion within a given historical period. Of still greater moment to him is the law of their variation, of their development, i.e., of their transition from one form into another, from one series of connexions into a different one. This law once discovered, he investigates in detail the effects in which it manifests itself in social life.
This dialectical method enabled Marx to reveal the contradictions inherent within the system of capitalist production. The tendency of the rate of profit to fall, the continuous drive to global expansion, the inevitable formation of monopolies – these and other scientific laws were expounded by Marx. They naturally need verification through a study of today’s conditions. Rescuing Marx from the dogmatists is essential in our preparation to transcend a capitalism that is in its deepest-ever and most threatening crisis.
Paul Feldman
Communications editor
http://www.aworldtowin.net/index.html
4 February 2011
Wednesday, 2 February 2011
Uprisings deepen capitalism's crisis
Attempts to solve the global debt crisis have sent food prices soaring, driving impoverished masses onto the streets throughout the Middle East. Now a wave of political revolutions dashes remaining but false hopes of economic “recovery”.
Oil prices are rising sharply as the upheaval that began in Tunisia and now grips Egypt threatens to spread to major producers Algeria, Libya and even Saudi Arabia. Stock markets are jittery as they take in the consequences, including any threat to oil tankers which use the Suez Canal.
In Egypt, workers, the unemployed, young and old, artists and athletes, Christians and Muslims have united in their determination to bring the 30-year old autocratic regime of Hosni Mubarak to an end. His determination to hang on until September pleases neither the Egyptian people nor the White House, which fears the consequences of an unstoppable revolutionary process the longer Mubarak’s regime clings to power.
This fact is recognised by the International Monetary Fund too, which helped impose harsh market “reforms” on Egypt in the 1990s, which have only deepened inequality. IMF chief Dominique Strauss-Kahn warned governments to tackle economic strains or risk instability and even war.
“This protest won’t end in North Africa; it will spread in many countries because of high unemployment and increasing food prices,” Hamza Alkholi, chairman and chief executive of Saudi Alkholi Group, a holding company investing in industrials and real estate, said in an interview in Davos, Switzerland.
As Nouriel Roubini, the leading economics analyst who forecast the global financial crash, notes:
What has happened in Tunisia, is happening right now in Egypt, but also riots in Morocco, Algeria and Pakistan, are related not only to high unemployment rates and to income and wealth inequality, but also to this very sharp rise in food and commodity prices.
In Egypt, 40% of the 80 million people live on less than $2 a day. Prices of basic foodstuffs have soared by over 17%, putting basic necessities beyond the reach of many. The average Egyptian now spends 40% of his or her income on food while economists put the unofficial jobless rate at about 25%.
The worldwide surge in commodity prices is being driven by stock markets and investment banks desperate to find new areas for profit-taking. With the 2008 financial meltdown still unravelling, speculators have turned to basic commodities. They have used funds pumped into the system by the US Treasury and the Bank of England, also known as QE or “quantitative easing”.
QE was designed to boost economic growth. Instead, it has helped to create a 32% increase in the average cost of food in the second half of 2010, according to the UN Food and Agriculture Organisation (FAO). Wheat prices alone jumped 70% between June and December.
Despite Mubarak’s televised claim that the protests had been manipulated by political forces this is a completely Egyptian, largely secular, wholly grass roots movement. With its roots in a strike by textile workers in April 2008, a popular revolution is under way. The country is at a standstill as events unfold. The economy is paralysed. People’s committees have taken charge of the security of their streets and neighbourhood.
Even when Mubarak shut down the internet and mobile phone networks last week the 70,000 strong April 6th Facebook group of mostly young people continued to organise the protest, calling for the “million man march” that brought more than two million Egyptians onto the streets of Cairo, Alexandria, Suez, Sinai and Upper Egypt demanding that the president should leave.
People on the street demand change to “every element of the system” but lack a developed leadership that can transform the Egyptian capitalist state. As soaring prices and unemployment make clear, revolutionary social and economic change is required along with the end of the Mubarak dictatorship.
Gerry Gold
Economics editor
http://www.aworldtowin.net/
Oil prices are rising sharply as the upheaval that began in Tunisia and now grips Egypt threatens to spread to major producers Algeria, Libya and even Saudi Arabia. Stock markets are jittery as they take in the consequences, including any threat to oil tankers which use the Suez Canal.
In Egypt, workers, the unemployed, young and old, artists and athletes, Christians and Muslims have united in their determination to bring the 30-year old autocratic regime of Hosni Mubarak to an end. His determination to hang on until September pleases neither the Egyptian people nor the White House, which fears the consequences of an unstoppable revolutionary process the longer Mubarak’s regime clings to power.
This fact is recognised by the International Monetary Fund too, which helped impose harsh market “reforms” on Egypt in the 1990s, which have only deepened inequality. IMF chief Dominique Strauss-Kahn warned governments to tackle economic strains or risk instability and even war.
“This protest won’t end in North Africa; it will spread in many countries because of high unemployment and increasing food prices,” Hamza Alkholi, chairman and chief executive of Saudi Alkholi Group, a holding company investing in industrials and real estate, said in an interview in Davos, Switzerland.
As Nouriel Roubini, the leading economics analyst who forecast the global financial crash, notes:
What has happened in Tunisia, is happening right now in Egypt, but also riots in Morocco, Algeria and Pakistan, are related not only to high unemployment rates and to income and wealth inequality, but also to this very sharp rise in food and commodity prices.
In Egypt, 40% of the 80 million people live on less than $2 a day. Prices of basic foodstuffs have soared by over 17%, putting basic necessities beyond the reach of many. The average Egyptian now spends 40% of his or her income on food while economists put the unofficial jobless rate at about 25%.
The worldwide surge in commodity prices is being driven by stock markets and investment banks desperate to find new areas for profit-taking. With the 2008 financial meltdown still unravelling, speculators have turned to basic commodities. They have used funds pumped into the system by the US Treasury and the Bank of England, also known as QE or “quantitative easing”.
QE was designed to boost economic growth. Instead, it has helped to create a 32% increase in the average cost of food in the second half of 2010, according to the UN Food and Agriculture Organisation (FAO). Wheat prices alone jumped 70% between June and December.
Despite Mubarak’s televised claim that the protests had been manipulated by political forces this is a completely Egyptian, largely secular, wholly grass roots movement. With its roots in a strike by textile workers in April 2008, a popular revolution is under way. The country is at a standstill as events unfold. The economy is paralysed. People’s committees have taken charge of the security of their streets and neighbourhood.
Even when Mubarak shut down the internet and mobile phone networks last week the 70,000 strong April 6th Facebook group of mostly young people continued to organise the protest, calling for the “million man march” that brought more than two million Egyptians onto the streets of Cairo, Alexandria, Suez, Sinai and Upper Egypt demanding that the president should leave.
People on the street demand change to “every element of the system” but lack a developed leadership that can transform the Egyptian capitalist state. As soaring prices and unemployment make clear, revolutionary social and economic change is required along with the end of the Mubarak dictatorship.
Gerry Gold
Economics editor
http://www.aworldtowin.net/
Wednesday, 12 August 2009
Two years into the crisis and the human toll mounts
Two years ago this week, the global capitalist economy entered uncharted territory. It started with a crisis in the credit markets – the so-called “credit crunch” – and within a year it had led to a precipitate collapse in economic output in all sectors.
The collapse of inter-bank lending in August 2007 was bad enough to prompt senior, respected commentators to declare that “the system” – they only meant the unregulated system of institutions trading in credit-derived financial products – was broken beyond repair. These contagious sentiments expressed a mounting worldwide panic exemplified by the queues of customers outside Northern Rock in the middle of the following month.
Most of the attention then as now is focussed on the financial system. Attempts to prevent the financial crisis turning into a complete meltdown produced the second transformation in the role of the capitalist state since the 1970s.
The first transformation became known as globalisation. The irresistible need of capital for expansion resulted in transnational corporations dictating policy to national governments both directly and via global agencies like the International Monetary Fund and from 1995 the World Trade Organisation.
Lobbyists for corporate interests demanded that regulation and control on the movement of capital be eliminated for all practical purposes, accompanied by an assault on workers’ income and conditions. Civil war conditions were launched against British miners in 1984. The benchmark for wages was set by the transfer of much manufacturing to China where the rate was reduced to as little as a dollar a day. Profits soared.
A series of worsening crises from the mid-nineties onwards gave warning that the years of credit-led growth were reaching their limits and that overproduction was unsustainable. As we said in A House of Cards – from fantasy finance to global crash published in November 2007:
The effects on the real economy are more devastating. As the scale of the worsening crisis unfolds, millions more families are being driven from their repossessed homes, reclaimed by their owners, the banks and other mortgage lenders. Industry after industry is emulating the collapse of car-making worldwide because consumption has shrunk. Today will show that unemployment in the UK has soared to record levels, with young people making up more than a third of those without work.
This dramatic decline in the fortunes of capital changed the role of states once again, obliging them – those that aren’t yet bankrupt – and their central banks to launch a series of attempted rescue packages and the large-scale printing of money. The new bursts of credit designed to enable production to continue will have to repaid by as yet unborn generations of taxpayers, but the best that has been achieved is a temporary slowdown in the rate of deterioration.
The true cost of engineering a return to growth involves the elimination of not just failed banks, but huge swathes of no-longer profitable credit-dependent factories, farms and software houses. Workers facing the consequences will find the cost too great to bear. The system – the capitalist system of production – is broken and the cost of fixing it would be counted not just in closed factories, but in the elimination of rights, of human lives and an inhospitable planet.
This is the moment to prepare the ground for a revolutionary transformation to a society where property is held in common and goods and services are produced to satisfy needs not profits, according to priorities determined through a new democratic process.
Gerry Gold
Economics editor
A World to Win
http://www.aworldtowin.net/index.html
The collapse of inter-bank lending in August 2007 was bad enough to prompt senior, respected commentators to declare that “the system” – they only meant the unregulated system of institutions trading in credit-derived financial products – was broken beyond repair. These contagious sentiments expressed a mounting worldwide panic exemplified by the queues of customers outside Northern Rock in the middle of the following month.
Most of the attention then as now is focussed on the financial system. Attempts to prevent the financial crisis turning into a complete meltdown produced the second transformation in the role of the capitalist state since the 1970s.
The first transformation became known as globalisation. The irresistible need of capital for expansion resulted in transnational corporations dictating policy to national governments both directly and via global agencies like the International Monetary Fund and from 1995 the World Trade Organisation.
Lobbyists for corporate interests demanded that regulation and control on the movement of capital be eliminated for all practical purposes, accompanied by an assault on workers’ income and conditions. Civil war conditions were launched against British miners in 1984. The benchmark for wages was set by the transfer of much manufacturing to China where the rate was reduced to as little as a dollar a day. Profits soared.
A series of worsening crises from the mid-nineties onwards gave warning that the years of credit-led growth were reaching their limits and that overproduction was unsustainable. As we said in A House of Cards – from fantasy finance to global crash published in November 2007:
Losses from the financial crisis alone are colossal. Bank write-downs and losses currently total more than $1,500bn. The IMF has predicted losses across the financial services industry could eventually total $4,000bn, or nearly one-third the annual value of US production.“Then on 9 August 2007, the long period of corporate-driven globalisation of the world economy came to an abrupt end. That Thursday, major banks suddenly refused to lend to each other and a ‘credit crunch’ hardened the arteries of the global financial system.”
(free download - http://www.aworldtowin.net/about/HouseOfCards.html)
The effects on the real economy are more devastating. As the scale of the worsening crisis unfolds, millions more families are being driven from their repossessed homes, reclaimed by their owners, the banks and other mortgage lenders. Industry after industry is emulating the collapse of car-making worldwide because consumption has shrunk. Today will show that unemployment in the UK has soared to record levels, with young people making up more than a third of those without work.
This dramatic decline in the fortunes of capital changed the role of states once again, obliging them – those that aren’t yet bankrupt – and their central banks to launch a series of attempted rescue packages and the large-scale printing of money. The new bursts of credit designed to enable production to continue will have to repaid by as yet unborn generations of taxpayers, but the best that has been achieved is a temporary slowdown in the rate of deterioration.
The true cost of engineering a return to growth involves the elimination of not just failed banks, but huge swathes of no-longer profitable credit-dependent factories, farms and software houses. Workers facing the consequences will find the cost too great to bear. The system – the capitalist system of production – is broken and the cost of fixing it would be counted not just in closed factories, but in the elimination of rights, of human lives and an inhospitable planet.
This is the moment to prepare the ground for a revolutionary transformation to a society where property is held in common and goods and services are produced to satisfy needs not profits, according to priorities determined through a new democratic process.
Gerry Gold
Economics editor
A World to Win
http://www.aworldtowin.net/index.html
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