Capitalist crisis, a socialist alternative
Section One: World Relations
Chapter Six: The Middle East
Another region which shows the failure of the world and regional bourgeoisie to solve accumulated historical problems, is the Middle East. Following the Oslo Accords of 1993 and 1995, a new period of peace and prosperity was promised for the region. Yet, if anything, the divide between the Israelis and the Arabs has become even wider. The CWI’s perspective that the Oslo agreement represented a betrayal of the national aspirations of the Palestinian people has been completely borne out. Moreover, again as we predicted, the expected beneficial effects from ‘huge investments’ from outside, particularly from the Arab sheikhdoms, have not materialised. In fact, as they face the effects of their own worsening economic situation, in turn a product of the Asian and the world economic situation, the conditions of the Palestinian people have worsened since Arafat accepted the so-called ‘step-by-step’ approach towards the establishment of a Palestinian state.
Israel itself has experienced a certain growth but is torn apart by religious divisions which could not only topple the Netanyahu government but produce the greatest divisions since the state was established 50 years ago. Israel has been transformed from a largely agricultural state, with a weak industrial base, into the ‘Silicon Valley of the Middle East’. As with other countries, the development of an arms industry has become the handmaiden for the growth of high technology industries. Ironically, it was the arms embargo, particularly applied by the French following the 1967 Six-day War, that forced Israel to develop its arms industry. This was, and remains, an enormous burden on the Israeli economy, swallowing at one stage one-sixth of the national wealth. It produced an unsustainable budget deficit, which culminated in hyper inflation under Mehachem Begin after the 1973 Yom Kippur war. But now this arms industry, 20 years later, has played a key role in the development of a sizeable industrial sector in Israel.
Of course, none of this would have been possible without the annual $1.8bn military subvention from US imperialism and the $500m of private funding from the Jewish population in the US. The early 1990s have seen a quite spectacular growth in production. Between 1990-96, the average growth rate was 5.9% annually. However, this has come to an abrupt halt as the state has been forced to pursue a tighter fiscal and monetary policy. The bombings of Tel Aviv and Jerusalem has meant that tourism - a main source of income - has begun to dry up. Nevertheless, exports from the high technology sector still increased by 35%,, and now represents 64% of total exports. At the time of the foundation of the state in 1948, 99% of exports consisted of oranges.
A decisive factor in the recent development of the economy was the arrival of 750,000 Jewish immigrants from the former Soviet Union in the 1990s. They have been attacked as parasites, with images of doctors sweeping roads and the ‘Jewish mafia’ buying Jaguar cars "with suitcases of cash". However, the paradox of the situation is that Israel, a client state in the Middle East of the major capitalist and imperialist powers, has benefited enormously from the past human investments made possible on the basis of the planned economy in the Soviet Union. Many of the ‘Soviet arrivals’ had a very high level of pure science and engineering skills, vital for high-tech industries. As one bourgeois commentator wrote, without their input, a properly trained high-tech workforce "might otherwise have taken a generation to train". What has been Israel’s gain has been a loss to the former Soviet Union. It is another example of the crimes of Stalinism which was incapable not only of harnessing the full potential of the plan, but managed to completely alienate the Jewish population and drive them into the hands of the Jewish capitalists.
Crisis of Zionism
At the same time, the original aims of the Zionist pioneers of Israel are disintegrating. Zionism objectively played the role of furthering the aims of imperialism to divide Jew and Arab in the region. It was a movement of colonial conquest, which uprooted and drove a whole people from its traditional homeland. At the same time, it covered its aims with ‘socialist’ ideology and a ‘collectivist approach’. This was harnessed in the Kibbutz movement. However, this was always subject to the laws of capitalism. The tendency towards disintegration of the Kibbutz would, therefore, inevitably be manifested at a certain stage. Last year the Kibbutz movement had to be bailed out of its debts to the tune of $2.05bn. Against the background of a burgeoning capitalist economy, the communal lifestyle is no longer practical and effective and is being abandoned by the new generation.
This went hand-in-hand, as elsewhere, with the bourgeoisie going over to a particularly brutal form of the ‘free market’. The Histraduth, a peculiar Zionist relic, which combined the trade unions with some ownership of industry, has been broken up. A massive privatisation programme was introduced and is being pursued with Thatcherite zeal. For instance, the workforce in telecommunications has been cut by 12% and as the Israeli government threatens further privatisations, big redundancies loom. This will inevitably lead to greater class polarisation, which has been an increasing feature of Israeli society in the 1990s. Indeed in 1997 there were important workers' struggles, including a general strike, which mark an historic step forward in developing class struggle.
It is paralleled by the growing opposition to the ultra-orthodox Jews’ attempt to transform Israel into a theocratic state. The Netanyahu government only has a majority in the Israeli Knesset because of the 23 seats held by the religious parties. Their ministers in the government have introduced policies that discriminate in favour of ultra-orthodox Jews in housing, for instance, leaving young secular Jews and Israeli Arabs at the bottom of the housing list. Some of the orthodox Jewish groups are a mirror image of the Islamic fundamentalists. Many judges who are secular Jews have received death threats for allegedly being ‘too liberal’. There is the rise of mad ultra-nationalist Zionists, one of whose members assassinated Israeli prime minister, Rabin, in 1995. The growing ultra-orthodox political party, Shas, campaigns for the replacement of civil judges and courts by religious judges and rabbinatical courts. Young secular Jews are incensed that, while they are compelled to serve in the army, 30,000 orthodox students based in the religious schools can defer military conscription while they are ‘studying’, which can last for decades!
At the same time, decisive sections of the Jewish bourgeoisie who are looking - in the post-Oslo period - hungrily to the new markets they believe they would dominate in the surrounding Arab states, are increasingly opposed to the concessions which the Netanyahu government makes to the religious parties. These help to block off any agreement both with the Palestinians and with neighbouring Arab states.
The divisions amongst the Israelis are mirrored by those that exist amongst the Palestinians and amongst the Arabs in general. Arafat’s gamble in accepting the Oslo Accords has failed. He rules a tiny enclave entirely dependent on Israel. Netanyahu has gone back on the promises made by the murdered Rabin and has declared: "Palestinians should have those areas they live on but without a state." His government is prepared to offer half of the West Bank but only 8-10% of ‘historic Palestine’ to the Palestinians. This is totally unacceptable to even the compromised Arafat, never mind to the mass of the Palestinians and Arab people.
"Peace Process" dead
US capitalism, in collaboration with the EU, attempted at the London conference in May to force Netanyahu to accept a plan under which Israel would cede complete control of 18.2% of the West Bank to the Palestinians over 12 weeks. At the moment, Palestinian forces currently control only 3%. Even if Netanyahu is prepared to move he will not accept the US’s proposals, and any concessions by him would probably mean the downfall of his government and either its replacement by a Labour government or, what seems more likely, a coalition between Netanyahu’s Likud and Labour. It would go hand-in-hand with the establishment of an American, Palestinian and Israeli committee to discuss "combating terrorism" - a demand Israel has made since it has faced Islamic fundamentalist suicide bombers aimed against Israeli targets. In addition, Arafat must publish a presidential decree forbidding incitement against Israelis. The Palestinians are also required to approve a law banning the possession of private firearms and to give the Israelis a list of Palestinian policemen, a measure aimed at reducing their number.
But at the moment rather than concessions, Netanyahu has moved in the opposite direction, ratifying new Israeli settlements in the West Bank, the extension of settlements in Jerusalem, etc. The leverage which US imperialism has over the Israeli government is weakened by the domestic position of Clinton and the pressure exerted by the six million Jews in the US in the run-up to the mid-term Congressional elections. In addition to this, there is growing opposition to Arafat, and not just on the failure of the Oslo Accords (Netanyahu has already declared the peace process "dead"). There is also vocal criticism from within Arafat’s own Fatah movement - which controls 60 of the 88 seats in the Palestinian Legislative Council - against the growing corruption and repression of his regime.
Without any further concessions, the Palestinian and Arab masses will explode. "The second intifada is coming and it will be bigger than the first. This time it will be with guns," declared a Palestinian youth to a bourgeois reporter. But a new conflict will not be just between the Palestinians and the Israelis. Already within Israel, one million Bedouin Arabs - one-sixth of the population and, up to now, relatively docile - have threatened massive strike action over the demolition of their houses and traditional grazing areas by the Israelis. There has been no halt to the expansion of Jewish settlements, no end to confiscation of land or resident identity cards in Jerusalem, no end to the demolition of Palestinian homes and no Israeli troop redeployment from the West Bank.
Little wonder then that the fundamentalists have grown, with Hamas enjoying an estimated 40% support amongst the Palestinian population. Even George Habas, leader of the Popular Front for the Liberation of Palestine (PFLP), has linked up with Hamas in a new ‘Palestinian Front’. Promises have been made to "confront Israel with all possible means". Clashes have developed between Arafat supporters and Hamas where the latter’s leaders have declared: "We don’t want to fight the PA [the Palestinian Authority]… if we fight it could lead to a civil war. This is what Israel wants." But the incipient civil war amongst Palestinians could break out into the open if the situation continues without any concession to Palestinian fears in the next period.
It is highly unlikely that the Netanyahu government will be able to hold onto power. If it falls, it could either be replaced by a Labour government or by a new national government, including the Israeli Labour Party. In fundamentals, the Labour Party does not disagree with most of Netanyahu’s approach to the Palestinians. Its leader, Ehud Barak, has declared that it would establish ‘red lines’. This means Jerusalem would remain under Israeli control; there would be no return to pre-1967 borders; no modern armed forces west of the Jordan river; and "most of the Jewish settlements in few big blocks, but not necessarily all the isolated settlements, would stay under Israeli ‘sovereignty’." He generously declared that while he would not "care if they [the Palestinians] established their own state", the provision would be "it had no modern air force or surface-to-air missiles".
War and economic crisis
There are other military strategists within Israel, who speculate that a new war leading to a partial defeat of Israel is the precondition for a ‘realistic’ mood to develop in Israel. Above all, they calculate, the influence of the religious parties must be broken. It is not excluded, however, that Arafat, who is the main prop for imperialism, and Israel, could be toppled. Even a Palestinian businessman declared to the British Guardian reporter: "I would give it a year… people will wait to see if a Palestinian state will be declared. If there is no state, then maybe there will be no Palestinian Authority and Hamas will take over." Any attempt to resort to repression of Hamas would result in it going underground and in all probability a ‘dual struggle’ being conducted both against the Israeli military and the troops of the Palestinian Authority.
Any new conflict between Palestine and Israel would be against the background of a more volatile situation throughout the Middle East. Even the seemingly unshakeable Saudi Arabia has been seriously affected by the drop in the price of oil and the Asian crisis. The latest price for Arab Light, at $9 a barrel, has had a drastic effect. It sells oil now at only $3.42 per barrel, the lowest since 1973. Over the past ten years the annual per capita income of Saudi Arabia has fallen below the level of Latvia. The full magnitude of Saudi Arabia’s position is not yet fully felt by its population.
The full extent of the Asian crisis has also not yet hit home. A deepening of the recession in Japan will be an even bigger blow to the Saudis than the financial meltdown in South-east Asia. Japan is a major market for Saudi Arabian oil and, therefore, will have a crucial effect on the development of the Saudi economy. The attempt to switch greater exports to the most important oil market in the world, the USA, will come up against fierce competition that already exists there, particularly from oil exports from Venezuela and Mexico. In addition to this, the re-entry of Iraq onto the oil markets is bound to further undermine Saudi Arabia’s position.
This will find a reflection in the social situation within Saudi Arabia and the outmoded grip that is exercised by the feudal sheikhdoms. The growing opposition of the Shia population in Saudi Arabia and throughout the Gulf states, combined with the worsening of the economic position of these regimes could result in their overthrow in the next period. This, of course, would threaten the strategic and economic interests of US imperialism who would not hesitate to intervene militarily once more to prevent the coming to power, in particular, of a fundamentalist regime.
Profound changes in Iran
The attraction of fundamentalism has lessened, particularly of radical fundamentalism, in the light of the important developments in Iran. However this does not mean that support for fundamentalism will just evaporate. The worsening of the conditions of the great majority of the population in the Muslim world and the growing hatred of the capitalists of the advanced industrial world, combined with the absence of an alternative from Marxism and the organised labour movement, means the ideas of fundamentalism can retain a grip on the minds of significant sections of the masses. But radical fundamentalism associated with the Iranian revolution has waned.
The US State Department’s annual report still declares that Iran "remained the most active state sponsor of terrorism in 1997". It says that it "continued to fund and train known terrorist groups", and that it had conducted at least 13 assassinations abroad.
However, Iranian society has undergone profound changes, which, in turn, have weakened the position of the hard-line fundamentalists. The previous president, Rafsanjani, had attempted in two presidential terms from 1989 to shift the country towards a more ‘modern’ and ‘liberal’ stance. However, he was continually frustrated by the mullahs who, since the 1979 revolution, have considerable material as well as spiritual interests to defend. In theory, the state still controls 80% of the economy, producing some 5,000 goods and services. But this ‘state control’ hides the fact that the mullahs and their business supporters run these industries and cream off the benefits for themselves. At the same time, the mood amongst the youth and women has undergone a profound change. The majority of the population is under 25 and the students, in particular, have been to the forefront in the struggle against fundamentalism.
Divisions in ruling Iranian theocracy
The opposition to the mullahs and fundamentalism was reflected in the victory of Khatami in 1997. This represented a huge blow to the ruling theocracy. In previous elections the hardliners had, in effect, been able to fix the vote. But now more than 20 million voters turned out, and with the votes of the youth and women, in particular, elected the 55-year-old cleric. He had previously been ousted from office in 1992 "for permissiveness". On the first anniversary of his election, thousands of university students thronged into Tehran University where Khatami was only able to speak after a 15-minute ovation. In a clear warning to the mullahs he declared: "If religion comes into conflict with freedom, then it will be religion that suffers."
Khatami represents that wing of the theocracy that wishes to bend before the growing mass opposition. Failure to do so is a guarantee that the mullahs will suffer the same fate as the Shah in 1979. On every occasion the masses have chosen the slightest concessions to pour out onto the streets and challenge the regime. During the World Cup, especially following the 2-1 victory of Iran over the ‘Great Satan’ of the USA, millions poured out into the streets with youth and noticeably young women wearing chadors to the fore. This was not just a demonstration on football, but was a blow against the hardliners. The latter had refused to sanction large screens in the centre of Tehran to broadcast the football because they feared any mass gathering. What an irony of history that a regime that was brought to power by one of the greatest mass movements ever witnessed now fears these very masses.
Khatami reflects the yearning of the majority to throw off the dead hand of the mullahs. He also represents the liberal wing of the Iranian bourgeoisie which realises that the old methods, particularly of fundamentalism, are now outmoded. However, the hardliners will not give up without a struggle. They have looked on, in horror, as Khatami has accepted the establishment of nearly 200 new newspapers and magazines, increasing Iranian dailies by a third. His attempt to lean on the youth has been met with threats to repress mass demonstrations.
The hardliners, with a majority in the Majlis (parliament) seeking to stem the tide, have tried to strike a blow against Khatami by putting one of his supporters, the mayor of Tehran, Karbaschi, on trial, which resulted in a five-year jail sentence. The charge against him was one of corruption. But the trial has blown up in their faces. It has been televised live and has vied with the World Cup in capturing the attention of the masses. Moreover Karbaschi is rumoured to have incriminating files on at least two senior Ayatollahs amongst the hardliners who are, allegedly, up to their necks in corruption. Karbaschi is relatively popular because of the more liberal regime he has employed in Tehran, the protection of dissident rallies, his justification of cinemas screening controversial films. All of this has enhanced the popularity of Khatami and Karbaschi. The ground is clearly being prepared for explosive change in Iran.
Détente with Iran
Internationally, the bourgeoisie has reassessed its approach towards Iran, notwithstanding the US State Department’s report quoted earlier. Clinton is reported to want to "make Iran his China", emulating Nixon’s historic détente with Beijing. Under pressure from the European Union, Congress has waived sanctions against European companies investing in Iranian oil and gas. The Iranian regime is now firmly orientated towards the bourgeoisie. The Iranian revolution, at one stage, looked as though it might develop in the direction of the complete expropriation of the bourgeoisie and the establishment of a peculiar theocratic ‘deformed workers’ state’. But that process was halted in the 1980s and went completely into reverse following the collapse of Stalinism. It is only a matter of time before some of the 80% of the economy which theoretically remains in the hands of the state, is privatised. This would certainly happen if the forces behind Khatami completely triumph over the Islamic hardliners.
The attraction of radical Islamic fundamentalism has, therefore, dimmed in the light of these developments. Even Hizbollah, in the Bekar Valley in Lebanon, has sought to adopt a more attractive image, even employing ‘spin doctors’. The process will go even further under the pressure of internal events in Iran and the pressure exerted from outside. American companies are frantically urging a change in US policy towards ‘constructive engagement’, a policy of ‘rewards and incentives’ to Tehran.
Tehran occupies a key strategic position between a number of major areas. It not only adjoins Iraq and the Persian Gulf, but also the Caspian Sea. And, as the Wall Street Journal has commented, the Caspian region contains potential oil reserves of up to $200bn. Licking its lips, it declared: "The demise of the Soviet Union has opened this pot of gold to the outside world." Therefore, opposition to Iran must be jettisoned in favour of the vital economic and strategic interests of US monopoly imperialism. They have pressed Clinton to by-pass the Iran/Libyan Sanctions Act, which compels the president to impose economic sanctions on foreign companies that invest in Iran’s energy sector. Recognising the clear interests of the different camps in Iran, the Wall Street Journal declared that: "Iran has embarked on a historic struggle between those open to the West and those openly hostile to the West". As a sign of its coming rapprochement with the Iranian regime, the US has outlawed the opposition group, the Mujaheddin Al-Kalk (MKO).
An additional reason for drawing closer to Iran is because of the ferocious regional arms race and the threat of increased nuclear proliferation. The US has battled in the past period, probably unsuccessfully, to prevent nuclear material reaching Iran from Yeltsin’s Russia. One of the main features of the period ahead will be the developments of economic, political and even military conflicts within the main regional blocks as the various powers struggle to defend their own interests.
While the developments in the Middle East give a picture of increased ethnic and national tension, particularly between Israelis and the Arab masses, it is not the full story. The proletariat is beginning to emerge increasingly under its own banner. This is shown in the first instance in the struggle for independent trade unions, both in the Palestinian areas and amongst the Israeli working class. The bread riots in Jordan in 1997, which shook the Hashimite dictatorship, is also an indication of the growing opposition of the Arab masses to the dictatorial Arab regimes.
The struggle for democracy, jobs and bread is inextricably bound up with the overthrow of capitalism in the Middle East and the establishment of a socialist federation throughout the region. On this basis there could be a blossoming and development of the productive forces to the benefit of the great majority of the ordinary workers and peasants. This would also allow full scope for the establishment of a viable independent Palestinian state, if the Palestinian masses so desired, alongside a state for the Israelis.
On the basis of capitalism, a continuation of war, conflict, and even the threat of the use of nuclear weapons, looms. This danger has become more real in the wake of the nuclear tests of India and Pakistan. Alongside a ‘Hindu bomb’ and a ‘Muslim bomb’, there has been a clamour throughout the region in favour of an ‘Arab bomb’. Israel already possesses the potential to quickly develop nuclear weapons (if it does not already have them) and the Iranian regime is probably a long way towards emulating them.