THE CWI, Committee for a Workers’ International, sends May Day greetings to the working class and oppressed peoples of the world.
cwi comment and analysis.
Global capitalist turmoil and the future for socialism
At the dawn of a new century capitalism is entering a new, deeper crisis, as witnessed by the turmoil on the stock markets. More than ever working people need the guiding themes of May Day – international struggle, solidarity and socialism.
Despite police repression, thousands have protested in Washington this April against the effects of globalisation, neo-liberalism and capitalism , during a meeting of the World Bank and IMF. CWI members in the US have taken part in these protests, which mark an important stage in the re-development of solidarity between workers, youth and the oppressed internationally.
The representatives of capitalism attending this event have been in a state of siege. Not only do they have angry protesters to contend with but also a serious undermining of their system, caused by the enormous crash on the international stock markets and its consequences.
Stock market crash
The market economy – the world system of capitalism – means mass unemployment, worsening living conditions and poverty. The dramatic fall in world stocks and shares is a reflection of the irrational and destructive nature of the capitalist market.
In the week leading up to 16 April 2000 Nasdaq, the biggest player in the ’techno-boom’, lost a quarter of its value in one week. On Friday 14 April, Wall Street’s three major stock indices recorded their biggest one-day point declines ever. By the time investors had finished for the day about a trillion dollars had been lost. Microsoft has had $239 billion, the equivalent to the gross domestic product of Belgium, wiped from its value. At the time of writing it is reported that massive fall in share values have taken place in Asia and Europe. Up to £40 billion was lost in London on Monday 17 April. Asian markets suffered dives of up to 10%. Whatever else happens to the financial markets and world economy in the coming days, weeks and months, the huge losses in share values already suffered will eventually have a detrimental impact on the jobs and living conditions of many workers.
For over two years new technology stocks have rocketed. For over two years new technology stocks have rocketed. Yet none of the fantastically overvalued ’dot.com’ new companies had yet made a profit. This was a predominantly speculative bubble, not based upon the real economy. Yet its effects helped fuel a boom in the US economy, the longest, but one of the weakest, in its history. The US in turn kept large sectors of the world economy afloat and even parts of Asia and Latin America began to pick up (though with increasing misery for millions). However, large parts of the world, including Japan, have remained in a deep recession/slump for the last number of years.
Capitalist commentators thought they had overcome the inherent crisis of capitalism, on the basis of globalisation and the new technology boom. But as the CWI has consistently warned, at some point the stocks and shares bubble would burst, reflecting the real underlying weakness facing the US economy.
We cannot predict exactly what will happen next to the world economy, but all the factors that can lead to a world-wide economic downturn are present in the situation.
The markets are extremely volatile. The crash appears to have been triggered after news of a jump in US inflation. This led to concerns that interest rates (the cost of borrowing) will have to rise to contain inflationary pressures. Capitalist commentators desperately plead that the present crisis is just a markets "correction". But any number of factors, such as a major bank going bust, could trigger a major economic recession/slump. The effects of the crises of capitalism will be visited upon millions of workers in the US and Europe, and even more catastrophically in the ’Third World’ and so-called ’emerging’ economies.
A deep recession or even slump may now unfold. If investors take their money and run, this can be the start of a huge ’credit crunch’.
Many people will be affected by a wipe out of stock values – about half of all Americans have some stocks and by the end of 1999, 31.7% of all US citizens’ personal wealth was in the form of shares invested on the stock markets.
American households have spent well beyond their means and got heavily into debt. US companies have invested huge sums in ’dot.com shares’, accruing enormous debts. But ultimately there were not the profits from the real economy to justify this mad spending spree.
US workers have been squeezed to the full to increase productivity rates. Corporate profits have for some time shown signs of reaching their limits. US manufacturing profits have reportedly suffered a real drop over the last two years. Moreover, the new technology, while for a period boosting productivity, also forces prices down and squeezes profits.
The plunge in the share values is the beginning of the reversal of the so called "virtuous circle" – of rising share values, consumer spending and boom. Now we have the prospect of a spending slump, higher costs, and a fall in output.
The US could follow Japan, which has been stagnating since its own bubble burst ten years ago. Despite many costly attempts to recover the economy Japan has remained stagnant. A similar development in the US will have devastating consequences for the rest of the world economy, which relies so heavily on the health of the US.
It may be possible that capitalism can escape such a dire development for a further period. If so, this will only increase the contradictions and make a future recession/slump even deeper.
The big bosses and capitalist governments will expect the working class to pay the price for the crisis of their rotten system. The last number of years have seen over-capacity and even over-production develop in a number of sectors, such as the car industry. To attempt to escape from this crisis, capitalists will actually destroy the means of production, and with it millions of jobs and livelihoods. For example, thousands of jobs are under threat at the Rover car plant in the Midlands of England.
Workers need their own independent organisations and programme to resist these attacks. Marxists and socialists have organised to fight capitalism on a global scale since the First International was established by Marx and Engels. In 1889 the first congress of the Second International took the historic decision to make the first of May an international day of workers’ struggles and solidarity. Since then millions of workers across the globe have traditionally marched on and celebrated May Day.
Commemorate Leon Trotsky
This May Day, and throughout the year 2000, we are also commemorating the life and legacy of one of the great Marxists and international workers’ leaders, Leon Trotsky. It is sixty years since Trotsky was murdered in Mexico City on the orders of Stalin. But the Stalinists could not kill-off the Old Man’s ideas. Today, Trotskyism represents the modern expression of genuine Marxism and all the best traditions of the international workers’ movement.
Trotsky was the co-leader, along with Lenin, of the Russian Revolution in 1917, which saw the working class come to power. He led the struggle against Stalin and the rising counter-revolutionary bureaucracy in the 1920s, when Soviet Russia was isolated and economically backward.
In the 1930s, Trotsky kept the flame of genuine Marxism alive while the Third International, under the domination of the bureaucratic caste ruling in Russia, degenerated along reformist and national lines. In Trotsky’s opinion, his most important task was to set about creating a new workers’ international, a ’Fourth International’.
The Committee for a Workers’ International (CWI) bases itself on the ideas of Marx, Engels, Lenin and Trotsky. The CWI works to establish a mass revolutionary socialist international. We stand for an end to capitalism and for a socialist society based upon need and not greed. A planned economy, democratically run by the working class on an international scale, can completely transform the lives of everyone.
A new period has opened up since the collapse of once-mighty Stalinism and the bourgeoisification of the social democratic parties. The working class has suffered a massive ideological barrage from capitalism and setbacks. At the same time, space has opened up for the development of genuine socialism on a mass basis. This will not take place in a straightforward fashion, given the ideological confusion and setbacks suffered by the workers’ movement during the 1990s. It will be a protracted and complicated process. However, we are already seeing important mass struggles on an international scale that mark a qualitative step forward.
International Workers’ Struggles
May Day 2000 is celebrated as workers’ struggles are taking place in many parts of the world. The CWI, with sections and supporters in over 34 countries, actively supports these struggles and in many cases plays an important leading role in them.
In Europe, important fight-backs against cuts and job losses are taking place. In some countries, such as France, Southern Ireland and Australia, workers are taking offensive action, and winning wage increases and shorter hours. These workers have faced increased exploitation even during years of economic boom and are now demanding some gains of their own.
There have also been magnificent movements on broader political issues, such as the mass protests against the inclusion of the far right FPO in the new Austrian coalition government. CWI comrades in Austria played a key role in organising daily protests of thousands, raising the slogan ’Resistance!’, which was taken up by the mass movement.
Fighting the poison of fascism, racism, nationalism and ethnic and religious bigotry will increasingly be a key task for the workers’ movement. European governments are trying to scapegoat asylum seekers for the crisis of the system. In Britain, the main political parties and the media have whipped up racism. The New Labour government has viciously attacked the rights and welfare of refugees, calling them "bogus" asylum seekers.
Socialists must expose the lies and propaganda of these governments. A socialist programme demands jobs, a living wage and decent housing for all. Workers’ unity is necessary to resist the fascists and far right groups.
Even in the ex-Stalinist states, where workers have faced the most dramatic decline in living standards and enormous class confusion, heroic struggles are taking place. In recent months, workers at the Metalist factory in Kazakhstan won partial gains after months of strike action. CWI members played a key role in this dispute, and continue to organise workers in Kazakhstan, despite state repression. Likewise, today CWI members in the Czech Republic are organising international solidarity for miners staging an underground strike in northern Bohemia.
In the under-developed and semi-developed sectors of the world, workers, peasants and the landless are conducting magnificent struggles against corrupt and often brutal regimes.
In India, power workers and dock workers have taken strike action. In Sri Lanka, CWI members have taken a principled stand against the government oppression of the Tamil areas, and fight for the unity of Sinhalese and Tamil workers in the teeth of vicious reaction.
The tempo of struggle is reaching a revolutionary pitch in a number of countries. For example, after decades of theocratic and reactionary rule, the youth and working class of Iran are heroically fighting back. This marks the first stages of a new Iranian revolution, which will help speed up the overthrow of the repressive regimes throughout the Middle East.
In impoverished Zimbabwe, the regime of Mugabe is desperately attempting to divert the anger of the workers and the landless with a cynical policy of ’land seizures’. The developing opposition mass movements in Zimbabwe can see the end of Mugabe’s rule. However workers and peasants need bold socialist policies to fundamentally change their lives. The leaders of Zimbabwe’s main opposition party came from the leadership of the unions, but instead of building an independent movement of workers and peasants they have adopted pro-capitalist policies. This sort of programme can only disappoint workers, opening up the danger of a descent into chaos and civil war.
After some years of relative quiescence, the working class of South Africa has decisively taken to the road of struggle again. Last year saw general strikes. This April over 100,000 mainly public sector workers marched against the neo-liberal policies of the ANC government.
Revolutionary movements in Latin America
In Latin America significant struggles are breaking out at present, some of which have already reached revolutionary proportions.Since the beginning of the year uprisings have occurred in Bolivia and Ecuador. In Venezuela the populist regime of Chavez is on a collision course with US imperialism. In Colombia, the regime is desperately fighting to contain the guerrilla forces.
In early April four days of mass movements shook Bolivia. Workers and peasants were protesting against the privatisation of the water system and huge hikes in water rates. Enormous demonstrations were fired upon by government troops. A massive police mutiny demanding wage increases led to shoot-outs between the army and the police of La Paz, the capital. Tens of thousands of peasants closed off roads in most of Bolivia’s provinces. Unions went on strike and students organised protests.
Similar uprisings took place in Ecuador at the start of the year and led to the declaration of a new ’people’s government’. However, the ’moderate’ elements in the popular movement handed power back to the ’safe’ representatives of capitalism and landlordism, behind the backs of the masses. But the struggle is not over, and the masses will have learned from this experience.
The CWI salutes the renewed offensive of the masses of Ecuador, Bolivia and throughout Central and Latin America. What an answer to all those sceptics and cynics who preached that the working class would no longer struggle!
The revolutionary events unfolding in these countries make clear the need for the working class to have its own independent organisations and programme. In Ecuador, power was within the reach of the working masses, but the movement lacked a revolutionary, socialist leadership.
Many of the issues that have historically confronted the workers’ movement during periods of class upsurges are re-appearing in these struggles – the nature and role of the capitalist state, ’guerrillism’, ’Popular Frontism’ etc. Only the rich ideas of Marxism can provide the programme, tactics, strategy and theory for the successful overthrow of capitalism and the coming to power of the working class.
The events in South America mark an important step forward. The demands of the masses in Bolivia and Ecuador are clearly anti-capitalist. However, the organisations leading the movements are very broad ideologically and confused. The masses know what they are against but are not clear about what they want. A generalised socialist consciousness has not yet developed. It is through the experiences and lessons of these revolutionary events, and also by the intervention of Marxists, that genuine socialism will find a mass audience.
Alongside revolutionary movements and mass uprisings, elements of counter-revolution can also develop in this period, especially when there is no substantial Marxist force to give a decisive lead to the great movements of the masses. In Nigeria, after the removal of the military dictatorship, but without real change in living conditions, disappointment and disillusionment set in amongst sections of the population. While there have been movements by public sector workers and students there has also been tribal, ethnic and religious clashes costing many lives. The CWI in Nigeria continues to grow, offering workers and the poor a socialist alternative to the new civilian government’s right wing policies.
Following the half completed revolution in Indonesia that overthrew the dictator Suharto, reaction has reared its ugly head. Some Indonesian islands have been convulsed by bloody ethnic clashes, largely orchestrated by reactionary elements in the army and state. However, the process of revolution is not over; students and the poor continue to take action against the capitalist government.
Capitalism, a system based upon private ownership and the nation state, is the fundamental barrier to human progress. Economic crisis, mass unemployment, poverty, wars and conflicts – these are all part and parcel of the market economy.
This has been illustrated by the disaster that has accompanied the re-introduction of capitalism in Eastern Europe and the ex-Soviet Union. Over 50% of Russians live below the poverty line. Life expectancy has dropped from 72 to 59 years in a decade.
The mafia-capitalist regimes of the former Stalinist states have plunged a number of peoples into terrible wars. The Balkans has suffered three wars in less than a decade, with 100,000s killed.
Last year saw NATO’s war against the regime of Slobodan Milosevic. At the time the CWI took a principled stand against NATO and the imperialist intervention, and called for the right of self-determination for Kosova/Kosovo. Our analysis and warnings have proved correct. Today, Kosova is ruled by an undemocratic UN/NATO force and the western powers have presided over vicious ethnic cleansing of Serbs, and other minorities. The powers continue to oppose genuine independence for Kosova. The authoritarian regime of Milosevic is still in power, while the Serb people suffer the effects of the 79 days of NATO bombings and continuing sanctions.
Only a united worker’’ movement in Kosova, Serbia and across the Balkans can end ’ethnic cleansing’, overthrow the local regimes and western occupiers, and allow real self-determination for Kosova. The CWI applauds the strikes and protests of workers, pensioners and students in Bosnia and Croatia last year, and recently in Serbia.
War has also been visited upon the people of Chechnya by the brutal Russian Federation regime of Putin. The Russian state has imperialist ambitions in the region. Increasingly it is coming into conflict with Western powers, such as the US, and their drive to exploit the resources and people of the Caucasus.
NATO’s war marked a decisive new chapter in power relations. The world is now a much more volatile and dangerous place. New conflicts on an international scale are inevitable in this period. ’Local conflicts’, such as the ’Kargil war’ last year between India and Pakistan, cost the lives of many workers and the poor.
’Third World’ horror
Capitalism finds its most barbaric expression in the so-called ’Third World’ , where the mass of humanity exists. In the Middle East, Africa, Asia and Latin America, billions go without the most basic necessities. Every year the ’official’ statistics make even more grim reading. According to the World Bank (April 2000) half of the world’s population survives on less than $2 a day, and 57% of the world’s population in the 63 poorest countries receive only 6% of world income. Over 1.5 billion people ’live’ on less than $1 per day.
Between 1990 and 1998, thirteen countries experienced worsening rates of infant mortality. Many of these are in Africa, a continent torn apart by conflict, famine and absolute poverty. Western powers do not think twice about the lives of African people in their pursuit of markets, resources and areas of control, as can be seen by their involvement in the terrible conflicts afflicting Sierra Leone and the Congo. The powers continue, through widespread sanctions that include vital medical supplies, to murder hundreds of thousands of Iraqi civilians. This is the reality of the ’civilising role’ of international capitalism today! Of course, socialists want to see the end of the brutal regime of Saddam Hussein, but that will be the task of the Iraqi people.
The World Bank states that 50 million people have now been infected with HIV/Aids, of whom 34 million are still alive. About 23 million of them live in Africa, where there is no real medical treatment. Subsequently, life expectancy has fallen in a number of states. Botswana and Zimbabwe have seen life expectancy cut by 17 years in the last few years.
Unfair trade terms and debt burdens have been the main ways the rich capitalist nations of the West have exploited the masses and resources of Africa, Asia, and Latin America. The World Bank and the IMF carry out the looting of the economies of the ’Third World’, on behalf of the rich capitalist nations.
Protests against global Capitalism
Decades of neo-liberal attacks are creating a sharp reaction, not just in the ’Third World’, but in the advanced capitalist states as well. Last year saw magnificent demonstrations against the WTO in Seattle, and earlier this year there were protests at Davos against the World Economic Forum. Brutal police actions in Washington during the April IMF/World Bank summit have only highlighted again the case against global capitalism. These protests mark a very important step forward, bringing together a number of single issue campaigners, socialists and trade unions.
The support given by the leaders of the social democracy to the aims and policies of the WTO, World Bank and IMF shows the complete capitalist nature of these parties. One ex-’hard left’ in the British New Labour government, Clare Short, said the anti-WTO protesters were "living on another planet". In fact, it is Clare Short and New Labour, along with all the other social democratic leaders around the world, who are living on another planet if they think that workers and youth will accept a continuous diet of neo-liberal attacks.
Capitalism is a global system dominated by big multinational companies. These account for more than one third of world output and two thirds of world trade. As the economic crisis deepens the movements against global capitalism will grow, on a national and international basis, and increasingly will have a class character. This will highlight the need for an alternative society – a socialist society.
In order to successfully struggle, workers will fight to reclaim their trade unions from the ’leadership’ of the careerists and bureaucrats. Workers will also move to create new mass parties that represent their interests.
New mass workers’ parties
This year also marks the 100th anniversary in Britain of the Labour Representation Committee, the forerunner of the Labour Party. This historic conquest for the working class came about as a result of a combination of mass workers’ struggles over a period and also the intervention of socialist and Marxist groups.
A similar process will see the development of new mass workers’ parties internationally in this period, although no-one can predict exactly how or when they will arise. These workers’ parties will mark a huge step forward in the struggle for socialism. The CWI is striving to build revolutionary workers’ parties and a new International.
Since the 1990s, in a number of countries, new parties to the Left of the social democracy have made electoral gains. CWI sections have played an active role in a number of these new Left formations, for example, in the Scottish Socialist Party, and in the Portuguese Left Bloc, which have both made electoral gains in the last year.
However, the future of these new parties or alliances is not assured. Where the leaders, such as in the United Left (IU) in Spain, have adopted right wing policies they have suffered at the polls and experienced a fall of working class support. In the March Spanish general elections the IU saw its seats in parliament fall from 21 to 8 after going into a pact with the right wing Socialist Party.
In Britain, the decision by Ken Livingstone to break from New Labour and to run as an independent for the new London mayor’s position has struck a chord with millions of workers and middle class people. This shows the vacuum that exists on the Left. Despite a populist programme and conspicuous lack of socialist policies, Livingstone, largely due to his previous ’red’ reputation, is expected to score a big victory against the New Labour candidate. This is not surprising given the capitalist policies of Tony Blair. Today, one third of London’s households and half of London’s children live in poverty – in the richest city in Europe and the fifth richest country in the world.
Tony Blair has attempted to lead the way on the European and world stage with his ’Third Way ideology’. This was meant to have replaced "outdated class politics". But the class conclusions millions of workers will reach living under capitalism will shipwreck the ’Third Way’.
For a socialist century!
Capitalism has long ago outlived any progressive role. The capitalist system means growing inequality and poverty on a world scale. In Latin America, despite some recent economic growth, 15% of households (90 million people) are living in "extreme poverty" (Financial Times, London, 24 March 2000). Similarly, real wages in South Korea have declined by 10%, and in Indonesia by 42%, since the 1997 Asian financial crisis.
At the start of the 19th century the ratio of real incomes between the world’s richest and poorest nations was three to one. By 1900 it was 10 to one. By 2000 it had risen to 60 to one.
The only way to overcome the system of inequality and poverty is through a decisive struggle to abolish capitalism and landlordism on a world scale. This May Day workers and socialists will once again commit themselves to this task. The CWI will play its role in the building of the forces necessary to carry through the socialist transformation of society.