CWI meeting discusses global capitalist crisis in midst of covid pandemic

Protesters in Huancayo, Peru, 11 November 2020 (Photo: Pembuat CADENATVHYO/Wikimedia)

The CWI’s International Executive Committee (IEC) met via Zoom over three days, from 13-15 November.

Attended by over 80 comrades from Europe, Africa, Asia, Latin America, USA, Canada and other areas of the world, the IEC members and visitors from the different national sections of the CWI discussed on the first day the crucial questions of world perspectives in the midst of the covid pandemic.

The discussion also took place against the backdrop of Trump’s defeat in the US presidential election in early November.

Introducing the discussion, Tony Saunois, the Secretary of the CWI and a member of the International Secretariat, pointed to the unprecedented turmoil and upheaval that had engulfed the world since the last IEC meeting in June 2020.

The US elections led to a defeat for Trump. At the same time, there were some elements of civil war present in the US. Trump himself, in refusing to concede defeat to the Democrat Joe Biden, had been at least testing the water for a possible ‘constitutional’ coup and carrying on as president.

These unprecedented clashes are a reflection of the scale of the crisis facing the US and world capitalism and its leading representatives. Deep splits have also opened up in Britain. Prime Minister Boris Johnson’s Tory party is riven with division, with open attacks on him by MPs and government ministers in the wake of collapsing approval ratings. This comes less than a year after Johnson and the Tories won an 80-seat majority in the UK general election of December 2019.

Such volatility underlines the analysis made by the CWI that there exists a series of inter-related crises globally. The clashes between the classes are growing as the social and economic consequences of the covid pandemic unfold. In addition, the geopolitical conflict between China and the US is even more aggravated. On top of this, the health disaster of coronavirus – which has now killed over 1.3 million globally – and the unresolved environmental catastrophe, all point to the utter incapacity of capitalism to resolve any of the problems facing human society.

That a new historical era has now begun is becoming ever more clear. Nevertheless, there are still many uncertainties with a number of possibilities and outcomes that are posed. What is certain is that the speed of political events is gathering up rapidly.

The recent announcement of possible viable vaccines to immunise against covid-19 can have a big impact on the mood among the working class. A certain economic boost for capitalism will also flow from this if widespread vaccination does take place in 2021. However, there will be many points of conflict, including who gets the vaccine, how it will be distributed, the cost to populations and governments.

The absence of mass workers’ parties arguing for socialist ideas, even in a broad sense, has been a key missing element. This was obvious in the US election – where ‘lesser evilism’ was a dominant theme – but it also applies in most countries, including where there have been eruptions of struggle and class conflict.

The CWI and the working class face an unprecedented situation. We have not seen such a deep crisis of capitalism and, at the same time, the absence of large or mass socialist parties since the first half of the nineteen century. We are still also seeing the shadow of the effects of the collapse of the former Stalinist regimes on political consciousness.

The bourgeois globally have, en masse, turned to a form of Keynesianism to save their system. Full figures are not clear and are changing by the day, however, more than $20 trillion has been spent to try and place a floor under the collapsing economies, this year alone, to attempt to avoid a disintegration of capitalism.

The unprecedented scale of the crisis is shown by comparisons with the last world downturn in 2008/9. 2020 will see a shrinkage of around 5% in global GDP. In 2008, it was 0.1%. For the US, still the world’s biggest economy, the comparative figures are a 7% contraction for 2020 and 2.5% in 2009.

“Horror without end”

If that is the situation in the advanced capitalist nations, the position facing the masses in the neocolonial world is indeed “horror without end”, to use Lenin’s expression about what capitalism entails.

India is likely to see a 24% contraction in GDP this year, with hundreds of millions of jobs being lost as a result.

The process that we have pointed to over the past decade of de-globalisation, with a retreat to economic nationalism and increasing tensions within previous trading blocs is accelerating.

The Chinese ruling regime has turned to being more reliant on developing the national economy and market through its policy of “dual circulation”. The de-coupling of China and the US has become more pronounced and it is still taking place although it remains to be seen how far this can go.

The period of globalisation, as we explained previously, reflected the expansion and integration of the world economy during recent decades has now been thrown into reverse. Biden’s election in the US is very unlikely to change the long-term decline of US imperialism and the rise of China as a world power.

The Chinese middle class represents a population of around 400 million – this compares to an EU population of 450 million. This also includes a layer of lower paid workers, in reality. However, this market has a effect: for example, profits for German car companies have boomed recently linked to exports to China.

At the other end of the scale, there is massive wealth polarisation and soaring inequality. The Chinese working class is also an immense force with massive potential power. The inequality and tensions which are developing are certain to explode at some point. The massive repression and control are also going to provoke a backlash, including from sections of the middle class.

The speeding up of geopolitical shifts and increased national and regional clashes are also evident. The re-eruption of conflict between Armenia and Azerbaijan over Nagorno-Karabakh is one example of an increasingly unstable arena. Greece and Turkey have also clashed recently. New realignments in the Middle East involving UAE, Israel and Saudi Arabia have emerged.

Abrupt changes are taking place in all spheres of capitalist society.

US elections

The scale of the economic and social crisis in the midst of the covid pandemic dominated the US election. Tony commented that 54 million in the US face food insecurity by the end of 2020. A reported 32 million people in the US say they have considered suicide this year.

Elements of social civil war and clashes within the ruling class have increased. However, the majority of the bourgeois in the US wanted Trump to be defeated. They hoped for a ‘blue wave’ that would allow Biden to win and the Democrat Party to win the Senate. There was no Biden landslide, however. Trump’s vote actually increased – including among Latino and Black people – to the second-highest ever for a US presidential candidate – up 10 million compared to 2016.

In the absence of a mass working-class alternative, Biden could not decisively cut into Trump’s base of support. Although, on the basis of ‘anyone but Trump’, Biden did win the popular vote by around 6 million votes.

Trumpism has not been defeated, with that wing of the Republican party holding a majority now.

Trump seems to be preparing for another run at the presidency in four years.

Biden won’t ‘heal the nation’, as he has claimed. It’s likely that Biden will pack his cabinet with the corporate Democratic establishment, and also possibly reach ‘over the aisle’ to the Republicans as well. Bernie Sanders and the ‘progressive left’ in the Democrats, in contrast, will be given nothing. On the contrary, both Sanders and AOC have come under attack from the right-wing of the Democrats for allegedly costing them seats in the both the Senate and the House.

While a stimulus package and a so-called green new deal of around $2 trillion is possible under Biden, the economic headwinds facing a Biden presidency are powerful. In no sense is it comparable with the Clinton presidency in the 1990s when more benign economic conditions existed.

While Biden will ‘re-engage with the world’, including rejoining the WHO, Paris Agreement on climate change etc., US foreign policy will retain its imperialist fundamentals.

The same relationship with Israel will continue, as will clashes with China. However, direct military intervention by the US in the world is much more difficult following the experiences in Iraq among others.

2020 has seen multiple movements and uprisings. From the BLM eruption in June 2020 to the #EndSARS movement in Nigeria. Iraq, Chile, Lebanon, Thailand, Poland and Peru have all seen mass struggle based on an anti-elite mood and anger at the corrupt political establishment.

In these movements, where young people have played a leading role, anti-capitalist consciousness and a hunger for revolution are often being expressed. At the same time, this is combined with an anti-party mood and some illusions in a reformed or more ‘democratic’ capitalism.

Spontaneity and its limits were seen in Lebanon. There was a mass cross-religious and confessional movement that led to the fall of the government. Nevertheless, without a mass working-class alternative based on socialist ideas being developed, it ended up with a return of the previous president back into power.

Role of the left

The past period has seen the capitulation of the ex-social democracy and also the ‘new left’ who have proved to be unfit for purpose. The pressure for ‘national unity’ during the pandemic was embraced by these forces, as it was by the majority of the trade union leadership.

In the case of Podemos, in Spain, and the Left Bloc, in Portugal, they have gone into government or have supported governments led by the pro-capitalist former social democracy. This raises questions as to the future of these organisations. It is not at all certain that they will play a role in the formation of new mass workers’ parties. However, this can change in some countries and splits within them are a possibility. Some may be an electoral attraction for the youth and sections of the working class. However, this will vary from country to country.

Mélenchon in France has established a new political platform to contest the presidential elections in 2022. He could still be a point of reference yet he has failed to take the necessary steps to build LFI as a political party despite continuing to enjoy significant support.

In Britain, both Jeremy Corbyn, who has had the Labour whip in parliament removed from him and Momentum, have continued with calls for “unity” with Starmer and the right-wing leadership of the Labour Party, rather than take the necessary steps to help build a new mass workers’ party.

Bernie Sanders’ strategy in the US is to push Biden to the left. Prominent left figure, Alexandria Ocassia Cortez (AOC) said to the New York Times she did not know if she wanted to stay in politics. This is at a time when the mood in society is being more angry and distrustful of governments, including in their handling of covid.

Second lockdown

With many countries in the second round of lockdown, there has been a decisive change in mood. There are increasing numbers who oppose the lockdown measures and the economic and social impact in their wake.

On this issue, the far right is trying to organise and mobilise support. In both Germany and Italy there have been large anti-lockdown protests. In the UK, Nigel Farage has relaunched the Brexit Party as an anti-lockdown and anti-corruption party.

France has seen battles between students and police during a recent round of teachers’ strikes. Macron’s response has been to implement harsher repressive measures and legislation.

Capitalist governments internationally have used covid to introduce a raft of repressive laws, including Modi in India and Rajapakse in Sri Lanka. There are also examples of the far-right going into the state machine – army and police forces – to try to gain influence and to use these forces against the working class.

The character of the period means the far-right and right-wing reactionary populism will continue to be a feature of the situation. Some of these forces, like Bolsonaro, in Brazil, have even adopted elements of a welfare programme – originating from the Workers’ Party (PT) – added to it to try and rebuild some of their lost support.

However, reaction does have its limits. In Bolivia, the MAS won the recent elections with the sitting right wing president removed.

In Poland, there has been a huge mobilisation against the attempts by the Law and Justice party, PiS, to ban all abortion, using the law courts. This reflects the potential for mass struggle, as well as the explosive and polarised political situation of capitalism today

The capacity of the CWI to build and grow in the next months and years is rooted in the utter failure of capitalism, and by putting forward a correct analysis, programme and tactics. As important as always is our confidence in the working class as the key force to change society.

There were a number of key themes that emerged during the discussion at the IEC meeting. The US election, China and the US, the role of the left parties, and also the impact of the covid crisis in Europe were some of the main themes discussed.

National question

Donal, from Ireland, reported that a combination of Brexit, covid and the economic downturn had further destabilised an already unstable sectarian situation in the north of Ireland. Job losses in aviation and aerospace and the wider manufacturing sector had hit the working class hard, especially Protestant workers.

While at the start of the pandemic the trade union movement in places like Northern Ireland was on the front foot, in the main paralysis and a class-collaborationist approach have been evident at the tops of the movement.

Peter Taaffe from the International Secretariat pointed out that this was an extremely important discussion for the CWI. Implicit in Trump’s refusal to accept the result of the election was the threat of a coup. As Marx and Engels pointed out, the US Civil War had a ten-year period of a “dress rehearsal’ before it broke out in earnest. The abolition of slavery by Lincoln during the civil war acted as a decisive change in the balance of forces in the conflict.

For days, Trump was implicitly threatening some kind of coup but the military tops applied pressure on Trump to step back. However Trumpian populism will remain and the increasing political polarisation in the US are symptoms of the coming storm. Significantly discussion started within some trade unions on the question of a general strike if Trump did not accept the result.

In the neo-colonial world, there is not one stable government. The mass movement in Poland on abortion rights saw one commentator compare it to Paris in 1968 – prior to the May ‘68 general strike – which reflects the explosive mood. The covid vaccine is a potential step forward and could give the working class the opportunity to breathe again.

Peter also stressed the importance of the national question and the importance of the unique approach of the CWI towards this issue. He cited Ireland and, in particular, the stormy events of 1968/1969. Peter visited the North and had discussions with the most radical youth in the Derry Young Socialists and others, laying the political basis for the growth of Militant in Ireland. The recent tragic events in Nagorno-Karabakh illustrate the continuing importance of the national question and of Marxists adopting a correct policy towards it.

Jeff from the US highlighted the fact that the US ruling class, reflected by the corporate media, overwhelmingly backed Biden against Trump. Biden’s long history of working with Republicans and his history as a safe pair of hands for capitalist interests – unlike Trump – made him their favoured candidate. Jeff discussed what Trump’s intentions were. As the pro-Trump demos got smaller as Biden was “called” winner, Trump relied on weak legal challenges rather than being able to win behind him the military or a mass movement on the streets.

Alex spoke to highlight that Macron in France has stumbled from one blunder to another over covid. The second lockdown has, like the first one, exposed an unprepared health system. Macron has held the same approach, making announcements on Wednesdays and for new covid policies to be carried out on Thursdays, which reflects a fear of leaving a space for class anger to be expressed.

Trade union and left leaders readily accepted Macron’s pro-corporate policy and have failed to put forward clear demands or organise workers to struggle during the pandemic. The economy has dropped by 11% and unemployment increased to 10%. One million people fell into poverty during the covid pandemic, so far. For the CWI, transitional demands are even more important in this period, linking the immediate issues of how to fight with the need for a socialist society.

Clare, a member of the International Secretariat, argued that the Chinese economy is recovering faster than most other nations. This last quarter’s growth rates are predicted to be 4.5%. The Chinese communist party leaders tried to cover up covid, at the start of the pandemic, and punished doctors and others who spoke out. Journalist Will Hutton said that China has been more effective than the West in dealing with the crisis, through surveillance and what he mistakenly describes as “Leninist capitalism”.

While private firms have dominated in China’s technology sector, the Chinese premier, Xi Jinping, has carried out ‘re-centralisation’ and is trying to regain increased state control over the economy, as the crisis has unfolded. Despite economic growth, 40% of the population live below the poverty line. Around 600 million live on less than $5 a day and five million earn less than 92 cents, a day. Increasing use of Han nationalism is used by the regime to try and find new bases of support in society.

Yuva, from Malaysia, explained that the economic impact of the covid crisis on south-east Asia is profound, with an expected contraction of 2.7% in GDP for 2020 – the worst since 1961. In Thailand, the military and monarchy are facing a mass movement, linked to the economic crisis, with millions of jobs, lost especially in tourism. In the Philippines, ten million jobs have gone. As in Thailand, unemployment is expected to increase to 25%. In Malaysia, an all-out crisis is expected next year.

The recent trade deal with China, the south-east Asian economies and Australia etc. (RCEP) covers 2.2 billion people and encompasses around 30% of world trade. It reflects the growing power of China at the expense of India and also the US. But the working masses will gain little. Between 50-80% of the workforce are in the informal sector.

India has seen 130 million lost jobs before and during covid, explained Jagadish. There is not a combative, mass left party in existence, in reality. Many workers’ leaders have embraced and accept capitalism. This has allowed Modi and his pernicious Hindu nationalism to engage in a demonisation campaign against immigrants. But there have been many regional state-wide protests against the Modi regime and the conditions are ripe for mass struggle.

In Sri Lanka, a semi dictatorship has been established under the brutal Sinhala nationalist, Mahinda Rajapaksa. Siri outlined the increasing competition between India, China and western imperialism for influence over Sri Lanka and the region. Rulers of both India and the Chinese Communist Party have been involved in direct interventions. While US ministers have visited Sri Lanka and joint military operations have also included Australia.

Left formations

Leila from France commented on the role and limitations of the left. Mélenchon and his La France Insoumise movement are still seen as a left opposition to the Macron government. Mélenchon has launched his bid for the 2022 presidential elections with a new platform, rather than LFI, and at the moment seems to be resisting pressure to coalesce with the pro-capitalist Socialist Party and the Greens.

However, Melenchon’s programme has severe limits – arguing for a mixed economy with state intervention but still within capitalism. He also refuses to move towards launching a genuine new party for the working class with democratic structures.

Sascha from Germany agreed that there was a need for flexibility in our perspectives. While the direction of events is clear, there can also be unforeseeable factors like the current pandemic. A bad winter with new lockdowns is possible before a vaccine is ready. The mood in Germany is now different compared to the first lockdown. There are more scepticism and anger towards the government. The far-right can, which is opposing lockdowns, make gains in this situation. A recent 40,000-strong anti-lockdown demo was hijacked by the far right.

The emergence of new workers’ parties can still be a protracted process, given the character of the trade union leaders and the low level of consciousness which can affect how new parties develop. It is also important not to go too far in writing off some of these left formations. In some cases, they can still attract electoral support and members.

Sascha said that while some of these formations were politically ‘left-populist’, not all were. Now in Germany, there is the possibility of left populism emerging with a more nationalistic outlook while taking up the issue of elites versus the rest. Such a party could, in the case of Germany, develop a greater appeal than DIE LINKE.

Role of the trade unions

Rob from England and Wales focused on the role of the trade union leaders during the pandemic. The capitulation by the trade union bureaucracy – both of a right and left variant – to the ‘national unity’ mood was widespread. This included the tops of formally left unions, such as the PCS and RMT, where much trade union activity was abandoned.

CWI members on the leadership bodies of British unions like the RMT, Unison, PCS and others have resisted the national unity pressure and have held a firm line. This contrasts with much of the left.

A series of splits are opening up among the bureaucracy – reflecting the pressure that is building underneath them from the working class. This is very likely to grow enormously once the lockdown is eased. As it is, the second wave and the reaction to it is significantly different from the first lockdown. With bosses attempting to fire and rehire on worse terms and conditions, major clashes are possible.

The German bourgeoisie has put money into the economy to avoid a big crisis but are still very dependent on the world market, explained Angelika from Germany. Insolvencies of companies delayed for a period as a result of state support. In the auto industry component companies are especially announcing jobs cuts. Profits from luxury car sales in China have not stopped Daimler plans to cut 20,000 jobs and move production to eastern Europe.

The metalworkers trade union – facing pressure from below – have been forced into organising some limited protests. How to fight against job cuts a big issue.

Mass struggles

In Latin America, Patricio explained, there is a growing explosive situation, including in Peru, Venezuela and Bolivia. Social unrest and political instability have grown in the last months. The Chilean movement ran from October 2019 until March 2020 and was cut across by covid. It was a pre-revolutionary situation, with the main social force coming from workers and the young working class. It indicated the crisis of the regime, economy and health. Patricio pointed out that the consciousness of the masses is and evolving. In general, the leaders moved to the right, while the masses moved to the left

Repression was the consistent policy of the Chilean government. A lot of new organisations and assemblies, reflecting the mass movement, were formed. There was a limited attempt to coordinate those kinds of assemblies. But now they could be relaunched in response to a new wave of struggle that has begun in Chile.

Soweto dealt with the huge revolt in Nigeria reflected in the #EndSARS movement, which has indicated the possibilities for revolution in Nigeria The uprising in October – only a few days after the 60th anniversary of Nigerian independence, which the ruling elite wanted to mark as a celebration – is rooted in the disappointment with ruling party which has been in power since 2015. There was enormous sympathy among the working class for the movement. The struggle would not have gone as far without that support. Elements of a pre-revolutionary situation developed for a few days. The rapid changes in consciousness were reflected by the demands of the movement. It began against police repression but rapidly evolved to demand political action while we called for the fall of the Buhari government.

The trade unions had suspended a planned general strike over fuel price rises in the weeks before the movement began. It was a rotten deal that resulted in the government hiking the fuel price anyway. The mistrust of the labour leadership is understandable and it can complicate consciousness. Therefore a programme for how the unions can be transformed and rebuilt is essential.

Speed of events

Replying to the discussion Robert Bechert from the International Secretariat underlined the tremendous speed of events, including new clashes in Peru and protests in Washington DC. The overnight signing of the RCEP trade pact, excluding the US and India, pointed to the shifting sands of rival economic blocs, and clashes between the major economic powers. All of them underpinned by a trend towards de-globalisation.

It is also important to register that it is still far from clear now how effective any vaccine for covid will be and how widely it will be available. The full effects of the pandemic will be unlikely to rapidly disappear.

What is certain is that the economic impacts will last for a very long time. Key factors include the massive expansion of debt and ‘zombie’ corporations. Some entire national economies can only survive through debt. The fear among the ruling class of a popular reaction by masses, and the undermining of the ruling class and their rule, is profound.

The capitalist class are using the crisis to attack jobs and terms and conditions. A key question is who is going to pay and how will the debt issue be resolved? This poses the need for fighting trade unions and overcoming the conservative and politically weak trade union leaders. The initial response of the trade union bureaucracy was to move to shut down internal democracy during covid.

This has led to a growing questioning of the trade union leaders, not least in Nigeria when they called off the planned September general strike by agreeing with the government that there was no alternative to fuel price hikes.

This means Marxists must have a dual strategy of working in union structures, as much as possible, and also outside the official structures when, in some cases, highly bureaucratised unions do not reflect what the needs and actions of the working class. However, trade union leaders can also be pushed into acting by pressure from below.

The movements of young people have been a major factor in the recent period. The SARs protests in Nigeria, the BLM movement, climate change protests, the mass protests in Peru and Thailand, are striking examples of the speed and energy of young people moving into struggle.

The national question has become even more of an issue in a number of countries. In each case it is vital to emphasise that there is no solution on a capitalist basis

Robert emphasised that in the US a deep polarisation and division will continue and the election outcome has not resolved this. Therefore very sharp conflicts are inherent in these conditions. An immediate civil war is not posed but violent clashes, with the existence of armed groups, can break out, including in the short term.

The building of an independent workers’ movement is a key task, but it will also come up against the repressive institutions of US capitalism.

In Germany and internationally, we need to characterise the different left forces that have emerged. Distinguishing between left populism and left reformism and, a later stage, centrism, is crucial. Generally speaking, many of the left organisations have a left-populist character, and while criticising capitalism they do not campaign for socialism as the alternative

Even in the CWI, we saw individuals and organisations, who have now left us, embrace left populism – talking about the ‘people’ and dropping references to the working class, and failing to consistently explain the need for socialism as part of a transitional programme.

In Belgium, the left party, PTB/Pvda which has recently grown, restricts itself to a minimum programme of wealth taxes, and advocate nothing close to a transitional programme. Both the PTB and the Socialist Party in the Netherlands are very bureaucratic and restrict the involvement of their membership in policy decisions.

With the populist and far-right posing a real threat that needs to be confronted, ‘lesser evilism’, itself a form of a ‘popular front’, calls for support for so-called ‘progressive’ capitalist politicians. For Marxists, this is no way forward. The CWI poses an alternative to this dead-end and for the need to build ‘united front’ policies of workers’ organisations. Part of this process is the need for the working class to build its own independent organisations, mass fighting, democratic trade unions and political parties.

Robert concluded by pointing out that the phrase ‘sharp turns and sudden changes’ is very applicable for this period. Neoliberalism is dropped by the bourgeois, at least for now, so the ruling class can try and tackle the crisis.

The role of Marxists is to participate and advance a programme that puts socialism to the fore. The capitalist class will increasingly turn to repression, fearful for the future and the mass movements that will develop against their system. Socialism offers the only viable way out.

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