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How power profits from disaster; by Naomi Klein:

16 Mar

After a crisis, private contractors move in and suck up funding for work done badly, if at all – then those billions get cut from government budgets. Like Grenfell Tower, Hurricane Katrina revealed a disdain for the poor. By 

 

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There have been times in my reporting from disaster zones when I have had the unsettling feeling that I was seeing not just a crisis in the here and now, but getting a glimpse of the future – a preview of where the road we are all on is headed, unless we somehow grab the wheel and swerve. When I listen to Donald Trump speak, with his obvious relish in creating an atmosphere of chaos and destabilisation, I often think: I’ve seen this before, in those strange moments when portals seemed to open up into our collective future. One of those moments arrived in New Orleans after Hurricane Katrina, as I watched hordes of private military contractors descend on the flooded city to find ways to profit from the disaster, even as thousands of the city’s residents, abandoned by their government, were treated like dangerous criminals just for trying to survive.

I started to notice the same tactics in disaster zones around the world. I used the term “shock doctrine” to describe the brutal tactic of using the public’s disorientation following a collective shock – wars, coups, terrorist attacks, market crashes or natural disasters – to push through radical pro-corporate measures, often called “shock therapy”. Though Trump breaks the mould in some ways, his shock tactics do follow a script, and one that is familiar from other countries that have had rapid changes imposed under the cover of crisis.

This strategy has been a silent partner to the imposition of neoliberalism for more than 40 years. Shock tactics follow a clear pattern: wait for a crisis (or even, in some instances, as in Chile or Russia, help foment one), declare a moment of what is sometimes called “extraordinary politics”, suspend some or all democratic norms – and then ram the corporate wishlist through as quickly as possible. The research showed that virtually any tumultuous situation, if framed with sufficient hysteria by political leaders, could serve this softening-up function. It could be an event as radical as a military coup, but the economic shock of a market or budget crisis would also do the trick. Amid hyperinflation or a banking collapse, for instance, the country’s governing elites were frequently able to sell a panicked population on the necessity for attacks on social protections, or enormous bailouts to prop up the financial private sector – because the alternative, they claimed, was outright economic apocalypse.

The Republicans under Donald Trump are already seizing the atmosphere of constant crisis that surrounds this presidency to push through as many unpopular, pro-corporate policies. And we know they would move much further and faster given an even bigger external shock. We know this because senior members of Trump’s team have been at the heart of some of the most egregious examples of the shock doctrine in recent memory.

Rex Tillerson, the US secretary of state, has built his career in large part around taking advantage of the profitability of war and instability. ExxonMobil profited more than any oil major from the increase in the price of oil that was the result of the 2003 invasion of Iraq. It also directly exploited the Iraq war to defy US state department advice and make an exploration deal in Iraqi Kurdistan, a move that, because it sidelined Iraq’s central government, could well have sparked a full-blown civil war, and certainly did contribute to internal conflict.

 

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As CEO of ExxonMobil, Tillerson profited from disaster in other ways as well. As an executive at the fossil fuel giant, he spent his career working for a company that, despite its own scientists’ research into the reality of human-caused climate change, decided to fund and spread misinformation and junk climate science. All the while, according to an LA Times investigation, ExxonMobil (both before and after Exxon and Mobil merged) worked diligently to figure out how to further profit from and protect itself against the very crisis on which it was casting doubt. It did so by exploring drilling in the Arctic (which was melting, thanks to climate change), redesigning a natural gas pipeline in the North Sea to accommodate rising sea levels and supercharged storms, and doing the same for a new rig off the coast of Nova Scotia.

At a public event in 2012, Tillerson acknowledged that climate change was happening – but what he said next was revealing: “as a species”, humans have always adapted. “So we will adapt to this. Changes to weather patterns that move crop production areas around – we’ll adapt to that.”

He’s quite right: humans do adapt when their land ceases to produce food. The way humans adapt is by moving. They leave their homes and look for places to live where they can feed themselves and their families. But, as Tillerson well knows, we do not live at a time when countries gladly open their borders to hungry and desperate people. In fact, he now works for a president who has painted refugees from Syria – a country where drought was an accelerant of the tensions that led to civil war – as Trojan horses for terrorism. A president who introduced a travel ban that has gone a long way towards barring Syrian migrants from entering the United States.

A president who has said about Syrian children seeking asylum, “I can look in their faces and say: ‘You can’t come.’” A president who has not budged from that position even after he ordered missile strikes on Syria, supposedly moved by the horrifying impacts of a chemical weapon attack on Syrian children and “beautiful babies”. (But not moved enough to welcome them and their parents.) A president who has announced plans to turn the tracking, surveillance, incarceration and deportation of immigrants into a defining feature of his administration.

Waiting in the wings, biding their time, are plenty of other members of the Trump team who have deep skills in profiting from all of that.

 

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Between election day and the end of Trump’s first month in office, the stocks of the two largest private prison companies in the US, CoreCivic (formerly the Corrections Corporation of America) and the Geo Group, doubled, soaring by 140% and 98%, respectively. And why not? Just as Exxon learned to profit from climate change, these companies are part of the sprawling industry of private prisons, private security and private surveillance that sees wars and migration – both very often linked to climate stresses – as exciting and expanding market opportunities. In the US, the Immigration and Customs Enforcement agency (Ice) incarcerates up to 34,000 immigrants thought to be in the country illegally on any given day, and 73% of them are held in private prisons. Little wonder, then, that these companies’ stocks soared on Trump’s election. And soon they had even more reasons to celebrate: one of the first things Trump’s new attorney general, Jeff Sessions, did was rescind the Obama administration’s decision to move away from for-profit jails for the general prison population.

Trump appointed as deputy defence secretary Patrick Shanahan, a top executive at Boeing who, at one point, was responsible for selling costly hardware to the US military, including Apache and Chinook helicopters. He also oversaw Boeing’s ballistic missile defence programme – a part of the operation that stands to profit enormously if international tensions continue to escalate under Trump.

And this is part of a much larger trend. As Lee Fang reported in the Intercept in March 2017, “President Donald Trump has weaponised the revolving door by appointing defence contractors and lobbyists to key government positions as he seeks to rapidly expand the military budget and homeland security programmes … At least 15 officials with financial ties to defence contractors have been either nominated or appointed so far.”

The revolving door is nothing new, of course. Retired military brass reliably take up jobs and contracts with weapons companies. What’s new is the number of generals with lucrative ties to military contractors whom Trump has appointed to cabinet posts with the power to allocate funds – including those stemming from his plan to increase spending on the military, the Pentagon and the Department of Homeland Security by more than $80bn in just one year.

The other thing that has changed is the size of the Homeland Security and surveillance industry. This sector grew exponentially after the September 11 attacks, when the Bush administration announced it was embarking on a never-ending “war on terror”, and that everything that could be outsourced would be. New firms with tinted windows sprouted up like malevolent mushrooms around suburban Virginia, outside Washington DC, and existing ones, such as Booz Allen Hamilton, expanded into brand new territories. Writing in Slate in 2005, Daniel Gross captured the mood of what many called the security bubble: “Homeland security may have just reached the stage that internet investing hit in 1997. Back then, all you needed to do was put an ‘e’ in front of your company name and your IPO would rocket. Now you can do the same with ‘fortress’.”

That means many of Trump’s appointees come from firms that specialize in functions that, not so long ago, it would have been unthinkable to outsource. His National Security Council chief of staff, for instance, is retired Lt Gen Keith Kellogg. Among the many jobs Kellogg has had with security contractors since going private was one with Cubic Defense.

According to the company, he led “our ground combat training business and focus[ed] on expanding the company’s worldwide customer base”. If you think “combat training” is something armies used to do all on their own, you’d be right.

One noticeable thing about Trump’s contractor appointees is how many of them come from firms that did not even exist before 9/11: L-1 Identity Solutions (specialising in biometrics), the Chertoff Group (founded by George W Bush’s homeland security director Michael Chertoff), Palantir Technologies (a surveillance/big data firm cofounded by PayPal billionaire and Trump backer Peter Thiel), and many more. Security firms draw heavily on the military and intelligence wings of government for their staffing.

Under Trump, lobbyists and staffers from these firms are now migrating back to government, where they will very likely push for even more opportunities to monetise the hunt for people Trump likes to call “bad hombres”.

This creates a disastrous cocktail. Take a group of people who directly profit from ongoing war and then put those same people at the heart of government. Who’s going to make the case for peace? Indeed, the idea that a war could ever definitively end seems a quaint relic of what during the Bush years was dismissed as “pre–September 11 thinking”.

 

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And then there’s vice-president Mike Pence, seen by many as the grownup in Trump’s messy room. Yet it is Pence, the former governor of Indiana, who actually has the most disturbing track record when it comes to bloody-minded exploitation of human suffering.

Before we delve into Pence’s role, what’s important to remember about Hurricane Katrina is that, though it is usually described as a “natural disaster”, there was nothing natural about the way it affected the city of New Orleans. When Katrina hit the coast of Mississippi in August 2005, it had been downgraded from a category 5 to a still-devastating category 3 hurricane. But by the time it made its way to New Orleans, it had lost most of its strength and been downgraded again, to a “tropical storm”.

That’s relevant, because a tropical storm should never have broken through New Orleans’s flood defense. Katrina did break through, however, because the levees that protect the city did not hold. Why? We now know that despite repeated warnings about the risk, the army corps of engineers had allowed the levees to fall into a state of disrepair. That failure was the result of two main factors.

One was a specific disregard for the lives of poor black people, whose homes in the Lower Ninth Ward were left most vulnerable by the failure to fix the levees. This was part of a wider neglect of public infrastructure, which is the direct result of decades of neoliberal policy. Because when you systematically wage war on the very idea of the public sphere and the public good, of course the publicly owned bones of society – roads, bridges, levees, water systems – are going to slip into a state of such disrepair that it takes little to push them beyond the breaking point. When you massively cut taxes so that you don’t have money to spend on much of anything besides the police and the military, this is what happens.

It wasn’t just the physical infrastructure that failed the city, and particularly its poorest residents, who are, as in so many US cities, overwhelmingly African American. The human systems of disaster response also failed – the second great fracturing. The arm of the federal government that is tasked with responding to moments of national crisis such as this is the Federal Emergency Management Agency (Fema), with state and municipal governments also playing key roles in evacuation planning and response. All levels of government failed.

It took Fema five days to get water and food to people in New Orleans who had sought emergency shelter in the Superdome. The most harrowing images from that time were of people stranded on rooftops – of homes and hospitals – holding up signs that said “HELP”, watching the helicopters pass them by. People helped each other as best they could. They rescued each other in canoes and rowboats. They fed each other. They displayed that beautiful human capacity for solidarity that moments of crisis so often intensify. But at the official level, it was the complete opposite. I’ll always remember the words of Curtis Muhammad, a longtime New Orleans civil rights organizer, who said this experience “convinced us that we had no caretakers”.

The way this abandonment played out was deeply unequal, and the divisions cleaved along lines of race and class. Many people were able to leave the city on their own – they got into their cars, drove to a dry hotel, called their insurance brokers. Some people stayed because they believed the storm defenses would hold. But a great many others stayed because they had no choice – they didn’t have a car, or were too infirm to drive, or simply didn’t know what to do. Those are the people who needed a functioning system of evacuation and relief – and they were out of luck.

Abandoned in the city without food or water, those in need did what anyone would do in those circumstances: they took provisions from local stores. Fox News and other media outlets seized on this to paint New Orleans’s black residents as dangerous “looters” who would soon be coming to invade the dry, white parts of the city and surrounding suburbs and towns. Buildings were spray-painted with messages: “Looters will be shot.”

Checkpoints were set up to trap people in the flooded parts of town. On Danziger Bridge, police officers shot black residents on sight (five of the officers involved ultimately pleaded guilty, and the city came to a $13.3m settlement with the families in that case and two other similar post-Katrina cases). Meanwhile, gangs of armed white vigilantes prowled the streets looking, as one resident later put it in an exposé by investigative journalist AC Thompson, for “the opportunity to hunt black people”.

 

 

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I was in New Orleans during the flooding and I saw for myself how amped up the police and military were – not to mention private security guards from companies such as Blackwater who were showing up fresh from Iraq. It felt very much like a war zone, with poor and black people in the cross hairs – people whose only crime was trying to survive. By the time the National Guard arrived to organize a full evacuation of the city, it was done with a level of aggression and ruthlessness that was hard to fathom. Soldiers pointed machine guns at residents as they boarded buses, providing no information about where they were being taken. Children were often separated from their parents.

What I saw during the flooding shocked me. But what I saw in the aftermath of Katrina shocked me even more. With the city reeling, and with its residents dispersed across the country and unable to protect their own interests, a plan emerged to ram through a pro-corporate wish-list with maximum velocity. The famed free-market economist Milton Friedman, then 93 years old, wrote an article for the Wall Street Journal stating, “Most New Orleans schools are in ruins, as are the homes of the children who have attended them. The children are now scattered all over the country. This is a tragedy. It is also an opportunity to radically reform the educational system.”

In a similar vein, Richard Baker, at that time a Republican congressman from Louisiana, declared, “We finally cleaned up public housing in New Orleans. We couldn’t do it, but God did.” I was in an evacuation shelter near Baton Rouge when Baker made that statement. The people I spoke with were just floored by it. Imagine being forced to leave your home, having to sleep in a camping bed in some cavernous convention centre, and then finding out that the people who are supposed to represent you are claiming this was some sort of divine intervention – God apparently really likes condo developments.

Baker got his “cleanup” of public housing. In the months after the storm, with New Orleans’s residents – and all their inconvenient opinions, rich culture and deep attachments – out of the way, thousands of public housing units, many of which had sustained minimal storm damage because they were on high ground, were demolished. They were replaced with condos and town houses priced far out of reach for most who had lived there.

And this is where Mike Pence enters the story. At the time Katrina hit New Orleans, Pence was chairman of the powerful and highly ideological Republican Study Committee (RSC), a caucus of conservative lawmakers. On 13 September 2005 – just 15 days after the levees were breached, and with parts of New Orleans still under water – the RSC convened a fateful meeting at the offices of the Heritage Foundation in Washington DC. Under Pence’s leadership, the group came up with a list of “Pro-Free-Market Ideas for Responding to Hurricane Katrina and High Gas Prices” – 32 pseudo-relief policies in all, each one straight out of the disaster capitalism playbook.

 

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What stands out is the commitment to wage all-out war on labour standards and the public sphere – which is bitterly ironic, because the failure of public infrastructure is what turned Katrina into a human catastrophe in the first place. Also notable is the determination to use any opportunity to strengthen the hand of the oil and gas industry. The list includes recommendations to suspend the obligation for federal contractors to pay a living wage; make the entire affected area a free-enterprise zone; and “repeal or waive restrictive environmental regulations … that hamper rebuilding”. In other words, a war on the kind of red tape designed to keep communities safe from harm.

President Bush adopted many of the recommendations within the week, although, under pressure, he was eventually forced to reinstate the labour standards. Another recommendation called for giving parents vouchers to use at private and charter schools (for-profit schools subsidized with tax dollars), a move perfectly in line with the vision held by Trump’s pick for education secretary, Betsy DeVos. Within the year, the New Orleans school system became the most privatized in the US.

And there was more. Though climate scientists have directly linked the increased intensity of hurricanes to warming ocean temperatures, that didn’t stop Pence and his committee from calling on Congress to repeal environmental regulations on the Gulf coast, give permission for new oil refineries in the US, and green-light “drilling in the Arctic National Wildlife Refuge”.

It’s a kind of madness. After all, these very measures are a surefire way to drive up greenhouse gas emissions, the major human contributor to climate change, which leads to fiercer storms. Yet they were immediately championed by Pence, and later adopted by Bush, under the guise of responding to a devastating hurricane.

It’s worth pausing to tease out the implications of all of this. Hurricane Katrina turned into a catastrophe in New Orleans because of a combination of extremely heavy weather – possibly linked to climate change – and weak and neglected public infrastructure. The so-called solutions proposed by the group Pence headed at the time were the very things that would inevitably exacerbate climate change and weaken public infrastructure even further. He and his fellow “free-market” travelers were determined, it seems, to do the very things that are guaranteed to lead to more Katrinas in the future.

And now Mike Pence is in a position to bring this vision to the entire United States.

 

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The oil industry wasn’t the only one to profit from Hurricane Katrina. Immediately after the storm, the whole gang of contractors who had descended on Baghdad when war broke out – Bechtel, Fluor, Halliburton, Blackwater, CH2M Hill and Parsons, infamous for its sloppy Iraq work – now arrived in New Orleans. They had a singular vision: to prove that the kinds of privatized services they had been providing in Iraq and Afghanistan also had an ongoing domestic market – and to collect no-bid contracts totaling $3.4bn.

The controversies were legion. Relevant experience often appeared to have nothing to do with how contracts were allocated. Take, for example, the company that Fema paid $5.2m to perform the crucial role of building a base camp for emergency workers in St Bernard Parish, a suburb of New Orleans. The camp construction fell behind schedule and was never completed. Under investigation, it emerged that the contractor, Lighthouse Disaster Relief, was in fact a religious group. “About the closest thing I have done to this is just organised a youth camp with my church,” confessed Lighthouse’s director, Pastor Gary Heldreth.

After all the layers of subcontractors had taken their cut, there was next to nothing left for the people doing the work. Author Mike Davis tracked the way Fema paid Shaw $175 per sq ft to install blue tarps on damaged roofs, even though the tarps themselves were provided by the government. Once all the subcontractors took their share, the workers who actually hammered in the tarps were paid as little as $2 per sq ft.

“Every level of the contracting food chain, in other words, is grotesquely overfed except the bottom rung,” Davis wrote, “where the actual work is carried out.” These supposed “contractors” were really – like the Trump Organization – hollow brands, sucking out profit and then slapping their name on cheap or non-existent services.

In order to offset the tens of billions going to private companies in contracts and tax breaks, in November 2005 the Republican-controlled Congress announced that it needed to cut $40bn from the federal budget. Among the programmes that were slashed: student loans, Medicaid and food stamps.

So, the poorest people in the US subsidized the contractor bonanza twice: first, when Katrina relief morphed into unregulated corporate handouts, providing neither decent jobs nor functional public services; and second, when the few programs that assist the unemployed and working poor nationwide were gutted to pay those bloated bills.

New Orleans is the disaster capitalism blueprint – designed by the current vice-president and by the Heritage Foundation, the hard-right think tank to which Trump has outsourced much of his administration’s budgeting. Ultimately, the response to Katrina sparked an approval ratings freefall for George W Bush, a plunge that eventually lost the Republicans the presidency in 2008. Nine years later, with Republicans now in control of Congress and the White House, it’s not hard to imagine this test case for privatised disaster response being adopted on a national scale.

The presence of highly militarised police and armed private soldiers in New Orleans came as a surprise to many. Since then, the phenomenon has expanded exponentially, with local police forces across the country outfitted to the gills with military-grade gear, including tanks and drones, and private security companies frequently providing training and support. Given the array of private military and security contractors occupying key positions in the Trump administration, we can expect all of this to expand further with each new shock.

The Katrina experience also stands as a stark warning to those who are holding out hope for Trump’s promised $1tn in infrastructure spending. That spending will fix some roads and bridges, and it will create jobs. Crucially, Trump has indicated that he plans to do as much as possible not through the public sector but through public-private partnerships – which have a terrible track record for corruption, and may result in far lower wages than true public-works projects would. Given Trump’s business record, and Pence’s role in the administration, there is every reason to fear that his big-ticket infrastructure spending could become a Katrina-like kleptocracy, a government of thieves, with the Mar-a-Lago set helping themselves to vast sums of taxpayer money.

New Orleans provides a harrowing picture of what we can expect when the next shock hits. But sadly, it is far from complete: there is much more that this administration might try to push through under cover of crisis. To become shock-resistant, we need to prepare for that, too.

 

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NO NUKES – US deploys “usable” nuclear weapon amid continuing war threats against Iran.

1 Feb

The Pentagon deployed a new, smaller nuclear warhead aboard the ballistic missile submarine USS Tennessee as it sailed into the Atlantic last month in the midst of the spiraling crisis with Iran. The weapon, known as the W76-2 warhead, has an explosive yield of roughly five kilotons, a third of the destructive power of the “Little Boy” bomb that claimed the lives of some 140,000 people in Hiroshima in 1945.

The Federation of American Scientists (FAS) revealed the deployment this week, citing unnamed civilian and military figures. It stated that two of the 20 Trident submarine-launched ballistic missiles onboard the USS Tennessee and other subs will be armed with the W76-2 warheads. Each missile can be loaded with as many as eight such warheads, capable of striking multiple targets.

 

First launch of a Trident missile on January 18, 1977 at Cape Canaveral, Florida

 

The new weapon has been rolled out with remarkable speed. The Trump administration’s 2018 Nuclear Posture Review called for the development of “a low-yield SLBM [submarine-launched ballistic missile] warhead to ensure a prompt response option that is able to penetrate adversary defenses” and close “an exploitable ‘gap’ in US regional deterrence capabilities.”

The pretext for the warhead’s deployment was the unsubstantiated claim that Russia is developing similar weapons and has adopted a doctrine of “escalate to de-escalate” or “escalate to win” by utilizing low-yield nuclear weapons, with the expectation that Washington would not retaliate with strategic warheads for fear of initiating an all out thermonuclear war. The Pentagon’s argument has been that a low-yield and rapid reaction ballistic missile is needed to “restore deterrence.”

The report by the FAS strongly suggests, however, that this alleged Russian doctrine is a pretext and that “it is much more likely that the new low-yield weapon is intended to facilitate first-use of nuclear weapons against North Korea or Iran.”

It points out that both the US National Security Strategy and the Nuclear Posture Review (NPR) envision the use of nuclear weapons in response to “non-nuclear attacks, and large-scale conventional aggression,” and that the NPR explicitly stated that the W76-2 warhead was designed to “expand the range of credible US options for responding to nuclear or non-nuclear strategic attack.” Washington does not rule out a nuclear strike, including against non-nuclear armed countries like Iran.

 

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The deployment of the USS Tennessee with its new “usable” nuclear warheads came at roughly the same time as President Donald Trump huddled with his top aides on December 29 at his Mar-a-Lago resort in Florida, ordering the criminal drone missile assassination of Gen. Qassem Suleimani, one of Iran’s top officials. The drone killing was carried out at Baghdad’s international airport five days later.

In a report Thursday, NBC News, citing unnamed senior US officials, established that at the same meeting in Florida, “Trump also authorized the bombing of Iranian ships, missile launchers and air defense systems… Technically, the military can now hit those targets without further presidential authorization, though in practice, it would consult with the White House before any such action.”

The report warned that “the two sides remain in a dangerous boxer’s clench, in which the smallest miscalculation, some officials believe, could lead to disaster.”

In other words, for all the talk of war having been averted following the act of war and war crime carried out by Washington in the murder of Suleimani, the reality is that the world remains on the knife’s edge of a catastrophic military confrontation, which could rapidly escalate into the first use of nuclear weapons in three-quarters of a century.

The threat against Iran is part of far broader buildup to global war through which US imperialism is seeking to offset the erosion of its previously hegemonic domination of the global economy by resorting to the criminal use of overwhelming military force.

 

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After securing a $738 billion military budget for 2020 with the support of an overwhelming majority—Democratic and Republican alike—in the US Congress, the Trump administration is now preparing to push through a 20 percent increase in the budget for the National Nuclear Security Administration (NNSA), the agency overseeing the buildup of the US nuclear arsenal. This $20 billion budget proposal, made public this week, represents only a fraction of the more than $1 trillion the US is projected to spend on “modernizing” the arsenal over the next three decades—plans that were set into motion under the Democratic administration of Barack Obama, before Trump took office.

Trump is a war criminal. His threats to carry out the “obliteration” of Iran and to rain “fire and fury” upon North Korea are not merely hyperbole. The “usable” nuclear weapons to commit such atrocities have already been placed in his hands.

As the Senate impeachment trial of the US president limps to an ignominious close, it is striking that Trump’s greatest crimes, including acts of war and his threat to drag the world into a nuclear war, feature in no way in the charges against him. On the contrary, the articles of impeachment center on allegations that he withheld lethal military aid to Ukraine and has been insufficiently aggressive in confronting Russia.

This charge is made, as Newsweek pointed out this week, after the Pentagon staged an unprecedented 93 separate military exercises between May and the end of September of last year, all of them simulating or preparing for war against Russia. This includes practice bombing runs less than 500 miles from the Russian border and the steady build-up of ground forces in the three Baltic states and Poland, together with escalating US air deployments described as “bomber assurance” and “theater security” programs.

The drive to war has its source not in the diseased mind of Donald Trump, but rather in the insoluble crisis of global capitalism. There exists no antiwar faction within the US ruling class, including its Democratic representatives, only tactical differences over how US imperialist interests should best be pursued on the global arena.

The struggle against a new imperialist world war and the threat it poses to the survival of humanity can be based only upon the struggles of the working class, which is engaged in a wave of strikes and social upheavals across the planet. These emerging mass struggles must be armed with a socialist and internationalist program to unify workers in the common fight to put an end to the source of war and social inequality, the capitalist system. BY Bill Van Auken

 

Published by the International Committee of the Fourth International (ICFI)

 

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Here are 10 things you should know about socialism!

31 Jan

 

What do we mean when we talk about “socialism”? Here are ten things about its theory, practice, and potential that you need to know.

Over the last 200 years, socialism has spread across the world. In every country, it carries the lessons and scars of its particular history there. Conversely, each country’s socialism is shaped by the global history, rich tradition, and diverse interpretations of a movement that has been the world’s major critical response to capitalism as a system.

 

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1. Socialism is a yearning for something better than capitalism

Socialism represents the awareness of employees that their sufferings and limitations come less from their employers than from the capitalist system. That system prescribes incentives and options for both sides, and rewards and punishments for their behavioral “choices.” It generates their endless struggles and the employees’ realization that system change is the way out.

In Capital, Volume 1, Karl Marx defined a fundamental injustice—exploitation—located in capitalism’s core relationship between employer and employee. Exploitation, in Marx’s terms, describes the situation in which employees produce more value for employers than the value of wages paid to them. Capitalist exploitation shapes everything in capitalist societies. Yearning for a better society, socialists increasingly demand the end of exploitation and an alternative in which employees function as their own employer. Socialists want to be able to explore and develop their full potentials as individuals and members of society while contributing to its welfare and growth.

Karl Marx, date unknown. Photo from Bettmann/Getty Images.

Socialism is an economic system very different from capitalism, feudalism, and slavery. Each of the latter divided society into a dominant minority class (masters, lords, and employers) and a dominated majority (slaves, serfs, employees). When the majority recognized slavery and feudal systems as injustices, they eventually fell.

The majorities of the past fought hard to build a better system. Capitalism replaced slaves and serfs with employees, masters and lords with employers. It is no historical surprise that employees would end up yearning and fighting for something better. That something better is socialism, a system that doesn’t divide people, but rather makes work a democratic process where all employees have an equal say and together are their own employer.

 

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2. Socialism is not a single, unified theory

People spread socialism across the world, interpreting and implementing it in many different ways based on context. Socialists found capitalism to be a system that produced ever-deepening inequalities, recurring cycles of unemployment and depression, and the undermining of human efforts to build democratic politics and inclusive cultures. Socialists developed and debated solutions that varied from government regulations of capitalist economies to government itself owning and operating enterprises, to a transformation of enterprises (both private and government) from top-down hierarchies to democratic cooperatives.

Sometimes those debates produced splits among socialists. After the Russian Revolution of 1917, socialists supporting the post-revolutionary Soviet Union underscored their commitment to socialism that entailed the government owning and operating industries by adopting the new name “communist.” Those skeptical of Soviet-style socialism tended increasingly to favor state regulation of private capitalists. They kept the name “socialist” and often called themselves social democrats or democratic socialists. For the last century, the two groups debated the merits and flaws of the two alternative notions of socialism as embodied in examples of each (e.g. Soviet versus Scandinavian socialisms).

Early in the 21st century, an old strain of socialism resurfaced and surged. It focuses on transforming the inside of enterprises: from top-down hierarchies, where a capitalist or a state board of directors makes all the key enterprise decisions, to a worker cooperative, where all employees have equal, democratic rights to make those decisions, thereby becoming—collectively—their own employer.

 

3. The Soviet Union and China achieved state capitalism, not socialism

As leader of the Soviet Union, Lenin once said that socialism was a goal, not yet an achieved reality. The Soviet had, instead, achieved “state capitalism.” A socialist party had state power, and the state had become the industrial capitalist displacing the former private capitalists. The Soviet revolution had changed who the employer was; it had not ended the employer/employee relationship. Thus, it was—to a certain extent—capitalist.

Lenin’s successor, Stalin, declared that the Soviet Union had achieved socialism. In effect, he offered Soviet state capitalism as if it were the model for socialism worldwide. Socialism’s enemies have used this identification ever since to equate socialism with political dictatorship. Of course, this required obscuring or denying that (1) dictatorships have often existed in capitalist societies and (2) socialisms have often existed without dictatorships.

After initially copying the Soviet model, China changed its development strategy to embrace instead a state-supervised mix of state and private capitalism focused on exports. China’s powerful government would organize a basic deal with global capitalists, providing cheap labor, government support, and a growing domestic market. In exchange, foreign capitalists would partner with Chinese state or private capitalists, share technology, and integrate Chinese output into global wholesale and retail trade systems. China’s brand of socialism—a hybrid state capitalism that included both communist and social-democratic streams—proved it could grow faster over more years than any capitalist economy had ever done.

 

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4. The U.S., Soviet Union, and China have more in common than you think 

As capitalism emerged from feudalism in Europe in the 19th century, it advocated liberty, equality, fraternity, and democracy. When those promises failed to materialize, many became anti-capitalist and found their way to socialism.

Experiments in constructing post-capitalist, socialist systems in the 20th century (especially in the Soviet Union and China) eventually incurred similar criticisms. Those systems, critics held, had more in common with capitalism than partisans of either system understood.

Self-critical socialists produced a different narrative based on the failures common to both systems. The U.S. and Soviet Union, such socialists argue, represented private and state capitalisms. Their Cold War enmity was misconstrued on both sides as part of the century’s great struggle between capitalism and socialism. Thus, what collapsed in 1989 was Soviet State capitalism, not socialism. Moreover, what soared after 1989 was another kind of state capitalism in China.

 

5. Thank American socialists, communists, and unionists for the 1930s New Deal

FDR’s government raised the revenue necessary for Washington to fund massive, expensive increases in public services during the Depression of the 1930s. These included the Social Security system, the first federal unemployment compensation system, the first federal minimum wage, and a mass federal jobs program. FDR’s revenues came from taxing corporations and the rich more than ever before.

President Franklin D. Roosevelt, center, and his New Deal administration team on September 12, 1935. Photo by Keystone-France/Gamma-Keystone/Getty Images.

In response to this radical program, FDR was reelected three times. His radical programs were conceived and pushed politically from below by a coalition of communists, socialists, and labor unionists. He had not been a radical Democrat before his election.

Socialists obtained a new degree of social acceptance, stature, and support from FDR’s government. The wartime alliance of the U.S. with the Soviet Union strengthened that social acceptance and socialist influences.

 

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6. If 5 was news to you, that’s due to the massive U.S.-led global purge of socialists and communists after WWII

After its 1929 economic crash, capitalism was badly discredited. The unprecedented political power of a surging U.S. left enabled government intervention to redistribute wealth from corporations and the rich to average citizens. Private capitalists and the Republican Party responded with a commitment to undo the New Deal. The end of World War II and FDR’s death in 1945 provided the opportunity to destroy the New Deal coalition.

The strategy hinged on demonizing the coalition’s component groups, above all the communists and socialists. Anti-communism quickly became the strategic battering ram. Overnight, the Soviet Union went from wartime ally to an enemy whose agents aimed “to control the world.” That threat had to be contained, repelled, and eliminated.

U.S. domestic policy focused on anti-communism, reaching hysterical dimensions and the public campaigns of U.S. Sen. Joseph McCarthy. Communist Party leaders were arrested, imprisoned, and deported in a wave of anti-communism that quickly spread to socialist parties and to socialism in general. Hollywood actors, directors, screenwriters, musicians, and more were blacklisted and barred from working in the industry. McCarthy’s witch hunt ruined thousands of careers while ensuring that mass media, politicians, and academics would be unsympathetic, at least publicly, to socialism.

U.S. Sen. Joseph McCarthy led a campaign to put prominent government officials and others on trial for alleged “subversive activities” and Communist Party membership during the height of the Cold War. Photo by Corbis/Getty Images.

In other countries revolts from peasants and/or workers against oligarchs in business and/or politics often led the latter to seek U.S. assistance by labeling their challengers as “socialists” or “communists.” Examples include U.S. actions in Guatemala and Iran (1954), Cuba (1959-1961), Vietnam (1954-1975), South Africa (1945-1994), and Venezuela (since 1999). Sometimes the global anti-communism project took the form of regime change. In 1965-6 the mass killings of Indonesian communists cost the lives of between 500,000 to 3 million people.

Once the U.S.—as the world’s largest economy, most dominant political power, and most powerful military—committed itself to total anti-communism, its allies and most of the rest of the world followed suit.

 

7. Since socialism was capitalism’s critical shadow, it spread to those subjected by and opposed to capitalist colonialism 

In the first half of the 20th century, socialism spread through the rise of local movements against European colonialism in Asia and Africa, and the United States’ informal colonialism in Latin America. Colonized people seeking independence were inspired by and saw the possibility of alliances with workers fighting exploitation in the colonizing countries. These latter workers glimpsed similar possibilities from their side.

This helped create a global socialist tradition. The multiple interpretations of socialism that had evolved in capitalism’s centers thus spawned yet more and further-differentiated interpretations. Diverse streams within the anti-colonial and anti-imperialist tradition interacted with and enriched socialism.

 

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8. Fascism is a capitalist response to socialism

A fascist economic system is capitalist, but with a mixture of very heavy government influence. In fascism, the government reinforces, supports, and sustains private capitalist workplaces. It rigidly enforces the employer/employee dichotomy central to capitalist enterprises. Private capitalists support fascism when they fear losing their position as capitalist employers, especially during social upheavals.

Under fascism, there is a kind of mutually supportive merging of government and private workplaces. Fascist governments tend to “deregulate,” gutting worker protections won earlier by unions or socialist governments. They help private capitalists by destroying trade unions or replacing them with their own organizations which support, rather than challenge, private capitalists.

Frequently, fascism embraces nationalism to rally people to fascist economic objectives, often by using enhanced military expenditures and hostility toward immigrants or foreigners. Fascist governments influence foreign trade to help domestic capitalists sell goods abroad and block imports to help them sell their goods inside national boundaries.

Blackshirts, supporters of Benito Mussolini who founded the National Fascist Party, are about to set fire to portraits of Karl Marx and Vladimir Lenin in Italy in May 1921. Photo by Mondadori/Getty Images.

Usually, fascists repress socialism. In Europe’s major fascist systems—Spain under Franco, Germany under Hitler, and Italy under Mussolini—socialists and communists were arrested, imprisoned, and often tortured and killed.

A similarity between fascism and socialism seems to arise because both seek to strengthen government and its interventions in society. However, they do so in different ways and toward very different ends. Fascism seeks to use government to secure capitalism and national unity, defined often in terms of ethnic or religious purity. Socialism seeks to use government to end capitalism and substitute an alternative socialist economic system, defined traditionally in terms of state-owned and -operated workplaces, state economic planning, employment of dispossessed capitalists, workers’ political control, and internationalism.

 

9. Socialism has been, and still is, evolving

During the second half of the 20th century, socialism’s diversity of interpretations and proposals for change shrank to two alternative notions: 1.) moving from private to state-owned-and -operated workplaces and from market to centrally planned distributions of resources and products like the Soviet Union, or 2.) “welfare-state” governments regulating markets still comprised mostly of private capitalist firms, as in Scandinavia, and providing tax-funded socialized health care, higher education, and so on. As socialism returns to public discussion in the wake of capitalism’s crash in 2008, the first kind of socialism to gain mass attention has been that defined in terms of government-led social programs and wealth redistributions benefitting middle and lower income social groups.

The evolution and diversity of socialism were obscured. Socialists themselves struggled with the mixed results of the experiments in constructing socialist societies (in the Soviet Union, China, Cuba, Vietnam, etc.). To be sure, these socialist experiments achieved extraordinary economic growth. In the Global South, socialism arose virtually everywhere as the alternative development model to a capitalism weighed down by its colonialist history and its contemporary inequality, instability, relatively slower economic growth, and injustice.

Socialists also struggled with the emergence of central governments that used excessively concentrated economic power to achieve political dominance in undemocratic ways. They were affected by criticisms from other, emerging left-wing social movements, such as anti-racism, feminism, and environmentalism, and began to rethink how a socialist position should integrate the demands of such movements and make alliances.

 

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10. Worker co-ops are a key to socialism’s future

The focus of the capitalism-versus-socialism debate is now challenged by the changes within socialism. Who the employers are (private citizens or state officials) now matters less than what kind of relationship exists between employers and employees in the workplace. The role of the state is no longer the central issue in dispute.

A growing number of socialists stress that previous socialist experiments inadequately recognized and institutionalized democracy. These self-critical socialists focus on worker cooperatives as a means to institutionalize economic democracy within workplaces as the basis for political democracy. They reject master/slave, lord/serf, and employer/employee relationships because these all preclude real democracy and equality.

Homesteaders, relocated by the U.S. Resettlement Administration, a federal agency under the New Deal, working at a cooperative garment factory in Hightstown, New Jersey, in 1936. The U.S. Resettlement Administration relocated struggling families to provide work relief. Photo by Universal History Archive/Universal Images Group/Getty Images.

For the most part, 19th and 20th century socialisms downplayed democratized workplaces. But an emerging, 21st century socialism advocates for a change in the internal structure and organization of workplaces. The microeconomic transformation from the employer/employee organization to worker co-ops can ground a bottom-up economic democracy.

The new socialism’s difference from capitalism becomes less a matter of state versus private workplaces, or state planning versus private markets, and more a matter of democratic versus autocratic workplace organization. A new economy based on worker co-ops will find its own democratic way of structuring relationships among co-ops and society as a whole.

Worker co-ops are key to a new socialism’s goals. They criticize socialisms inherited from the past and add a concrete vision of what a more just and humane society would look like. With the new focus on workplace democratization, socialists are in a good position to contest the 21st century’s struggle of economic systems.

 

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Richard D. Wolff is Professor of Economics Emeritus, University of Massachusetts, Amherst, and a Visiting Professor in the Graduate Program in International Affairs of the New School University, NYC. He taught economics at Yale University, the City University of New York, and the University of Paris. Over the last 25 years, in collaboration with Stephen Resnick, he has developed a new approach to political economy that appears in several books co-authored by Resnick and Wolff and numerous articles by them separately and together. Professor Wolff’s weekly show, “Economic Update,” is syndicated on over 90 radio stations and goes to 55 million TV receivers via Free Speech TV and other networks.

 

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